Chapter 5 Design of Goods and Services

CHAPTER5: DESI GNOFGOODSANDSERVI CES TRUE/ FALSE 1. Regal Mar i ne' sat t empt st okeepi nt ouchwi t hcust omer sandr espondt ot hemar ket pl ace ar emadei mpossi bl ebecauseconsumert ast eschangeandmar i t i meengi neer i ng i mpr ov es. Fal se( I nt r oduct i on, easy ) 2. Apr oductst r at egymayf ocusondi f f er ent i at i on, l owcost , orr api dr esponse. Tr ue( I nt r oduct i on, easy ) 3. Thegoal oft hepr oductdeci si oni st odev el opandi mpl ementapr oductst r at egyt hat meet st heneedsoft hemar ket pl acewi t hacompet i t i v eadv ant age. Tr ue( I nt r oduct i on, moder at e) 4. Pol i t i cal / l egal changeandeconomi cchangear ebot hf act or si nf l uenci ngmar ket oppor t uni t i esf ornewpr oduct s. Tr ue( Goodsandser v i cessel ect i on, easy ) 5. Thef ourphasesoft hepr oductl i f ecy cl ear ei ncubat i on, i nt r oduct i on, gr owt h, anddecl i ne. Fal se( Goodsandser v i cessel ect i on, moder at e) 6. I nt hemat ur i t yst ageoft hepr oductl i f ecy cl e, oper at i onsmanager swi l l beconcer nedwi t h keepi ngsuf f i ci entcapaci t yav ai l abl ef ort hepr oduct . Fal se( Goodsandser v i cessel ect i on, moder at e) 7. Rel at i v el yf ewnewpr oducti deas, per hapsonl y1i n250, becomesuccessf ul l ymar ket ed pr oduct s. Tr ue( Goodsandser v i cessel ect i on, moder at e) 8. St r y keri l l ust r at es" under st andi ngt hecust omer "byusi ngi t ssal esf or ceasadef act o r esear chanddev el opmentt eam. Tr ue( Goodsandser v i cessel ect i on, moder at e) 9. Comput er ai deddesi gn( CAD)r ef er st ot heuseofspeci al i zedcomput erpr ogr amst o di r ectandcont r ol manuf act ur i ngequi pment . Fal se( Gener at i ngnewpr oduct s, moder at e) 10. Vi r t ual r eal i t yt echnol ogycani mpr ov edesi gnsl essexpensi v el yt hant heuseofphy si cal model sorpr ot ot y pes. Tr ue( Gener at i ngnewpr oduct s, moder at e) 11. Qual i t yf unct i ondepl oy mentr ef er st of i r st , det er mi ni ngwhatwi l l sat i sf yt hecust omer , and second, t r ansl at i ngt hecust omer s’ desi r esi nt oat ar getdesi gn. Tr ue( Pr oductdev el opment , moder at e) 12. Robustdesi gni samet hodt hatensur est hatsmal l v ar i at i oni npr oduct i onorassembl y doesnotadv er sel yaf f ectt hepr oduct . LXXXV Tr ue( I ssuesf orpr oductdesi gn, moder at e) 13. Modul ardesi gnexi st sonl yi nt angi bl epr oduct s; i tmakesnosensei nser v i ces. Fal se( I ssuesf orpr oductdesi gn, moder at e) 14. Oneenv i r onment al l yf r i endl yappr oacht opr oductdesi gni st ousel i ght ercomponent s. Tr ue( I ssuesf orpr oductdesi gn, moder at e) 15. Anoper at i onsmanager ' smostet hi cal act i v i t yi st oenhancepr oduct i v i t ywhi l edel i v er i ng desi r edgoodsandser v i ces.Unf or t unat el y , t hi sact i v i t yi snotenv i r onment al l ysound. Fal se( I ssuesf orpr oductdesi gn, moder at e) 16. Twoi ssues—v i ewi ngapr oducti nt er msofi t si mpactont heent i r eeconomyand consi der i ngt hel i f ecy cl eofapr oduct —combi net oi ncr easet hel i kel i hoodofet hi cal deci si onsbymanager s. Tr ue( I ssuesf orpr oductdesi gn, moder at e) 17. Rapi dl ydev el opi ngpr oduct sandmov i ngt hem t ot hemar keti spar toft i mebased compet i t i on. Tr ue( Ti mebasedcompet i t i on, moder at e) 18. Theenhancementofexi st i ngpr oduct si sanext er nal pr oductdev el opmentst r at egy . Fal se( Ti mebasedcompet i t i on, easy ) 19. The" makeor buy "deci si ondi st i ngui shesbet weenwhatanor gani zat i onchoosest o pr oduceandwhati tchoosest opur chasef r om suppl i er s. Tr ue( Def i ni ngt hepr oduct , moder at e) 20. Gr oupt echnol ogyenabl est hegr oupi ngofpar t si nt of ami l i esbasedonsi mi l arpr ocessi ng r equi r ement s. Tr ue( Def i ni ngt hepr oduct , easy ) 21. Awor kor deri sal i st i ngoft hecomponent s, t hei rdescr i pt i on, andt hequant i t yofeach r equi r edt omakeoneuni toft hepr oduct . Fal se( Document sf orpr oduct i on, moder at e) 22. Anassembl ydr awi ngl i st st heoper at i onsnecessar yt opr oducet hecomponent . Fal se( Document sf orpr oduct i on, moder at e) 23. Toy ot apl anst ousePLM sof t war ef ort est i ngofdesi gnsandal sof ormodel i ngt heent i r e f act or y . Tr ue( Document sf orpr oduct i on, moder at e) 24. Thecust omermaypar t i ci pat ei nt hedesi gnof , andi nt hedel i v er yof , ser v i ces. Tr ue( Ser v i cedesi gn, moder at e) 25. Themoment of t r ut hi st hecr uci al momentbet weent heser v i cepr ov i derandt he cust omert hatexempl i f i es, enhances, ordet r act sf r om t hecust omer ' sexpect at i on. Tr ue( Ser v i cedesi gn, moder at e) LXXXVI 26. Theobj ect i v eofadeci si ont r eei st heexpect edv al ueofeachcour seofact i on. Tr ue( Appl i cat i onofdeci si ont r eest opr oductdesi gn, moder at e) MULTI PLECHOI CE 27. Whi choft hesest at ement sr egar di ngRegal Mar i nei st r ue? a.Pr oductdesi gni sacr i t i cal deci si onf ort hef i r m. b.Regal usesat hr eedi mensi onal CADsy st em t oshor t enpr oductdev el opmentt i me. c. Regal st i l l usessomewoodenpar t sandhandpr oducessomecomponent s. d.Regal ' suseofCADhasr esul t edi nasuper i orpr oduct . e. Al l oft heabov ear et r ue. e( Gl obal companypr of i l e, moder at e) 