The Theory of Constraints Identifies Bottlenecks and Possible Disruption That

question 41

Multiple Choice

The theory of constraints identifies bottlenecks and possible disruption that threatens throughput.When disruptions are hard to pinpoint or eliminate,managers may utilize which of the following techniques?

• A)quality control techniques from Total Quality Management.
• B)quantity control techniques from Total Quantity Management.
• C)price control techniques from Total Price Management.
• D)cost control techniques from Total Cost Management.

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Definitions:

Contribution Margin

Contribution margin represents the amount by which sales revenue exceeds variable costs, indicating how much revenue is contributing to covering fixed costs and generating profit.

Net Income

The net income of a business following the deduction of all taxes and expenses from its overall revenue.

Degree of Operating Leverage

A financial ratio that measures the sensitivity of a company's operating income to its sales volume, indicating how a change in sales will affect profits.

Net Income

The total profit of a company after all expenses, including taxes and operating costs, have been subtracted from total revenue.