INTERNATIONAL BACCALAUREATE DIPLOMA PROGRAMME PRACTICE PAPER 2 APRIL 2014

Transcription

1 INTERNATIONAL BACCALAUREATE DIPLOMA PROGRAMME PRACTICE PAPER 2 APRIL 2014 SUBJECT: Business and Management LEVEL: HL PAPER: 1 DAY & DATE: EXAM DURATION: 2h 15m MAXIMUM MARKS: 80 MARKS OBTAINED: CANDIDATE NAME: CANDIDATE SESSION NO: INSTRUCTIONS TO CANDIDATES Do not open this examination paper until instructed to do so. A clean copy of the Business and Management case study[the Imperial] is required for this examination paper. Read the case study carefully. Section A: answer two questions. Section B: answer the compulsory question. Section C: answer the compulsory question. A calculator is required for this examination paper. Clean copies of the Business and Management formulae sheet and discount tables are required for this examination paper. The maximum mark for this examination paper is [80 marks]. ADDITIONAL MATERIAL: ANSWER SHEETS, CASE STUDY ( The Imperial), FORMULAE SHEET & DISCOUNT TABLES. This question paper consists of 7 printed pages including this cover page.

2 Answer two questions from this section. SECTION A 1. (a) Define the following terms: (i) appraisal(line 102) (ii) training (line 108) (b) Explain the difference between Roger operating the hotel as a sole trader (line 5) and Global Properties operating it as a private limited company (lines 18 and 19). Analyse the role of market research in helping Martin decide which option to promote to Global Properties. [7 marks] 2. (a) Define what is meant by the term non-profit organizations (line 79). (b) Using the additional information below prepare a position map for The Imperial and comment on its position. [6 marks] Additional information: Hotel Name Price Quality The Imperial High Medium Mombasa Sands High High Sea View Low High Auberge High High Renaissance Med Med Kenyan Surprise High Medium Analyse the possible causes of communication failure that led to Guthoni s dismissal. [7 marks] Section A continued on the next page

3 Section A continued from the previous page 3. (a) (i) Identify two other possible sources of secondary market data that Martin might have referred to (lines 58 and 59). (ii) Define what is meant by the term strategic alliance (line 150). (b) Martin has just received the following information from one of his staff. Calculate the payback and ARR for this investment using the figures below. Additional information: To: Martin Kimathi Manager, The Imperial From: Jeffrey Makau - Head of Guest Relations Yacht Purchase Memo I believe that with Kenya s new found success at sailing in the recent summer Olympics, the hotel should invest in 5 yachts as a new activity to offer our guests. It should not only attract hotel guests, but also residents of Mombasa to come and try out the boats, particularly as Kenya s sailing double Silver medalist has recently moved to the city. Each yacht costs $2,000 each and at any one time 4 of the 5 yachts will be used. In the first year sales, I predict, to be $1,000, increasing by 50% for the next 2 years, before remaining at that level for a lifespan of six years. A purchase of 5 yachts, would result in a 20% discount. Analyse the results of the calculations in (b) as well as what other factors Martin may have to consider before making a decision. [7 marks]

4 SECTION B Answer the compulsory question in this section. 4. (a) Identify two inputs for The Imperial and two processes that occur within The Imperial. (b) Prepare a PEST analysis using the case study and the information below. [8 marks] Additional Information: Extract from Africa Today news broadcast The poor safety standards in Tanzania s Safari parks has seen a drop in tourists wanting to visit both the country and the region over recent months. This could, in part, be because of the new vehicle sensor technology produced by Asian supplier, Wangnet that claims to sense anything within a 20 metre radius. Mr Wong, marketing director of Wangnet, says that although they have had some issues with the unpredictable nature of wild animals the technology is excellent for vehicles both on the road and on water. In other news, the government in Somalia gathers strength as more members of the Al-Shabaab group, turn to peaceful means to achieve their ends. This has led to an inflow of foreign investment particularly from Asiain to both Somalia and Kenya. The new Kenyan minister for women, Mrs Sigeihopes that women in Somalia, can soon follow Kenya s example and become active in the workplace and in positions of leadership. However, on hearing Mrs Sigei speak, senior members of the Kikuyu tribe voiced their frustrations that tribal customs are being lost due to the changing role of women and the government s move towards greener waste management. Tribal elders stated, Our land is being taken, for recycling plants and we now have to ask permission to have a fire over 2 meters tall. Discuss the advantages and disadvantages of internal and external recruitment for The Imperial. [8 marks]