28. Regal Mar i ne a.nol ongerbui l dsboat swi t hanywoodenpar t s b.desi gnsandbui l dsboathul l sbyhand c. t r eat st hepr oductdesi gndeci si onascr i t i cal t oi t ssuccess d.get si t scompet i t i v eadv ant agebybei ngt hel owcostpr oducerofboat sdesi gnedby ot her s e. desi gnssev er al newboat seachy ear , butcont r act sot herf i r msf ort hei rmanuf act ur e c( Gl obal companypr of i l e, moder at e) 29. Thet hr eemaj orsubdi v i si onsoft hepr oductdeci si onar e a.sel ect i on, def i ni t i on, anddesi gn b.goods, ser v i ces, andhy br i ds c. st r at egy , t act i cs, andoper at i ons d.cost , di f f er ent i at i on, andspeedofr esponse e. l egi sl at i v e, j udi ci al , andexecut i v e a( Goodsandser v i cessel ect i on, moder at e) 30. Whi choft hef ol l owi ngar el i kel yt oi nf l uencemar ketoppor t uni t i esi nt heaut oi ndust r y ? a.t hedev el opmentofst r ongermat er i al s b.sust ai nedeconomi cgr owt h c. changi ngdemogr aphi cs d.suppl i er s e. Al l oft heabov emayi nf l uencemar ketoppor t uni t i es. e( Goodsandser v i cessel ect i on, moder at e) 31. Oper at i onsmanager smustbeabl et oant i ci pat echangesi nwhi choft hef ol l owi ng? a.pr oductmi x b.pr oductoppor t uni t i es c. t hepr oduct st hemsel v es d.pr oductv ol ume e. al l oft heabov e e( Goodsandser v i cessel ect i on, moder at e) 32. I nwhi chst ageoft hepr oductl i f ecy cl eshoul dpr oductst r at egyf ocusonpr ocess modi f i cat i ons? LXXXVI I a.i nt r oduct i on b.gr owt h c. mat ur i t y d.decl i ne e. noneoft heabov e a( Goodsandser v i cessel ect i on, moder at e) 33. Whi choft hef ol l owi ngwoul dl i kel ycauseachangei nmar ketoppor t uni t i esbasedupon l ev el sofi ncomeandweal t h? a.economi cchange b.soci ol ogi cal anddemogr aphi cchange c. t echnol ogi cal change d.pol i t i cal change e. l egal change a( Goodsandser v i cessel ect i on, moder at e) 34. Apr oduct ' sl i f ecy cl ei sdi v i dedi nt of ourst ages, whi char e a.i nt r oduct i on, gr owt h, sat ur at i on, andmat ur i t y b.i nt r oduct i on, gr owt h, st abi l i t y , anddecl i ne c. i nt r oduct i on, mat ur i t y , sat ur at i on, anddecl i ne d.i nt r oduct i on, gr owt h, mat ur i t y , anddecl i ne e. noneoft heabov e d( Goodsandser v i cessel ect i on, easy ) 35. Whenshoul dpr oductst r at egyf ocusonf or ecast i ngcapaci t yr equi r ement s? a.att hei nt r oduct i onst ageoft hepr oductl i f ecy cl e b.att hegr owt hst ageoft hepr oductl i f ecy cl e c. att hemat ur i t yst ageoft hepr oductl i f ecy cl e d.att hedecl i nest ageoft hepr oductl i f ecy cl e e. noneoft heabov e b( Goodsandser v i cessel ect i on, easy ) 36. Whi choft hef ol l owi ngst at ement sr egar di ngpr oductl i f ecy cl eandpr of i t abi l i t yi st r ue? a.Pr of i ti shi ghesti nt hegr owt hl i f ecy cl ephasebecauset hepr oducti snewanduni que. b.Pr of i ti sl owesti nt hegr owt hst ageoft hel i f ecy cl ebecausecost sar esohi gh. c. Pr of i ti sati t sgr eat esti nt hedecl i nest ageoft hepr oductl i f ecy cl e. d.Br eakev eni sat t ai nedi nt hegr owt hst ageoft hepr oductl i f ecy cl e. e. Cashf l owt ur nsposi t i v ei nt hemat ur i t yphase. c( Goodsandser v i cessel ect i on, moder at e) 37. Theanal y si st ool t hathel psdet er mi newhatpr oduct st odev el op, andbywhatst r at egy , by l i st i ngpr oduct si ndescendi ngor deroft hei ri ndi v i dual dol l arcont r i but i ont ot hef i r mi s a.deci si ont r eeanal y si s b.Par et oanal y si s c. br eakev enanal y si s d.pr oduct by v al ueanal y si s e. pr oductl i f ecy cl eanal y si s d( Goodsandser v i cessel ect i on, moder at e) 38. I nwhi chst ageoft hepr oductl i f ecy cl eshoul dpr oductst r at egyf ocusoni mpr ov edcost LXXXVI I I cont r ol ? a.i nt r oduct i on b.gr owt h c. mat ur i t y d.decl i ne e. noneoft heabov e c( Goodsandser v i cessel ect i on, moder at e) 39. _ _ _ _ _ _ _ _ _ _ _ _ _ _i susedt or ankacompany ' spr oduct st odet er mi newhi chpr oduct s r epr esentt hebestuseoft hef i r m' sr esour ces, or , per haps, t odet er mi newhi chpr oduct s ar et obeel i mi nat ed. a.Val ueanal y si s b.Val ueengi neer i ng c. Fi nanci al anal y si s d.Pr oduct by v al ueanal y si s e. Pr oductcostj ust i f i cat i on d( Goodsandser v i cessel ect i on, easy ) 40. Whi choft hef ol l owi ngr epr esentanoppor t uni t yf orgener at i nganewpr oduct ? a.under st andi ngt hecust omer b.demogr aphi cchange, suchasdecr easi ngf ami l ysi ze c. changesi npr of essi onal st andar ds d.economi cchange, suchasr i si nghousehol di ncomes e. Al l oft heabov ear esuchoppor t uni t i es. e( Gener at i ngnewpr oduct s, moder at e) 41. Whi choft hef ol l owi ngi st r uer egar di ngv al ueengi neer i ng? a.Val ueengi neer i ngoccur sonl yaf t ert hepr oducti ssel ect edanddesi gned. b.Val ueengi neer i ngi st hesameasv al ueanal y si s. c. Val ueengi neer i ngi sor i ent edt owar di mpr ov ementofdesi gn. d.Val ueengi neer i ngoccur sdur i ngpr oduct i onwheni ti scl eart hepr oducti sasuccess. e. Val ueengi neer i ngcansav esubst ant i al amount sofpr oductcost , butqual i t ysuf f er s. c( Pr oductdev el opment , moder at e) 42. Reduci ngt hecompl exi t yofapr oductandi mpr ov i ngapr oduct ' smai nt