You own a pizza restaurant, and the members of your kitchen staff are great workers and equally able. However, you notice that your kitchen productivity is subject to diminishing marginal returns. If so, does this mean that the third person to show up for work generates higher marginal product than the seventh person to show up for work?
The manufacturing process for electric automobiles is subject to learning curves, so future average cost of production declines as current production increases. Which of the following actions by the manufacturer would take advantage of the learning curve character?
A. Increase current production above the profit maximizing level in order to gain cost advantages in the future
B. Decrease current production below the profit maximizing level in order to earn higher profits in the future
C. Increase current production above the profit maximizing level in order to avoid higher costs in the future
D. Decrease current production below the profit maximizing level in order to save money now and in the future
When marginal cost of production rises above the average total cost of production, we know that:
A. average total cost is increasing
B. the firm has economies of scale
C. marginal cost is negative
D. average total cost is decreasing
The following sets of number represent the average costs for producing Good A, Good B, and Goods A and B together. Which of these cases represents economies of scope for the production of Goods A and B?
A. 40, 50, 120
B. 40, 50, 80
C. 50, 60, 120
D. 40, 50, 90
Suppose the monthly total costs of production for a firm may be described with the following equation: TC = 30,000,000 + 250*Q where Q is the number of items produced. True or false — this cost structure exhibits diseconomies of scale?
In the first instance the structure of the Lego group may be seen as changing significantly since 2004. The first change for the company’s structure may be seen as beginning with the appointment of a new CEO an action which may be seen as both a large pragmatic change for any organisation but also a significant one from a symbolic perspective (Mullins 2009). Such a change has allowed Lego to re-define its operations allowing the company to move into new diversified markets such as the use of the Lego brand in relation to computer games and the production of traditional sets which are related to television and cinematic spin offs. Other structural changes relate to the companies operations, operations in counties with relatively high labour costs such as Europe and the US have been outsourced to companies in Singapore and Mexico respectively. In addition the company’s operations in the Czech Republic whilst remaining under the ownership of the Lego group have been put under the day to day management of the companies joint venture partner Flextronics. These structural changes which have taken place within Lego’s operational function have allowed the company to make significant savings in labour costs. Despite these advantages there must also be the consideration that there are some draw backs. In outsourcing production there is the consideration that Lego will lose some of the control it had over its operations previously (Slack 2009), this is a key consideration for Lego as the success of the company and its brand has previously relied on a high association with good quality, something which may be damaged if outsourcing is not managed correctly. HR: The company’s HR policy may be seen as a true test of the organisations wider values against a back drop of changing economic conditions. On the one hand the company’s policies may be seen as facilitation an organisation which values organisational learning and development through the medium of its staff. Such considerations can be seen in the specific deployment of such policies of continuous improvement which is a key contributor to the company’s high standards for product quality. Despite this following such heavy losses in 2004 Lego made significant reductions of staff from 5,604 in 2004 to a low of 4,199 in 2007 a figure which has since recovered dramatically to 5,388 in 2008. As such the company may be seen as demonstrating that whilst its organisational values are key to its success reductions will be made to adapt to market conditions were necessary. Another contradiction that one may consider is that the company in the case study maintains that it will meet the legal requirements as a minimum in relation to its operations. This raises two concerns in the first case there is the consideration that all companies should in theory meet these minimum standards in any case and so this doesn’t really form a policy so much as a statement of the obvious. In the second instance Lego in recent years has outsourced a considerable amount of its operations t>GET ANSWER