IGCSE Business Unit 5 Production

What are economies of scale?

• A type of business structure

• A method of production

• Efficiencies that lower average costs of production

• Increased costs due to higher output

What happens to average costs as a firm increases its output?

• They always decrease

• They remain constant

• They initially decrease and then may increase

• They always increase

What is an internal economy of scale related to purchasing?

• Increasing production speed

• Hiring more employees

• Reducing the number of suppliers

• Buying raw materials in bulk for discounts

What is a key characteristic of job production?

• Customization for individual customers

• High volume production

• Standardized products

• Low labor costs

What is a disadvantage of batch production?

• Long lead times

• High customization

• High flexibility

• Low setup costs

What does capital-intensive production primarily use?

• Labor

• Manual processes

• Machinery and technology

• Natural resources

What is the formula for calculating productivity?

• Total Costs / Total Output

• Total Output / Number of Workers

• Total Output + Number of Workers

• Total Workers / Total Output

What is the main focus of lean production?

• Minimizing waste

• Maximizing output

• Increasing labor costs

• Standardizing products

What does TQM stand for?

• Total Quantity Measurement

• Total Quality Management System

• Total Quality Measurement

• Total Quality Management

What is a key benefit of just-in-time (JIT) stock management?

• More suppliers needed

• Higher inventory levels

• Minimized stockholding costs

• Increased storage costs