6. The opportunity cost of making a component part in a factory with excess capacity for which there is no alternative use is: A. The variable manufacturing cost of the component. B. The total manufacturing cost of the component. C. Zero. D. The fixed manufacturing cost of the component. 7. Orange Computer Co. is quickly becoming a major player in the personal computer market. The company currently has multiple companies producing products that go into an Orange computer. This practice of having an outside firm provide a function for Orange Computer Co. is called: A. Outsourcing. C. Profitability maximization. D. Strategic positioning. 8. Value streams are useful in decision-making because: A. They identify all value-added products and services. B. They help to highlight the improved efficiency in the plant. C. Special orders can be evaluated within the context of the value stream. D. Irrelevant costs are identified. 9. Put simply, transfer pricing is a management tool for assigning a "price" to internally transferred goods (or services) in order to simulate the marketplace, thus encouraging mangers to make decisions that are in the best interest of the: A. Operating managers. B. Producing (i.e., selling) unit within the firm. C. Firm as a whole. D. Manager of the buying (i.e, purchasing) unit. 10. Because the full-cost method of transfer pricing includes fixed cost, it can: A. Pass strict accounting requirements for determining transfer prices. B. Pass strict governmental requirements for determining transfer prices. C. Establish consistency across state and national borders. D. Cause sub-optimal short-term decision making