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Transcription of this question: 4.Mattel and Chinese manufacturingMore than two-thirds Of the 800 million toys produced every year by Mattel are made in China,which specializes in low-cost manufacturing. Many Western companies like Mattel do business inChina to keep costs down. In 2007, however, Mattel had to recall many toys made in China becausethey were faulty and dangerous. A survey found that almost 40% Of British consumers are now lesslikely to buy Chinese-made toys because Of these product recalls.Although Mattel expects the Chinese manufacturers to comply with its safety and quality assurancestandards, the Chinese government plays only a limited role in supervising factories. As a result,Mattel itself must be responsible for checking safety and quality standards in factories it doesnot own.Some Western firms doing business in China believe they have a social responsibility to ensure theysell toys which meet safety and quality standards. However, many Western managers working inChina say top management in Europe or America Often do not want to hear about the problems butjust want to source cheap products.Many business analysts believe that the Chinese focus on high-volume, low-cost manufacturingworked well in the initial phase Of the country’s economic expansion. They argue that Chinese firmsshould now focus on quality, otherwise China’s economic growth will suffer. This trend has begunwith the emergence Of Chinese companies, competing at higher levels Of technology and takingadvantage Of economies of scale. These companies may have branches and factories overseas.[Source: adapted from “Plenty ofblame to go around The Economisl, 27 September 20071(a)(b)(c)(d)Define the term quality assurance.Distinguish between two different views that firms, such as Mattel, may take Oftheir social responsibility in an international context.Examine one opportunity and one threat for Mattel in doing business in China.Discuss two possible areas Of conflict between Mattel’s stakeholders that mayarise from doing business in China.[2 marks][6 marks][5 marks][7 marks]

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