End of unit evaluation (Unit 1)

João Carneiro Correa Ribeiro

Section A
1.
a. Define the concept of change.
Change is the transformation, movement or alteration of a value, condition or
form to another.

[2]Define (AO1) = Give the precise meaning of a word, phrase, concept or physical quantity

b. Construct a fully labelled decision tree and identify the best

option for Sassy (show all your work).

Option 3b is the best one

[6]Construct (AO4) = Display information in a diagrammatic or logical form.

c. Explain one limitation for Sassy of using a decision tree as a
planning tool.
 One limitation for Sassy of using a decision tree as a planning tool is that it is
purely a quantitative tool, I does not take into account any external or internal factors
that may impact a decision, unlike a STEEPLE or a SWOT analysis.
For example, this may cause to, if a business tries to make a decision using
only this tool, to be dumbfounded to see there is customer rejection or employee
dissatisfaction for a reason that was not considered in the decision tree.

[2]Explain (AO2) = Give a detailed account, including reasons or causes.

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Section B
1.

2.
a. Define the term private sector.
Private sector is the “citizen sector”, it is run by private individuals who are
motivated by making money (profit), and it is legally regulated by the government.

[2] Define (AO1) = Give the precise meaning of a word, phrase, concept or physical quantity.

b. Explain two roles of F4Y’s mission statement.

One role that F4Y’s mission statement plays is to inform why they do what
they do, showing it’s overall goal, and that is: to give a great time for all.
Another role that F4Y’s mission statement plays is to inform how the company
does what it does, and that is: by providing safety and affordability.

[4] Explain (AO2) = Give a detailed account including reasons or causes.

c. Explain one disadvantages and one advantage to F4Y of

operating as a privately held company.
One advantage of F4Y operating as a privately held company is that all
shareholders will have limited liability, this means that their capital will not be at risk if
the company fails.
One disadvantage of F4Y operating as a privately held company is that unlike
sole traders or partnerships where profits are not shared or shared with few people,
in a privately held company profits are shared between all shareholders.

[4] Explain (AO2) = Give a detailed account including reasons or causes.

 d. Using the Ansoff matrix, evaluate the two possible growth
strategies for F4Y.
Using the Ansoff matrix, we can see that option 1 consists of a market
development strategy where they will make a product they already offer (the park),
available to new customers (children and adults with disabilities). By using this tool,
we can also see that option 2 consists of a diversification strategy where whey will
build a new product (corporate team-building activities) to new customers (highly
paid senior leadership teams).
Both options have pros and cons, those are presented below:
Pros Cons

Option 1 - It could work out - There is the risk that even with
and save the the new “upgrades” the park
company; does not receive new
- The investment customers;
required will be less - There will need to be an
than the one from investment to train employees to
option 2. best receive the new customers;
- Even if it works out, the capital
acquired by this option may not
be enough.

Option 2 - This could save the
company and put it
in a better position
to organize itself
later;
- Even if it “sacrifices”
two jobs, it can save
many more;
- High risk, high
reward situation.
- This decision goes against the
company’s morals, as its
objective is to give a great time
for all in an affordable way;
- Two senior managers will leave
the company if this option is
chosen;
- If this option fails, the company
will be, most likely, near
collapse;
- Big investment is required.

In my opinion, F4Y should go with option 2, even if they lose managers and if
it goes against the company’s morals. I would choose this option because I believe it
is the only real way to make the organization start gaining money again, I believe
that even though option 1 is safer, it wouldn’t raise the capital that is required to save
F4Y. Knowing that it is still important to mention the risk that is involved, but in my
opinion, if this option doesn’t work, it will only make the company’s ‘fate’, sooner
completed.

[10] Evaluate (AO3) = Make an appraisal by weighing up the strengths and limitations.
 3.

4.
a. Define the term primary sector.
Primary sector is the sector of an industry that collects/extracts raw materials
or products from the earth.

[2] Define (AO1) = Give the precise meaning of a word, phrase, concept or physical quantity.

b. Explain how each of the two external threats arising from the
STEEPLE analysis would have impacted on farmers’
incomes in the developing world.
Foremost, the competition with bigger producers would cause the farmers’
income to plummet as the availability of their competitors’ products would be higher,
therefore pushing the farmers’ products “out of the shelves”.
Moving on, another factor that would impact the farmers’ income is the severe
drought, as this affects their level of production there will be less sales, and therefore
less income.

[4] Explain (AO2) = Give a detailed account including reasons or causes.

c. Explain one advantage and one disadvantage to Pedro of

operating as a sole trader.
One advantage to Pedro of operating as a sole trader is that he’ll be able to
keep all the profits for himself, without sharing it like in a partnership or
publicly/privately held company.
One disadvantage to Pedro of operating as a sole trader is that he’ll have
unlimited liability, this basically means that his capital will be at risk if the company
fails.

[4] Explain (AO2) = Give a detailed account including reasons or causes.

d. Examine Pedro’s proposal to create an agricultural

cooperative in his community rather than continuing to
operate as a sole trader.
Pedro’s proposal, despite being risky, can save the farmers’ companies, as
most of them will not survive on their own seeing that the industry is becoming more
competitive, most of them can’t afford to keep up with the technologies to continue to
be competitive, they suffer heavily on weather conditions, etc.
 Some negative aspects that may affect and create risk to this decision are:
the farmers may not agree on decisions as there will be many partners, many
stakeholder conflicts will appear, profit will have to be shared, etc.
Although there are downsides, there still are positive aspects and arguments
to create this cooperative, some are: production will increase, they will form a more
competitive institution, profits will increase, etc.
So basically, creating this agricultural cooperative, even though there are
downsides, may be the only way to save the companies owned by the farmers, so, in
my opinion, it would be the best option to do so and make such partnerships.

[10] Examine (AO3) = Consider an argument or concept in a way that uncovers the assumptions and
interrelationships of the issue.