The value chain concept helps companies control costs over the value chain as a whole.

41) The value chain concept helps companies control costs over the value chain as a whole.
Answer:  TRUE
Diff: 1
LO:  2-2
EOC:  S2-3
AACSB:  Analytical Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits

42) Research and development is needed to improve products and to design new products.
Answer:  TRUE
Diff: 1
LO:  2-2
EOC:  S2-3
AACSB:  Reflective Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits

43) Receipt of materials is part of the firm's value chain.
Answer:  TRUE
Diff: 1
LO:  2-2
EOC:  S2-3
AACSB:  Analytical Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits

44) A company's distribution system is an important part of the value chain.
Answer:  TRUE
Diff: 1
LO:  2-2
EOC:  S2-3
AACSB:  Reflective Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits

45) For a merchandising company, the costs of shipping inventory to the retail outlet is associated with which element of the value chain?
A) Design
B) Distribution
C) Production and Purchases
D) Customer Service
Answer:  B
Diff: 1
LO:  2-2
EOC:  S2-3
AACSB:  Reflective Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits

46) All of the following are part of a company's value chain except
A) design.
B) distribution.
C) administration.
D) marketing.
Answer:  C
Diff: 1
LO:  2-2
EOC:  S2-3
AACSB:  Reflective Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits

47) Which of the following activities is not included in the value chain?
A) Reporting
B) Design
C) Production
D) Customer service
Answer:  A
Diff: 1
LO:  2-2
EOC:  S2-3
AACSB:  Reflective Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits
48) All of the following activities are included in the value chain except
A) customer service.
B) design.
C) safety.
D) production.
Answer:  C
Diff: 1
LO:  2-2
EOC:  S2-3
AACSB:  Reflective Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits

49) Which of the following would not be included in the value chain?
A) Website development costs
B) Costs to deliver product to retail outlets
C) Costs of print advertisements
D) All of these costs would be included as part of the value chain.
Answer:  D
Diff: 2
LO:  2-3
EOC:  S2-4
AACSB:  Reflective Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits

50) The value chain is used by
A) service, manufacturing and merchandising businesses.
B) only service and manufacturing businesses.
C) only service and merchandising businesses.
D) only manufacturing and merchandising businesses.
Answer:  A
Diff: 2
LO:  2-2
EOC:  S2-3
AACSB:  Reflective Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits