Page 90 - Cambridge IGCSE Business Studies

Cambridge IGCSE Business Studies Section 2 People in business

2 ABC is a candy manufacturer. It employs 50 workers.
Workers are paid $150 per week based on a 40-hour week.
Workers also receive a bonus if they reach production targets
set by management.

The factory manager receives a salary of $30,000 per year
plus a company car. All managers at ABC are part of a profi t-
sharing scheme. They also receive private health insurance.

The motivation of production workers is low. They leave the
company after an average of only 16 months.

a What is meant by the term ‘bonus’? [2]

b What is meant by the term ‘motivation’? [2]
c Identify and explain two benefi ts to ABC of offering
fringe benefi ts to its managers. [4]
d Identify and explain how any two non-fi nancial
methods of motivation might be used by ABC to
improve the motivation of production workers. [6]
e Do you think that the production workers should
receive the same fringe benefi ts and share of profi ts
as the factory manager? Justify your answer. [6]

88
Total available marks 40