BSG COMPREHENSIVE EXAM
QUESTIONS & ELABORATED
ANSWERS RATED 100% COMPLETE
Q: Which one of the following is a way to reduce costs and strive to achieve a
competitive advantage based on lower overall costs per pair sold than rival companies?
- Correct Answer ✔✔ A: Striving to keep marketing expenses per branded pair sold to
amounts that are below the industry-high in each region ✓
Q: Which one of the following is most likely to be an effective or attractive profit-
enhancing way to try to reduce total production costs per pair at a particular production
facility? - Correct Answer ✔✔ A: Pursuing actions that will better enable the company to
operate its production facilities at (or very close to) full production capacity, including
maximum use of overtime ✓
Q: The managers of all companies should make a point of examining the production
benchmarks shown on p. 6 of each year's Footwear Industry Report in order to... -
Correct Answer ✔✔ A: determine whether immediate actions need to be taken at one or
more of their company's production facilities to do a better job of managing total
compensation, workforce productivity, production labor costs, spending for TQM/Six
Sigma programs, total production costs, and/or reject rates. ✓
Q: Which one of the following is an advantage of having production facilities to
manufacture athletic footwear in all four geographic regions? - Correct Answer ✔✔ A:
Increased ability to lower expenditures for shipping/freight costs from the company's
production operations to distribution centers in the various regions--this is because
when a company has production operations in all four geographic regions it typically
needs to ship fewer pairs of footwear from production facilities in one region to
distribution centers in a different region ✓
Q: An appealing strategy that a company can use to reduce its exposure to adverse
exchange rate adjustments to the costs of pairs shipped to a distribution warehouse
from a production facility in a different geographic region is to... - Correct Answer ✔✔ A:
invest in sufficient production capacity in each of the four geographic regions to greatly
reduce (maybe even eliminate) the need to ship pairs to a distribution warehouse from a
production facility in a different geographic region--such a strategy has the highly
attractive added benefit of cutting/eliminating tariff payments on imported footwear. ✓
Q: Which one of the following actions is least likely to increase labor productivity by an
amount that is large enough to result in lower labor costs per pair produced at a
particular plant? - Correct Answer ✔✔ A: Increasing total compensation per production
, worker to an amount that is slightly above the industry-average in those regions where
the company has production facilities ✓
Q: The installation of production improvement option D which boosts worker productivity
by 50% by using robots to assist in producing footwear... - Correct Answer ✔✔ A: is a
more economically attractive means for reducing labor costs per pair produced at a
production facility in North America than for a production facility in the Asia-Pacific. ✓
Q: Valid reasons why a company should definitely open a new production facility in
Latin America include... - Correct Answer ✔✔ A: being able to avoid paying import
tariffs on footwear produced and sold in Latin America; moreover, the freight costs on
pairs shipped from a production facility in Latin America to the Latin American
distribution center are lower than the freight costs on pairs shipped from production
facilities outside Latin America to the Latin American distribution center. ✓
Q: Which of the following is a valid reason or strong signal that a company should
consider changing from a low-cost/low-price strategy for branded footwear to a different
strategy? - Correct Answer ✔✔ A: The company's total production costs per branded
pair, distribution and warehouse costs per branded pair available for sale, and branded
costs per pair sold shown on pp. 6-7 of the most recent Footwear Industry Report are
near or above the industry-average (instead of being at or near the industry-low) and, in
addition, many other companies in the industry are selling branded footwear at below-
average prices (which signals that this target market segment may be overcrowded with
competitors). ✓
Q: Production improvement option B (with capital costs of $1.6 million per million pairs
of production capacity and annual depreciation costs of 10%) that reduces production
run setup costs by 50% each year makes the most economic sense in which of the
following circumstances? - Correct Answer ✔✔ A: Company managers expect to
produce 350 models/styles and 4 million pairs of branded footwear on an ongoing basis
at a new 4-million pair capacity facility in Latin America--annual production run setup
costs for 350 models of branded footwear are $9 million. ✓
Q: A strategy to be a low-cost provider of branded footwear is unlikely to result in the
company being one of the best-performers in the industry unless the company's
management team... - Correct Answer ✔✔ A: proves adept in operating the company
as cost effectively (if not more cost effectively) than rivals that are also striving to be a
low-cost provider of branded footwear. ✓
Q: A company's management team should seriously consider bidding for a private-label
footwear contract in a particular geographic region when... - Correct Answer ✔✔ A: the
data in the Comparative Competitive Efforts section of the latest Competitive
Intelligence Report indicates that some of the winning bidders for private-label footwear
were able to win contracts at an offer price above their selling price for branded
footwear. ✓
QUESTIONS & ELABORATED
ANSWERS RATED 100% COMPLETE
Q: Which one of the following is a way to reduce costs and strive to achieve a
competitive advantage based on lower overall costs per pair sold than rival companies?
