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Transcription of this question: 4.The case study for Henri’s MBA contains additional information on TM:TMs competitive advantage is achieved through its innovative computerized kanbansystem. This enables TMto achieve many efficiencies. TM aims to operate on ajust-in-time (JIT) basis.TM uses many suppliers. TM has taken advantage of China’s move towards a marketeconomy and now many of TMs suppliers are located in China. This helps TMtomaintain competitive advantage through lower prices, but makes it more difficult toachieve effective quality control. It also outsources production to other low-cost countries.This helps TMto establish new markets and identify new products to develop.Henri studies the TM case study further. He is outraged by what he reads:TMs Chief Executive Officer (CEO) earns 250 times more, per year, than a salesperson.Financial rewards for senior management are very high: in addition to shares, they aregiven profit-related pay, performance-related pay (PRP) and fringe payments (perks).Despite being one of the most profitable businesses in the world, most employees at TMhave not had a pay rise for three years despite increasing sales.Shareholders made significant retums on investments.(a)(b)(c)(d)Define the term quality control.Explain two reasons why just-in-time (JIT) lean production might be useful to TMExplain two factors that demotivate employees at TMAt the next evening class, Henri and his class talk about the financial information thatthe tutor has provided (line 86). The students create the following tables:[2]Gross profit margin (%)Net profit margin (%)Inventory/stock tumover (number oftimes per year)Debtor days ratio (number of days)Creditor days ratio (number of days)Current ratioAcid-test/quick ratioGearing ratio (%)201519.10.9As at December 201514.824.661.50.6028201424.75.6As at December 201413.521.241.721.3526Using the tables above and any other information, discuss two possible strategies thatTM could use to improve its financial ratios.[10]

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