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Chapter 07 - Managing Quality and Time to Create Value Chapter 07 Managing Quality and Time to Create Value True / False Questions 1. The return-on-quality (ROQ) view of quality management assumes that there is a tradeoff between the costs and benefits of improving quality. TRUE AACSB: Reflective Thinking AICPA FN: Measurement Difficulty: Easy Learning Objective: 1 2. A defect is an attribute of a product, either tangible or intangible, that falls short of customer expectations. TRUE AACSB: Reflective Thinking AICPA BB: Critical Thinking Difficulty: Easy Learning Objective: 1 3. The optimum quality level maximizes total quality rather than total profits. FALSE AACSB: Reflective Thinking AICPA BB: Critical Thinking Difficulty: Medium Learning Objective: 1 4. The optimum quality level is always higher than the maximum quality level. FALSE AACSB: Reflective Thinking AICPA BB: Critical Thinking Difficulty: Medium Learning Objective: 1 7-1 Chapter 07 - Managing Quality and Time to Create Value 5. Total quality management (TQM) assumes that improvements in quality, as defined by customers, will always result in improved organizational performance. TRUE AACSB: Reflective Thinking AICPA BB: Marketing Difficulty: Medium Learning Objective: 1 6. Two generally accepted quality dimensions are product or service attributes and profitability from an individual customer. FALSE AACSB: Reflective Thinking AICPA BB: Marketing Difficulty: Medium Learning Objective: 1 7. A run chart is a chart that shows trends in variations in products or service attributes over time by reflecting measures of important quality features taken at defined points in time. TRUE AACSB: Reflective Thinking AICPA FN: Measurement Difficulty: Medium Learning Objective: 2 8. The maximum and minimum desired levels on a control chart are called the upper control limit and the lower control limit. TRUE AACSB: Reflective Thinking AICPA FN: Measurement Difficulty: Medium Learning Objective: 2 7-2 Chapter 07 - Managing Quality and Time to Create Value 9. A control chart describes variation in product or service attributes over time by measuring important quality features and comparing them to maximum and minimum desired levels. TRUE AACSB: Reflective Thinking AICPA FN: Measurement Difficulty: Medium Learning Objective: 2 10. A histogram is a chart that shows trends in variation in products or service attributes over time by reflecting measures of important quality features taken at defined points in time. FALSE AACSB: Reflective Thinking AICPA FN: Measurement Difficulty: Medium Learning Objective: 2 11. Cause-and effect-analysis involves formulating diagnostic signals that identify potential causes of product or service defects. ... View Full Document

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