ai nabi l i t yf oruse ar eact i v i t i esof a.Pr oductLi f ecy cl eManagement( PLM) b.pr oduct by v al ueanal y si s c. manuf act ur abi l i t yandv al ueengi neer i ng d.or gani zi ngf orpr oductdev el opment e. desi gnf ordest r uct i on( DFD) c( Pr oductdev el opment , moder at e) LXXXI X 43. Qual i t yf unct i ondepl oy ment( QFD) a.det er mi neswhatwi l l sat i sf yt hecust omer b.t r ansl at escust omerdesi r esi nt ot het ar getdesi gn c. i susedear l yi nt hedesi gnpr ocess d.i susedt odet er mi newher et odepl oyqual i t yef f or t s e. al l oft heabov e e( Pr oductdev el opment , moder at e) 44. Agr aphi ct echni quef ordef i ni ngt her el at i onshi pbet weencust omerdesi r esand pr oduct / ser v i cei s a.Pr oductLi f ecy cl eManagement b.t heHouseofQual i t y c. t hemomentoft r ut h d.t heassembl ydr awi ng e. t hepr oductdev el opmentt eam b( Pr oductdev el opment , moder at e) 45. Whi choft hef ol l owi ngi st r uer egar di ngcomput er ai deddesi gn? a.I ti st ooexpensi v et ousei nmostmanuf act ur i nganddesi gnset t i ngs. b.I ti sanol dt echnol ogy , nol ongeri nsi gni f i cantuse. c. I tr esul t si nl ongerdev el opmentcy cl esf orv i r t ual l yal l pr oduct s. d.I ti st heuseofcomput er st oi nt er act i v el ydesi gnpr oduct sandpr epar eengi neer i ng document at i on. e. Al l oft heabov ear et r ue. d( I ssuesf orpr oductdesi gn, moder at e) 46. Whi choft hef ol l owi ngi st r ueconcer ni ngCAD? a.Accur at ei nf or mat i onf l owst oot herdepar t ment s. b.Mostpr oductcost sar edet er mi nedatt hedesi gnst age. c. Desi gnopt i onsar eeasi ert or ev i ewbef or ef i nal commi t ment sar emade. d.Vi r t ual l yal l pr oduct shav et hei rdev el opmentcy cl eshor t ened. e. Al l oft heabov ear et r ue. e( I ssuesf orpr oductdesi gn, moder at e) 47. Whi choft hesest at ement sbestdescr i besv i r t ual r eal i t yt echnol ogy ? a.I ti susedt omoni t orandcont r ol aphy si cal pr ocess. b.I ti st heuseofspeci al comput erpr ogr amst odi r ectandcont r ol manuf act ur i ng equi pment . c. I ti st heabi l i t yt odepi ctobj ect si nt hr eedi mensi onal f or m. d.I ti sav i sual f or m ofcommuni cat i oni nwhi chi magessubst i t ut ef ort her eal t hi ng. e. noneoft heabov e d( I ssuesf orpr oductdesi gn, moder at e) 48. Whi choft hesei snotabenef i tofCAD/ CAM? a.shor t erdesi gnt i me b.i magessubst i t ut ef ort her eal pr oduct c. pr oduct i oncostr educt i ons d.newr angeofcapabi l i t i es e. dat abaseav ai l abi l i t y b( I ssuesf orpr oductdesi gn, moder at e) XC 49. Anoper at i onsmanager ' smostet hi cal act i v i t yi s a.t oenhancepr oduct i v i t ywhi l edel i v er i ngdesi r edgoodsandser v i ces b.t ousel essener gy c. t ousemor er ecy cl edi ngr edi ent s d.t ousel esshar mf ul i ngr edi ent s e. t of ol l owappr opr i at eOSHAandEPAr egul at i ons a( I ssuesf orpr oductdesi gn, moder at e) 50. Val ueanal y si st akespl ace a.whent hepr oducti ssel ect edanddesi gned b.dur i ngt hei ni t i al st agesofpr oduct i onwhensomet hi ngneedst obedonet oassur e pr oductsuccess c. whent hepr oducti sf i r stconcei v ed d.dur i ngt hepr oduct i onpr ocesswheni ti scl eart henewpr oducti sasuccess e. whent hepr oductcosti sv er yl ow d( I ssuesf orpr oductdesi gn, moder at e) 51. Whi choft hef ol l owi ngmakespr oduct st hatar ef r i endl i ert ot heenv i r onment ? a.usi ngl essmat er i al s b.mor er ecy cl edmat er i al s c. usi ngl essener gy d.usi ngl esshar mf ul i ngr edi ent s e. al l oft heabov e e( I ssuesf orpr oductdesi gn, moder at e) 52. Pr oduct sar emor e" env i r onment al l yf r i endl y "whent heyar emade a.usi ngcheapermat er i al s b.usi ngl essener gy c. accor di ngt oOSHAst andar ds d.wher eenv i r onment al r egul at i onsar el ax e. mor edi f f i cul tt odi sassembl e b( I ssuesf orpr oductdesi gn, easy ) 53. Anoper at i onsmanager ' set hi cal r esponsi bi l i t i es a.ar el i mi t edt ot hepr oduct i onphaseofpr oductl i f ecy cl e b.ar el i mi t edt of ol l owi ngpubl i shedl awsandr egul at i ons c. ext endf r om desi gn, t opr oduct i on, t of i nal dest r uct i on/ di sposi t i onofapr oduct d.donoti ncl udebei ngef f i ci entwi t ht hef i r m' sr esour ces e. neednotconsi derapr oductdesi gn' si mpactont heent i r eeconomy c( I ssuesf orpr oductdesi gn, moder at e) 54. Whi choft hef ol l owi ngi sanexampl eofanext er nal pr oductdev el opmentst r at egy ? a.newi nt er nal l ydev el opedpr oduct s b.enhancement st oexi st i ngpr oduct s c. al l i ances d.mi gr at i onsofexi st i ngpr oduct s e. Al l oft heabov ear eexampl esofi nt er nal pr oductdev el opmentst r at egy . c( Ti mebasedcompet i t i on, moder at e) XCI 55. Whi choft hef ol l owi ngpr oductdev el opmentst r at egi eshast hehi ghestr i sk? a.acqui r i ngt hedev el oper b.al l i ances c.j oi ntv ent ur es d.newi nt er nal l ydev el opedpr oduct s e.pur chasi ngt echnol ogy d( Ti mebasedcompet i t i on, moder at e) 56. Anengi neer i ngdr awi ngshowst he a.di mensi ons, t ol er ances, mat er i al s, andf i ni shesofacomponent b.di mensi ons, t ol er ances, cost , andsal esorusev ol umeofacomponent c. mat er i al s, f i ni shes, machi ni ngoper at i ons, anddi mensi onsofacomponent d.cost , mat er i