Exam 4: Cost Advantage

Explain why a learning curve is more complex than a scale curve.

Blaze Corp., a car company, shared its costs of producing cars.It did so by introducing the production of car accessories that are used by customers to upgrade or customize their cars.Blaze Corp.started selling car accessories such as engine oils, wheels, and music player and thus shared its market research costs between cars and car accessories.This led to a definite decrease in the overall cost of production.This scenario best illustrates _____.

The expenses and taxes that are directly related to the wide-ranging operation of a company best define the term _____.

Li, the president of Lavender Inc., believes that when employees are trained, they should work on one particular task till they know how to perform it perfectly.Thus, the employees are usually encouraged to repeatedly perform their designated tasks.Li claims that the more an employee engages in a particular task, the more skilled he or she will become at it.Which of the following statements strengthens Li's belief?

In a recent presentation by the management of Seas Inc., the presenters conducted a discussion with a pictorial chart on the cumulative units of production of the company and its correlation with the cost per unit of the product.Which of the following charts did the presenters of Seas discuss?

Orange Superstore is largely customer centric and economical in its methods.The store sells the best quality products at prices that are lower than other stores.The store depends on the fact that its salespeople get better at completing their tasks over time.This method used by Orange Superstore is an example of _____.

Breaking a large process into smaller elements that require specialized knowledge is known as _____.

String Line Inc.has established a loyal supplier base.The management at String Line had created a system in which it chooses a supplier that is reasonably affordable, and instead of quoting the company's price and demanding that it be met, it complies with the supplier's quotes.Over time, this has established a bond of loyalty with the supplier.When String Line opened a new branch, the supplier built its plant close to the branch so as to save transportation costs.Which of the following has String Line Inc.established with the supplier?

Which of the following statements is true of a company's general and administrative costs (G&A)?

Which is an important source of proprietary knowledge?

Turbine Industries breaks down its manufacturing process into smaller segments that are performed by employees who are trained very well.This also helps the firm to save time because this way the employees do not need to juggle between various tasks.This scenario best illustrates _____.

Mercury Corp., a startup company, is sure that it will achieve a steep curve of 75 percent as it is selling a unique product that has not been introduced into the market before.The company is confident that this product will be sold at a fast rate due to two reasons: the product is a necessity in every home and it is a break-through solution.Mercury sees this product as helping the company grow at a fast pace.Which of the following strategies has Mercury Corp.adopted?

Which of the following is a primary characteristic of employing automated equipment in a company with high levels of production?

Five Checkers Inc.has been able to purchase more supplies for less money than its competitors.Five Checkers makes use of a set of communication skills that create compromising deals with its suppliers.Sound reasons are stated by Five Checkers to show why the suppliers must reduce their prices.The reasons are accepted by the suppliers and thus have helped increase profits for Five Checkers Inc.In this scenario, Five Checkers Inc.used _____.

Indigo Inc.experienced a drop in the price of each product as the overall volume of production increased.This relationship or method caused an increase in profits accrued by the company.This is an example of the _____.

Suppose a garment manufacturer named Vogue Inc.buys materials from another country that is well known for its cotton and silk exports.Recently, the currency of this country fell, which enabled Vogue Inc.to purchase more raw materials.Vogue Inc.achieved cost advantage through _____.

Ming Gardens Corp., an interior design company, is solely owned by Veronica.The company has been able to achieve competitive advantage due to the knowledge acquired by Veronica over the years.This knowledge was attained under the protective custody of Veronica and she does not want to publish them to anyone.This scenario reflects the development of _____.

A reduction in costs per unit due to increases in efficiency of production as the number of goods being produced increases best defines the term _____.

Which of the following is a feature of task specialization?

A group of students studying a firm named Sanders & Collins Corp.found that the workers initially learned their task-related activities very fast.In turn, this helped the firm reduce the labor cost incurred in producing each product.However, their rate of learning these tasks reduced over time.This scenario best illustrates the _____.