Question

Which of the following is *not* an accurate characteristic of your company's production operations?

a. TQM/six sigma quality control programs and best practices training are used to promote better workmanship and reduce the number of pairs rejected due to defects
b. going into year 11, both of your company's production facilities utilize 100% new state-of-the-art equipment that was installed in Year 8; because this equipment has a useful life of only 10 years, it will have to be replaced in year 18
c. training production workers in the use of best practice procedures at each step of the manufacturing process is an important means of reducing the reject rates on pairs produced that occur due to worker error and inattention to detail
d. all additions of footwear-making equipment must be in increments of 250,000 pairs; it is up to company managers to determine whether the benefits of installing new equipment are worth the added costs
e. standard and superior materials are sourced from outside suppliers and the "base" prices of these materials that can vary up and down according to strength of global demand for and usage of standard versus superiors materials in producing footwear.

Answer 1

The inaccurate characteristic of the company's production operations is option b, as it incorrectly states when the equipment should be replaced based on its useful life.

Step-by-step explanation:

The student's question seeks to identify which statement does not accurately characterize their company's production operations. Upon reviewing the information in the provided text, it's clear that emphasis is placed on the substitution between labor and physical capital in the context of production technology.

Firms are constantly looking for ways to produce outputs at the lowest cost, which may involve choosing different levels of automation and equipment. Labor costs can influence a firm's choice towards more capital-intensive production methods.

Considering the provided statements, the inaccurate characteristic of the company's production operations is option b. It mentions that the equipment with a useful life of 10 years will have to be replaced in year 18, which is incorrect because if the equipment was installed in Year 8 and has a 10-year lifespan, it would need replacement in Year 18. This is a clear error as it should be replaced in Year 17.