BUSS2 Revision

Revision Questions for BUSS2

You will be answering these questions in class on Thursday 25th April (Mod 2) or Friday 26th April (Mod 1)

1. Identify two ways to boost a firm’s cash flow. (2)

2. State the labels for a) the vertical and b) the horizontal axes of the Boston Matrix. (2)

3. Explain why a firm with effective Quality Assurance wouldn’t need Quality Control.  (3)

4. A firm has fixed costs of £8,000 and variable costs of £3 per unit. When it puts its price up from £5 to £6, sales fall from 20,000 to 18,000 units. Calculate the change in profit. (4)

5. Outline two reasons why a firm with a price inelastic product might cut its price. (4)

6. Using Maslow’s theory, explain the impact on staff of organising a social event. (3)

7. A producer of car tyres has a maximum capacity of 2,000 tyres a day. Current demand has slipped to 1,400 tyres per day, though output is being held at 1,500 units. Daily fixed costs amount to £12,000.

7a) What’s the current capacity utilisation? (2)

7b) What are the fixed costs per tyre at full capacity and at the current output level. (3)

8. Give the meaning of the term delegation. (2)

9. Outline 2 possible extension strategies for a shampoo with sales that are no longer bubbly. (4)

10. BJ Ltd estimates that its ‘Dralux’ brand has a price elasticity of -0.5. Current sales are 5,000 units a week at £5 each. Now it’s planning to increase the price of Dralux by 20%. Calculate the impact on total revenue.  (4)

11. Explain why a new chocolate brand might be priced using a market skimming strategy. (3)

12. Identify two non-marketing ways to boost a company’s market competitiveness. (2)

13. Explain the meaning of the term ‘negative revenue variance’ (2)

BUSS2 Finance & People Test TAFC Ltd Feedback

Always start with a definition:

Motivation is what causes us to act in a certain way.

For motivational techniques being the most important reason for the company having an effective workforce:

• effective employees are promoted and rewarded with bonuses encouraging improved performances from the workforce

• the company's employees work in teams offering greater empowerment for employees thereby enhancing performance

• team working offers social benefits to employees and can therefore motivate

• the company's employees are involved in decision-making offering the chance for motivation by meeting esteem needs

• the company supports and encourages social activities which links with 'social needs' as identified by Maslow

 
Against motivational techniques being the most important reason for the company having an effective workforce:

• the company invests heavily in training and this should help to boost the performance of the workforce by giving it the appropriate skills for each individual job

• the company has a low level of turnover (8%) meaning it is retaining well trained employees who are likely to perform effectively

• the company has invested £1 million in production technology which contributes to the effectiveness of the workforce

Issues for evaluation might include the following:

• the employees are obviously motivated well (they voted AFC as one of Britain's best employers) but there is limited evidence that this has made the workforce effective

• arguably training is the most important factor, the company places great importance on it

• is there any real evidence that the company's workforce is effective? The company's profit margins are falling for example