IGCSE, A Level Business Student Forum

Q2 Differentiate between labour intensive & capital-intensive businesses. [4]

Possible Structure:
[KN] Core feature of labour v/s capital intensive
[AN] Its impact on business
[KN] Core feature of labour v/s capital intensive
[AN] Its impact on business

[kn] the production process relies on human labor rather then machinery or capital and whereas in capital intensive production heavily require on machinery to perform specific task that would other wisebe done by human labor
[an] business opted for labor in tensive ma benefit from lower initial setup cost as hey dont have to invest in heavy ,machinery and also labor is also more flexible and adaptable to changes in production cost
[kn] the capital investment is comparatively low compare to hiring and training of large force and capital intensive has high investment due to purchases of heavy machinery
[an] thus in capital intensive it lead to higher productivity and also reduces th cost of labor and make wok efficient and there is always be a quality control in capital intensive

[KN] Labor-intensive means using a lot of people to get work done by hand, while capital-intensive means relying more on machines and technology and less on people.
[AN] The production method's choice between labor and capital intensity directly shapes business costs, efficiency, and competitiveness, impacting overall profitability and adaptability.

[KN] Labor-intensive production tends to be more flexible and adaptable to changing demands, while capital-intensive production offers higher efficiency and scale but may be less adaptable.
[AN] The choice between labor-intensive and capital-intensive methods affects a business's adaptability to market changes, with labor-intensive being more flexible but capital-intensive offering efficiency and scale advantages.