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An Australian chemical manufacturer has decided to relocate its production plant to a developing country to take advantage of regulatory differences - HSC - SSCE Business Studies - Question 22 - 2005 - Paper 1
Question 22
An Australian chemical manufacturer has decided to relocate its production plant to a developing country to take advantage of regulatory differences. (a) Identify O... show full transcript
Worked Solution & Example Answer:An Australian chemical manufacturer has decided to relocate its production plant to a developing country to take advantage of regulatory differences - HSC - SSCE Business Studies - Question 22 - 2005 - Paper 1
Step 1
Identify ONE advantage to the manufacturer of relocating its production plant.
Answer
One significant advantage for the manufacturer in relocating its production plant to a developing country is the potential for lower production costs. This includes reduced labor expenses and operational costs, which can significantly increase profit margins.
Step 2
Identify TWO stakeholders affected by the relocation, and describe an ecological conflict of interest that may arise between these stakeholders.
Answer
Two key stakeholders affected by the relocation are the local community and the environmental conservation groups.
The local community stands to benefit from job opportunities created by the new plant. However, this can create conflict with environmental conservation groups that may be concerned about the pollution and environmental degradation that the factory could bring. For instance, while the community may prioritize economic growth and job creation, conservation groups may advocate for the protection of local ecosystems. This divergence in interests can lead to ecological conflicts where the manufacturer's operations could harm the environment, thereby causing tension between promoting economic benefits and environmental sustainability.