al s, t ol er ances, andl eadt i mef oracomponent e. cost , di mensi ons, andmachi ni ngoper at i onsf oracomponent a( Def i ni ngt hepr oduct , moder at e) 57. Thedi mensi ons, t ol er ances, mat er i al s, andf i ni shesofacomponentar et y pi cal l yshown ona( n) a.assembl ychar t b.engi neer i ngdr awi ng c. bi l l ofmat er i al d.assembl ydr awi ng e. r out esheet b( Def i ni ngt hepr oduct , moder at e) 58. Whi choft hef ol l owi ngdoesnotr esul tf r om t heef f ect i v euseofgr oupt echnol ogy ? a.r educedt ool i ngset upt i me b.si mpl i f i edt r ai ni ng c. r educedr awmat er i al sandpur chases d.si mpl i f i edpr oduct i onpl anni ngandcont r ol e. i mpr ov edl ay out , r out i ng, andmachi nel oadi ng b( Def i ni ngt hepr oduct , moder at e) 59. Whi choft hef ol l owi ngt y pi cal l yshowst hecomponent s, t hei rdescr i pt i on, andt hequant i t y ofeachr equi r edt omakeoneuni tofapr oduct ? a.anengi neer i ngdr awi ng b.anassembl ydr awi ng c. abi l l ofmat er i al d.anassembl ychar t e. ar out esheet c( Document sf orpr oduct i on, moder at e) 60. Whi choft hef ol l owi ngshowsi nschemat i cf or m howapr oducti sassembl ed? a.anengi neer i ngdr awi ng b.anassembl ydr awi ng c. anassembl ychar t d.ar out esheet e. apr ocesssheet b( Document sf orpr oduct i on, moder at e) XCI I 61. Thecomponent s, t hei rdescr i pt i on, andt hequant i t yofeachr equi r edt omakeoneuni tofa pr oductar edocument edon a.agr oupt echnol ogyl i st i ng b.ar out esheet c. abi l l ofmat er i al s d.anengi neer i ngdr awi ng e. noneoft heabov e c( Document sf orpr oduct i on, moder at e) 62. Ar out esheetpr ov i desa( n) a.expl odedv i ewoft hepr oduct b.i nst r uct i ont omakeagi v enquant i t yofapar t i cul ari t em c. schemat i cshowi nghowt hepr oducti sassembl ed d.sequenceofoper at i onsnecessar yt opr oducet hecomponent e. setofdet ai l edi nst r uct i onsabouthowt oper f or m at ask d( Document sf orpr oduct i on, moder at e) 63. Gr oupt echnol ogyr equi r est hat a.eachcomponentbei dent i f i edbyacodi ngschemet hatspeci f i est het y peof pr ocessi ngandt hepar amet er soft hepr ocessi ng b.aspeci f i cser i esofengi neer i ngdr awi ngsbepr epar ed c. al l bi l l sofmat er i al bepr epar edusi ngt hesamef or mat d.engi neer i ngchangenot i cesbel i nkedt oeachoft hebi l l sofmat er i al andengi neer i ng not i ces e. t hef i nal pr oduct sbest andar di zed a( Def i ni ngt hepr oduct , moder at e) 64. Anassembl ydr awi ng a.shows, i nschemat i cf or m, howt hepr oducti sassembl ed b.showsanexpl odedv i ewoft hepr oduct c. l i st st heoper at i ons, i ncl udi ngassembl yandi nspect i on, necessar yt opr oducet he componentwi t ht hemat er i al speci f i edi nt hebi l l ofmat er i al d.pr ov i desdet ai l edi nst r uct i onsonhowt oper f or m agi v ent ask e. descr i best hedi mensi onsandf i ni shofeachcomponent b( Document sf orpr oduct i on, easy ) 65. Anassembl ychar t a.showsgr aphi cal l yhowt hepr oducti sassembl ed b.showsanexpl odedv i ewoft hepr oduct c. l i st st heoper at i ons, i ncl udi ngassembl yandi nspect i on, necessar yt opr oducet he componentwi t ht hemat er i al speci f i edi nt hebi l l ofmat er i al d.pr ov i desdet ai l edi nst r uct i onsonhowt oper f or m agi v ent ask e. descr i best hedi mensi onsandf i ni shofeachcomponent a( Document sf orpr oduct i on, easy ) XCI I I 66. Apr ocesssheeti sat y peof a.assembl ydr awi ng b.assembl ychar t c. r out esheet d.wor kor der e. bi l l ofmat er i al s c( Document sf orpr oduct i on, moder at e) 67. Whi choft hef ol l owi ngdocument sl i st st heoper at i ons( i ncl udi ngassembl yandi nspect i on) necessar yt opr oducet hecomponentwi t ht hemat er i al speci f i edi nt hebi l l ofmat er i al ? a.anengi neer i ngdr awi ng b.anassembl ydr awi ng c. ar out esheet d.anassembl ychar t e. anoper at i onschar t c( Document sf orpr oduct i on, moder at e) 68. Ar est aur antki t chencont ai nsawal l post ert hatshows, f oreachsandwi chont hemenu, a sket choft hei ngr edi ent sandhowt heyar ear r angedt omaket hesandwi ch.Thi si san exampl eofa( n) a.assembl ydr awi ng b.r out esheet c. bi l l ofmat er i al s d.wor kor der e. v i r t ual t echnol ogy a( Document sf orpr oduct i on, moder at e) 69. Thedocumentf orpr oduct i ont hatgi v est hei nst r uct i ont omakeagi v enquant i t yofa par t i cul ari t em, usual l yt oagi v enschedul e, i s a.t hewor kor der b.t her out esheet c. t hebi l l ofi nf or mat i on d.t heassembl ychar t e. t hev al ueanal y si s a( Document sf orpr oduct i on, moder at e) 70. Whi choft hef ol l owi ngi snotaser v i cedesi gnt echni queusedt or educecost ? a.i ncr easi ngcust omeri nt er act i on b.del ay i ngcust omi zat i on c. aut omat i on d.modul ar i zi ngt hepr oduct e. r educi ngcust omeri nt er act i on a( Ser v i cedesi gn, moder at e) XCI V 71. Whi choft hef ol l owi ngexampl esi nv ol v escust omerpar t i ci pat i oni nt hedesi gnoft he ser v i ce? a.i nv est i ngi namut ual f und b.buy i ngal i f ei nsur ancepol i cy c. pr ov i di ngt hest ockbr okerwi t ht hedesi r eddi st r i but i onoft hepor t f ol i o d.seei ngamov i eatt het heat er e. eat i ngataf ast f oodr est aur ant c( Ser v i cedesi gn, moder at