Make or Buy Decision Quiz

What is the primary goal of a make or buy decision?

• To increase the number of products

• To increase the number of suppliers

• To optimize the utilization of facilities

• To reduce the number of employees

Which of the following is a qualitative factor in make or buy decisions?

• Idle facilities

• Opportunity costs

• Product quality

• Incremental costs

How can patents influence make or buy decisions?

• By increasing the number of suppliers

• By increasing production costs

• By preventing a company from making certain parts

• By reducing the need for skilled labor

In the example of ABC Company, what was the cost to manufacture one part?

• $0.85

• $0.80

• $0.835

• $0.90

Why did ABC Company decide to manufacture the part in-house?

• The company had excess labor

• The manufacturing cost per part was lower than the purchase cost

• The manufacturing cost per part was higher than the purchase cost

• The company wanted to increase its supplier base