Lesson 3.4.4
3.4.4 Making operational decisions: improving quality Quiz: AQA Business, Unit 4
20 questions
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Lesson 3.4.4, Making operational decisions: improving quality: 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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Quality control is best described as:
- Measuring the profitability of each product line
- Checking finished products or outputs to detect and remove faulty items
- Training staff to meet the firm's mission statement
- Designing systems to prevent defects from ever occurring
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Quality assurance is best described as:
- Setting the price of products to meet customer expectations
- Inspection of products after production to remove defective goods
- Holding inventory to protect against supplier failures
- Systems and processes designed to prevent defects from occurring in the first place
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Which method of improving quality is an example of quality assurance?
- Inspecting every item at the end of the production line
- Introducing standardised procedures and staff training to prevent errors
- Rejecting faulty batches from suppliers after delivery
- Sampling output once a week to detect faults
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A benefit of improving quality is:
- Less need for marketing, as customers will find the product themselves
- Higher customer loyalty and possibly the ability to charge higher prices
- Higher costs for customers because quality is expensive to produce
- Elimination of all competition in the market
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A difficulty of improving quality is:
- Quality improvements always reduce all costs immediately
- Customers never notice changes in quality
- Quality cannot be measured at all
- The initial cost of new systems, training and equipment may be high
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A consequence of poor quality for a business could be:
- Lower costs, because fewer checks are needed
- Increased customer loyalty, because shoppers feel sympathy for the brand
- Improved relationships with competitors who benefit from faults
- Product recalls and damage to brand reputation, which can reduce future sales
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Which is a potential consequence of product safety failures for a business?
- Suppliers gain more orders from the faulty product
- Shareholders receive higher dividends because of the recall
- Stakeholders gain because faulty goods lower prices
- Legal action and fines from regulators, alongside lost customer trust
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A car plant tests each engine at the end of the line and rejects 2% of them. Which approach is this?
- Quality planning
- Quality control
- Quality assurance
- Supplier rating
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A batch of 10,000 units has a 3% defect rate, and each defective unit costs 12 to rework. What is the total rework cost?
- 360
- 1,200
- 30,000
- 3,600
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After introducing quality assurance, a firm's monthly returns fall from 500 to 200 items. Each return costs 15. What is the monthly saving?
- 10,000
- 7,500
- 3,000
- 4,500
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A food manufacturer finds contamination after products have been sold and recalls them. What is the most likely short-term consequence?
- Customers become more loyal because the firm is honest
- Costs fall because inspection is no longer needed
- Immediate recall costs and lost sales as customers stop buying
- Sales rise as the news raises awareness of the brand
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Improving quality by buying better raw materials is most likely to create which difficulty?
- Better raw materials eliminate the need for any staff
- Higher input costs may squeeze profit margins unless prices rise
- Better raw materials are never more expensive
- Quality improvements cannot affect profit margins
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Why is quality assurance often cheaper in the long term than quality control?
- QA eliminates all customer complaints automatically
- QA involves no staff time or training costs
- QC always costs more than any QA system
- Preventing defects avoids the rework, returns and waste that inspection only detects
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A firm samples 50 of 2,000 units and finds 4 defective. How many defective units are estimated in the whole batch?
- 160
- 400
- 40
- 80
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A firm reduces quality to cut costs and its sales fall. Which principle is illustrated?
- Poor quality damages customer loyalty, which can reduce demand
- Costs fall only if quality is raised
- Lower quality always increases demand because it is cheaper
- Quality is irrelevant to demand in competitive markets
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Evaluate: what is the strongest argument that quality assurance is preferable to quality control for a business with a strong brand?
- Brands never suffer from quality problems
- QA eliminates the need for any product testing
- QA protects the brand by preventing defects reaching customers, while QC can only detect faults already made
- QC is illegal for businesses with strong brands
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A factory with 25,000 units has a 4% defect rate. Each defect costs 8 to fix and 20 in lost margin. What is the total cost of defects?
- 8,000
- 36,000
- 20,000
- 28,000
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A firm spends 60,000 on quality assurance and saves 90,000 in defect costs. What is its net benefit?
- 90,000
- 60,000
- 30,000
- 150,000
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Evaluate: why can poor quality harm stakeholders beyond the business itself?
- Faulty products can injure customers and damage suppliers' reputations, creating wider social and legal consequences
- Poor quality affects only shareholders' dividends
- Customers benefit from cheaper goods that are of poor quality
- Suppliers gain orders from faulty products
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Evaluate: why might a firm's quality improvements fail to raise sales even though its defects fall?
- Fewer defects always reduce sales because fewer customers complain
- Falling defects raise costs by the same amount as the reduction
- Customers never judge quality, so sales cannot be affected
- Customers may not notice or value the change, or rivals may match it, so the gain is not reflected in demand
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