Refer to the Scenario Below to Answer the Following Questions

question 139

Multiple Choice

Refer to the scenario below to answer the following questions.
Improving Service Standards at AirCargo (Scenario)
AirCargo is a regional airline that ships freight between communities in the four western provinces and the northern territories. Company president Mick Ward has asked his team of managers to investigate several complaints he has received about the company's services. Mick is particularly concerned about complaints that the company is not achieving its service commitment to customers. AirCargo promises delivery within 24 to 48 hours between larger centres, and 48 to 96 hours between smaller communities. Unfortunately, Mick has learned that the company is not achieving this standard, particularly in some northern communities, where shipments are often delayed by more than a week. Mick has made it clear to his managers that the status quo is not an option; either delivery times must be improved or their service promise must be adjusted. Ultimately, Mick would like to see AirCargo achieve the same standard as industry leader FastFreight, who promise 4
-AirCargo's district manager in Yellowknife advises Mick that some deliveries are delayed because of missed connecting flights. She has examined the situation and believes that the problem can be fixed by adjusting the departure times by one hour. Mick tells her to reschedule the flight times to fix the problem once and for all. This is an example of __________.

• A) revising the standard
• B) taking basic corrective action
• C) taking immediate corrective action
• D) clan control
• E) market control

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Definitions:

Total Variable Costs

The overall expense that changes in proportion to the level of output or production activity.

Output

The total amount of goods or services produced by a company, industry, or economy within a specific period.

Supply Curve

A graphical representation showing the relationship between the price of a good or service and the quantity of that good or service that a supplier is willing and able to supply.

Total Variable Costs

The sum of all costs that vary with the level of output, including materials and labor directly involved in the production process.