CAMBRIDGE INTERNATIONAL AS & A LEVEL BUSINESS
Topic worksheet 23.1
The nature of operations
1
True or false?
Identify whether each of the following statements is true or false.
True or false?
Batch production offers some flexibility in product design
Job production has a low unit production cost
Flow production requires specialised capital equipment
Mass customisation has high unit costs and limited flexibility in design
Capital intensive production is only an option for large firms
Flow production requires a highly skilled workforce
The factor inputs are land, capital and enterprise
2
Labour productivity calculations
You should show your workings for each of the following questions.
a
A business employs 670 workers who produced 500 000 units over the last year. Calculate the labour
productivity per worker.
b
The business has decided to invest in some capital machinery which increases the level of units produced
by 15% but reduces staff levels by 30%.
i
How many workers are now at the firm?
Cambridge International AS & A Level Business – Chalk & Malpas © Cambridge University Press 2021
1
CAMBRIDGE INTERNATIONAL AS & A LEVEL BUSINESS
3
ii
How many units are now being produced?
iii
What is the new labour productivity figure based on these changes?
iv
Has productivity increased or decreased at the business?
Capital or labour intensive?
Identify whether each of the following statements applies to capital- or labour-intensive operations.
Capital- or labour-intensive?
High fixed costs
Impacted by the quick pace of technological change
Costs are mainly variable in nature
Quality of the products produced can vary
Customised products are easier to make
Cambridge International AS & A Level Business – Chalk & Malpas © Cambridge University Press 2021
2