Band 6 HSC Business Studies responses

How does NESA define a BAND 6 response?

A band 6 response will

• demonstrates comprehensive knowledge and understanding of business functions and operations
• critically analyses the nature, role and structure of business
• evaluates the effectiveness of management responses to internal and external influences that affect business
• interprets and applies specific numerical data to analyse and solve business problems and predict future trends
• synthesises contemporary business issues when evaluating management responses and strategies
• clearly communicates using business terminology, concepts and comprehensive case studies in a variety of appropriate formats

Below are some sample band 6 responses from past HSC students. Unlike the sample HSC answers, these responses are done by year 12 students under timed conditions and are a more accurate representation of what is expected of students in exams.

Question 1.

How might a business benefit when an operations manager acts in an ethically and socially responsible manner? Support your answer with relevant examples. (4 marks)

A business operates in an ethical and socially responsible manner when it goes beyond legal requirements to improve its interaction with the environment and the community at large. When an operations manager acts ethically and responsibly, for example by minimising waste or implementing the usage of safe production measures, this will reflect well on the business's reputation and attract more consumers. An example is Qantas Airbus A380's reduced use of fuel which attracted more customers due to its sustainable and ethical image.

Question 2.

Why might a business be resistant to meeting its corporate social responsibilities? (4 marks)

Corporate social responsibilities include going beyond the minimum legal requirements so a business can be perceived more positively. A business might be resistant to meet corporate social responsibilities as it often requires significant financial commitment as well as the commitment of time which would require a business to overhaul an aspect of its activities.

Question 3.

Why is it important for a business to control its debt-to-equity ratio? (4 marks)

Potentially, if a business has too much debt, it creates the issue of bankruptcy and therefore, an end to the business. By controlling debt to equity through raising revenue, selling debt and increasing owner's equity, one will benefit as they will be able to repay creditors and reduce loans. This will also mean the business can now invest equity into other aspects of the business to gain competitive advantage, increase market share and stabilise continuous monetary growth.

Question 4.

Explain the interdependence of finance and operations in a business. Support your answer with relevant examples. (4 marks)

The finance and operations factions of a business need to work together to ensure a smooth running business. The operations function needs the finance function to have the budget for the cost centre of the business. The finance budget will determine whether things such as upgrading technology are financially achievable for operations and if they will improve the profitability of the business long term. Operations will also need to determine how much money they need for their production through the finance function.

Question 5.

TextMore is a global communications business that is facing increased competition. Management has decided to reduce the size of this factory workforce by 25% but also employ more information technology (IT) specialists.

Explain two human resource strategies that could be used to effectively manage downsizing TextMore's factory workforce. (6 marks)

1. Adopting a behavioural leadership style - as psychological issues with job security arise, a behavioural management approach can aid in the process of communicating, motivating, empowering and providing a more egalitarian approach during the process.
2. A performance management system to evaluate factory employee performance and make redundancies based on lower-performing employees failing to meet a certain level of performance criteria.

Question 6.

Red Flash is an Australian manufacturer of a range of sportswear. It is intending to expand overseas by establishing a subsidiary in a developing country. Management has identified that labour laws in the country vary greatly from those of Australia. In establishing its operations overseas, Red Flash has chosen an ethnocentric rather than a polycentric or geocentric staff system.

a) Identify TWO skills of management needed to implement this business proposal. (1 mark)

They need to have people skills, good communication skills and planning, organising and leadership skills.

b) Discuss a possible conflict of interest between stakeholders in relation to the decision to locate in a developing country (3 marks)

Employees, being stakeholders, would have the fear of losing their jobs because the business can find labour for cheaper. They would also not be paying taxes if they relocated there, which is frowned upon by the Australian government, another stakeholder of the business.

c) Evaluate the decision of management to chooseplanning an ethnocentric rather than polycentric or geocentric staffing system for this subsidiary. (6 marks)

Ethnocentric refers to staffing the overseas staffing with staff from the existing company. Often this means the company retains its top-level staff from its own country but employs the lower-level staff, labourers, from the country they are moving into. They are doing this so that they can still have a high level of control and so executive staff members retain their job even after the relocation. It also means that the executive staff team are already trained and familiar with the business, streamlining the business's initial success after relocation. However, the disadvantage is that they are paying the high-level staff more and that the employees from the country they have relocated to would feel exploited.

Want more examples?

Check out NESA's Business Studies Stage 6 HSC resource pack to access more sample responses and example essays.

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