Which of the Following Is Not an Advantage of Work

question 103

Multiple Choice

Which of the following is not an advantage of work cells?

• A) reduced direct labor cost
• B) decreased use of equipment and machinery
• C) heightened sense of employee participation
• D) reduced raw material and finished goods inventory
• E) reduced investment in machinery and equipment

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Definitions:

Forecasting Risk

The potential for future revenues or earnings to deviate from projected amounts due to variables that affect demand, supply, and pricing.

NPV Estimates

Calculations used to determine the Net Present Value of an investment, forecasting the difference between the present value of cash inflows and outflows.

Operating Leverage

A measure of how revenue growth translates into growth in operating income, indicating the degree to which a company can increase its profits by increasing sales, given its fixed costs.

Scenario Analysis

A process of analyzing possible future events by considering alternative possible outcomes (scenarios), thus helping in the decision-making process.