Question 1

The concept of economies of scale tells us that as plant output expands,unit costs decrease.

Accepted Answer

A) True 
 B)False

Question 2

Six Sigma refers to a statistically based philosophy that aims to:

Accepted Answer

A)   increase defects.
B)   lower productivity.
C)   increase the costs of value creation.
D)   eliminate waste.
E)   increase cost per unit.

Question 3

The drawback of a just-in-time inventory system is that it:

Accepted Answer

A)   increases the total capital required by a firm.
B)   leaves a firm without a buffer stock of inventory.
C)   increases inventory holding costs, such as warehousing and storage costs.
D)   is less efficient than traditional system in spotting and fixing defective inputs.
E)   lowers a company's profitability as measured by return on capital invested.

Question 4

One way to reduce the risks associated with a global supply chain that operates on just-in-time principles is to:

Accepted Answer

A)   depend on one supplier for an important input.
B)   outsource the production of inputs only to advanced countries.
C)   hold an excess buffer stock of inventory.
D)   source inputs from several suppliers located in different countries.
E)   avoid using electronic data interchange.

Question 5

Flexible machine cells,a flexible manufacturing technology,cannot be used for mass customization.

Accepted Answer

A) True 
 B)False

Question 6

Production and logistics functions must be able to accommodate demands for local responsiveness.Elaborate.

Accepted Answer

Production and logistics functions must ...

Question 7

Which of the following is an objective of logistics?

Accepted Answer

A)   Increase the cost of value creation
B)   Manage firms global supply chain at a low cost
C)   Reduce inventory turnover
D)   Reduce a firm's customer responsiveness
E)   Increase inventory holding costs

Question 8

A _____ includes a grouping of various types of machinery,a common materials handler,and a computer to control the production of a family of parts or products.

Accepted Answer

A)   specialized asset
B)   dynamic capability
C)   turnkey project
D)   flexible machine cell
E)   just-in-time inventory

Question 9

Which of the following is a step taken by automobile companies in situations where either centralization or decentralization of production is not feasible?

Accepted Answer

A)   Outsourcing production to developing countries
B)   Inshoring production into the home country
C)   Selling product patents and technology to competitors
D)   Refraining from international trade
E)   Establishing top-to-bottom manufacturing operations

Question 10

In recent years,time-based competition has lost its importance in international business.

Accepted Answer

A) True 
 B)False

Question 11

A major cost saving from just-in-time inventory systems comes from:

Accepted Answer

A)   a shift in focus away from quality.
B)   increasing productivity of workers.
C)   speeding up inventory turnover.
D)   creating a buffer stock of inventory.
E)   writing off excess unsold inventory against earnings.

Question 12

_____ refers to the activity that controls the transmission of physical materials through the value chain,from procurement through production and into distribution.

Accepted Answer

A)   Promotion
B)   Recruitment
C)   Logistics
D)   Benchmarking
E)   Inshoring

Question 13

Which of the following is a recent trend among international businesses regarding make-or-buy decisions?

Accepted Answer

A)   Foreign facilities are considered nothing more than low-cost production facilities.
B)   Research and design operations are restricted to home-country production facilities.
C)   Manufacturing facilities are being based in each major national market.
D)   Firms are avoiding time-based competition with each other.
E)   Outsourcing decisions are expanding to embrace the production of service activities.

Question 14

A firm with a wide product variety will find it:

Accepted Answer

A)   difficult to achieve shorter product runs.
B)   difficult to increase its product sales.
C)   difficult to reduce its unit costs.
D)   easy to realize economies of scale.
E)   easy to reach optimum production efficiency.

Question 15

To be able to accommodate demands for local responsiveness,a firm should:

Accepted Answer

A)   ignore national differences in consumer tastes and preferences.
B)   decentralize production activities to the major national or regional markets.
C)   ensure that the manufacturing processes in all units are inflexible.
D)   standardize the product coming out of all manufacturing units.
E)   refrain from hiring host country managers.

