Lesson 3.4.1
3.4.1 Setting operational objectives Quiz: AQA Business, Unit 4
20 questions
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Lesson 3.4.1, Setting operational objectives: 20 multiple choice questions for the AQA Business (7132), Unit 4: Operational management, written with Revision Ninja.
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The 20 questions
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Flexibility as an operational objective means:
- The ability to change the business's legal structure quickly
- The ability to adapt output, product range or delivery to changes in demand
- The ability to fix prices for a whole year
- The ability to pay employees by piece rate only
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Speed of response refers to:
- How quickly the business can change its mission statement
- How rapidly the business's share price rises
- How quickly a business can meet customer requests or deliver products
- How fast managers take decisions on paper without any action
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Added value is best described as:
- The total of all costs incurred during production
- The difference between the value of output and the cost of the bought-in inputs used to produce it
- The value of shares issued by a business in a year
- The price charged by a competitor for the same product
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Which is an example of an environmental operational objective?
- Increasing output of goods by 20% within a year
- Cutting the number of production staff by 10%
- Raising the average selling price by 5%
- Reducing waste sent to landfill by 30% within three years
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Why is setting operational objectives valuable?
- It means operational decisions are no longer influenced by costs
- It guarantees the business will never face competition
- It gives clear targets for operations so performance can be measured and aligned with corporate goals
- It replaces the need for quality control checks on output
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Quality as an operational objective is most closely linked to:
- Keeping labour costs as low as possible
- Maximising the number of product variants on sale
- Meeting or exceeding customer expectations and specifications consistently
- Producing the largest possible volume of output each day
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Which operational objective is most directly about cost control?
- Maintaining a customer satisfaction score above 90%
- Introducing a new environmentally friendly product line
- Responding to orders within 24 hours of receipt
- Keeping the unit cost of production as low as possible
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A bakery sets an objective to cut the time from order to delivery from three days to one day. Which operational objective is this?
- Flexibility
- Speed of response
- Added value
- Environmental
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A car manufacturer aims to change production quickly between models in response to demand. Which objective is this?
- Flexibility
- Environmental
- Quality
- Costs
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A business has revenue of 200,000 and bought-in materials costing 80,000. What is its added value?
- 120,000
- 200,000
- 80,000
- 280,000
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A corporate objective is to double profit. Which operational objective most directly supports it?
- Increasing the number of marketing campaigns by three
- Reducing unit production costs by 15%
- Improving the business's logo
- Expanding the head office building
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A business sets an objective to cut carbon emissions even though this raises short-term costs. How should the decision be evaluated?
- It has no effect on any stakeholders
- It is certain to reduce costs and profit immediately
- It may raise short-term costs but can improve brand reputation and meet regulatory expectations over time
- It is illegal for any business to set environmental objectives
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A firm's defect rate falls from 5% to 2% on 40,000 units. How many fewer defective units are produced?
- 800 fewer defective units
- 3,000 fewer defective units
- 1,200 fewer defective units
- 2,000 fewer defective units
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Why might an objective to minimise costs conflict with an objective to improve quality?
- Costs and quality always move in the same direction with no trade-off
- Quality objectives are set only by government agencies
- Costs are irrelevant when quality is the objective
- Cheaper inputs or faster production can reduce quality, so the firm must balance the two objectives
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A firm offers only large batches, but customers increasingly want small custom orders. Which objective is most at risk?
- Costs
- Added value
- Flexibility
- Environmental objectives
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Evaluate: what is the strongest argument that an operational objective of speed may conflict with quality?
- Quality is measured only after delivery, so it cannot be affected
- Speed and quality are the same objective in every business
- Rushing production can increase errors, so meeting speed targets may reduce the consistency of quality
- Speed applies only to services, so it cannot conflict with quality
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A factory produces 60,000 units, each sold at 15, with bought-in costs of 6 per unit. What is the added value?
- 600,000
- 900,000
- 360,000
- 540,000
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Which situation suggests that operational objectives are likely to be ineffective?
- They are set annually by external consultants only
- They are measurable and linked to corporate objectives, giving clear direction
- They are not linked to corporate objectives or are not measurable, so staff cannot tell whether they are met
- They are shared with all stakeholders at the same time
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A business cuts its response time from five days to two days. What is the percentage reduction?
- 40%
- 3%
- 60%
- 150%
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A business aims to grow added value, but its revenue is flat. What is the best explanation?
- Bought-in costs have risen faster than revenue, so the value added per unit has fallen
- Added value is unrelated to bought-in costs
- Added value rises whenever revenue is flat
- Added value measures only labour costs, so it must rise
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