Business Unit 4 Flashcards
(36 cards)
Define Production
Production is the process of creating goods and services.
Define Productivity
Productivity is the measure of output per unit of input.
State the benefits of increasing efficiency
Benefits include reduced costs, increased output, and improved quality.
Explain 2 reasons why businesses hold inventory
Businesses hold inventory to meet customer demand and to protect against supply chain disruptions.
Define Lean Production
Lean Production is a methodology that focuses on minimizing waste while maximizing productivity.
Define Just in Time (JIT) stock control.
JIT stock control is a strategy that aligns raw-material orders with production schedules.
State two pros and two cons of JIT stock control
Pros: Reduced inventory costs, increased efficiency. Cons: Risk of stockouts, reliance on suppliers.
Define Kaizen
Kaizen is a continuous improvement philosophy that focuses on small, incremental changes.
State three benefits of lean production
Benefits include lower costs, improved quality, and faster delivery times.
Define Job Production
Job Production is a manufacturing process where products are made individually or in small batches.
State two benefits and two drawbacks of Job Production
Benefits: High customization, flexibility. Drawbacks: Higher costs, longer production times.
Define Batch Production
Batch Production is a method where goods are produced in groups or batches.
State two benefits and two drawbacks of Batch Production
Benefits: Efficient use of resources, flexibility. Drawbacks: Inconsistent quality, downtime between batches.
Define Flow Production
Flow Production is a continuous production method where items move through the production process.
State two benefits and two drawbacks of Flow Production
Benefits: High efficiency, lower unit costs. Drawbacks: Less flexibility, high initial setup costs.
State 5 new pieces of technology that improve productivity
Technologies include automation, artificial intelligence, cloud computing, IoT devices, and advanced robotics.
Define Fixed costs and give two examples
Fixed costs are expenses that do not change with the level of production. Examples: Rent, salaries.
Define Variable costs and give two examples
Variable costs are expenses that vary directly with production levels. Examples: Raw materials, direct labor.
Define average costs
Average costs are the total costs divided by the number of units produced.
Explain how to calculate total costs
Total costs are calculated by adding fixed costs and variable costs.
Define Economies of scale
Economies of scale refer to the cost advantages that a business obtains due to scale of operation.
State and explain 5 types of economies of scale
Types include purchasing economies, technical economies, managerial economies, financial economies, and marketing economies.
Define Diseconomies of Scale
Diseconomies of scale occur when a company grows too large and experiences increased per-unit costs.
State and explain three examples of diseconomies of scale
Examples include communication issues, lack of motivation among employees, and increased bureaucracy.
