BSG 1 Test Answers

The factors that affect the reject rates at the company’s footwear production facilities include

Answer: the size of the incentive payment per non-defective pair produced, best practices training expenditures per worker, spending for TQM/Six Sigma quality control efforts, and the number of models/styles comprising the company’s product line.

Which of the following is the most important competitive factor in determining a company’s ability to secure contracts to supply private-label footwear to chain retailers in a particular geographic region?

Answer: The company’s price offer

The company currently has production facilities to make athletic footwear in

Answer: North America and Asia-Pacific

Which of the following statements about the average wholesale price a company charges footwear retailers in a given geographic region is incorrect?

Answer: So long as a company has a big price-based competitive advantage in a region’s 

Wholesale Segment, it has the ability to achieve an attractively-large sales volume and market share even if it suffers from competitive disadvantages on other competitively-relevant factors.

Which of the following currencies are involved in causing favorable or unfavorable exchange rate adjustments to a company’s costs and revenues?

Answer: Singapore dollars, euros, U.S. dollars, and Brazilian reals

Which of the following statements about the impact of a company’s competitive efforts in a region on its regional market share and number of branded pairs sole is false?

Answer: The biggest possible competitive advantage a company can achieve in a given region’s Internet Segment is to offer free shipping and thereby capture the biggest number of pairs sold and biggest market share of any company in that region’s Internet Segment.

The company’s shipments of newly-produced branded and private-label footwear from its plants to its regional distribution centers are subject to

Answer: any applicable import tariffs and exchange rate adjustments.

Which of the following are factors in determining a company’s credit rating?

Answer: its default risk ratio, debt-asset ratio, and interest coverage ratio.

Which of the following most accurately describes your company’s production operations?

Answer: TQM/Six Sigma quality control programs and best practices training are a means of increasing the S/Q ratings of both branded and private-label footwear produced at each production facility.

Which of the following are components of the total compensation package for production workers at your company’s production facilities?

Answer: Base wages, incentive payments per non-defective pair produced, fringe benefits, and any overtime pay

The projected growth in buyer demand for branded athletic footwear is

Answer: 9-11% annually in Latin America and Asia-Pacific during Years 11-15 and 7-9% annually in these two regions during Years 16-20.

The factors that affect worker productivity include

Answer: how much emphasis is placed on inventive compensation (as measured by the percentage of the company’s total compensation package accounted for by incentive pay) and expenditures for best practices training.

The interest rate a company pays on 1-year, 5-year, and 10-year loans is a function of

Answer: its credit rating and the length of the term over which repayment is scheduled to occur

Which of the following are the four geographic regions in which the company sells branded and private-label athletic footwear?

Answer: Europe-Africa, Latin America, Asia-Pacific, and North America

Which of the following statements about the importance of each competitive factors in determining company sales volume and market shares in a particular geographic region is false?

Answer: Tiny cross-company differences in competitive effort on a highly influential competitive factor (like S/Q ratings, the number of models/styles offered, and selling prices) nearly always have a bigger impact on company sales/market share outcomes in a region than do large differences on less influential competitive factors.

The three competitive factors that impact only Internet Sales and market share in a region include

Answer: expenditures for search engine advertising

The projected growth in buyer demand for private-label athletic footwear is

Answer: 10-12% annually in the Asia-Pacific and Latin America regions during Years 16-20.

Which one of the following is NOT one of the competitive factors that impact both Internet Sales and Wholesale Sales of branded footwear?

Answer: Search engine advertising

Which one of the following is NOT one of the factors that affects the S/Q rating of a company’s footwear?

Answer: The percentage size of a production facility’s reject rates for branded and private-label footwear due to defective workmanship and poorly-maintained equipment

Which of the following are the 5 measures on which a company’s performance is judged/scored?

Answer: Stock prices, credit rating, earnings per share, ROE, and image rating

In year 11, footwear companies can expect to sell

Answer: an average of 4.84 million branded pairs and an average of 800,000 private label pairs, although sales at some companies may run higher or lower than the averages due to differing levels of competitive effort.

The interest rate a company pays on loans outstanding depends on

Answer: its credit rating

The company’s present production capability (as of Year 10) is

Answer: 6 million pairs without the use of overtime and 7.2 million pairs with the use of overtime

The factors that affect a company’s S/Q rating include:

Answer: the percentage use of superior materials; a company’s cumulative spending for TQM/Six Sigma quality control programs; the use of best practices training; and expenditures or new styling/features per model

Which one of the following does not affect the reject rates?

