The Theory of Constraints (TOC) Approach Is Strategically Important in Dynamic

question 58

Multiple Choice

The theory of constraints (TOC) approach is strategically important in dynamic markets because it leads to:

• A) A more responsive and flexible manufacturing environment.
• B) Better customer relationships.
• C) Quicker data accessibility.
• D) Faster setup times.

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Definitions:

Cash Break-even

The point at which a business's cash expenses equal its cash revenues, resulting in no net cash flow.

Accounting Break-even

The point at which total revenues equal total expenses, indicating no profit or loss from operations.

Financial Break-even

The point at which total revenues equal total costs and expenses, leaving no net profit or loss from a financial perspective.

IRR

Internal Rate of Return; a financial metric used in capital budgeting to estimate the profitability of potential investments.