A systematic appraisal of the design,quality,and performance requirements of a product to reduce purchasing costs is referred to as
A)cost analysis.
B)a make-buy decision.
C)value analysis.
D)procurement analysis.
E)a buy class decision.

Question

Quizplus · Accepted Answer

The systematic appraisal of the design, quality, and performance requirements of a product to reduce purchasing costs is referred to as value analysis. This process involves analyzing the functionality of a product and evaluating alternative materials or manufacturing methods to achieve the same function at a lower cost. Cost analysis and procurement analysis may be a part of the value analysis process, but they do not encompass all aspects of it. Make-buy decision and buy class decision are not directly related to the process of cost reduction through analysis.

A Systematic Appraisal of the Design,quality,and Performance Requirements of a Product