HSC TRIAL EXAMINATION Business Studies

STUDENT NO/NAME…………………………………….

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2018

HSC TRIAL EXAMINATION

Business Studies

General Instructions

• Reading time – 5 minutes

• Working time – 3 hours

• Write using black pen

• Draw diagrams using pencil

• Use the multiple-choice answer sheet

provided

• Write your Student Number at the top of

every page and on the multiple-choice

answer sheet

Total marks – 100

Section I 20 marks

• Attempt Questions 1-20

• Allow about 35 minutes for this part

Section II 40 marks

• Attempt Questions 21-24

• Allow about 1 hour and 15 minutes for this

part

Section III 20 marks

• Attempt Question 25

• Allow about 35 minutes for this section

Section IV 20 marks

• Attempt Questions 26 or 27

• Allow about 35 minutes for this section

This paper MUST NOT be removed from the examination room


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Section I

20 marks

Attempt Questions 1–20

Allow about 25 minutes for this section

Select the alternative A, B, C or D that best answers the question and indicate your choice with a

cross (X) in the appropriate space on the grid below.

A B C D

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Section I

20 marks

Attempt Questions 1-20

Allow about 35 minutes for this part

Use the multiple-choice answer sheet provided for Questions 1-20

1 After conducting market research a business decides to add additional features to their

product.

Which operation strategy is the business using?

(A) Branding

(B) Quality management

(C) New product or service design

(D) Outsourcing

2 As a result of a SWOT analysis, a highly regarded restaurant finds that the government will

relax laws regarding the service of alcohol. The restaurant owner has decided to extend its

operating hours and convert part of its restaurant into a boutique bar.

What is the aim of this strategy?

(A) an opportunity to extend their strength

(B) an opportunity to extend a threat

(C) a strength overcomes a threat

(D) a strength overcomes a weakness

3 Below is cash flow information for a business.

January February March April

Opening Balance $10 000

Cash Receipts $2 500 $1 500 $500 $3 000

Cash Payments $6 000 $3 000 $6 500 $1 000

At the end of which month would this business need to organise a bank overdraft?

(A) January

(B) February

(C) March

(D) April


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4 Lisa purchased car based on fuel efficiency as stated on the manufacturer’s website. After

the purchase she found that the fuel consumption was higher than stated.

What are the ethical issues for the car manufacturer?

(A) Implied conditions

(B) Accuracy in advertising

(C) Relationship marketing

(D) Ethical considerations

5 A business is giving staff technical training about their new line of products to better meet

the needs of customers.

Which marketing strategy is this business using?

(A) Word of mouth

(B) Sales promotion

(C) Advertising

(D) Personal selling

6 A business is undertaking a review of its suppliers. This would be because of:

(A) an increasing expense ratio

(B) a decreasing gross profit ratio

(C) a decreasing current ratio

(D) an increasing debt to equity ratio

7 Which of the following is an example of legal compliance for a business?

(A) Providing Medicare for its employees

(B) Paying employees superannuation

(C) Providing employees with a motor vehicle

(D) Provision of work related clothing


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Use the table below to answer question 8 and 9.

Sales $750 000

Cost of Goods Sold ?

Gross Profit ?

Expenses ?

Expense ratio (expenses / sales) 33%

Gross Profit Ratio (Gross profit / sales) 75%

Net profit ratio (Net Profit / Sales) ?

8 Which column in the following table shows the Gross Profit and Expenses for this

business?

Gross Profit Expenses

A $750 000 $562 500

B $562 500 $247 500

C $315 000 $247 500

D $247 500 $562 500

9. What is the net profit for the business?

(A) $562 500

(B) $600 000

(C) $315 000

(D) $420 000

10 In order to reduce youth unemployment, the government is offering tax incentives for

businesses that employ workers under the age of 25.

Which consideration would most likely lead to a change in recruitment policy?

