# PROB AND S 623 Mid Term PRACTICE ASSIGNMENT 1. All Answers Provided.

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PROB AND S 623 Mid Term PRACTICE ASSIGNMENT 1 1. Award: 10 out of 10.00 points MC Qu. 22 Which of the following is not a basic questi... Which of the following is not a basic question in capa city planning? what kind is needed how much is needed when is it needed *who will pay for it what it will be used for Type, quantity, and timing are the essential elements of the capacity decision. 2. Award: 10 out of 10.00 points MC Qu. 30 Efficiency is defined as the ratio of: Efficiency is defined as the ratio of: *actual output to effective capacity. actual output to design capacity. design capacity to effective capacity. effective capacity to actual output. design capacity to actual output. Efficiency measures the usage of effective capacity. 3. Award: 10 out of 10.00 points MC Qu. 52 For fixed costs of $2,000, revenue per unit ... For fixed costs of $2,000, revenue per unit of $2, and variable cost per unit of $1.60, the break-even quantity is: 1,000. 1,250. 2,250. *5,000. 3,000. Dividing the fixed costs of $2,000 by the per-unit contribution margin of $0.40 leads to a break-even quantity of 5,000 units. References 4. Award: 10 out of 10.00 points MC Qu. 53 Which of the following would not be a potent... Which of the following would not be a potential upside in a decision to outsource? supplier capacity potential to lower fixed costs supplier expertise *knowledge sharing supplier cost Loss of direct control over operations, knowledge sharing, and the possible need to disclose proprietary information are three risks of outsourcing. 5. Award: 10 out of 10.00 points MC Qu. 62 The owner of Firewood To Go is considering b... The owner of Firewood To Go is considering buying a hydraulic wood splitter which sells for $50,000. He figures it will cost an additional $100 per cord to purchase and split wood with this machine, while he can sell each cord of split wood for $125. How many cords of wood would he have to split with this machine to break even? 5,000 3,000 *2,000 1,000 0 Divide the fixed cost of $50,000 by the per-cord contribution margin of $25. 6. Award: 10 out of 10.00 points MC Qu. 64 The owner of Firewood To Go is considering b... The owner of Firewood To Go is considering buying a hydraulic wood splitter which sells for $50,000. He figures it will cost an additional $100 per cord to purchase and split wood with this machine, while he can sell each cord of split wood for $125. If, for this machine, design capacity is 50 cords per day, effective capacity is 40 cords per day, and actual output is anticipated to be 35 cords per day, what would be its utilization? 100 percent 80 percent 75 percent *70 percent 0 percent Divide actual output by design capacity. 7. Award: 10 out of 10.00 points MC Qu. 66 The owner of a greenhouse and nursery is con... The owner of a greenhouse and nursery is considering whether to spend $6,000 to acquire the licensing rights to grow a new variety of rosebush, which she could then sell for $6 each. Per-unit variable cost would be $3. What would the profit be if she were to produce and sell 5,000 rosebushes? $0 *$9,000 $15,000 $10,000 $30,000 Total revenue would be $30,000. Total cost (fixed = $6,000, variable = $15,000) would be $21,000. 8. Award: 10 out of 10.00 points MC Qu. 76 Doctor J. is considering purchasing a new bl... Doctor J. is considering purchasing a new blood analysis machine to test for HIV; it will cost $60,000. He estimates

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