e) 72. Moder nATM machi nesar eanaut omat edexampl eofaser v i cedesi gnt hat a.r educescust omeri nt er act i on b.modul ar i zest heser v i ce c. del ay sser v i cecust omi zat i on d.hasnomomentoft r ut h e. hasi nsuf f i ci entqual i t yf unct i ondepl oy ment a( Ser v i cedesi gn, moder at e) 73. Whi choft hef ol l owi ngmoment soft r ut hexempl i f i est hecust omer ' sst andar d expect at i ons? a.Youradv i sormadey ouwai t , ev ent houghy ouhadanappoi nt ment . b.Youhadt ov i si tmor et hanoncet or eachy ouracademi cadv i sor . c. Youradv i sorwascompet ent , hel pf ul , andunder st andi ng. d.Youradv i sorf ai l edt okeepherappoi nt mentwi t hy ou. e. Youradv i sorof f er edt owor kwi t hy ouaty ourconv eni ence. c( Ser v i cedesi gn, di f f i cul t ) 74. Whi chser v i cedesi gnt echni que( s)woul dor di nar i l ynotbeappr opr i at ef orf ul l ser v i ce r est aur antmeal s? a.modul ar i zi ngt hepr oduct b.cust omi zat i onasl at ei nt hepr ocessaspossi bl e c. r educi ngcust omeri nt er act i on d.t hemomentoft r ut h e. Al l oft heabov ear eappr opr i at e. c( Ser v i cedesi gn, moder at e) 75. Whi choft hef ol l owi ngscenar i osi l l ust r at esamomentt hatexceedst hecust omer ' s expect at i ons? a.anexpr essmai l ser v i cet hatguar ant eesov er ni ghtdel i v er y b.af l i ghtat t endantt hatr espondsshor t l yaf t erbei ngcal l ed c. ahai r dr essert hatcut sy ourhai ratt her i ghtl engt h d.apr of essort hatcont act speopl ei nsev er al compani est of i ndy ouaj ob e. abankt hatsendsy oumont hl yaccountst at ement s d( Ser v i cedesi gn, di f f i cul t ) 76. Whi choft hef ol l owi ngscenar i osi l l ust r at esamomentt hatmeet st hecust omer ' s expect at i ons? a.asal escl er kt hatcal l edy oubyy ournameony oursecondv i si tt ot hest or e b.anexpr essmai l ser v i cet hatguar ant eessamedaydel i v er y c. af l i ghtat t endantt hatr espondsshor t l yaf t erbei ngcal l ed d.apr of essort hatcont act speopl ei nsev er al compani est of i ndy ouaj ob XCV e. asal escl er katt hecl ot hi ngst or et hataskedy out owai tf orami nut eassoonasa weal t hy l ooki ngcust omerent er edt hest or e c( Ser v i cedesi gn, di f f i cul t ) 77. Ther ol eofdeci si ont r eesi npr oductdesi gni s a.t or ankpr oduct si ndescendi ngor deroft hei rdol l arcont r i but i ont ot hef i r m b.t obet t erunder st andt hecust omer s' want s c. t ocal cul at et heexpect edv al ueofeachcour seofact i on d.t ocal cul at et hev al ueofqual i t yf unct i ondepl oy ment e. t ocal cul at et hev al ueoft hemomentoft r ut h c( Appl i cat i onofdeci si ont r eest opr oductdesi gn, easy ) 78. Pay of f s, al t er nat i v es, andexpect edmonet ar yv al uesar et er msassoci at edwi t h a.v i r t ual r eal i t y b.Pr oductLi f ecy cl eManagement c. Qual i t yFunct i onDepl oy ment d.deci si ont r ees e. makeor buyanal y si s d( Appl i cat i onofdeci si ont r eest opr oductdesi gn, easy ) FI LLI NTHEBLANK 79. Regal Mar i ne' suseof_ _ _ _ _ _ _ _ _ _ _hasr educedpr oductdev el opmentt i meandr educed pr obl emswi t ht ool i ngandpr oduct i on. CADorComput er ai dedDesi gn( Gl obal companypr of i l e, moder at e) 80. I nt he_ _ _ _ _ _phaseoft hepr oductl i f ecy cl e, t hepr oductdesi gnhasbegunt ost abi l i z e. gr owt h( Goodsandser v i cessel ect i on, moder at e) 81. _ _ _ _ _ _ _ _ _ _ _l i st spr oduct si ndescendi ngor deroft hei ndi v i dual dol l arcont r i but i ont ot he f i r m. Pr oduct by v al ueanal y si s( Goodsandser v i cesel ect i on, moder at e) 82. _ _ _ _ _ _ _ _ _ _ _ _ _i sapr ocessf ordet er mi ni ngcust omerr equi r ement sandt r ansl at i ngt hem i nt oat t r i but est hateachf unct i onal ar eacanunder st andandactupon. Qual i t yFunct i onDepl oy mentorQFD( Goodsandser v i cesel ect i on, moder at e) 83. The_ _ _ _ _ _ _ _ _ _i sapar toft hequal i t yf unct i ondepl oy mentpr ocesst hatut i l i zesapl anni ng mat r i xt or el at ecust omer" want s"t o" how"t hef i r mi sgoi ngt omeett hose" want s. " HouseofQual i t y( Goodsandser v i cesel ect i on, moder at e) 84. _ _ _ _ _ _ _ _ _ _pr ov i desaf or matal l owi ngt heel ect r oni ct r ansmi t t al oft hr eedi mensi onal dat a. St andar df ort heexchangeofpr oductdat aorSTEP( Gener at i ngnewpr oduct s, moder at e) 85. Theuseofi nf or mat i ont echnol ogyt ocont r ol machi ner yi scal l ed_ _ _ _ _ _ _ _ _ _ _ _ _ . comput er ai dedmanuf act ur i ngorCAM ( Gener at i ngnewpr oduct s, moder at e) 86. I fadesi gncanbepr oducedt or equi r ement sev enwhent hepr oduct i onpr ocesshas unf av or abl econdi t i ons, t hedesi gni ssai dt obe_ _ _ _ _ _ _ _ _ . XCVI r obust( I ssuesf orpr oductdesi gn, moder at e) 87. Pr oduct sorser v i cesdesi gnedi neasi l ysegment edcomponent sar eknownas_ _ _ _ _ _ _ _ _ _ _ . modul ardesi gns( I ssuesf orpr oductdesi gn, moder at e) 88. _ _ _ _ _ _ _ _ _ _ _ _ _r ev i ewssuccessf ul pr oduct sf ori mpr ov ementdur i ngt hepr oduct i on pr ocess. Val ueanal y si s( I ssuesf orpr oductdesi gn, moder at e) 89. Sensi t i v i t yt oawi dev ar i et yofenv i r onment al i ssuesi npr oduct i onpr ocessesi sr ef er r edt o as_ _ _ _ _ _ _ _ _ _ _ _ _ _ . gr eenmanuf act ur i ng( I ssuesf orpr oductdesi gn, moder at e) 90. Tov i ewpr