Practice Material Business - foundation in business PDF

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practice materials for foundation in business 2020-2021. hope it is helpful for you. happy learning! this is helpful especially when you are looking for past students work...

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HERIOT WATT UNIVERSITY MALAYSIA FOUNDATION IN BUSINESS TUTORIAL on Topic 5 SECTION A: SHORT ANSWER QUESTIONS 1. Anaylse the reasons for Chinese organisations expanding production in recent years. (SQA 2016) (4 marks) The Chinese organisations are expanding their production in recent years due to several reasons. Traditionally low wages relative to wages in western countries, as this allows Chinese organisations to have lower operating costs and become more competitive. Secondly, it reducts the cost of transportation due to containerization, this reduces the operating costs and increased profits which could be used to expand their business. Lastly, the increased demand for Chinese made products worldwide due to low cost has increased the disposable income of Chinese workers. This would stimulates the domestic demand in China whereby, encourages local Chinese businesses to grow. 2. Organisations from ASEAN and China have become more powerful. Explore the

effects of these organisations on UK business. (10 marks) One of the effects of organisations from China and ASEAN countries on UK businesses are reduction in costs. As the component parts needed for ASEAN businesses can be made cheaper in China with lower wage rates and cheaper materials, which reduces the cost of raw materials to the businesses. The prices would be cheaper due to reduction of costs to be more competitive and profitable. Moreover, ASEAN businesses can learn new production techniques from Chinese organisations, which would make them more efficient and competitive. On the other hand, this would increase the competition from Chinese organisations as they produce in lower prices and higher volume. In return, ASEAN businesses would also have to reduce their prices in order to compete, which reduces the profitability of their businesses. Thus, this may also lead to an increase risk of bankruptcy or being brought out. 3. Discuss the challenges of doing business in China. (10 marks) There are several challenges of doing businesses in China. The political challenges has been under the communist party rule for many decades. As the rules and regulations in China are not so transparent or absolutely not at all compared to the western economies where the government promotes transparency for doing business. Moreover, the legal challenges is loosely defined which gives a rise to various loopholes in the law compared to the strict laws and patents in economies of the west protect domestic and foreign businesses. “Shanzhai” is known as the copycat culture where the society is predominantly Confucian and the tradition 1...