Answer: The installation of plant upgrade C

Which of the following are the 4 geographic regions in which the company sells branded and private label athletic footwear?

Answer: Asia-Pacific, Europe-Africa, Latin America, and North America

The market for PRIVATE label athletic footwear is projected to grow

Answer: 10% annually in all four geographic regions during the Year 11-Year 15 period and 8.5% annually in all four regions during the Year 16-Year 20 period

Which of the following most accurately describes your company’s plant operations?

Answer: Standard and superior materials are sourced from outside suppliers at prices that vary according to global demand-supply conditions; the company’s production workers are compensated on the basis of both base pay and incentive payments per non-defective pair produced.

Which of the following is/are not among the factors that affect worker productivity?

Answer: The percentage of newly-hired workers and the percentage use of superior materials

The company’s shipments of newly produced branded and private label footwear from its plants to its regional distribution centers are subject to

Answer: any applicable import tariffs and exchange rate adjustments

The company currently has production facilities to make athletic footwear in

Answer: North America and Asia-Pacific

Which of the following currencies are involved in affecting the operations of your company’s athletic footwear business?

Answer: Singapore dollars, euros, U.S Dollars, and Brazilian reals

Which of the following are the 5 measures on which a company’s performance is judged/scored?

Answer: Earnings per share, ROE, Stock price, Credit rating, and image rating

Which of the following best describes the materials the company uses to make its footwear?

Answer: Standard and superior materials

The market for BRANDED athletic footwear is projected to grow

Answer: 5-7% annually in North America and Europe-Africa during Year 11-Year 15 and 

3-5% annually in these regions during the Year 16-Year 20 period.

Which of the following are factors in determining a company’s credit rating?

Answer: Its debt-asset ratio, default risk ratio, and interest coverage ratio

Which of the following are components of the compensation package for production workers at your company’s plants?

Answer: Base wages, incentive payments per non defective pair produced, and overtime pay.

A footwear makers price competitiveness in selling branded footwear to retailers in a particular geographic region is determined by

Answer: whether its wholesale price is above or below the average price of all companies competing in that geographic region

The reject rates at the company’s footwear plants are a function of

Answer: the size of the incentive payment per non defective pair produced, spending for best practices training, spending for TQM/Six Sigma quality control efforts, the number of models/styles comprising the company’s product line, and the installation of plant upgrade option A

Which of the following is not among the factors that affect worker productivity?

Answer: Whether plant upgrade option A has been installed

Which of the following currencies are NOT involved in affecting the operations of your company’s business

Answer: Swiss francs, south African rand, Chilean pesos, and Turkish lira

Which of the following most accurately describes your companys plant operations?

Answer: TQM/Six sigma quality control programs and best practices training are used to boost the S/Q ratings of both branded and private label footwear

The company currently has production facilities to make athletic footwear in

Answer: Asia-Pacific and North America

Which of the following is NOT a factor is determining a company’s unit sales and market share of branded footwear in a particular geographic region? (DO NOT confuse with question 15)

Answer: The number of new performance features built into each year’s models/styles

Which one of the following is not one of the factors that affect the S/Q rating of a company’s footwear?

Answer: How much is spent to inspect newly produced pairs and avoid shipping defective shoes

Which one of the following does not affect the reject rates at a company’s plants?

Answer: The s/q rating of pairs being produced and the use of plant upgrade option B

The factors that affect worker productivity include

Answer: Whether plant upgrade option D has been installed, the size of incentive payments per non defective pair, base pay increases, how favorably a company’s compensation package compares with the industry average compensation package, and expenditures for practices training

Which of the following is not an accurate description of your company’s plant operations?

Answer: A private label footwear is outsourced from contract manufacturers in Latin America and the Asia-Pacific at prices equal to $8 per pair

Which one of the following is not a factor in determining a company’s unit sales and market share of branded footwear in a particular geographic region?

Answer: Footwear features and footwear durability

Which of the following is the most important factor in determining a company’s unit sales and market share of private label footwear in a particular geographic region?

Answer: The company’s bid price

Which of the following is/are not among the factors that affect worker productivity? (same as 9?) **LOOK into

Answer: S/Q Ratings and the warranty claim rate on recently sold footwear

The market for branded athletic wear is projected to grow

Answer: 9-11% annually in Latin America and the Asia-Pacific during Year11-Year 15 and 7-9% annually in these regions during the year 16-year 20 period

The market for branded athletic wear is projected to grow

Answer: 9-11% annually in Latin and Asia Pacific during the year 11 – year 15 period and 5-7% annually in North America and Europe-Africa during the year 11-15 period