oductdesi gnf r om a" sy st ems"per spect i v e, manager smustv i ewapr oducti n t er msofi t si mpacton_ _ _ _ _ _ _ _ _ _ _ _ _ _ . t heent i r eeconomy( I ssuesf orpr oductdesi gn, easy ) 91. Boei ng' suseofepoxycomposi t esandt i t ani um gr aphi t el ami nat er epr esentt heet hi cal andenv i r onment al l yf r i endl yconceptof_ _ _ _ _ _ _ _ _ _ _ _ _ _ . usel i ght ercomponent s( I ssuesf orpr oductdesi gn, easy ) 92. Rapi dl ydev el opi ngpr oduct sandmov i ngt hem t ot hemar keti sr ef er r edt oas_ _ _ _ _ _ _ _ _ _ _ _ . t i mebasedcompet i t i on( Ti mebasedcompet i t i on, easy ) 93. Adr awi ngt hatshowst hedi mensi ons, t ol er ances, mat er i al s, andf i ni shesofacomponent i sa( n)_ _ _ _ _ _ _ _ _ _ _ _ . engi neer i ngdr awi ng( Document sf orpr oduct i on, easy ) 94. Al i st i ngoft hecomponent s, t hei rdescr i pt i on, andt hequant i t yofeachr equi r edt omake oneuni tofpr oducti st he_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ . bi l l ofmat er i al s( Document sf orpr oduct i on, moder at e) 95. Toy ot ahaspur chased_ _ _ _ _ _ _ _ _ _ _ _ _ _ _sof t war et hatwi l l t estpar t sdesi gnsandev en model t heent i r ef act or y . Pr oductLi f ecy cl eManagement( Document sf orpr oduct i on, moder at e) 96. Anexpl odedv i ewoft hepr oducti sa( n)_ _ _ _ _ _ _ _ _ _ _ _ . assembl ydr awi ng( Document sf orpr oduct i on, moder at e) 97. The_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _i st hecr uci al momentbet weent heser v i cepr ov i derandt he cust omert hatexempl i f i es, enhances, ordet r act sf r om t hecust omer ' sexpect at i ons. moment of t r ut h( Ser v i cedesi gn, moder at e) 98. I nanal y zi ngpr oductdesi gndeci si ons, deci si ont r eesdet er mi net he_ _ _ _ _ _ _ _ _ _ _ofeach cour seofact i on. expect edv al ueorEMV( Appl i cat i onofdeci si ont r eest opr oductdesi gn, moder at e) SHORTANSWER XCVI I 99. Whati st heobj ect i v eoft hepr oductdeci si on? Dev el opandi mpl ementapr oductst r at egyt hatmeet st hedemandsoft hemar ket pl ace wi t hacompet i t i v eadv ant age.( Goodsandser v i cessel ect i on, moder at e) 100.Whati sapr oduct by v al ueanal y si s, andwhatt y peofdeci si ondoesi thel pmanager s make? Apr oduct by v al ueanal y si sl i st spr oduct si ndescendi ngor deroft hei ri ndi v i dual dol l ar cont r i but i ont ot hef i r m, aswel l ast het ot al annual dol l arcont r i but i onoft hepr oduct .I t hel psmanager sev al uat epossi bl est r at egi esf oreachpr oduct .Thepr oduct by v al ue r epor tf ocusesmanagement ' sat t ent i onont hest r at egi cdi r ect i onf oreachpr oduct . ( Goodsandser v i cessel ect i on, moder at e) 101.Li stt hef act or st hati nf l uencenewpr oductoppor t uni t i es. Fact or st hati nf l uencenewpr oductoppor t uni t i esi ncl udeeconomi cchange, soci ol ogi cal anddemogr aphi cchange, t echnol ogi cal change, pol i t i cal change, andot herchanges br oughtaboutt hr oughmar ketpr act i ce, pr of essi onal st andar ds, suppl i er s, anddi st r i but or s. ( Goodsandser v i cessel ect i on, moder at e) 102." Wi t hr espectt ot hepr oductdeci si on, manager smustbeabl et oacceptr i skandt ol er at e f ai l ur e. "Commentonwhyt hi si sanecessar yhazar di nmaki ngnewpr oductdeci si ons, gi v enal l t hepower f ul t ool sandcar ef ul l ybui l tsy st emst hatsuppor tt hatdeci si on. Thev astmaj or i t yofnewpr oducti deasdonotbecomemar ket abl epr oduct s, andmost mar ket abl epr oduct sar ef ai l ur es.Per haps500desi gnsaccompanyeachsuccess. ( Goodsandser v i cessel ect i on, moder at e) 103.Li stt hegener al benef i t sder i v edf r om CAD. Pr oductqual i t y( bet t eradher encet ost andar ds) ; shor t erdesi gnt i me; pr oduct i oncost r educt i ons( f r om bet t erdesi gn) ; dat abaseav ai l abi l i t y( f ornewpr oduct s) ; andnewr ange ofcapabi l i t i es( easepr ogr ammi ngofCNCmachi nes) .( Gener at i ngnewpr oduct s, moder at e) 104.I si tpossi bl ef orapr oduct ' sl i f ecy cl est aget oaf f ecti t spr oductst r at egy ?I npar t i cul ar , descr i behowonepr oducti ngr owt handanot heri nmat ur i t ymi ghthav edi f f er entpr oduct st r at egi es. Ther ei snor easonf ort hest r at egyt obest at i ct hr ought hel i f ecy cl est ages. Or gani zat i onsof t ent r eatnewpr oduct sdi f f er ent l yt hanol derones, i nt er msofsuppor tf or changes, aggr essi v enessi npur sui tofmar ket , et c.I npar t i cul ar , gr owt hi sassoci at edwi t h st abi l i zat i onofdesi gn, andwi t hensur i ngt hatsuf f i ci entcapaci t yexi st s.Mat ur i t yi sat i me f orhi ghv ol umeoper at i onsandcostcont r ol .( Goodsandser v i cessel ect i on, moder at e) 105.Li stt hebenef i t sassoci at edwi t hv al ueengi neer i ng. Benef i t si ncl udei mmedi at ecostr educt i ons; r educedpr oductcompl exi t y ; addi t i onal st andar di zat i onofcomponent s; i mpr ov ementoff unct i onal aspect soft hepr oduct s; i mpr ov edj obdesi gnandj obsaf et y ; i mpr ov edmai nt ai nabi l i t y( ser v i ceabi l i t y )oft he pr oduct ; andr obustdesi gn.( Pr oductdev el opment , moder at e) 106.Whati sbr ai nst or mi ng? Br ai nst or mi ngi sat eam t echni quet ogener at ecr eat i v ei deasonapar t i cul arsubj ect .The goal , i napr oductdev el opmentset t i ng, i st ogener at eanopendi scussi ont hatwi l l y i el d cr eat i v ei deasaboutpossi bl epr oduct sandpr oducti mpr ov ement s.