Business Operations Management Flashcards
7 cards from real CBO practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Business Operations Management flashcards as text
A business operator is reviewing cash flow and notices a profitable company has a negative operating cash flow. What is the most likely explanation?
Answer: Rapid growth is consuming cash through rising receivables and inventory
Fast-growing profitable companies often have negative operating cash flow because cash is tied up in growing receivables and inventory before collections occur.
Which type of market research involves analyzing existing data collected for another purpose, such as government census reports?
Answer: Secondary research
Secondary research uses previously collected data from external sources, which is faster and less expensive than primary data collection.
A business operator must choose between two equipment options: one with lower upfront cost but higher maintenance, and one with higher upfront cost but lower maintenance. Which analysis tool is most appropriate?
Answer: Total cost of ownership (TCO) analysis
TCO analysis calculates all costs over an asset's useful life, including purchase, operation, maintenance, and disposal, enabling a true cost comparison.
An employee handbook provision states employees are 'at-will.' What does this legally mean in most U.S. states?
Answer: Either the employer or employee may end employment at any time for any lawful reason
At-will employment means either party can end the employment relationship at any time without cause, as long as the reason is not legally prohibited.
A business operator is building a budget and wants to start from zero assumptions rather than adjusting prior year figures. Which budgeting method applies?
Answer: Zero-based budgeting
Zero-based budgeting requires every expense to be justified from scratch each period, eliminating automatic carryover of prior spending.
Which performance management approach involves employees setting their own goals in collaboration with managers, then being evaluated against those self-set objectives?
Answer: Management by Objectives (MBO)
MBO is a collaborative goal-setting process where managers and employees jointly define objectives and use them as the basis for performance review.
A business owner wants to protect a unique product formula from competitors indefinitely. Which form of intellectual property protection is most appropriate?
Answer: Trade secret
Trade secret protection lasts indefinitely as long as the information is kept confidential, unlike patents which expire after 20 years.