MBA 705: Exam 3
Capital-Labor Substitution: - correct answer ✔ ✔ An organization's
ability to substitute labor for capital or vice versa as production
increases.
Experience Curve: - correct answer ✔ ✔ ncreases. Experience
Curve: The reduction in per-unit costs that occur as an organization
gains experience producing a product or service.
Functional Strategies: - correct answer ✔ ✔ The strategies pursued
by each functional area of a business unit, such as marketing, finance, or
production.
Human Capital: - correct answer ✔ ✔ The sum of the capabilities of
individuals in an organization.
,Just-In-Time (JIT) Inventory System: - correct answer ✔ ✔ An
inventory system, popularized by the Japanese, in which suppliers
deliver parts just at the time they are needed by the buying organization
to use in its production process.
Knowledge Management: - correct answer ✔ ✔ People and their
skills and abilities (i.e., knowledge capital) represent the only resource
that cannot readily be reproduced by a firm's competitors. Knowledge
capital must be effectively leveraged if high-performing firms are to
remain as such over the long term.
Learning: - correct answer ✔ ✔ The increased efficiency that occurs
when an employee performs a task repeatedly.
Process R & D: - correct answer ✔ ✔ R & D activities that seek to
reduce the costs of operations and make them more efficient.
Product/Service R & D: - correct answer ✔ ✔ R & D activities
directed toward improvements or innovations in the quality or
uniqueness of a company's outputs.
Total Quality Management (TQM): - correct answer ✔ ✔ A broad-
based program designed to improve product and service quality and to
increase customer satisfaction by incorporating a holistic commitment to
quality as seen through the eyes of the customer.
, Because functional strategies should be designed to support corporate
and business strategies, they should not be considered until corporate
and business strategies have been formulated.
True or False - correct answer ✔ ✔ False.
Although functional strategies are formulated after the corporate and
business strategies have already been established, one still needs to
consider the capabilities of the various functional areas when
considering various corporate and business strategic options.
The most appropriate means of securing funds likely depends on the
corporate and business strategies being pursued.
True or False - correct answer ✔ ✔ True.
Some forms of raising capital tend to be more effective than others,
depending on the strategy.
The reduction in per-unit costs that occurs as an organization gains
experience producing a product or service is known as economies of
scale. Economies of scale is one of the contributing factors to the
experience curve.
Capital-Labor Substitution: - correct answer ✔ ✔ An organization's
ability to substitute labor for capital or vice versa as production
increases.
Experience Curve: - correct answer ✔ ✔ ncreases. Experience
Curve: The reduction in per-unit costs that occur as an organization
gains experience producing a product or service.
Functional Strategies: - correct answer ✔ ✔ The strategies pursued
by each functional area of a business unit, such as marketing, finance, or
production.
Human Capital: - correct answer ✔ ✔ The sum of the capabilities of
individuals in an organization.
,Just-In-Time (JIT) Inventory System: - correct answer ✔ ✔ An
inventory system, popularized by the Japanese, in which suppliers
deliver parts just at the time they are needed by the buying organization
to use in its production process.
Knowledge Management: - correct answer ✔ ✔ People and their
skills and abilities (i.e., knowledge capital) represent the only resource
that cannot readily be reproduced by a firm's competitors. Knowledge
capital must be effectively leveraged if high-performing firms are to
remain as such over the long term.
Learning: - correct answer ✔ ✔ The increased efficiency that occurs
when an employee performs a task repeatedly.
Process R & D: - correct answer ✔ ✔ R & D activities that seek to
reduce the costs of operations and make them more efficient.
Product/Service R & D: - correct answer ✔ ✔ R & D activities
directed toward improvements or innovations in the quality or
uniqueness of a company's outputs.
Total Quality Management (TQM): - correct answer ✔ ✔ A broad-
based program designed to improve product and service quality and to
increase customer satisfaction by incorporating a holistic commitment to
quality as seen through the eyes of the customer.
, Because functional strategies should be designed to support corporate
and business strategies, they should not be considered until corporate
and business strategies have been formulated.
True or False - correct answer ✔ ✔ False.
Although functional strategies are formulated after the corporate and
business strategies have already been established, one still needs to
consider the capabilities of the various functional areas when
considering various corporate and business strategic options.
The most appropriate means of securing funds likely depends on the
corporate and business strategies being pursued.
True or False - correct answer ✔ ✔ True.
Some forms of raising capital tend to be more effective than others,
depending on the strategy.
The reduction in per-unit costs that occurs as an organization gains
experience producing a product or service is known as economies of
scale. Economies of scale is one of the contributing factors to the
experience curve.
