Qualitative Factor That Should Be Considered When Evaluating A Make-or-buy Decision?

Which of the following factors should be considered in a make-or-buy decision?

The two most important factors to consider in a make-or-buy decision are cost and the availability of production capacity.

What other qualitative factors should be considered?

Examples of qualitative factors include customer satisfaction with a company’s products, pending litigation that harms a company’s reputation, a change in a company’s management, the relationship the company has with key vendors, or ownership of a new technology that gives the company a competitive advantage.

Which of the following is an important qualitative factor to consider regarding a special order?

An important Qualitative factor to consider regarding a special order is the ” effect the sale of special order units will have on the the sale of regularly priced units”.

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Are qualitative factors important in decision making?

Decisions based in part on qualitative factors are relevant, even though you can’t tie specific cost or revenue numbers to them. They can have a long-term impact on profitability, so you need to consider them. Qualitative factors should always be considered before making any business decisions.

What is make buy decision explain with examples?

A Make or Buy Decision is a decision made to either manufacture a product/ service in house or buy it from outside suppliers (outsourcing) based on cost-benefit analysis.

How do you evaluate make-or-buy decisions?

What Is a Make-or-Buy Decision?

  1. A make-or-buy decision is an act of choosing between manufacturing a product in-house or purchasing it from an external supplier.
  2. Make-or-buy decisions, like outsourcing decisions, speak to a comparison of the costs and advantages of producing in-house versus buying it elsewhere.

What are examples of qualitative?

Qualitative Information – Involves a descriptive judgment using concept words instead of numbers. Gender, country name, animal species, and emotional state are examples of qualitative information.

What is a qualitative factor definition?

Qualitative factors are decision outcomes that cannot be measured. Examples of qualitative factors are: Morale. The impact on employee morale of adding a break room to the production area.

What are the qualitative and quantitative factors in decision making?

Quantitative decisions are mostly based on statistical analysis of collected data whereas qualitative decisions are based on many algorithms like type and quality of data, factors that influence collected data, risk assessments etc.

Which of the following is an example of sunk cost?

A sunk cost refers to a cost that has already occurred and has no potential for recovery in the future. For example, your rent, marketing campaign expenses or money spent on new equipment can be considered sunk costs. A sunk cost can also be referred to as a past cost.

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Which of the following is a cost that Cannot be affected by any future action?

Relevant costs are costs that will be affected by a managerial decision. Irrelevant costs are those that will not change in the future when you make one decision versus another. Examples of irrelevant costs are sunk costs, committed costs, or overheads as these cannot be avoided.

Which of the following decisions involve a choice between internal and external production?

A decision involving a choice between internal and external production is what kind of decision? A choice between internal and external production is a keep-or-drop decision. No variable marketing costs would be incurred on the order. The company is operating significantly below the maximum productive capacity.

What are the 9 quantitative approaches to decision making?

Quantitative Techniques in Decision Making | Management

  • Technique # 1. Mathematical Programming:
  • Technique # 3. Cost-Benefit Analysis:
  • Technique # 4. Linear Programming:
  • Technique # 5. Capital Budgeting:
  • Technique # 7. Expected Value:
  • Technique # 9. Simulation:
  • Technique # 12. Information Theory:
  • Technique # 13.

What is the difference between quantitative and qualitative stock evaluation factors?

In technical analysis, qualitative method gains an understanding of underlying reasons and motivations like why the trend is bullish or bearish and also to determine its quality. Quantitative method does not focus on underlying reasons and motivations but reacts 100% to preprogrammed parameters.

What are the quantitative factors in decision making?

Quantitative factors are numerical outcomes from a decision that can be measured. These factors are commonly included in various financial analyses, which are then used to evaluate a situation. Examples of quantitative factors are:

  • Direct labor hours.
  • Direct materials cost.
  • Interest cost.
  • Product returns.

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