Professional Documents
Culture Documents
Practice Paper 1
Practice Paper 1
Shareholder: any individual, group or organization with a direct interest in, and is affected
by the activities and performance of a business.
Director: senior executives who have been elected by the company’s shareholders to direct
business operations on behalf of their owners.
Diversification: A high-risk strategy that involves selling new products in new markets
Investments: the purchase of an asset with the potential to yield future financial benefits.
Private limited company: A business owned by shareholders with limited liability but
whose shares cannot be bought by or sold to the general public.
Public limited company: an incorporated business that allows the public to buy and sell
shares in the company via a stock exchange. All shareholders enjoy limited liability.
Consolidation: the action or process of combining a number of things into a single more
effective or coherent whole
Merger: the amalgamation (or integration) of two or more businesses to form a new
organization, thereby losing their original identities.
Licensing: When a third party organisation buys the right to produce the goods of another
business
Trade union: an organisation whose members unite to protect their rights and welfare
Take over: when one business buys out another by purchasing a majority stake in the
target company
Joint venture: when two or more companies invest in a shared business project, pooling
their resources to form a separate business.
Operations: concerned with providing the right goods and services in the right quantities
and at the right quality level in a cost-effective and timely manner.
- With reference to the case study, describe the difference between public and
private limited companies (lines 14-15).
- Outline one benefit and one limitation for MM being a public limited company
(lines 14-15).
- Outline one benefit and one limitation for MM merging with a Chilean company
(lines 20-22).
- Outline one benefit and one limitation of MM using a decentralized structure for
decision making?
- Outline two forms of primary market research MM could conduct to help identify
methods to increase hotel bookings.
Outline one benefit and one limitation of MM using primary market research.
- Discuss whether MM should form a joint venture or take over an existing lithium
producer (lines 148-150).
- With reference to lines 112- 126, how can MM retain employee satisfaction?
- With reference to the case study, discuss Megamin’s decision to utilize local wage
rates for their employees (lines 113-115).
- With reference to two motivational theories, suggest ways to improve motivation
among employees (line 112-126).
Finance
-Detail two reasons why MM’s closing balance was negative in Quarter 2 and
Quarter 3.