MGT 301 Flashcards
(372 cards)
1
Q
chapter 1
The service sector has lower productivity improvements than the manufacturing sector because __________.
the output quality is lower in the service sector than in the manufacturing sector
the service sector uses less skilled labor than the manufacturing sector
the service sector is usually more labor intensive than the manufacturing sector
A
the service sector is usually more labor intensive than the manufacturing sector
2
Q
A law firm has a staff of four employees working 8 hours a day for a total payroll cost of $640. In addition, the law firm has overhead expenses of $800 per day. Due to a recent software change, the same employees are able to process 14 case files a day rather than 8 using the old software system. What is the multifactor productivity of this revised operation?
A
0.097
Multifactor productivity = Output/
Labor + Material + Energy + Capital + Miscellaneous
3
Q
An insurance adjuster processes the claims of six policy holders in an eight hour work day. The adjuster uses $5 in gasoline and $3 in forms and office supplies to complete the work. What is her labor productivity?
A
Single-factor productivity = Units produced/Labor-hours used
0.75 claims per hours
4
Q
Which of the following is not one of the basic functions of the management process?
planning , organizing , inspecting, staffing , leading , and controlling
A
The management process consists of planning , organizing , staffing , leading , and controlling .
inspecting
5
Q
Three critical productivity input variables are __________.
A
labor, capital and management
6
Q
The total of all outputs produced by the transformation process divided by the total of the inputs is __________.
A
multifactor productivity
7
Q
Which of the following is not a typical service attribute?
Customer interaction is high
Intangible product
YOU WERE SURE AND CORRECT
Easy to store
A
Easy to store
8
Q
A foundry produces manhole covers. If 120 covers are produced in a 10-hour shift, the productivity of the line is __________.
A
12 covers / hr
9
Q
The person who is most noted for his contributions to quality control in operations management was __________.
A
W. Edwards Deming
10
Q
Which of the following appears to provide the best opportunity for increases in productivity?
A
management
11
Q
The service sector makes up approximately what percentage of all jobs in the United States?
A
85%
12
Q
Two car wash employees are paid $7.50 an hour each and are capable of washing 12 cars per hour, using $1 of water and $2 of soap and other cleaning supplies. What is the multifactor productivity of this operation?
A
tricky: two
0. 66
13
Q
Increases in productivity are difficult to achieve if __________.
A
the task is more personal
14
Q
Among the ethical and social challenges facing operations managers are __________.
A
maintaining a sustainable environment
15
Q
The “father” of scientific management is __________.
A
Frederick W. Taylor
16
Q
The person who introduced standardized, interchangeable parts was __________.
A
Eli Whitney
17
Q
The three major business functions necessary to all organizations are __________.
A
marketing, finance/accounting and production/operations
18
Q
An operations task performed at Hard Rock Café is __________.
A
preparing employee schedules
19
Q
Frito Lay scores well above the passing grade in quality control and utilizes statistical process controls to assist in these efforts. Which of the 10 operation management decisions is involved? A. layout B. quality C. supply chain management D. process strategy
A
B
10 decision
Design of goods and services
Managing quality
Process and capacity strategy
Location strategy
Layout strategy
Human resources and job design
Supply chain management
. Inventory management
Scheduling:
Maintenance
20
Q
The Frito-Lay plant applies a product focus strategy, which is appropriate for what type of producer? A. low-volume, low-variety B. high-volume, high-variety C. high-volume, low-variety D. low-volume, high-variety
A
High-volume, low-variety
21
Q
What drives plant location decisions at Frito-Lay? A. labor costs B. environmental regulations C. cost and availability of utilities D. proximity to raw materials or markets
A
Proximity to raw materials or markets
22
Q
Which of the following is not cited in the Frito-Lay video as one of the reasons why the company's employee turnover is low? A. strong concern for safety and ergonomics B. day care for children of employees C. respect for people D. good benefits
A
Day care for children of employees
23
Q
For each 1% downtime due to a breakdown in equipment, how much of a loss is incurred at Frito-Lay's Orlando plant? A. $200,000 B. $15,000 C. $94,000 D. $100,000
A
200000
24
Q
chapter 2
Which of the following OM strategic decisions pertains to the sensible location of processes and materials in relation to each other?
Goods and services design
Supply-chain management
Layout design
A
layout design
25
Which of the international operations strategies involves a focus on cost reductions and high local responsiveness?
Transnational
Global
Multidomestic
Multidomestic
26
Which of the following is correct?
KSFs are both necessary and sufficient for competitive advantage.
KSFs are often necessary, but not sufficient for competitive advantage.
KSFs are often important, but not necessary for competitive advantage.
KSFs are often important, but not necessary for competitive advantage.
Key success factors (KSFs) Activities or factors that are key to achieving competitive advantage.
Key Success Factors and Core Competencies
B ecause no firm does everything exceptionally well, a successful strategy requires determining the firm’s key success factors and core competencies. Key success factors (KSFs) are those activities that are necessary for a firm to achieve its goals. Key success factors can be so s ignificant that a firm must get them right to survive.
