B6 Flashcards
Product-quality-related costs are part of a total quality control program. A product-quality-related cost incurred in detecting individual products that do not conform to specifications is an example of a(n):
internal failure cost, appraisal cost, external failure cost, prevention cost
appraisal cost
appraisal costs would detect individual products that do not conform to specifications. Examples: statistical quality checks, inspections, testing, maintenance of lab
Which of the following is an example of prevention costs?
Redesign of processes, tooling changes, testing, lost customers
Redesign!
Testing is an APPRAISAL cost NOT PREVENTION
Which of the following is NOT a characteristic of TQM?
continuous improvement, customer focus, waste reduction, quality circles
Waste reduction - it is more of a lean manufacturing quality not TQM
Unlike business process reengineering, business process management:
has a longer implementation time, seeks radical change, seeks incremental change, increases the financial risk associated with the change
Seeks incremental change - business process management seeks incremental change by tweaking the existing process and design
A manufacturer that wants to improve its staging process compares its procedures against the check-in process for a major airline. Which of the following tools is the manufacturer using?
economic value-added, benchmarking, statistical process control, total quality management
Benchmarking
Benchmarking is a process where a company compares itself to peers to measure performance and to understand where improvements can be made in its processes
Which of the following is least likely to be a major process carried out by a project manager?
authorization, planning, selecting improvement initiatives, closing
Selecting improvement initiatives - this is a component of PROCESS management, not project management
Which of the following is a role of the project sponsor?
a. responsibility for overall project delivery
b. develop, implement, monitor, control, and end the plan when plan objectives have been met
c. communicate project needs to the board of directors
d. communicate project metrics to stakeholders and team members
A - the project sponsor is an individual at the executive level of management who is responsible for allocating funding and resources to the project. the role of the project sponsor includes responsibility for overall project delivery
Globalization is often measured using the following statistic:
a. shifts in global supply and demand curves
b. world trade growth as a percentage of GDP
c. exports as a percentage of imports
d. exchange rate velocity
B!!
NAFTA offers trading partners operating within its boundaries reductions in tariffs on products in exchange for compliance with limits on imported labor and materials used in the manufacture of those products. this practice is also known as a:
international rebate, value added tax, sourcing requirement, foreign trade zone
sourcing requirement
sourcing requirements generally refer to content or value added limits on the percentage of labor or materials used in import products. compliance with limits may result in tariff reductions
if an investor’s certainty equivalent is greater than the expected value of an investment alternative, the investor is said to be:
cautious, risk indifferent, risk averse, risk seeking
RISK SEEKING
What would be the primary reason for a company to agree to a debt covenant limiting the percentage of its long-term debt?
a. to lower the company’s bond rating
b. to reduce the coupon rate on the bonds being sold
c. to cause the price of the company’s stock to rise
d. to reduce the risk for existing bondholder’s
b.
the primary reason for a company to agree to a debt covenant limiting the percentage of its long-term debt is to reduce the coupon rate on NEW bonds being sold. a debt covenant is a provision in a bond indenture (contract between the bond issuer and the bond holders) that the bond issuer will either do (affirmative covenants) or not to (negative covenants) certain things. in this question, the issuer would agree not to issue bonds in the future over a certain percentage of its long-term debt. such a provision would be good for hte potential bondholders and would probably reduce the coupon rate on the bonds being sold
Which of the following types of bonds is most likely to maintain a constant market value?
zero-coupon, floating-rate, convertible, callable
floating-rate
Floating rate bonds would automatically adjust the return on a financial instrument to produce a constant market value for that instrument. no premium or discount would be required since market changes would be accounted for through the interest rate
