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01 Hours 45 Minutes

100 Marks

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IB BUSINESS MANAGEMENT SL, Paper 2, November, 2009, TZ0, Solved Past Paper

Master the 2009 IB November for Paper 2 Business Management SL with examiner tailored solutions and comments for TZ0

Question 1 [Explained]

The case study revolves around Mitsubishi Motors, a multinational car manufacturer, which faced significant challenges during the economic downturn in South-East Asia in the late 1990s. Unlike its competitors, Mitsubishi had a smaller market share in the United States, which exacerbated the impact of the downturn on its sales. The company experienced its worst losses in 1997. In response to these challenges, Mitsubishi Motors announced a vision statement in 2005, emphasizing driving pleasure and safety. By 2006, the company introduced new models, including the award-winning Kei car and a revised Outlander SUV. The financial data provided for the years ending May 31, 2004, and May 31, 2007, offers insights into Mitsubishi's financial performance, including sales revenue, costs, assets, liabilities, and profits. This data will be used to analyze the company's financial health and strategic decisions during this period.

	Year ended 31 May 2004 (millions of Yen)	Year ended 31 May 2007 (millions of Yen)
Cost of goods sold	2160	1789
Current assets	869	1061
Current liabilities	1567	1111
Expenses	574	405
Fixed assets	1160	719
Loan capital	432	360
Non-operating income	0	0
Retained profit (from balance sheet)	17	156
Sales revenue	2519	2203
Share capital	13	153

Question 1 [a] [Explanation]

This part of the question asks you to define specific business terms that are crucial to understanding Mitsubishi Motors' situation. These terms are often used in business contexts to describe market dynamics and organizational structures.

Question 1 [a] [i] [Explanation]

The term market share refers to the portion of total sales in a particular market that is attributed to a specific company or product. It is usually expressed as a percentage and indicates the company's competitiveness within the market.

Question 1 [a] [ii] [Explanation]

A multinational company is a corporation that operates in multiple countries, managing production or delivering services beyond its home country. These companies often leverage global markets to expand their reach and increase profitability.