( Pr oduct dev el opment , easy ) XCVI I I 107.Whati squal i t yf unct i ondepl oy ment( QFD) ? QFDr ef er st odet er mi ni ngwhatwi l l sat i sf yt hecust omerandt r ansl at i ngt hosecust omer desi r esi nt ot het ar getdesi gn.( Pr oductdev el opment , easy ) 108.Li stt hest epsi nv ol v edi nbui l di ngt heHouseofQual i t y . I dent i f ycust omer s' want s, i dent i f ypr oduct / ser v i ceat t r i but es, r el at et hecust omer s' want s t ot hepr oduct / ser v i cehow' s, conductanev al uat i onofcompet i ngpr oduct s, dev el op per f or mancespeci f i cat i onsf orpr oductorser v i cehow' s, andassi gnhow' st ot he appr opr i at epl acei nt het r ansf or mat i onpr ocess.( Pr oductdev el opment , moder at e) 109.Expl ai nt hedi f f er encebet weenv al ueanal y si sandv al ueengi neer i ng. Val ueengi neer i ngi sconcer nedwi t hr educi ngcostandi mpr ov i ngf unct i oni na pr epr oduct i onset t i ng; v al ueanal y si s, wi t hsi mi l arai ms, t akespl acedur i ngpr oduct i on, whent hepr oducthasshownt hati twi l l succeed.Techni quesar esi mi l ar .( Pr oduct dev el opmentandI ssuesf orpr oductdesi gn, moder at e) 110.Whati sanoper at i onsmanager ' smostet hi cal act i v i t y ?Howi st hi sdut yenv i r onment al l y sound? Anoper at i onsmanager ' smostet hi cal dut yi st oenhancepr oduct i v i t ywhi l edel i v er i ng desi r edgoodsandser v i ces.I ti senv i r onment al l ysoundbecausei tl eadst ouseofl ess r esour cesperuni tofpr oduct .( I ssuesf orpr oductdesi gn, moder at e) 111.Whatt woi ssuesshoul dbeconsi der edi ncombi nat i oni nor dert oenhancet hel i kel i hood ofet hi cal deci si oni nt her eal m ofpr oductdesi gn?Whyi seachi mpor t ant ? Thet woi ssuesar e( 1)v i ewpr oductdesi gnf r om a" sy st ems"per spect i v e, and( 2) consi dert hel i f ecy cl eoft hepr oduct .Thef i r sti ssuecausesmanager st ogobey ond " whati sbestorcheapestf ort hef i r m? "Thesecondcausesmanager st oaddr ess env i r onment al concer nsov ert hel i f eoft hepr oduct , notj ustatt i meofmanuf act ur e. ( I ssuesf orpr oductdesi gn, moder at e) 112.Li stt hespeci f i cgui del i nest hatcanhel panoper at i onsmanagerachi ev eenv i r onment al l y f r i endl ydesi gns. Speci f i cal l y , t hef ol l owi ngi deasar epr esent edi nt het ext : makepr oduct sr ecy cl abl e, use r ecy cl edmat er i al , usel esshar mf ul i ngr edi ent s, usel i ght ercomponent s, usel essener gy , andusel essmat er i al .( I ssuesf orpr oductdesi gn, moder at e) 113.Whatar esomeoft hebenef i t sf r om usi ngenv i r onment al t eamsf orpr oductdesi gn? Env i r onment al t eamshel pdev el opsaf eandmor eenv i r onment al l ysoundpr oduct s, mi ni mi zet hewast eofr awmat er i al sandener gy , di f f er ent i at epr oduct sf r om compet i t i on, r educeenv i r onment al l i abi l i t i es, i ncr easecost ef f ect i v enessofcompl y i ngwi t h env i r onment al r egul at i ons, andhel pt heor gani zat i onber ecogni zedasagoodcor por at e ci t i zen.( I ssuesf orpr oductdesi gn, moder at e) 114.Di scusst headv i sabi l i t yofusi ngmodul arassembl i esi nmanuf act ur i ng.( Whatar et he adv ant agesanddi sadv ant ages? )Towhatext entcant hesear gument sbeut i l i zedi n ser v i cepr oduct s? Modul esar eeasi l ysegment edcomponent s; t heyaddf l exi bi l i t yt opr oduct i onand mar ket i ng; al l owsmi xandmat chofcomponent s( cust omi zat i onatpoi ntofcust omer cont act ) .Useofmodul esusual l ymeansf ewerpar t s, l essdesi gnandt ool i ngexpense. XCI X Di sadv ant agesi ncl udeusi ngamodul ei napr oductf orwhi chamor especi f i ccomponent woul dhav ebeenbet t er .Modul esexi sti nser v i ces, asi nf ast f oodmeal sbui l tt ocust omer speci f i cat i on.( I ssuesf orpr oductdesi gn, di f f i cul t ) 115.Whati st i mebasedcompet i t i on? Ti mebasedcompet i t i oni scompet i t i ont hati sbasedont i me.I ti nv ol v esr api d dev el opmentofpr oduct s, f asti nt r oduct i ont ot hemar ket pl ace.Of t en, t hef i r stcompany i nt opr oduct i onmayhav ei t spr oductadopt edast he" st andar d. "( Ti mebasedcompet i t i on, moder at e) 116.St at et hebenef i t sofi mpl ement i nggr oupt echnol ogy . Benef i t si ncl udei mpr ov eddesi gn; r educedr awmat er i al sandpur chases; si mpl i f i ed pr oduct i onpl anni ngandcont r ol ; i mpr ov edr out i ngandmachi nel oadi ng; r educedt ool i ng set upt i me, wor ki npr ocess, andpr oduct i ont i me; anddev el opmentofwor kcel l s. ( Def i ni ngt hepr oduct , moder at e) 117.Li stt heext er nal pr oductdev el opmentst r at egi es; descr i beeachi nasent enceort wo. Theext er nal pr oductdev el opmentst r at egi esi ncl udeal l i ances, j oi ntv ent ur es, and pur chaseoft echnol ogyorexper t i sebyacqui r i ngt hedev el oper .Al l i ancesar ecooper at i v e agr eement st hatal l owf i r mst or emai ni ndependent , butusecompl ement i ngst r engt hst o pur suest r at egi esconsi st entwi t ht hei ri ndi v i dual mi ssi ons.Joi ntv ent ur esar ecombi ned owner shi pt opur suenewpr oduct sormar ket s.Pur chasi ngt echnol ogyorexper t i sei s usual l yaccompl i shedbyacqui r i ngent r epr eneur i al f i r mst hathav eal r eadydev el opedt he t echnol ogyt hatf i t st hemi ssi on.Thei ssuet henbecomesf i t t i ngt hepur chased or gani zat i on, i t st echnol ogy , andi t spr oductl i nei nt ot hebuy i ngf i r m, r at hert hanapr oduct dev el opmenti ssue.