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1 MTD manufactures specialist cleaning products including soap. Batch production is used. The
business uses just-in-time inventory control . MTD took 18 morlths to develop its latest environmentally
friendly cleaning product. The Marketing Manager has to decide on the packaging and method of
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promotion for this new product. She said: 'All our stakeholders, including pressure groups, are
important. MTD wants to contribute to sustainable development.'
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(a) Define 'pressure group' . c
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(b) Identify two features of batch production.

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(c) Outline two factors MTD should consider when deciding on the packaging for its new product.

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(d) Explain two possible advantages to MTD of using just-in-time inventory control.
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....... . .l~ritv ,~ •
Advantage 2: .... .. E.k.::,.'!.l. ..\.t.::........................................................................:........... .

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Explanation: ...~ ~ Q . . . .. .... j;).:~··········~::1.&..Q±J'..b;:1..........b·,v.h*-..... J ~
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... .. :;~~::-.......... :.~!.}\!::.:;, ......,............................................. ........................................... [6]

(e) Do you think using social media is the best way for a business to promote a new product?
Justify your answer.

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(6]
2 Josh owns an office cleaning business. He hes a number of large end smell business customers.
Josh employs 6 full-time cleaners who ere ell given off-the-job training. Josh believes that using
the latest cleaning equipment increases added value. He said: 'Customers ere happy with the
service. I am always sending text (SMS) messages to wor1<ers about additional wor1<.' Josh has
been looking at his balance sheet. He cannot decide If a bank loan is the best source of finance to
use for new equipment. The new equipment will cost $60000.

Table 1: Extract from Josh's balance sheet as at 30 April 2017 ($000)

Current assets 120

Trade receivables 90
X
Cash
- - - - - - - -- - -- ·-· -
y
Current liabilities
Net current assets 70

(a) What is meant by 'trade receivables'?

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[2)

(b) Calculate lhe following values.

X.. .......;,. .....

"?.,() ( 0 C)
............................................................ ....................................................... ...

Y: ....... $....~ .~~································································•······························:········ [2]

(c) Identify and explain one advantage and one disadvantage to Josh of using text (SMS)
messages as a method of internal communication.

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• \, . .
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Disadvantage: ... .. ..... ...............~
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(d) Identify one advantage and one disadvantage to Josh of using off-the-Job training .

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Explanation: ...~

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Explanation: .................................................................................................................... ..
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, ........................................................................................................................................... [6]

,' (e) Do you think a bank loan is the best source of finance for Josh to use for the new equipment?
Justify your answer.

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'
(bl Explain the benefits end limitations of the following two ways of echlevln
Which way should CC use? Justify your answer. g quality production.

• Quality control
• Quality assurance

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Quality control: ..... ,......... , .•..•£. .......
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Recommendation : ..... ~.C.......).\.\.(.:f.!lA .. '.± .....,I :-!-P..A:.d:'!-:!"i.\ .~:\~........

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