How did you go in the 2018 HSC Business Studies Exam? Not sure and want to double check some of your answers?
We’ve got you covered with this post outlining the answers and explanations for Sections I and II the 2018 HSC Business Studies Exam Paper!
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2018 HSC Business Studies Exam Solutions & Sample Answers
Section I (Multiple Choice) – 20 Marks
Q1. C
Q2. A
Q3. C
Q4. D
Q5. C
Q6. D
Q7. D
Q8. B
Q9. D
Q10. A
Q11. B
Q12. C
Q13. A
Q14. C
Q15. B
Q16. A
Q17. D
Q18. D
Q19. B
Q20. B
Section II (Short Answer) – 40 Marks
Question 21
a) Describe TWO transformation processes that the business should implement. (4 marks)
Answers could include:
- the 4Vs (volume, variety, variation in demand and visibility)
- sequencing and scheduling
- technology, task design and process layout
- monitoring, control and improvement
Sample answer:
As the business struggles to complete its repairs, it should make use of sequencing and scheduling tools such as Gantt charts and critical path analysis. This would allow the business to improve the efficiency in which it carries out its tasks and provide better estimated time of completions which would help adjust customer expectations and thereby better meet them.
Further, by monitoring and controlling its repair processes, the company will identify and address the legal regulations it fails to meet such as Work Health and Safety legislation. It will also improve the quality of its repair services by identifying skills that its human resources lack.
b) Recommend TWO quality management strategies that the business can use to overcome its problems. (6 marks)
Answers could include:
- Quality control
- Quality assurance
- Quality improvement
Sample answer:
Quality control involves feed forward, concurrent and feedback controls to ensure the service meets consumer expectations and fit for purpose. Feed forward involves checking to foresee potential problems with the repair service such as checking tools like spanners are working properly, concurrent controls ensure quality during the repair service, and feedback ensures the repair service solved all the problems with the truck through surveys or courtesy calls post-service. This therefore ensures a high quality service which meets consumer expectations.
Furthermore, quality assurance involves using a set of procedures and processes that prevent defects and issues during the service. This can be achieved through meeting quality standards and gaining certification that assures the service provided is high quality and hence allows for efficient repairs. In addition, this will help the company meet legal regulations as the certification would not be awarded unless the company demonstrates high quality practices, including those involving WHS.
Question 22
a) Outline the strategic role of human resources in this business. (2 marks)
Answers could include:
- strategic role of human resources
- support the needs of employees
- promote the goals of the organisation
Sample answer:
The strategic role of H/R in this business is to support the needs of its employees by listening to their suggestions whilst promoting the goals of the organisation, including maintaining loyal staff.
b) Demonstrate how the leadership style of this business has affected employee performance (4 marks)
Answers could include:
- leadership style – autocratic/authoritarian/directive/dictatorial
Sample answer:
The leadership style at this business is autocratic as management do not listen to suggestions. As a result, employee performance has suffered as employees feel unmotivated to perform well as they do not feel involved in the success of the business. Furthermore, the autocratic leadership style has led to employees looking to move, which has further distracted employees from focusing at their current role, as they would likely increase their absenteeism to attend job interviews at other businesses.
c) Justify the use of ONE human resource management process to improve the culture of this workplace. (4 marks)
Answers could include:
- acquisition
- development
- maintenance
- separation
Sample answer:
Management should implement renewed maintenance processes in an attempt to re-engage and motivate their employees. These include monetary rewards such as bonuses and non-monetary rewards such as increased status in the workplace. Bonuses would be paid to supplement wages for great employee performances, which would improve the level of morale amongst employees, helping to motivate them. Further, increased status would be highly effective in allowing employees to be heard and involved in the decision making process, a key reason for the business’ issues with staff. This would also allow greater communication and engagement from employees, thereby improving the culture of the workplace.