- Correct Answer ✔✔ A: Striving to keep marketing expenses per branded pair sold to
amounts that are below the industry-high in each region ✓
Q: Which one of the following is most likely to be an effective or attractive profit-
enhancing way to try to reduce total production costs per pair at a particular production
facility? - Correct Answer ✔✔ A: Pursuing actions that will better enable the company to
operate its production facilities at (or very close to) full production capacity, including
maximum use of overtime ✓
Q: The managers of all companies should make a point of examining the production
benchmarks shown on p. 6 of each year's Footwear Industry Report in order to... -
Correct Answer ✔✔ A: determine whether immediate actions need to be taken at one or
more of their company's production facilities to do a better job of managing total
compensation, workforce productivity, production labor costs, spending for TQM/Six
Sigma programs, total production costs, and/or reject rates. ✓
Q: Which one of the following is an advantage of having production facilities to
manufacture athletic footwear in all four geographic regions? - Correct Answer ✔✔ A:
Increased ability to lower expenditures for shipping/freight costs from the company's
production operations to distribution centers in the various regions--this is because
when a company has production operations in all four geographic regions it typically
needs to ship fewer pairs of footwear from production facilities in one region to
distribution centers in a different region ✓
Q: An appealing strategy that a company can use to reduce its exposure to adverse
exchange rate adjustments to the costs of pairs shipped to a distribution warehouse
from a production facility in a different geographic region is to... - Correct Answer ✔✔ A:
invest in sufficient production capacity in each of the four geographic regions to greatly
reduce (maybe even eliminate) the need to ship pairs to a distribution warehouse from a
production facility in a different geographic region--such a strategy has the highly
attractive added benefit of cutting/eliminating tariff payments on imported footwear. ✓
Q: Which one of the following actions is least likely to increase labor productivity by an
amount that is large enough to result in lower labor costs per pair produced at a
particular plant? - Correct Answer ✔✔ A: Increasing total compensation per production
, worker to an amount that is slightly above the industry-average in those regions where
the company has production facilities ✓
Q: The installation of production improvement option D which boosts worker productivity
by 50% by using robots to assist in producing footwear... - Correct Answer ✔✔ A: is a
more economically attractive means for reducing labor costs per pair produced at a
production facility in North America than for a production facility in the Asia-Pacific. ✓
Q: Valid reasons why a company should definitely open a new production facility in
Latin America include... - Correct Answer ✔✔ A: being able to avoid paying import
tariffs on footwear produced and sold in Latin America; moreover, the freight costs on
pairs shipped from a production facility in Latin America to the Latin American
distribution center are lower than the freight costs on pairs shipped from production
facilities outside Latin America to the Latin American distribution center. ✓
Q: Which of the following is a valid reason or strong signal that a company should
consider changing from a low-cost/low-price strategy for branded footwear to a different
strategy? - Correct Answer ✔✔ A: The company's total production costs per branded
pair, distribution and warehouse costs per branded pair available for sale, and branded
costs per pair sold shown on pp. 6-7 of the most recent Footwear Industry Report are
near or above the industry-average (instead of being at or near the industry-low) and, in
addition, many other companies in the industry are selling branded footwear at below-
average prices (which signals that this target market segment may be overcrowded with
competitors). ✓
Q: Production improvement option B (with capital costs of $1.6 million per million pairs
of production capacity and annual depreciation costs of 10%) that reduces production
run setup costs by 50% each year makes the most economic sense in which of the
following circumstances? - Correct Answer ✔✔ A: Company managers expect to
produce 350 models/styles and 4 million pairs of branded footwear on an ongoing basis
at a new 4-million pair capacity facility in Latin America--annual production run setup
costs for 350 models of branded footwear are $9 million. ✓
Q: A strategy to be a low-cost provider of branded footwear is unlikely to result in the
company being one of the best-performers in the industry unless the company's
management team... - Correct Answer ✔✔ A: proves adept in operating the company
as cost effectively (if not more cost effectively) than rivals that are also striving to be a
low-cost provider of branded footwear. ✓
Q: A company's management team should seriously consider bidding for a private-label
footwear contract in a particular geographic region when... - Correct Answer ✔✔ A: the
data in the Comparative Competitive Efforts section of the latest Competitive
Intelligence Report indicates that some of the winning bidders for private-label footwear
were able to win contracts at an offer price above their selling price for branded
footwear. ✓
