BUSI 411 UPDATED EXAM
QUESTIONS AND ANSWERS 2026
EXAM PREP COMPLETE GUIDE
VERIFIED
◉ Design capacity.
Answer: the maximum output rate or service capacity an operation,
process, or facility is designed for.
◉ Effective capacity.
Answer: design capacity minus allowances such as personal time, and
maintenance.
◉ Capacity cushion.
Answer: extra capacity used to offset demand uncertainty.
◉ Bottleneck operation.
Answer: an operation in a sequence of operations whose capacity is
lower than that of the other operations.
◉ Economies of scale.
Answer: if the output rate is less than the optimal level, increasing the
output rate results in decreasing average unit costs.
◉ Diseconomies of scale.
, Answer: if the output rate is more than the optimal level, increasing the
output rate results in decreasing averages unit costs.
◉ Constraints.
Answer: something that limits the performance of a process or system in
achieving its goals.
◉ Break-even point (BEP).
Answer: the volume of output at which total cost and total revenue are
equal.
◉ Cash flow.
Answer: the difference between cash received from sales and other
sources, and cash outflow for labor, material, overhead, and taxes.
◉ Present value.
Answer: the sum, in current value, of all future cash flows of an
investment proposal.
◉ Bounded rationality.
Answer: the limitations on decision making caused by costs, human
abilities, time, technology, and availability of information.
◉ Sub optimization.
QUESTIONS AND ANSWERS 2026
EXAM PREP COMPLETE GUIDE
VERIFIED
◉ Design capacity.
Answer: the maximum output rate or service capacity an operation,
process, or facility is designed for.
◉ Effective capacity.
Answer: design capacity minus allowances such as personal time, and
maintenance.
◉ Capacity cushion.
Answer: extra capacity used to offset demand uncertainty.
◉ Bottleneck operation.
Answer: an operation in a sequence of operations whose capacity is
lower than that of the other operations.
◉ Economies of scale.
Answer: if the output rate is less than the optimal level, increasing the
output rate results in decreasing average unit costs.
◉ Diseconomies of scale.
, Answer: if the output rate is more than the optimal level, increasing the
output rate results in decreasing averages unit costs.
◉ Constraints.
Answer: something that limits the performance of a process or system in
achieving its goals.
◉ Break-even point (BEP).
Answer: the volume of output at which total cost and total revenue are
equal.
◉ Cash flow.
Answer: the difference between cash received from sales and other
sources, and cash outflow for labor, material, overhead, and taxes.
◉ Present value.
Answer: the sum, in current value, of all future cash flows of an
investment proposal.
◉ Bounded rationality.
Answer: the limitations on decision making caused by costs, human
abilities, time, technology, and availability of information.
◉ Sub optimization.
