Refrigerator Adaptations (Scenario) Cold-Aire Inc. Manufactures Refrigerators from Its Facilities in the United

question 19

Multiple Choice

Refrigerator Adaptations (Scenario)
Cold-Aire Inc. manufactures refrigerators from its facilities in the United States and China and ships them to retail stores around the world. Kitchen sizes vary around the world, and as a result, refrigerator sizes must vary as well. U.S. retailers want large refrigerators, while European and Asian retailers demand smaller units. Cold-Aire manufactures over 20 different models of refrigerators, which often vary in size by only a few inches. Cold-Aire managers are concerned that the firm is losing money because of product adaptations. Cold-Aire management is meeting to discuss the various cost-saving options for the firm.
-Which of the following best supports Cold-Aire making fewer refrigerator adaptations?

• A) Adaptation caters to local consumer demands.
• B) Standardization reduces manufacturing expenses.
• C) Adaptation establishes a sense of buyer loyalty.
• D) Standardization limits choices available to consumers.

---

Definitions:

Centralization

A system or process where decision-making authority is concentrated in a central body or fewer points within an organization or government.

Unethical Decisions

Actions or choices that do not align with moral or ethical standards.

Lower-level Managers

Managers who oversee the day-to-day operations within an organization, often directly supervising front-line employees.

FSGO

The Federal Sentencing Guidelines for Organizations, a set of standards that guide the sentencing of corporations involved in federal criminal offenses.