Gel Nails
Paper 2 Exam Practice Question - Gel Nails (GN)
Gel Nails (GN) produces a range of nail beauty products for multinational retailers.
(a)
State two features of multinational companies.
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With operations currently only in Singapore, where locals speak Malay and Singaporean
Mandarin, GN is considering expanding its production in one of three locations: Vietnam,
Indonesia or Thailand. The estimated costs and benefits of these three options are shown
below, with the probabilities of success, no change and failure also shown:
Option
Vietnam
(%)
Potential
return
($m)
Success
45
25.0
Unchanged
30
20.0
Failure
25
12.0
Outcome
Chance
Cost of
project
($m)
12.5
Indonesia
Thailand
Success
55
22.0
Unchanged
20
12.5
Failure
25
8.5
Success
50
20.0
Unchanged
25
10.0
Failure
25
-2.0
10.5
14.5
(b)
Construct a fully labelled decision tree, showing the predicted outcome for each option faced
by Gel Nails.
(c)
Outline one non-financial factor that Gel Nails should consider before choosing any of these
locations to expand into.
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