Which of the Following Is True About Lean Thinking

question 177

Multiple Choice

Which of the following is true about lean thinking?

• A)Customer orders drive the production process.
• B)Inventory levels are maintained at high levels.
• C)Raw materials are purchased in large quantities.
• D)Finished goods are produced ahead of customers' orders to protect against running out of finished goods inventory.

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Definitions:

Trading Possibilities Line

A line that shows the different combinations of two products that an economy is able to obtain (consume) when it specializes in the production of one product and trades (exports) it to obtain the other product.

Cost Ratios

These ratios compare different types of costs to each other or to sales in order to evaluate a company's financial efficiency and profitability.

Constant Costs

Costs that do not change in total with the level of activity or production volume, within a certain range of activity or period of time.

Domestic Real Cost

The actual economic cost of production or acquisition, factoring in domestic purchasing power and excluding the effects of inflation.