A Traditional Department Store with a Small Catalog Division Has

question 5

Multiple Choice

A traditional department store with a small catalog division has decided to set performance standards for its telephone-based order takers based on intensively studying the operations of L.L.Bean and Lands' End.This strategy is an example of ________.

• A) scenario analysis
• B) gap analysis
• C) benchmarking
• D) variance analysis

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Definitions:

Specialization

The process of focusing effort and resources on a limited number of activities, goods, or services to gain a comparative advantage in production.

Decreasing Returns To Scale

Long-run average total cost increases as output increases (also known as diseconomies of scale).

Economies Of Scale

The cost advantages that enterprises obtain due to their scale of operation, typically resulting in cost per unit of output decreasing with increasing scale.

Diminishing Returns

A principle stating that if one input in the production of a commodity is increased while all other inputs are held fixed, a point will eventually be reached at which additions of the input yield progressively smaller, or diminishing, increases in output.