1) Which part of the value chain is outside the firm?

A. The Design component

B. The Research and Development component

C. The Production activity

D. The Distribution chain

2) Which of the following statements regarding the value chain is true?

A. Service firms benefit from the value chain more than do manufacturing firms.

B. Value chain components do not overlap.

C. Value is not created until after the research and development stage.

D. Administrative functions are not included as part of the value chain.

3. Which of the following statements is false?

A. In essence, the value chain and the supply chain are similar; each creates something for which the customer is willing to pay.

B. Financial accounting information is important because it is sufficient to provide all the information for operational decisions commonly made by managers.

C. The supply or distribution chain is a linked set of organizations that exchange goods and services in combination to provide a final product or service to the customer.

D. Eliminating nonvalue-added activities always reduces costs without affecting the value of the product to customers.