Which Of The Following Is Not A Qualitative Factor To Be Considered In Make Or Buy Decision?

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

Choosing between these two methods is called the make-or-buy decision, or the outsourcing decision. Factors that influence the make-or-buy decision include both quantitative factors such as cost and time and qualitative factors such as the suppliers’ trustworthiness and the quality of their products.

What qualitative factors should be considered?

Qualitative factors may include: (1) effect on employee morale, schedules and other internal elements; (2) relationships with and commitments to suppliers; (3) effect on present and future customers; and (4) long-term future effect on profitability.

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.

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Which of the following is an irrelevant cost?

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.

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.

What are quantitative and qualitative factors in decision making?

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.

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.

Do qualitative factors matter in accounting?

Although relatively more difficult to analyze, the qualitative factors are an important part of a company. Since they are not measured by a number, they tend to be subjective and represent either a negative or positive force affecting the company.

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 qualitative factors should be considered in the outsourcing decision?

Let’s take a look at some of the factors to consider for taking outsourcing decisions for your business.

  • 1) Cost Savings.
  • ​2) Pricing.
  • 3) The Resources and Technology.
  • 4) The Ability To Meet Deadlines.
  • 5) Minimal Supervision.
  • 7) Trustworthiness.
  • 9) The Service Level Agreement.
  • 10) Communication.
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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.

What makes a cost relevant?

A relevant cost is a cost that only relates to a specific management decision, and which will change in the future as a result of that decision. The relevant cost concept is extremely useful for eliminating extraneous information from a particular decision-making process.

What is imputed cost with example?

Imputed cost is the cost incurred during the period when an asset is employed for a particular use, rather than redirecting the asset to a different use. This amount is the incremental difference between the two options. For example, a teacher decides to go back to school to earn a master’s degree.

What costs are always relevant?

Relevant costs include differential, avoidable, and opportunity costs. Irrelevant costs include sunk and fixed overhead costs.

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