(A) Economic

(B) Technological

(C) Social

(D) Legal


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11 The advantage of standardising products:

(A) Businesses can achieve economies of scale

(B) Businesses can justify charging higher prices

(C) Businesses products can be tailored specifically to their customer needs

(D) Businesses require a wider range of inputs in the operations process

12 A business is reducing the production of a long-standing product in order to increase

variety in its range.

In which operations’ process would this occur?

(A) Transformation

(B) Input

(C) Output

(D) Customisation

13 Tim is being bullied and intimidated by one of his fellow workers because of his

religious beliefs. He takes the complaint to his manager and as a result Tim’s

employment is terminated.

What workplace issues are involved in this situation?

(A) Equal employment opportunity and working conditions

(B) Workers compensation and unfair dismissal

(C) Workplace health and safety and working conditions

(D) Anti – discrimination and unfair dismissal

14 The ability of a business to manage its current assets and current liabilities is called:

(A) Factoring

(B) Inventory management

(C) Gearing

(D) Working capital management


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15 What is the name of the document that sets out minimum wages and working conditions

for employees in a particular industry?

(A) National Employment Standards

(B) The National Minimum wage

(C) A Modern Award

(D) An individual contract

16 Below is selected financial information for a business XYZ.

Cash $10 000

Mortgage $100 000

Accounts Payable $5 000

Building $250 000

Bank overdraft $3 000

Accounts Receivable $5 000

Credit Card $2 000

Inventory $20 000

The value of working capital ($) for XYZ is:

(A) 2.6:1

(B) 3.5:1

(C) $25 000

(D) $175 000

17 A café has added a number of vegan meals to its menu.

What influence on marketing has led to this change?

(A) Economic

(B) Government

(C) Psychological

(D) Sociocultural


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18 Use the financial information to answer the question below.

2016 2017

Sales 300 000 310 000

Expenses 15 000 25 000

Accounts Receivable 30 000 15 000

Accounts receivable turnover ratio: Sales / Accounts receivable

The average number of days it takes for this business to collect its accounts receivable in

2017 is:

(A) 10 days

(B) 17.7 days

(C) 20.7 days

(D) 36.5 days

19 Which of the following indicates improved human resource management?

(A) Increased staff retention levels

(B) Greater use of courts and tribunals in workplace disputes

(C) Higher workplace accident levels

(D) Increased involuntary redundancies

20 A smartphone manufacturer has used feedback from customer focus groups to produce

more lightweight phones that will be available in a greater range of colours. These phones

will be sold at a lower price than competitors.

This demonstrates the interdependence between which key business functions?

(A) Market research and marketing

(B) Marketing and operations

(C) Finance and operations

(D) Product differentiation and cost based competition

END OF SECTION


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Section II 40 marks

Attempt Questions 21–24

Allow about 1 hour 15 minutes for this section

Answer the questions in the spaces provided. These spaces provide guidance for the expected

length of response.

Question 21 (10 marks) Marks

a) Distinguish between commercial bills and debentures. 4

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b) Assess TWO strategies used to improve cash flow management. 6

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Question 22 (10 marks)

Oz Sports is a producer of high quality running shoes made from organic materials. Recently, they

have had a number of customer complaints about the durability of their running shoes. Oz Sports

customers claim that the shoes literally wear out after minimal usage.

(a) Outline ONE consumer law that would relate to Oz Sports. 2

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(b) Why is ethical behaviour important in marketing Oz Sports running shoes? 2

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(c) Describe ONE method of market research Oz Sports could use to obtain relevant 2

information about their customers.

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(d) Recommend ONE global product strategy and ONE global pricing strategy Oz Sports 4

could use to market their products overseas.

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(a) Identify TWO ways a business can differentiate their product in the operations process. 2

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(b) How can this business assess the effectiveness of their operations process based on 4

their output.

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‘A large electronics manufacturing business is increasing the use of technology in

an attempt to improve the efficiency and effectiveness of the transformation

process.


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(c) Assess the use of technology in improving the transformation process in this 4

manufacturing business.

