Which of the following is not one of the four principles of bottleneck management?
Release work orders to the system at the bottleneck’s capacity pace.
Lost time at the bottleneck is lost system capacity.
Increasing capacity at non-bottleneck stations is a mirage.
Increased bottleneck capacity is increased system capacity.
Bottlenecks should be moved to the end of the system process.
TOC was popularized by
Goldratt and Cox
E) Motorola and GE
TOC strives to reduce the effect of constraints by
offloading work from constrained workstations
increasing constrained workstation capability
changing workstation order to reduce process cycle time
A and B
A, B, and C
Break-even is the number of units at which
total revenue equals price times quantity
total revenue equals total variable cost
total revenue equals total fixed cost
total profit equals total cost
total revenue equals total cost
Which of the following statements regarding fixed costs is true?
Fixed costs rise by a constant amount for every added unit of volume.
While fixed costs are ordinarily constant with respect to volume, they can
“step” upward if volume increases result in additional fixed costs.
Fixed costs are those costs associated with direct labor and materials.
Fixed costs equal variable costs at the break-even point.
Fixed cost is the difference between selling price and variable cost.
Which of the following costs would be incurred even if no units were produced?
raw material costs
direct labor costs
building rental costs
Basic break-even analysis typically assumes that
revenues increase in direct proportion to the volume of production, while costs
increase at a decreasing rate as production volume increases
variable costs and revenues increase in direct proportion to the volume of
both costs and revenues are made up of fixed and variable portions
costs increase in direct proportion to the volume of production, while revenues
increase at a decreasing rate as production volume increases because of the
need to give quantity discounts
All of the above are assumptions in the basic break-even model.
Fabricators, Inc. wants to increase capacity by adding a new machine. The fixed
costs for machine A are $90,000, and its variable cost is $15 per unit. The
revenue is $21 per unit. The break-even point for machine A is
cannot be calculated from the information provided
A fabrication company wants to increase capacity by adding a new machine. The
firm is considering proposals from vendor A and vendor B. The fixed costs for
machine A are $90,000 and for machine B, $75,000. The variable cost for A is
$15.00 per unit and for B, $18.00. The revenue generated by the units processed
on these machines is $21 per unit. If the estimated output is 5000 units, which
machine should be purchased?
either machine A or machine B
no purchase because neither machine yields a profit at that volume
E) purchase both machines since they are both
Fred’s Fabrication, Inc. wants to increase capacity by adding a new machine.
The firm is considering proposals from vendor A and vendor B. The fixed costs
for machine A are $90,000 and for machine B, $70,000. The variable cost for A
is $9.00 per unit and for B, $14.00. The revenue generated by the units
processed on these machines is $20 per unit. The crossover between machine A and
machine B is
4,000 units, with A more profitable at low volumes
4,000 dollars, with A more profitable at low volumes
4,000 units, with B more profitable at low volumes
4,000 dollars, with B
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