Question 1

The purpose of break-even point analysis is to improve the control and leadership abilities of managers.

Accepted Answer

The purpose of break-even point analysis is to help managers make informed decisions about pricing, costs, and profits. While this information can be useful in improving control and leadership abilities, that is not the primary purpose of break-even point analysis.

Question 2

Inventory control by economic order quantity orders replacements whenever inventory level falls to a predetermined point.

Accepted Answer

Economic Order Quantity (EOQ) is a formula used in inventory management to determine the optimal order quantity that minimizes the total costs of holding inventory and ordering. It involves ordering replacements when inventory levels fall to a predetermined reorder point, ensuring an efficient balance between holding costs and ordering costs.

Question 3

The value chain is the specific sequence of activities that creates goods and services with value for customers.

Accepted Answer

This statement accurately describes the value chain as a series of activities that add value to a product or service for the customer.

Question 4

Just-in-time scheduling minimizes inventory by outing materials to workstations "just in time" to be used.

Accepted Answer

Just-in-time scheduling is a production strategy that aims to minimize inventory by delivering materials to workstations only when they are needed for production. This helps to reduce waste and improve efficiency in the production process.

Question 5

Some of the areas linked in supply chain management include purchasing, manufacturing, transportation, and distribution.

Accepted Answer

Supply chain management includes activities related to purchasing raw materials, manufacturing goods, transporting products, and distributing them to customers.

Question 6

Typical value chain support activities are procurement and human resource management.

Accepted Answer

Procurement and human resource management are two common examples of support activities in a value chain. Other examples include technology development, infrastructure, and firm-level infrastructure.

Question 7

Break-even point is where revenues equal costs.

Accepted Answer

The break-even point is the point at which revenues equal total costs, including both fixed and variable costs.

Question 8

Value creation is the end result of a task or activity that is worth more in terms of eventually delivering a product or service with higher customer appeal than was the case in the beginning.

Accepted Answer

Value creation involves creating something that is of greater value than what was originally put in, resulting in a product or service that is more appealing to the customer.

Question 9

Just-in-time scheduling is used by lazy managers who cannot be bothered to create schedules too far in advance.

Accepted Answer

Just-in-time scheduling is a methodology used to create schedules based on the current demand and availability of resources, rather than creating schedules far in advance. This approach is often used in situations where demand is highly variable, such as in service industries or manufacturing. It requires careful planning and management, and is not a reflection of lazy management.

Question 10

Value chain management attempts to manage each step of the input-through-output process for maximum efficiency and effectiveness.

Accepted Answer

Value chain management focuses on optimizing every step of the process from raw material acquisition to final delivery to the customer.

Question 11

The purpose of inventory control by economic order quantity is to improve productivity.

Accepted Answer

The economic order quantity (EOQ) model is a method of determining the optimal quantity of inventory to order in order to minimize the total costs associated with ordering and holding inventory. By using EOQ, businesses can avoid overstocking and stockouts, which can lead to increased productivity and efficiency. Therefore, inventory control by economic order quantity can indeed improve productivity.

Question 12

Long-linked technology processes must have interdependent tasks in order to be effective.

Accepted Answer

Long-linked technology processes involve a sequence of tasks that are dependent on one another, meaning that they have interdependencies. Without interdependent tasks, the process cannot be effective.

Question 13

Break-even analysis calculates the point at which revenues cover costs under different "what-if" conditions.

Accepted Answer

Break-even analysis is used to determine the amount of sales or revenue that will cover the costs of a business. It can be used to analyze the impact of changes in sales volume, price, or costs on the break-even point.

Question 14

Value chain management includes only primary activities and excludes support activities.

Accepted Answer

Value chain management includes both primary activities (such as production, marketing, and sales) and support activities (such as human resources, technology, and procurement).

Question 15

Value chain management is the specific sequence of activities that creates products and services with value for customers.

Accepted Answer

Value chain management involves a series of activities that add value to a product or service, from raw materials to the final product delivered to the customer. It helps in identifying the most effective ways to deliver value to customers while minimizing costs and maximizing profits.

Question 16

Resources and materials flow in → materials received and organized for use → people and technology create products → finished products distributed → customers served is an illustration of a value chain.

Accepted Answer

This is a correct illustration of a value chain, which shows the flow of resources, materials, people, and technology in creating and distributing finished products to customers.

Question 17

Supply chain management links all operations dealing with resource supplies strategically.

Accepted Answer

Supply chain management involves managing and coordinating all activities related to the sourcing, procurement, conversion, and logistics of resources, products or services. It requires a strategic approach to ensure that all operations are aligned with the organization's goals and objectives.

Question 18

The coordination and centralization of purchasing within a company is done to achieve supply chain management efficiencies.

Accepted Answer

Centralizing and coordinating purchasing within a company helps to streamline the procurement process, reduce costs, and improve supplier relationships, all of which contribute to improved supply chain management efficiencies.

Question 19

The goals of supply chain management are to achieve efficiency in all aspects of the supply chain while ensuring on-time availability of quality resources and products.

Accepted Answer

This statement accurately reflects the goals of supply chain management. The ultimate objective is to optimize the entire process, from sourcing the raw materials to delivering the finished product to the end customer, in a way that maximizes efficiency and quality. This includes managing inventory levels, reducing costs, minimizing waste, improving communication and collaboration with all parties involved, and ensuring timely delivery of goods and services.

Question 20

Efficiency is not a major issue in the value chain.

Accepted Answer

Efficiency is a critical factor in the value chain as it aims to minimize waste, reduce costs, and maximize output, resulting in increased profits.

Quiz 19: Operations and Services Management