Question 23
a) Identify ONE threat to this business. (1 mark)
Answers could include:
- size of the Australian market is shrinking
Sample answer:
The size of the Australian market is shrinking.
b) Why could monitoring and controlling be an important part of the marketing process for this business? (3 marks)
Answers could include:
- implementing, monitoring and controlling
- developing a financial forecast
- comparing actual and planned results
- revising the marketing strategy
Sample answer:
Monitoring and controlling of the marketing process are important as they allow businesses to adjust their marketing strategies to best respond to external threats and internal weaknesses whilst capitalising on external opportunities and internal strengths. In order to achieve this, the business should develop a financial forecast for its new factories in Europe and compare the actual and planned sales, market share and profitability of its existing Australian market. Further, monitoring and controlling will help the business revise its marketing strategies including the way it uses its promotion mix to interact with its loyal customers, ensuring the business’ marketing processes are effective in maximising sales.
c) How would the situational analysis change if the business decides to expand into Europe? (6 marks)
Answers could include:
- product life cycle – renewal
- SWOT analysis
- strengths – standardisation and economies of scale
- opportunities – scanning and learning, global sourcing, new markets,
- threats – competitive positioning, exchange rates
Sample answer:
If the business expands into Europe this would represent a new stage of its product life cycle, namely a renewal as it is introducing its existing products into a new market, the European market.
In its SWOT analysis, its strengths would now become the ability to standardise its products and therefore achieve economies of scale through mass production of its uniform product, hence allowing for reduced average production costs. Its opportunities would also open up, exemplified by the ability for the business to use scanning and learning to find new suppliers, evaluate new competitors, and learn from best practice around the world. This would allow for the business to utilise global sourcing to find cheaper inputs whilst developing its global web to ensure it is capable of distributing to multiple nations, hence maximising sales and profits.
Finally, the business must now consider new threats, including competitive positioning – the method of which businesses differentiate themselves from its competitors. This is a threat because as a new manufacturer in Europe, it will initially find itself threatened by other more established and differentiated firms occupying the market share. In addition the businesses must also consider exchange rate fluctuations which could increase costs of its inputs and decrease the price of its exports if the currency were to depreciate, thus limiting its profitability.
Question 24
a) Why is liquidity an objective of financial management? (2 marks)
Answers could include:
- liquidity
Sample answer:
Liquidity is the ability for a business to pay for its current liabilities using its current assets. It is important as an objective as proper management of liquidity will ensure the business is financially stable and not at risk of defaulting on its payments. This would then lead to a collapse in utility provision or suppliers refusing to deliver unless paid, resulting in cessation.
b) How could a business improve management of its account receivable turnover? (3 marks)
Answers could include:
- discounts on early payment
- factoring
- reviewing credit policy
Sample answer:
A business could improve its accounts receivable (AR) turnover by reviewing its credit policy for customers. This involves imposing a credit limit on its customers, hence limiting the amount of credit sales and easing the AR turnover ratio. Further, the firm can reduce the amount of time given to its customers to repay, which would speed up the rate in which it would receive payments on AR.
c) Discuss the use of leasing and the use of mortgages as a source of long-term finance for this business. (5 marks)
Answers could include:
- leasing
- advantages – does not need to outlay large amount in one transaction, tax deductions from lease payments, flexibility to release or upgrade the leased item at end of term
- disadvantages – need to maintain constant cash flow to meet payments, lack of ownership of the asset
- mortgages
- advantages – does not need to outlay large amount in one transaction, tax deductions from mortgage repayments, ownership of the asset, lower interest rate
- disadvantages – need to maintain constant cash flow to meet payments, secured which means the business loses the asset if it fails to make repayments, end up spending significantly more than the cost of the asset due to interest,
Sample answer:
Expanding into a larger factory represents investment into a non-current asset, making it suitable for non-current financing, as per the matching principle. Leasing and mortgages share some key advantages, including not needing to outlay large amounts of funds in one transaction, thereby allowing the company to maximise its growth potential without constrains of its balance sheet. Further, they provide tax deduction advantages through lease payments and mortgage repayments respectively which will maximise profit after tax. Overall however, mortgages offer more advantages as they also allow for ownership of the asset at the end of the term, whilst leasing does not.
Similarly, both share common disadvantages including the need to maintain constant cash flow to meet payments, stressing the need for adequate working capital management. In addition, mortgages also are secured, meaning that the business would lost its asset, the factory, if it were to fail in its repayments. Although leasing suffers from not allowing for the business to retain ownership, there is no risk of losing the asset due to foreclosure.
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Terry Huang completed his Bachelor of Secondary Education with a Bachelor of Commerce at the University of New South Wales. A strong believer that lessons should be engaging, relevant, and effective, his hustle and teaching approach have led to his recognition on the UNSW Faculty of Social Sciences Dean’s List for Academic Excellence, the NSW Teachers Federation Future Teacher scholarship, and the New Colombo Plan program. Terry enjoys listening to Kanye West, learning about cryptocurrency and memorising scenes from The Office.