Question 16

When should a firm concentrate its production facilities in a centralized location?

Accepted Answer

A)   When the production technology has a low minimum efficient scale
B)   When the production technology has low fixed costs
C)   When important exchange rates are expected to remain relatively stable
D)   When flexible manufacturing technologies are not available
E)   When the product's value-to-weight ratio is low

Question 17

Which of the following statements is true of Six Sigma?

Accepted Answer

A)   The higher the number of "sigmas," the higher the number of errors.
B)   At Six Sigma, a production process would be 90 percent accurate.
C)   Six Sigma work standards are based solely on numbers or quotas.
D)   It is almost impossible for a company to achieve Six Sigma perfection.
E)   Six Sigma is the modern successor to ISO 9000.

Question 18

When is decentralization of manufacturing facilities most appropriate?

Accepted Answer

A)   When the product serves universal needs
B)   When exchange rates are expected to remain relatively stable
C)   When the product's value-to-weight ratio is high
D)   When there are few trade barriers
E)   When the production technology has low minimum efficient scale

Question 19

The concept of _____ tells us that as plant output expands,unit costs decrease.One reason is the greater utilization of capital equipment.

Accepted Answer

A)   minimum efficient scale
B)   lean production
C)   Six Sigma
D)   economies of scale
E)   total quality management

Question 20

Flexible manufacturing technologies allow a company to produce a wider variety of end products at a unit cost that at one time could be achieved only through the mass production of a standardized output.

Accepted Answer

A) True 
 B)False

Exam 15: Global Production, Outsourcing, and Logistics

Six Sigma refers to a statistically based philosophy that aims to:

Correct AnswerverifiedShow Answer

When should a firm concentrate its production facilities in a centralized location?

Correct AnswerverifiedShow Answer

Flexible machine cells,a flexible manufacturing technology,cannot be used for mass customization.

Correct AnswerverifiedShow Answer

Which of the following is an objective of logistics?

Correct AnswerverifiedShow Answer

One way to reduce the risks associated with a global supply chain that operates on just-in-time principles is to:

Correct AnswerverifiedShow Answer

Flexible manufacturing technologies allow a company to produce a wider variety of end products at a unit cost that at one time could be achieved only through the mass production of a standardized output.

Correct AnswerverifiedShow Answer

A firm with a wide product variety will find it:

Correct AnswerverifiedShow Answer

_____ refers to the activity that controls the transmission of physical materials through the value chain,from procurement through production and into distribution.

Correct AnswerverifiedShow Answer

The drawback of a just-in-time inventory system is that it:

Correct AnswerverifiedShow Answer

When is decentralization of manufacturing facilities most appropriate?

Correct AnswerverifiedShow Answer

A _____ includes a grouping of various types of machinery,a common materials handler,and a computer to control the production of a family of parts or products.

Correct AnswerverifiedShow Answer

In recent years,time-based competition has lost its importance in international business.

Correct AnswerverifiedShow Answer

Production and logistics functions must be able to accommodate demands for local responsiveness.Elaborate.

Correct AnswerverifiedProduction and logistics functions must ...View AnswerShow Answer

Which of the following is a step taken by automobile companies in situations where either centralization or decentralization of production is not feasible?

Correct AnswerverifiedShow Answer

A major cost saving from just-in-time inventory systems comes from:

Correct AnswerverifiedShow Answer

Which of the following statements is true of Six Sigma?

Correct AnswerverifiedShow Answer

The concept of _____ tells us that as plant output expands,unit costs decrease.One reason is the greater utilization of capital equipment.

Correct AnswerverifiedShow Answer

The concept of economies of scale tells us that as plant output expands,unit costs decrease.

Correct AnswerverifiedShow Answer

Which of the following is a recent trend among international businesses regarding make-or-buy decisions?

Correct AnswerverifiedShow Answer

To be able to accommodate demands for local responsiveness,a firm should:

Correct AnswerverifiedShow Answer

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Production and logistics functions must ...
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