QUESTION One way to reduce the risks associated with a global supply chain that operates on just-in-time principles is to: 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 […]
QUESTION Which of the following is a step taken by automobile companies in situations where neither centralization nor decentralization of production is feasible? 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 Which of the following is the initial reason for the establishment of a foreign production facility? A. Employee turnover is high. B. Products are not labor-intensive. C. Inventory turnover is low. D. Exchange rate fluctuations are high. E. Labor costs are low. ANSWER E
QUESTION A product’s value-to-weight ratio affects location decision primarily because of its influence on: A. transportation costs. B. shelf life. C. work-in-progress inventory. D. inventory turnover. E. capacity utilization. ANSWER A
QUESTION Which of the following is a recent trend among international businesses regarding make-or-buy decisions? 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 […]
QUESTION Two product features impact location decisions. Which of the two reduces the need for local responsiveness? A. The product’s ability to serve universal needs B. The product’s life cycle C. The product’s packaging D. The product’s flexible manufacturing technology E. The product’s value-to-weight ratio ANSWER A
QUESTION Which of the following is a hidden cost to basing production in a foreign location? A. Low employee turnover B. Low labor costs C. Poor product quality D. Expensive higher education system E. Low inventory turnover ANSWER C
QUESTION Technological factors are making it feasible for firms to concentrate manufacturing facilities at optimal locations. The major brakes on this trend are: A. differences in endowment factors. B. transportation costs and trade barriers. C. rising national differences in consumer tastes and preferences. D. growing free trade areas and democracy. E. declining fluctuations in exchange […]
QUESTION If a firm possesses proprietary product technology, the best option for that firm would be to: A. manufacture the product in-house so that it does not lose its competitive advantage. B. outsource the production activities to independent suppliers in order to realize economies of scale. C. merge with competitors to reduce investments on technology. […]
QUESTION Which of the following holds true for products with low value-to-weight ratios? A. They are relatively expensive. B. They do not weigh very much. C. Their transportation costs account for a very small percentage of total costs. D. It is advisable to manufacture them in multiple locations close to major markets. E. Examples of […]
