Multiple Choice Questions
1. Structural activities would include all of the following except:
a. Organizing the workforce into teams
b. Deciding to build a new manufacturing facility
c. Deciding where to locate a new retail store
d. All of the above are structural activities.

2. Organizational activities would include all of the following except:
a. Deciding how many suppliers to use
b. Processing purchase orders
c. The degree of decentralization in a company
d. Deciding how employees will be trained, organized, and utilized

3. An example of an operational activity is:
a. Organizing equipment in manufacturing cells in a JIT environment
b. Deciding on the size of an inventory warehouse
c. Inspecting parts as they are received
d. Deciding how many employees to hire

4. The primary goal of supply-chain management is best described as:
a. To reduce the costs of components and parts purchased from suppliers
b. To require suppliers to share a greater burden for managing inventory
c. To improve the quality of components and parts purchased from suppliers
d. To build long-term relationships that increase the profitability of both buyers and sellers

5. Customer relationship management (CRM) can be used to:
a. Determine the needs of customers
b. Identify customers that are not profitable
c. Develop new products
d. Identify cost savings
e. All of the above

6. The process dimension of activity-based management focuses on:
a. What, why, and how activities are performed
b. Tracing resources to activities
c. Identifying activities
d. Tracing costs to cost objects

7. Which of the following statements regarding value-added and non-value-added activities is false?
a. To be competitive, companies must strive to eliminate non-value-added activities.
b. Companies that have successfully implemented just-in-time programs are able to minimize or control non-value-added costs.
c. Companies that have successfully implemented total quality management programs often can significantly reduce non-value-added costs by increasing quality inspections.
d. Each of the above statements is correct.

8. Of the following processes, which is not commonly found in the “performance focus” stage of the activity-based management life cycle?
a. Connecting costs with performance measures
b. Emphasizing performance improvement
c. Evaluating the value received from company investments
d. Developing a detailed understanding of costs