Home » Learning Zone » Business Studies » Production and Operations Management: Test 2 - Question Bank

Production and Operations Management: Test 2 - Question Bank

Question Bank ''Production and Operations Management: Test 2'' with interactive revision questions on a variety of business topics.

Question Bank - Business Studies

Production and Operations Management: Test 2

Q1. Which of the following is NOT a sign that labour shortages are hitting a company.

(Select one answer)

(a) * The need to outsource part of its production.
(b) * A lack of accurate records as to staff training.
(c) * The introduction of university place sponsorship.
(d) * An increase in basic rates of pay for current employees.

Source: bized

Q2. External economies of scale are

(Select one answer)

(a) * savings that are made possible by outside agencies.
(b) * savings that can be made in distribution and selling.
(c) * savings that are available to a firm as a result of the concentration of an industry in a region.
(d) * savings that can be made in export markets only.

Source: bized

Q3. All of the following are justifications for holding large stocks of raw materials, except

(Select one answer)

(a) * the seasonal supply of materials such as coffee beans or even garden peas.
(b) * in anticipation of a future shortage and rapid rise in price.
(c) * large quantities are available on the market.
(d) * to take advantage of significant bulk buying reductions.

Source: bized

Q4. Which of the following are NOT a benefit thought to accompany the introduction of technology.

(Select one answer)

(a) * Improved efficiency and reductions in waste.
(b) * Increased strains in industrial relations.
(c) * The introduction of new and better products.
(d) * Advances in communication.

Source: bized

Q5. The opportunity cost to a business of an investment is

(Select one answer)

(a) * the amount of capital that has to be borrowed to be able to make the investment.
(b) * the cost of all the fixed assets that are to be purchased.
(c) * the next best investment now foregone.
(d) * the amount by which the project will have risen due to inflation, on a monthly basis.

Source: bized

Q6. When a firm in the secondary sector of the economy takes over a related business in the tertiary sector, this is an example of

(Select one answer)

(a) * horizontal integration.
(b) * backward integration.
(c) * Forward vertical integration.
(d) * Forward horizontal integration

Source: bized

Q7. A bank takes over a fishing company, a steel works, a vegetable processing firm and an airline. This is an example of

(Select one answer)

(a) * forward integration
(b) * a firm becoming a conglomerate.
(c) * horizontal integration.
(d) * company mergers.

Source: bized

Q8. Cell production is the modern production method where

(Select one answer)

(a) * buildings are made from prefabricated units, or cells.
(b) * production is done in small rooms.
(c) * the output from the Prison Service factories.
(d) * production on assembly lines is managed and run by groups of workers who are responsible for the quality of their work.

Source: bized

Q9. The long-run for a company is when

(Select one answer)

(a) * the scale of production itself, and thus capacity can be increased.
(b) * 5 years
(c) * the time it takes to buy and install new plant.
(d) * the time interval between the payment of a firms fixed costs.

Source: bized

Q10. In the interests of efficiency and obtaining more economies of scale, two firms agree to join together and become one. This is an example of a

(Select one answer)

(a) * hostile take-over
(b) * hostile merger.
(c) * friendly merger.
(d) * friendly take-over.

Source: bized

Q11. A firm can be considered to be efficient when it

(Select one answer)

(a) * is producing its product or service at the lowest possible average cost.
(b) * is fully utilising its capacity.
(c) * has minimised the amount of waste that it produces.
(d) * employs the maximum number of workers.

Source: bized

Q12. The short-run for a company is

(Select one answer)

(a) * one month, being the payment base for salaries.
(b) * the period where output can only be changed by altering the utilisation of existing plant and equipment.
(c) * the time it takes to terminate staff.
(d) * when it is working on a short-time basis.

Source: bized

Click to view your total score for all the above questions that you have attempted.

Contents | Previous | Next