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expensive resources than clerks are.
Answer (b) is incorrect because this would not be an efficient use of resources.
Answer (c) is incorrect because a balanced emphasis on effectiveness and efficiency means the job gets done us-
ing a minimum amount of resources.
Answer (d) is incorrect because the task was performed effectively but not efficiently.
Question: V4C3-0129
Which of the following can reflect the effectiveness of a firm s personnel department?
Answers
A: The ratio of total hiring costs to the total number of hires.
B: The ratio of employees hired at entry level in 1992 and still with the firm in 1994 to total employees
hired at entry level in 1992.
C: A comparison over time of the average number of days from the date the approved vacant position
requisition is received until the date the new hire starts work.
D: The ratio of the number of job offers accepted to the number of job offers extended.
Answer Explanations
Answer (a) is incorrect because this choice measures efficiency (inputs used to achieve a given level of output).
Answer (b) is the correct answer. Effectiveness measures the degree to which a predetermined objective is met.
Answer (c) is incorrect because this choice measures efficiency (inputs used to achieve a given level of output).
Answer (d) is incorrect because this choice measures efficiency (inputs used to achieve a given level of output).
Question: V4C3-0130
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Which of the following is not related to labor productivity measurement?
Answers
A: Work measurement.
B: Time study.
C: Work sampling.
D: Work groups.
Answer Explanations
Answer (a) is incorrect because work measurement is used to estimate the amount of worker time required to
generate one unit of work.
Answer (b) is incorrect because in a time study, analysts use stopwatches to time operations being performed by
workers.
Answer (c) is incorrect because work sampling is a work measurement technique, which randomly samples the
work of one or more workers at periodic intervals to determine the proportion of the total operation, which is ac-
counted for in one particular activity.
Answer (d) is the correct answer. Work groups are a collection of people working together; they are not a labor
productivity measurement.
Question: V4C3-0131
An example of an efficiency measure in a company would be
Answers
A: The profit per dollar of sales.
B: The number of contacts a broker makes per day.
C: The percentage of raw materials placed in storage within 24 hours of receipt.
D: New insurance policies written by an insurance agent as a percentage of total new and renewed
policies.
Answer Explanations
Answer (a) is the correct answer. A measure of cost control by stating the profit as a percentage of sales.
Answer (b) is incorrect because the number of contacts a broker makes per day would be a measure of
effectiveness.
Answer (c) is incorrect because the percentage of raw materials placed in storage without damage would be a
measure of effectiveness.
Answer (d) is incorrect because the percentage of new insurance policies written by an insurance agent would be
a measure of effectiveness.
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Question: V4C3-0132
Of the following factors that affect efficiency, which is a group-level factor?
Answers
A: Values and attitudes.
B: Abilities.
C: Motivation.
D: Leadership.
Answer Explanations
Answer (a) is incorrect because it is an individual level factor that impacts efficiency.
Answer (b) is incorrect because it is an individual level factor that impacts efficiency.
Answer (c) is incorrect because it is an individual level factor that impacts efficiency.
Answer (d) is the correct answer. A group-level factor that impacts efficiency.
Question: V4C3-0133
Successful organizations are able to balance efficiency and effectiveness. Which of the following scenarios
illustrates an organization out of balance by focusing too much on efficiency?
Answers
A: The job does not get done and limited resources are wasted.
B: The job gets done but limited resources are wasted.
C: The job does not get done but available resources are not wasted.
D: The job gets done and limited resources are not wasted.
Answer Explanations
Answer (a) is incorrect because this scenario illustrates an organization out of balance by having no focus on
either effectiveness or efficiency.
Answer (b) is incorrect because this scenario illustrates an organization out of balance by focusing too much on
effectiveness.
Answer (c) is the correct answer. This scenario illustrates an organization out of balance by focusing too much on
efficiency.
Answer (d) is incorrect because this scenario illustrates an organization perfectly balancing efficiency and
effectiveness.
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Question: V4C3-0134
Productivity is defined as the ratio of outputs of a production process to the inputs that are used. Consider a pro-
cess that currently produces 2,000 units of output with 500 hours of labor per day. This process can be redesigned
to produce 2,520 units of output requiring 600 labor hours per day. The percentage change in productivity from
redesigning the process is
Answers
A: 5%
B: 10%
C: 16%
D: 22%
Answer Explanations
Answer (a) is the correct answer. Productivity = output/input. Before redesign, productivity = 2,000 units/500
hours = 4 units per hour. After redesign, productivity = 2,520/600 hours = 4.2 units per hour. Percentage change
in productivity = [(4.2 4.0)/4.00] x 100 = 5%. By definition, choices (b), (c), and (d) will be incorrect.
This answer is incorrect. Refer to the correct answer explanation.
This answer is incorrect. Refer to the correct answer explanation.
This answer is incorrect. Refer to the correct answer explanation.
Question: V4C3-0135
Traditionally, large manufacturers have believed that economies of scale gained through large production runs of
like, or similar, products are the best way to keep production costs down and remain competitive. Select the most
appropriate response to whether this theory is still valid.
Answers
A: Yes, larger economies of scale continue to accrue from ever-larger production runs.
B: Yes, lower per-unit costs for standard products continue to guarantee a competitive advantage.
C: No, economies of scale can no longer be gained from long production runs.
D: No, production flexibility and diversity of products are needed to remain competitive.
Answer Explanations
Answer (a) is incorrect because economies of scale cannot continue to be achieved if the products are not salable.
Answer (b) is incorrect because if the item being produced is not the item that is desired, low cost is not an issue.
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Answer (c) is incorrect because economies of scale can still be achieved from long production runs if the goods
are salable.
Answer (d) is the correct answer. Global competition and more rapidly changing consumer tastes are lessening
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