( Ti mebasedcompet i t i on, moder at e) 118.Howdoesconf i gur at i onmanagementmani f esti t sel fwheny ouaskf orser v i ceony our aut omobi l e? Conf i gur at i onmanagementi susedbyev er yaut omobi l emanuf act ur ert ot r ackal l oft he changesbet weenanddur i ngamodel y ear .Tobespeci f i caboutt hepar tt hati sneeded, t heVI N( v ehi cl ei dent i f i cat i onnumber )i sof t enused.( Document sf orpr oduct i on, moder at e) 119.Br i ef l yexpl ai nhowPr oductLi f ecy cl eManagementi mpact spr oductdesi gn.Ci t ean exampl e. PLM at t empt st oi nt egr at emanyphasesofpr oductdesi gnandmanuf act ur e.One possi bl eusei st ol i nkCAD/ CAM wi t hr out i ng.Toy ot a' susewi l l al l owt est i ngofpar t s desi gns, andwi l l ev enal l owf ormodel i ngoff act or ybehav i or .( Document sf orpr oduct i on, moder at e) 120.Li stt hef ourmet hodsofser v i cedesi gnt hatcanr educecost sandenhancet hepr oduct . Cust omi zi ngasl at ei nt hepr ocessaspossi bl e; modul ar i zi ngt hepr oduct ; i dent i f y i ngt he ser v i cepar t st hatl endt hemsel v est oaut omat i onorr educedcust omeri nt er act i on; and f ocusi ngdesi gnont hemomentoft r ut h.( Ser v i cedesi gn, moder at e) C PROBLEMS 121.JDI , I nc.i st r y i ngt odeci dewhet hert omakeor buyapar t( #J45FPT) .Pur chasi ngt hepar t woul dcostt hem $1. 50each.I ft heydesi gnandpr oducei tt hemsel v es, i twi l l r esul ti na peruni tcostof$0. 75.Howev er , t hedesi gni nv est mentwoul dbe$50, 000.Fur t her , t hey r eal i zet hatf ort hi st y peofpar t , t her ei sa30%chancet hatt hepar twi l l needt obe r edesi gnedatanaddi t i onal costof$50, 000.Regar dl essofwhet hert heymakeor buyt he par t , JDIwi l l need100, 000oft hesepar t s.Usi ngdeci si ont r eesanal y si sandEMV, what shoul dJDIdo?Showt hedeci si ont r ee. Si ncet heexpect edv al uesr epr esentcost s, JDIshoul dsel ectt hel owestexpect edv al ue, andmaket hepar t .I t sexpect edmonet ar yv al ue( cost )i s$140, 000v er sus$150, 000f or t hebuydeci si on. ( Appl i cat i onofdeci si ont r eest opr oductdesi gn, moder at e) CI 122.Tr i pr oduct si st r y i ngt odeci dewhet hert omakeor buyanaccessor yi t em f oroneoft hei r pr oduct s.I ti spr oj ect edt hatt hi si t em wi l l sel l f or$10each.I ft hei t em i sout sour ced, t her ei sv i r t ual l ynocostot hert hant he$6peruni tt hatt heywoul dpayt hei rsuppl i er . I nt er nal l y , t heyhav et wochoi ces.Pr ocessAr equi r esani nv est mentof$120, 000f or desi gnandequi pment , butr esul t si na$4peruni tcost .Pr ocessBr equi r esonl ya $100, 000i nv est ment , buti t speruni tcosti s$5.Regar dl essofwhet hert hei t em i s subcont r act edorpr oducedi nt er nal l y , t her ei sa50%chancet hatt heywi l l sel l 50, 000uni t s, anda50%chancet hatt heywi l l sel l 100, 000uni t s.Dr awt hedeci si ont r eeappr opr i at et o t heal t er nat i v esandout comesst at ed.Usi ngdeci si ont r eesandEMV, whati st hei rbest choi ce? Pr ocessApr omi sest hehi ghestpr of i twi t hanEMVof$330, 000. ( Appl i cat i onofdeci si ont r eest opr oductdesi gn, moder at e) CI I 123.Acompanymanuf act ur esspeci al t ypol l ut i onsensi ngdev i cesf ort heof f shor eoi l i ndust r y . Onepar t i cul ardev i cehasr eachedmat ur i t y , andt hecompanyi sconsi der i ngwhet hert o r epl acei twi t hanewermodel .Technol ogi eshav enotchangeddr amat i cal l y , sot henew dev i cewoul dhav esi mi l arf unct i onal i t yt ot heexi st i ngone, butwoul dbesmal l erand l i ght eri nwei ght .Thef i r m' st hr eechoi cesar e: keept heol dmodel ; desi gnar epl acement dev i cewi t hi nt er nal r esour ces; andpur chaseanewdesi gnf r om af i r mt hati soneofi t s suppl i er s.Themar ketf ort hesedev i ceswi l l beei t her" r ecept i v e"or" neut r al "oft he r epl acementmodel .Thef i nanci al est i mat esar easf ol l ows:Keepi ngt heol ddesi gnwi l l y i el dapr of i tof$6mi l l i ondol l ar s.Desi gni ngt her epl acementi nt er nal l ywi l l y i el d$10 mi l l i oni ft hemar keti s" r ecept i v e, "buta$3mi l l i onl ossi ft hemar keti s" neut r al . " Acqui r i ngt henewdesi gnf r om t hesuppl i erwi l l pr of i t$4mi l l i onunder" r ecept i v e, "$1 mi l l i onunder" neut r al . "Thecompanyf eel st hatt hemar kethasa70per centchanceof bei ng" r ecept i v e"anda30per centchanceofbei ng" neut r al . "Dr awt heappr opr i at e deci si ont r ee.Cal cul at eexpect edv al uef oral l cour sesofact i on.Whatact i ony i el dst he hi ghestexpect edv al ue? Thet hr eeexpect edmonet ar yv al uesar e: Dev el opr epl acementi nt er nal l y : $10, 000, 000x. 7$3, 000, 000x. 3=$6. 1mi l l i on Pur chasenewdesi gn: $4, 000, 000x. 7+$1, 000, 000x. 3=$3. 1mi l l i on St aywi t hcur r entdesi gn: $6mi l l i on Thecompanyshoul dchooset hehi ghestv al ue, anddev el opar epl acementpr oductdesi gn wi t hi nt er nal r esour ces.( Appl i cat i onofdeci si ont r eest opr oductdesi gn, moder at e) CI I I