20. Location decisions

The ‘location decision’ for a business means:

• 1) deciding where the departments of a business are located in the factory

• 2) a shop-owner deciding on the positions for products in the shop

• 3) deciding where a business is going to operate from

• 4) deciding where a business is going to market its products

Business location decisions are very important for all of the following reasons except that:

• 1) the location might affect the sales of a product

• 2) the location might affect the costs of production

• 3) the location might affect the available supply of labour

• 4) the location might affect the legal form of ownership

In which one of the following cases is location nearest to reliable suppliers likely to be most important?

• 1) A manufacturing firm using flow production and Just-in-Time stock policies

• 2) A bank with many personal and business customers

• 3) A farmer raising sheep for meat production

• 4) A specialist producer of designer clothes which uses job production

If a product gains weight during the production process, such as soft drinks, then location of the factory is likely to be:

• 1) close to the sources of raw materials

• 2) close to the major markets

• 3) close to supplies of skilled labour

• 4) close to manufacturers of machinery used in the production of the product

When a raw material loses weight and bulk during processing, location of the processing business is likely to be:

• 1) close to the sources of raw materials

• 2) close to the major markets

• 3) close to supplies of skilled labour

• 4) close to manufacturers of processing machinery

A new business has been set up. It is an Internet seller of stationery products. All of the following factors are likely to affect the location decision except:

• 1) the availability of government grants in certain regions

• 2) transport links from its warehouse to main areas of population

• 3) location of manufacturers of machines that make stationery

• 4) cost of land for warehouse construction

Government location grants are most likely to be made available in regions of the country

which have:

• 1) many similar businesses operating

• 2) just experienced big firms closing down

• 3) very high levels of employment

• 4) many other firms starting up

The location of which one of the following businesses is most likely to be influenced by the

availability of skilled workers?

• 1) Computer software design

• 2) Large supermarket

• 3) Mass producer of family car models

• 4) Travel company’s ticket office

If a business is located in the wrong area then it is likely to experience:

• 1) low costs of production

• 2) low inefficiency

• 3) low break-even point

• 4) low profits

The location decision for a retailing business is most likely to be affected by:

• 1) costs of producing the goods

• 2) government grants to firms in the secondary sector of industry

• 3) location of competitors

• 4) location of energy sources