Management Sciences Test 1 Nddc Scholarship
Question 41
What is the most important criteria in capital budgeting?
C. Net present value
Net Present Value (NPV) is the most important criterion in capital budgeting because it measures the expected increase in wealth by considering the time value of money.
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Question 42
Which of the following statements (in general) is correct?
B. The lower the total debt-to-equity ratio, the lower the financial risk for a firm
A lower debt-to-equity ratio indicates the firm relies less on borrowed funds, reducing financial risk and the likelihood of default.
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Question 43
What should be the focal point of financial management in a firm?
C. The creation of value for shareholders
The primary goal of financial management is to maximize shareholder wealth, ensuring decisions increase the value of the firm rather than just focusing on profits or tax minimization.
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Question 44
What are the two basic types of production systems?
B. Intermittent and non-intermittent process
The two basic types of production systems are:
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Intermittent (or batch) production, where products are made in separate lots.
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Non-intermittent (or continuous) production, where production runs continuously without interruption.
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Question 45
What type of process would a paper mill be most likely to use?
A. Continuous flow
A paper mill operates using a continuous flow process, where raw materials are processed non-stop to produce large quantities of standardized products.
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Question 46
What technique deals with the problem of supplying sufficient facilities to production lines or individuals that require uneven service?
D. Queuing theory
Queuing theory deals with managing and analyzing waiting lines to ensure sufficient facilities or resources are available for production lines or individuals with uneven demand.
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Question 47
A manufacturer has been receiving excessive numbers of defective standard machine parts from a vendor on a regular basis. What is the most effective way to design a formal inspection system for incoming parts?
C. Statistical quality control
Statistical quality control (SQC) is the most effective method for designing a formal inspection system, as it uses statistical techniques to monitor and control the quality of incoming parts.
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Question 48
A set of simultaneous equations that has more variables than constraints has
B. An infinite number of solutions
A system of simultaneous equations with more variables than constraints is underdetermined, meaning there are infinitely many solutions that satisfy all equations.
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Question 49
In a PERT/CPM network, computing the critical path requires
B. Assigning the earliest finish time for an activity as the earliest start time for the next
In PERT/CPM, the critical path is determined by calculating earliest start and finish times and ensuring that the earliest finish of one activity becomes the earliest start of the next.
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Question 50
At the completion of the forward and backward passes, the slack for an activity is given by the
C. Difference between latest start and early start
In PERT/CPM, slack (or float) is the amount of time an activity can be delayed without delaying the project. It is calculated as:
Slack = LS - ES = LF - EF
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