27
Which of the following activities takes place most immediately once the organization's mission has been developed?
The functional areas develop their supporting missions.
Unselected
Operational tactics are developed.
Unselected
The firm develops alternative or back-up missions in case the original mission fails.
The functional areas develop their supporting missions
28
Which of the following is not part of value-chain analysis?
Financial management
Human resources
Product research
Financial management
Value-chain analysis is used to identify activities that represent strengths, or potential strengths, and may be opportunities for developing competitive advantage. These are areas where the firm adds its unique value through product research, design, human resources, supply-chain management, process innovation, or quality management.
29
Porter’s Five Forces Model is used to evaluate competition based on which 5 aspects?
Immediate rivals, potential entrants, customers, suppliers and substitute prodcuts
30
The fundamental purpose of an organization’s mission statement is to __________.
define the organization's purpose in society
31
An activity map __________.
Activity map A graphical link of competitive advantage, KSFs, and supporting activities.
32
Which of the following international operations strategies allows a firm to pursue all three operations strategies?
Transnational strategy
An international strategy uses exports and licenses to penetrate the global arena
he multidomestic strategy has decentralized authority with substantial autonomy at each business.
A global strategy has a high degree of centralization, with headquarters coordinating the organization to seek out standardization and learning between plants, thus generating economies of scale.
A transnational strategy exploits the economies of scale and learning, as well as pressure for responsiveness, by recognizing that core competence does not reside in just the “home” country but can exist anywhere in the organization.
33
Standardization is an appropriate strategy in which stage of the product life cycle?
Maturity
Different issues are emphasized during different stages of the product life cycle:
Introduction —Company strategy: Best period to increase market share, R&D engineering is critical. OM strategy: Product design and development critical, frequent product and process design changes, short production runs, high production costs, limited models, attention to quality.
Growth —Company strategy: Practical to change price or quality image, strengthen niche. OM strategy: Forecasting critical, product and process reliability, competitive product improvements and options, increase capacity, shift toward product focus, enhance distribution.
Maturity —Company strategy: Poor time to change image or price or quality, competitive costs become critical, defend market position. OM strategy: Standardization, less rapid product changes (more minor changes), optimum capacity, increasing stability of process, long production runs, product improvement and cost cutting.
j Decline —Company strategy: Cost control critical. OM strategy: Little product differentiation, cost minimization, overcapacity in the industry, prune line to eliminate items not returning good margin, reduce capacity.
34
Which of the following statements concerning the operations management decision is relevant to services?
There are many objective quality standards.
The customer is not involved in most of the process.
Labor standards vary depending on customer requirements.
Labor standards vary depending on customer requirements.
35
The difference between a multinational corporation (MNC) and an international business is that __________.
the multinational firm owns or operates facilities in a variety of countries
36
Which of the following is true?
Functional missions are combined to become the corporate mission.
Corporate strategy is shaped by functional strategies.
Functional strategies are shaped by corporate strategy.
Functional strategies are shaped by corporate strategy
37
A firm can effectively use its operations functions to yield competitive advantage through all of the following except __________.
setting equipment utilization goals
customization of product
maintaining a variety of product options
setting equipment utilization goals
38
Which of the following is least likely to be a cost leadership competitive advantage?
ANSWER
Correct
Broad product line
Unselected
Inventory management
Unselected
Mass production
broad product line
q 15
Low-cost leadership Achieving maximum value, as perceived by the customer
39
The ability of an organization to produce goods or services that have some uniqueness in their characteristics is __________.
competing on flexibility
Unselected
competing on differentiation
Unselected
competing on response
competing on differentiation
40
Which of the following international operations strategies involves a high degree of centralization?
ANSWER
Unselected
Global strategy
Unselected
Multidomestic strategy
Unselected
Transnational strategy
Global strategy
41
Which of the following is not one of the 10 strategic OM decisions listed in the text?
ANSWER
Unselected
Marketing
Unselected
Location selection
Unselected
Quality
marketing
42
Which of the following is the best example of competing on low-cost leadership?
ANSWER
Unselected
A firm produces more reliable products than its competitors.
Unselected
A firm produces its product with less raw material waste than its competitor.
Unselected
A firm’s products are introduced to the market faster than its competitors.
A firm produces its product with less raw material waste than its competitor
43
A strategy is __________.
ANSWER
Unselected
a set of opportunities in the marketplace
Unselected
a broad statement of purpose
Unselected
an action plan to achieve the mission
an action plan to achieve the mission
44
A firm producing a good is more likely to have which set of the following characteristics compared to a firm providing a service?
ANSWER
Unselected
Objective quality standards, tangible product and located away from customers
Unselected
Subjective quality standards, intangible product and located away from customers
Unselected
Objective quality standards, intangible product and located near customers
Unselected
Subjective quality standards, tangible product and located away from customers
Objective quality standards, tangible product and located away from customers
45
The ability of an organization to produce services that, by utilizing the consumers’ five senses, have some uniqueness in their characteristics is __________.
ANSWER
Unselected
flexible response
Unselected
experience differentiation
Unselected
product differentiation
experience differention
46
An international business is a firm that __________.
