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CAIE IGCSE Business Studies 4 operations management

Use this Operations Management hub to connect production choices, quality methods, inventory control, costs and location decisions in cases.

Syllabus
2027–2029
Course
Business 0264

Covered syllabus points

4.1. Production of goods and services4.2. Technology and production of goods and services4.3. Sustainable production of goods and services4.4. Costs, scale of production and break-even analysis4.5. Quality of goods and services4.6. Location decisions

4. Operations management question 1

[Maximum number: 10]

GAE is a multinational company. It manufactures steel. GAE has 2400 employees and has factories in 4 countries. The business regularly introduces new technology. Holding inventory is important. GAE's directors are planning to build a new factory and want to know how legal controls over location might affect this decision. The Managing Director said, 'The new factory will create many external benefits.'

Question (a)

(a)

Outline two advantages to GAE of introducing new technology.

Advantage 1:

Advantage 2:

[ 4 ]

Question (b)

(b)

Explain two reasons why holding inventory might be important for GAE.

Reason 1:
Explanation:
Reason 2:
Explanation:

[ 6 ]

4. Operations management question 2

[Maximum number: 12]

WMH is a business which operates in the secondary sector. It makes furniture including tables and chairs. WMH's employees are all members of a trade union. The Managing Director knows the business is likely to remain small. She is considering introducing new technology into WMH's factory. She also knows it is important for a manufacturing business to choose a suitable location for a factory.

Question (a)

(a)

Explain two possible effects of WMH introducing new technology.

Effect 1:
Explanation:
Effect 2:
Explanation:

[ 6 ]

Question (b)

(b)

Explain two factors a manufacturing business should consider when deciding on a suitable location for a factory. Which factor is likely to be the most important? Justify your answer.

[ 6 ]

4. Operations management question 3

[Maximum number: 12]

TJK manufactures candles. Contributing to sustainable development is important to TJK. The business uses batch production in its factory in country X. The target market for TJK's products is females between 20 and 50 years of age. The Managing Director is reviewing TJK's financial data. An extract is shown in Table 3.1. He is also considering the benefits to a business of becoming a multinational company.

Table 3.1

Table 3.1

Question (a)

(a)

Explain two ways TJK could contribute to sustainable development.

Way 1:
Explanation:
Way 2:
Explanation:

[ 6 ]

Question (b)

(b)

Do you think batch production is the best method of production for a business to use? Justify your answer.

[ 6 ]

4. Operations management question 4

[Maximum number: 2]

GHT is a public limited company. It produces steel products including gates and garage doors. GHT has a flat organisational structure and a short chain of command. GHT has many stakeholder groups including 600 employees. The Managing Director is considering introducing job rotation to improve employee motivation. He has also been analysing some financial data. An extract is shown in Table 3.1.

Table 3.1

Table 3.1

Define 'fixed cost'.

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