Q1 required candidates to prepare an independent report which assessed and appraised the two options from a strategic perspective. The report needed to allow the board of Nehby to compare and contrast the two options.

Many candidates extracted information from the case, but failed to explain how the information would inform the strategic decision. A number of candidates explained the evidence in relation to the decision, but only considered a limited amount of criteria and needed to develop the discussion in depth. Some candidates failed to consider the financial information they were given about NPV/payback, which should be a fundamental starting point for aninvestment decision. The question also required reasonably even treatment of the two options, but some candidates wrote much more about one than the other.

In the main most candidates attempted the required report format. Many lacked an introduction and summary. Although the question did not ask for a recommendation, a summary to a report would be normal business practice. It was also disappointing that many candidates did not make it easy to compare and contrast which is specific in the requirement. A point by point comparison of the two options is the clearest way to bring out differences between them.