NSN is a multinational company. It makes cars. Over the years, technology has changed production methods. NSN uses just-in-time inventory control in all its factories. NSN plans to open a new factory in country Z creating 7000 jobs. Country Z's Government has offered an $80m grant to NSN. A spokesperson for NSN said: 'Governments should support business activity. There were also other factors that influenced our decision to build the new factory there including the possible effects of economic growth.'

Mark scheme

Marking points from the official mark scheme (Oct/Nov 2021). The mark or mark type is shown in brackets.

1. [2] A business with factories, production, or service operations in more than one country
2. [2] A business with production or service operation in another country outside its normal area of operation
3. [1] has businesses everywhere
4. [1] works/operates in more than one country
5. [1] Create jobs
6. [1] Increase competition / develop a market
7. [1] Increase output / economic growth/GDP
8. [1] Benefit society (small) businesses can grow into large/important ones in the future
9. [1] Generate new ideas
10. [1] Can produce (a future source of) tax revenue
11. [1] Less warehouse space [k] needed to store parts for cars [app]
12. [1] Less inventory held [k] in its factories [app]
13. [1] Lower storage costs [k] for the multinational company [App]
14. [1] Improve working capital [k]
15. [1] Improve cash flow [k]
16. [1] Lower risk of obsolete/damaged stock [k]
17. [1] Very reliant on suppliers to deliver stock when needed / if parts not available / late it will have a major impact on production [k]
18. [1] as technology has changed how production is carried out [app]
19. [1] May not be able to meet sudden/unexpected order [k]
20. [1] Little room for mistakes (as minimal stock available for rework) [k]
21. [1] Less (purchasing) economies of scale [k]
22. [1] Could lead to increased demand [k] for cars [app]
23. [1] increasing revenue [an]
24. [1] Shortage of skilled workers [k] may make it more difficult to recruit workers [an]
25. [1] for the 7000 jobs[app]
26. [1] Employees may ask for higher wages [k]
27. [1] increasing costs [an]
28. [1] Increased rent costs / less choice of location [k]
29. [1] increasing fixed costs [an] for the factory[app]
30. [1] Increased competition [k]
31. [1] so may gain few customers / low market share [an]
32. [1] Need for retraining / learn new skills [k]
33. [1] leading to opportunities for promotion [an]
34. [1] Safer conditions [k]
35. [1] so less risk of injury [an]
36. [1] The job is more repetitive [k]
37. [1] so lower job satisfaction [an]
38. [1] Fewer workers needed / workers may lose their jobs / redundancy [k]
39. [1] so lower standard of living [an]
40. [1] More job insecurity / fear of change [k]
41. [1] so could reduce motivation [an]
42. [1] More skilled workers may be needed [k]
43. [1] leading to higher pay [an]
44. [1] Less job security [k] could reduce workers motivation [an].
45. [1] However, more skilled workers may be needed [k] leading to higher pay. [an]
46. [1] No, it will not benefit all employees as it depends on the individual worker.
47. [1] Those who lose their jobs will not see the benefit from technology [eval] whereas those who keep their job can benefit from learning new skills. [eval]