A-AS Level (CIE) Business Studies Paper-1: Specimen Questions with Answers 8 - 9 of 50

Question 8

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Describe in Detail

Essay▾

Explain two methods of quality control

Explanation

The basis of control chart is the setting of upper and lower control limits. These limits are used as a basis for judging the importance of the quality variation for sample and from time to time. The point fall outside these limits is taken to be a danger signal. The control limits serve as a guide for action. Control limits are established by computing:

  • Data of past and current production records
  • Reliability of statistical formulae has been proved in practice.

Types of Control Charts

There are two types of control charts:

  • Control Charts of Variables: Variables are those quality of a product which are measurable and can be expressed units of measurement such as age of motor tire in km. , diameter of radio knobs, parity of gold in carat etc.
  • Control Charts of Attributes The control charts of attributes and used where the quality features are to be controlled, which cannot be measured directly in quantitative measurement for this use the product is divided as defective and non-defective.

Question 9

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Describe in Detail

Essay▾

State the causal studies method of market research.

Explanation

The researcher investigates whether the value of one variable cause or determines the value of another variable, to establish linkage between them. Experiments often are used to measure causality. A dependent variable is a concept which is expected to be explained by an independent variable. On the other hand, an independent variable is a variable that can be manipulated by the market researcher to some extent. A causal study for Starbucks might involve changing one independent variable (for example, the number of direct mailings offering a 10-percent discount on a one-pound bag of coffee ever a six-month period to target customers) and then observing the effect on coffee sales.

Here, there is an appropriate causal order of events, or temporal sequence; the effect follows closely the hypothesized cause. A second criterion for causality is concomitant variation — the degree to which a presumed cause (direct-mail promotion) and a presumed effect (coffee sales) occur together or vary together. If direct-mail promotions cause increase in the coffee sales, then the number of direct-mail promotions will be increased, to increase the coffee sales and when the number of direct mail promotions is decreased, sales should fall.

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