4 (a) Identify and explain one advantage and one disadvantage to CC of employing skilled workers in the factories. Advantage: Explanation: Disadvantage: Explanation:

Mark scheme

Marking points from the official mark scheme (Oct/Nov 2015). The mark or mark type is shown in brackets.

1. Knowledge [2 × 1] - award one mark for each relevant advantage/disadvantage
2. Analysis [2 × 1] - award one mark for a relevant explanation for each advantage/disadvantage
3. Application [2 × 2] – award two application marks for each advantage/disadvantage
4. Award one mark for each relevant advantage/disadvantage (maximum of two), such as:
5. Advantage
6. Increased productivity/More efficient
7. Less training required/Reduced training costs
8. Reduces supervision
9. Can train other workers
10. High quality products
11. Fewer errors/Less waste
12. Disadvantage
13. Higher wages paid
14. Increased wage costs
15. May be more difficult to recruit
16. Skilled workers may be specialised in just one area/less flexible
17. Award a maximum of three additional marks for each advantage/disadvantage – 2 of which must be applied to this context.
18. Indicative response:
19. Employing skilled workers will increase labour productivity (k) and this means there will be a greater number of camping cookers produced (ap) and at a lower unit cost (an). This may lead to higher profits and higher dividends paid to shareholders (ap).
20. Possible application marks: loyal customers, need to maintain competitiveness; other businesses may pay higher wages to attract these workers; business wants to expand; many machines used in factory; part-time workers; in country X; manufactures camping equipment; three factories; 100 skilled workers in each factory; capital-intensive method of production; not allowed trade union membership; country Z; prices just below competitors prices; public limited company; takeover; equipment listed from Appendix 1.
21. There may be other examples in context which have not been included here.
22. Relevant points might include:
23. Merging with a competitor in country Z
24. Advantages: Already established in the market, Know target market well, Existing workforce of competitor has necessary skills, No need to build own factory, May be cheaper
25. Disadvantages: Less control over other company, May be disagreements between staff in the two firms, May incur redundancy costs
26. Setting up its own factory in country Z
27. Advantages: Choose location etc., New equipment will be up to date, Choose own staff, Government support
28. Disadvantages: Little knowledge of new market, May be different culture, Costs of setting up may be more expensive, Need to recruit new staff
29. Knowledge/Analysis/Evaluation – award up to 10 marks using the levels-based mark scheme below.
30. Level 3: At least 2 x Level 2 + 9-10 marks for well justified recommendation as to the best way to increase sales compared to the other way. 7-8 marks for some limited judgement shown in recommendation as to the best way to increase sales.
31. Level 2: 4-6 marks Detailed discussion of advantages and/or disadvantages of each option.
32. Level 1: 1-3 marks Outline of advantages and/or disadvantages of each option.
33. Level 1: 1 mark for each L1 statement (max of 3 marks) e.g. The company is already established in the market.
34. Level 2: one L2 explanation can gain 4 marks and a further mark can be awarded for each additional L2 explanation (max 6 marks) e.g. The company is already established in the market therefore it will be familiar with the culture and trends in the camping market in country Z. This will save CC time and money in carrying out market research as it will not need to do this. (4 marks for L2 answer + 1 application mark for mentioning trends in the camping market in country Z).
35. Level 3: For L3 to be awarded there needs to be at least two L2 marks awarded and then a recommendation which justifies which option CC should choose.
36. Award up to 2 additional marks for relevant application.
37. Possible application marks: existing business is already large; set up 20 years ago; in country X; manufactures camping equipment; three factories; 100 skilled workers in each factory; capital intensive method of production; not allowed trade union membership; public limited company; equipment listed from Appendix 1; Government grants available; similar range of camping equipment.
38. There may be other examples in context which have not been included here.