MTP Corporation Has Performed a Value-Added Analysis of Costs for Three

question 35

Multiple Choice

MTP Corporation has performed a value-added analysis of costs for three business processes. The costs were classified on a three-point scale, where Level One represented activities with the greatest value added. The results are shown below: $$\begin{array} { c r r r } & \text { Process A } & \text { Process B } & \text { Process C } \\\% \text { of costs at Level 1 } & 51 \% & 46 \% & 36 \% \\\% \text { of costs at Level 2 } & 23 \% & 16 \% & 17 \% \\\% \text { of costs at Level 3 } & 26 \% & 38 \% & 47 \% \\ \text { Total }& 100 \% & 100 \% & 100 \% \\\end{array}$$
-Based on the value-added analysis, which of the following statements is / are true: (i) Process A does not need any changes since more than half its costs are value-added, (ii) Process C should be abandoned since almost half its costs are non-value added.

• A) I only
• B) II only
• C) Both I and II
• D) Neither I nor II

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Definitions:

Probability

A value ranging from 0 to 1 that denotes the probability of an event's occurrence.

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Achieving victory or success in a contest, conflict, or endeavor.

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Annual Rates

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