Producer decisions - Resources

Resource Decisions 1. Natural Resources – any thing which occurs naturally – E.g. Cocoa Beans, Milk Capital Resources – Man made goods that are used in the production of other goods and services – E.g. Jafa Spinning Machine Human Resources – people who contribute to the production process. – E.g. workers who sort the roses

Sustainable Practices Impact on Producer – By using fair trade increase costs of producing the chocolate – May increase sales as more customers will purchase the chocolate knowing that its fair trade – May have increased advertising costs to advertise to consumers that they are using fair trade Impact on Society – Consumers feel good as they are helping the environment and producers in developing countries – Environmental impact is positive as more coco beans will be available for future generations

Use of Local Producers Impact in Producer – Use fresh milk in chocolate process – Cheaper transport cost by using local farmers – Supporting the local community so consumers may stay more loyal – May have higher costs Impact on Society – Increase the revenue for local farmers – Provide local jobs, which will mean households incomes will rise – Consumers feel good buying products that support the community

The number of employees Impact in Producer – Increase labour costs if they decide to higher another employee could lead to decreased profits – Could mean increased division of labour can occur which could increase productivity – May need to pay for training of the worker – Become more labour intensive. This could lead to division of labour, which may mean increases in productivity then leads to increases in sales and revenue for producer Impact on Society – Employment opportunities for community – Better service to customers – Increased skill level of workers in community

Purchase of Additional Machine Impact in Producer – Increase productivity – Become more capital Intensive – Cost of purchasing the capital – May need to train workers to use new machine Impact on Society – Negative impact on health, more chocolate being consumed – More chocolate available

Section Two

Question 3 Productivity measures the output per unit of input

Question 4

Question 5 Achieved Answer Productivity is important as it reduces costs of production allowing Cadbury’s to make higher profits AND/OR Productivity can be improved through division of labour which is when a specialist task is broken into smaller tasks and done by different workers.

Question 5 Merit Answer Productivity is important because if productivity has increased it means the costs of producing the good has decreased. This will then allow Cadbury’s to sell their product at a lower price to consumers. A lower price would make Cadbuy’s more competitive so consumers will then increase their demand for the product as its now cheaper and will purchase more. This increases the sales and revenue of Cadbury’s leading to increased profits

Question 5 Merit Answer Productivity can be improved through Division of Labour when specialist task is broken into smaller tasks and done by different workers. Workers in Cadbury’s could work in a production line, where one worker would do one task of production each. If the same worker is doing the same task over and over again, the worker can become more faster at doing that job. This means output would increase using the same number of workers therefore productivity will increase.

Question 5 Excellence Answer Productivity is important because if productivity has increased it means the costs of producing the good has decreased. This will then allow Cadbury’s to sell their product at a lower price to consumers. The workers sorting the roses would be able to sort more than roses a week. The lower price would make Cadbuy’s more competitive so consumers will then increase their demand for the product as its now cheaper and will purchase more. This increases the sales and revenue of Cadbury’s leading to increased profits

Question 5 Excellence Answer Productivity can be improved through Division of Labour when specialist task is broken into smaller tasks and done by different workers. Workers in Cadbury’s could work in a production line, where one worker would do one task of production each. If the same worker is doing the same task over and over again, the worker can become more faster at doing that job. This means output would increase using the same number of workers therefore productivity will increase. Cadbury’s would make more chocolate in a day than in the past A consequence to improved productivity will be that consumers of Cadbury’s chocolate would enjoy lower prices, customers may get a better service at Cadbury’s. Lower prices to consumers may mean that consumers have more income left over to purchase other goods and services or may consume more chocolate. If workers become more efficient they may be able to command higher wages from Cadbury’s. They are also more likely going to have a secure job as Cadbury's is likely to continue to operate if they are continuing to be profitable.