1. Riadify Ltd. uses target costing and is in the process of developing a new product, the Riadeluxe. Based on an initial design, estimated market demand, and required investment, the Riadeluxe's target cost was determined to be $4.50 per unit, but the as-if cost was assessed at $4.80 per unit. The design team reworked the specifications and was able to reduce the as-if cost by $1.00 without impacting the target profit, but the change in features meant that the target price would decrease by $0.50. Which of the following statements is true after the redesign? a) The as-if cost exceeds the target cost by $0.20; more redesign is needed. b) The as-if cost exceeds the target cost by $0.50; more redesign is needed. c) The target cost exceeds the as-if cost by $0.20; the product now appears viable. d) The target cost exceeds the as-if cost by $0.50; the product now appears viable.2. Groomed Run Cleaning Services operates in a large ski resort town, providing cleaning services for hotels and privately owned rental units. Currently, the company has the capacity to clean 300 units per day. It is now November, and long-term weather forecasts indicate that it will be an exceptional snow year at the resort, which would likely result in abnormally high demand and room turnover. Which of the following statements is true? a) As Groomed Run is a service provider, its design capacity and effective capacity will be equal. b) If Groomed Run increases the number of cleaning crews available in anticipation of increased demand, it will be following a capacity lag strategy. c) If Groomed Run follows a capacity lead strategy, it will run the risk of having to turn away potential work contracts. d) Groomed Run should use standard financial evaluation techniques to help it decide whether, and when, to increase capacity.3. Econotrawl Consulting advises customers on shipping and logistics issues. Customer needs are beginning to shift, as they are more often in need of increasingly complex logistics plans in shorter time frames. Management realizes the necessity to make significant changes to maintain its loyal customer base and remain competitive. To revitalize the company, management created flowcharts of all the main processes and then held brainstorming sessions to determine how these processes could be streamlined. After extensive consultation, staff members were rearranged into cross-functional groups to create more nimble and flexible teams. What model(s) does this approach represent? a) Business process management (BPM) but not business process re-engineering (BPR) b) BPR but not BPM C) BPM and BPR d) Neither BPM nor BPR4. A vacation spa resort has numerous hot tubs that must be maintained within strict safety limits. In particular, temperature and bromine levels are tested hourly. What type of chart would best help the spa maintain these levels within a safe limit? a) Process flowchart b) Control chart C) Scatter diagram Fishbone diagram5. A manufacturing company has been working with one of its primary suppliers to improve the quality of raw materials it purchases from the supplier. If the theory behind cost of quality (COQ) holds true, what would be expected to happen? a) The increase in upstream spending will be more than offset by decreases in downstream testing and failure costs. b) Detection costs will decrease because of increased spending on appraisal costs. c) The company's focus on quality control rather than quality assurance will result in an overall decrease in quality costs. d) The supplier's costs would be transferred to the manufacturing company, but this would reduce the combined quality costs of the two companies