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(a) Outline the role of human resources in business. 2

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(b) Examine the disadvantages of global outsourcing of human resources. 4

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(c) Discuss staff turnover as an indicator of the effectiveness of human resource 4

management.

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END OF SECTION II


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Section III 20 marks

Attempt Question 25


Answer the questions in a SEPARATE writing booklet. Extra writing booklets are available.

In your answer you will be assessed on how well you:

• demonstrate knowledge and understanding relevant to the question

• use the information provided

• communicate using relevant terminology and concepts

• present a sustained, logical and cohesive response in the form of a business report

Answers should be approximately 800 words (6 booklet pages).


You have been hired as a consultant to write a report to the management of head office. In

your report:

• Explain how a SWOT analysis can help management at Dish Dash Manufacturing.

• Analyse marketing strategies that can be used to improve sales levels for Dish dash

Manufacturing.

• Recommend financial strategies that can be used by management to improve the financial

position of this business.

Dish Dash manufacturing Pty Ltd is an Australian clothing wholesaler, established in 2015.

This company has been supplying Australian and overseas businesses with ladies clothing

and accessories. The business experienced growth in the first 3 years of operation, however,

it is currently experiencing rising levels of debt with customers not paying their accounts

on time. Dish Dash Manufacturing Pty Ltd is facing increasing competition from online

wholesalers and is holding an increased amount of stock they have not been able to sell.

Dish Dash Manufacturing Pty Ltd needs to compete with these online wholesalers and

improve their financial position if they are to remain in operation.


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Section IV 20 marks

Attempt Questions 26 OR 27


Answer the questions in a writing booklet. Extra writing booklets are available.

In your answer you will be assessed on how well you:

• demonstrate knowledge and understanding relevant to the question

• use relevant business case study/studies and contemporary business issues

• communicate using relevant business terminology and concepts

• present a sustained, logical and cohesive response


Assess operational strategies that management can use to respond to globalisation and quality

expectations.

OR


Assess human resource strategies that can be used to minimise workplace disputes and reduce

staff turnover.

End of Paper

2018 HSC TRIALS

Multiple Choice

1) C

2) A

3) C

4) B

5) D

6) B

7) B

8) B

9) C

10) A

11) A

12) A

13) D

14) D

15) C

16) C

17) D

18) B

19) A

20) B

Question 21 A

Criteria Marks

• Recognise or note/indicate differences between a commercial bill and a

debenture

3-4

• Sketch in general terms; indicate the main features. of commercial bill and

debenture

1-2

Commercial bills: This is a type of non-bank bills of exchange. This are issued by

institutions other than banks, and are given for larger amounts, usually over $100 000 for

a period of between 90 and 180 days. The borrower receives the money immediately and

promises to pay the sum of money and interest at a future date, strict financial discipline

on both the parties. (External sources of finance-short term borrowing)

❖ Debenture: This is a loan contract where the borrower will pay the amount borrowed back on

maturity day, and regular interest payments. Debentures are issued by a company for a fixed rate

of interest and for a fixed time, secured loan, can be individuals and businesses that lend the

money. (External sources of finance, long term borrowing)

Question 21 (b)

Criteria Marks

• Make a judgement of value, quality, outcomes, results or size of TWO

strategies used to improve cash flow management

5-6

• Provide characteristics and features of strategies used to improve cash flow

management

3-4

• Sketch in general terms; strategies used to improve cash flow management 1-2

Sample answer:

Cash flow management strategies – distribution of payments, discounts for early payments,

factoring

Question 22 (a)

(a) Outline ONE consumer law that would relate to Oz Sports.

Outcome: H2.

Criteria Marks

Sketches in general terms ONE consumer law that would relate to Oz Sports. 2

Limited sketch of ONE consumer law that would relate to Oz Sports. 1

Answer:

• Deceptive/Misleading advertising – high quality and made from organic materials.

• Implied conditions – shoes wear our after minimal usage.

• Warranties

• Price discrimination.

Question 22 (b)

(b) Why is ethical behaviour important in marketing Oz Sports running shoes?

Outcome: H3.