5 SECTION C Answer the compulsory question in this section. In the New Year, things at The Imperial have finally begun to pick up with the signing of a pharmaceutical contract for three conferences over the next eighteen months about the reduction of HIV/AIDS across Africa. It was Aluna Jeptoo s contact, the new Head of Housekeeping, that had informed her that the Red Cross had requested proposals from possible hotels that could hold a large number of conferences over such a short time period. Martin, Aluna and the hotel s project team had worked very hard putting the proposal and expected budget together and had finally been awarded the exclusive contract. Martin though wasn t sure if the first had been as profitable as he hoped. With the hotel beginning to grow organically again and workers appreciating the job enrichment programme, it came as no surprise that so many staff had taken part in the share ownership scheme set up by Global Properties through Martin s accountant. This had been one of the proposals put forward by the employees after the arbitration process to resolve the potential strike action and the surprise resignation of Susan Chapman. As more new business comes in, Martin feels he is in a stronger position to negotiate with potential suppliers and organizations over which of the options he must choose for the long-term future of The Imperial. Before he makes a final decision he is planning to undertake a social audit. More immediately though he is unsure about how to ensure that the hotel s transport remains fully operational for each of the three conferences and is considering that in the short-term the hotel should outsource this to one of the city s bus companies. However, he wants to ensure that he can protect The Imperial s corporate image. 5. (a) Define the terms: (i) strike (line 114) (ii) international standards (line 106) (b) Using the information in item 4 construct a completed budget for the first conference. Use your information in (b) explain why variances are known as favourable and adverse, rather than positive and negative. Section C continued on the next page

6 Section C continued from the previous page (d) (e) Examine the value of a social audit to both Martin Kimathi and the hotel s guests. [6 marks] Using the extension material, appendices and the case study, recommend to Martin which option should be adopted for The Imperial s future direction. [12 marks] Item 1: Kenyan s small, but dynamic tech industry continues to gather pace, with Kenya s Silicon Savannah in Nairobi focused on providing funding and if necessary space for people and organizations to develop technology and apps for use across East Africa. One such app is a wonderful invention, says businessman Mr Songok. I travel on business a lot and am away from home for days at a time. The Good Stay app lets me know what hotel availability there is within a 30 km radius. The app works with a GPS locator and directs customers to the nearest and most affordable hotel within the area. Rooms can even be held for up to 3 hours before a guest s arrival allowing for the most up to date availability. The designers RO Limited are looking to extend its use, by adding more features as smartphones sales become more common across the region. Source adapted from: BBC News How much will technology boom change Kenya? Item 2: Estimated investment figures from the Kenyan Government and private investment groups into Kenya s infrastructure over the next 5 years. Money will be go to railways and ports first, with roads and aviation being the second priorities. All figures are in $000s Total 20,000 25,000 28,000 35,000 46,000 Government 16,000 19,000 18,000 20,000 24,000 Private Investors 4,000 6,000 10,000 15,000 22,000 Ports 8,000 7,000 3,000 1,000 1,000 Railways 5,000 8,000 7,000 10,000 16,000 Roads 2,000 4,000 10,000 15,000 17,000 Aviation 5,000 6,000 8,000 9,000 12,000

7 Item3: It has been announced that a number of East African states, including Kenya, Uganda, Ethiopia and Somalia are working together to implement a regional sustainable tourist plan. Working with the United Nations, the plan, covering 10 years, looks at implementing a culture of sustainable tourism across the region focused particularly on the benefits to the local communities and the management of the environment. The aim is that leading tourist destinations, such as Kenya and Uganda will assist other countries within the region to establish tourism policies, training programmes to upskill personnel working across the tourist industry and to collect more up to data tourist trends regionally. The two leading nations will not only set up links across borders but are looking for potential centres of excellence within their own nations to become training establishments between hotels and tourist centres across the region. These centres will not only receive regional funding, but will also be the first to trial new green technologies aimed at reducing organizations costs and carbon footprint. Source adapted from: Regional Sustainable Tourism Master Plan Kenya Tourism Federation - Dec Item 4: Results for the first Pharmaceutical Conference Budgeted figures: Item Budget Security ($) 15,000 Income ($) 85,000 Staffing (people) 12 Washing ($) 10,000 Catering ($) 18,000 Having had the first of five conferences at The Imperial Martin requested information from the hotel s departments: - Over the 5 day conference the hotel was at 85% capacity. - Waiting staff had to be increased by 10 staff to accommodate the extra visitors that attended during the day, but didn t stay at the hotel. - All rooms were charged at a flat rate of $120 unless booking more than 5 people, which the company then received a 10% discount. - Catering was found to be $10,000 too short and so further supplies were rushed in. - Washing was 10% lower than had been expected. - Security had to be increased by 10% to protect the equipment and drugs, particularly overnight. 5 companies booked 10 rooms each.