Criteria Marks

Provides cause and effect of why is ethical behaviour important in marketing

Oz Sports’ running shoes.

2

Sketches in general terms why is ethical behaviour important in marketing

Oz Sports’ running shoes.

1

Answer:

• Ethical behaviour will enhance the brand image of Oz Sports’ running shoes - increasing

sales and profitability.

• Greater customer awareness of businesses behaviour and to retain existing customers, Oz

Sports needs to demonstrate Corporate Social Responsibility in their marketing of shoes (eg.

truthful and accurate marketing, engaging in fair competition and the avoidance of sugging).

Question 22 (c)

Describe ONE method of market research Oz Sports could use to obtain relevant information about

their customers.

Outcome: H2.

Criteria Marks

Provide characteristics and features of ONE method of market research Oz Sports

could use to obtain relevant information about their customers.

2

Sketches in general terms ONE method of market research Oz Sports could use to

obtain relevant information about their customers.

1

Answer:

• Primary market research: Survey existing customers, focus groups, customer feedback

given to salespeople.

• Secondary market research: Sports journals and magazines, ABS, published research

carried out by competitors.

Question 22 (d)

(d) Recommend ONE global product strategy and ONE global pricing strategy Oz Sports

could use to market their products overseas.

Outcome: H5.

Criteria Marks

Provides a reason in favour of ONE global product strategy and ONE global pricing

strategy Oz Sports could use to market their products overseas.

3 - 4

Provides characteristics and features of ONE global product strategy and ONE

global pricing strategy Oz Sports could use to market their products overseas.

1 - 2

Answer:

• Global Product strategies: global branding (the use of a logo on Oz Sports running shoes

to achieve global recognition, product differentiation and brand loyalty).

Standardization of running shoes (as the way the product is used is the same across markets

and would enable Oz Sports to achieve economies of scale in production).

Customization (Oz Sports could enable their customers to individually customize their

running shoes).

• Global Pricing strategies:

Global pricing (either standardize or customize according to market conditions in overseas

markets)

Competitive positioning (superior image due to their sport shoes being high quality and made

from organic materials)

Question 23 (a)

Criteria Marks

• Recognises and names TWO ways a business can differentiate a product in

the operations process

2

• Recognises and names ONE way a business can differentiate a product in

the operations process

1

Question 23 (b)

Question 23 (c)

Question 24 (a)

Criteria Marks

• Sketch in general terms; indicate the main features of the role of human

resources in business

2

• Identifies an aspect of the role of human resources in business 1

Outline: Sketch in general terms; indicate the main features.

Sample answer:

The role of human resource management in organisations is to organise people so that they can

effectively work (manage the employer and employee relationship)This includes managing

recruiting and hiring employees, coordinating employee benefits and suggesting employee

training and development strategies. In this way, HR professionals are consultants, not workers

in an isolated business function; they advise managers on many issues related to employees and

how they help the organisation achieve its performance objectives.

Question 24 (b)

Question 24 (c)

Criteria Marks

• Identifies issues and provides points for and/or against staff

turnover as an indicator of the effectiveness of human resource

management in detail

4

• Identifies issues and provides points for and/or against staff

turnover as an indicator of the effectiveness of human resource

management

3

• Sketches in general terms staff turnover as an indicator of the

effectiveness of human resource management. 2

• Makes a general statement about staff turnover as an indicator of

the effectiveness of human resource management 1

Sample answer

It might be said that staff turnover is a valid indicator of the effectiveness of human resource

management. This is because, in general, staff that are happy in their roles do not leave an organisation.

Also, as compared to some other indicators (such as staff morale), it is easier to measure.

Comparing with past and projected results will increase the usefulness of staff turnover as an indicator of

effective human resource management. Comparing with industry average will also be useful.

Using staff turnover in conjunction with other indicators such as absenteeism, worker satisfaction and

levels of disputation in the business will help management judge the effectiveness of human resource

management.

Question 25

Question 26

Question 27

HSC TRIAL EXAMINATION Business Studies

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