ANSWER
Unselected
uses raw materials from outside the country
Unselected
participates in international trade or investment
Unselected
hires non-U.S. citizens
participates in international trade or investment
47
```
How many different model boats are manufactured at Regal Marine?
A.
50
B.
22
C.
15
D.
37
```
22
48
```
In how many countries does Regal Marine have distributors?
A.
25
B.
40
C.
83
D.
32
```
40
49
```
Regal Marine utilizes the strategy of differentiation. Three aspects of differentiation are listed below; which one does not belong in this grouping?
A.
high quality
B.
marketing
C.
constant innovation
D.
unique features
```
B.
| marketing
50
```
Competing on cost is
A.
achieving maximum value as perceived by the customer.
B.
concerned with reliability of scheduling.
C.
concerned with uniqueness.
D.
based upon flexibility.
```
A.
| achieving maximum value as perceived by the customer.
51
```
Which of the following does not represent competing on response?
A.
based on quickness
B.
based on providing uniqueness
C.
based on flexibility
D.
concerned with reliability of scheduling
```
B.
| based on providing uniqueness
52
```
The creation of a unique advantage over competitors is referred as
A.
response.
B.
experience differentiation.
C.
differentiation.
D.
competitive advantage.
```
D.
| competitive advantage.
53
```
Which of the following is NOT one of the 10 strategic OM decisions listed in the text?
A.
quality
B.
location
C.
finance/accounting
D.
layout
```
finance/accounting ---- this is a primary function to an organization
54
```
Which of the following is NOT an OM strategy/issue during the introduction stage of the product life cycle?
A.
frequent product and process design changes
B.
high production costs
C.
limited models
D.
long production runs
```
D.
| long production runs
55
```
Which of the following is NOT an OM strategy/issue during the growth stage of the product life cycle?
A.
reduce capacity
B.
enhance distribution
C.
shift towards product focus
D.
forecasting critical
```
A.
| reduce capacity
56
```
Which of these is NOT an advantage of outsourcing?
A.
accessing outside technology
B.
cost savings
C.
gaining outside expertise
D.
potential creation of future competition
```
D.
| potential creation of future competition
57
chapter 16
Which of the following is an illustration of employee empowerment?
ANSWER
Unselected
Unionization of the workplace brings better morale and therefore better quality
Unselected
UPS drivers are trained to perform several motions smoothly and efficiently
Unselected
“No one knows the job better than those who do it.”
“No one knows the job better than those who do it.”
c (Toyota production system, moderate)
Lean production means doing more with less – less time, less space, less human effort, less machinery, less materials – while giving customer’s what they want.
58
Which one of the following is a concern expressed by suppliers?
ANSWER
Unselected
Having too many customers
Unselected
Large lot sizes
Unselected
Having limited ability to respond to changes in product and quality
Having limited ability to respond to changes in product and quality
c (Just-in-time (JIT), moderate)
59
Lead time for computers is 7 days with daily demand of 5 computers and a safety stock of 1 day. Each kanban holds 8 computers. What is the correct number of kanbans?
ANSWER
Unselected
5
Unselected
7
Unselected
8
5
but why?
60
The list of the 5Ss supports lean production by __________.
ANSWER
Unselected
reducing inventory, in the “standardize” item
Unselected
identifying non-value items and removing them, in the “sort/segregate” item
Unselected
increasing variability through standardization, in the “standardize” item
Lean Tools – 5S Seiri / Sort Seiton / Set in Order Seiso / Shine Seiketsu / Standardize Shitsuke / Sustai
identifying non-value items and removing them, in the “sort/segregate” item
61
The technique known as level schedules:
ANSWER
Unselected
processes many small batches rather than one large batch.
Unselected
allows for variance in scheduling between batches.
Unselected
is based on meeting one week’s demand.
level schedules?
processes many small batches rather than one large batch.
处理许多小批量而不是一个大批量。
62
Which of the following is generally found in most JIT environments?
ANSWER
Unselected
Pull systems
Unselected
A push or pull system, depending upon the rate of demand
Unselected
Push systems
what is JIT
pull systems
A pull system pulls a unit to where it is needed just as it is needed. Pull systems are a standard tool of Lean. Pull systems use s ignals to request production and delivery from supplying stations to stations that have production c apacity available. The pull concept is used both within the immediate production process and with s uppliers. By pulling material through the system in very small lots
A push system dumps orders on the next downstream workstation, regardless of timeliness and resource availability.
Pull systems are generally found in most JIT environments. Pull systems begin with the customer’s order. In pull systems workflow is initiated by the “pull” of the customer’s order. Thus, rather than pushing products based on forecasting models, JIT systems give the customer what they want when they want without waste or excessive holding inventory.
Push systems of inventory management involve forecasting inventory needs to meet customer demand. Under push systems companies must predict what products a customer will purchase along with determining the quantity of products purchased. This method tends to create a buffer of inventory to meet future demand and in JIT environments inventory is viewed as a waste.
63
The number of kanbans should be equal to:
ANSWER
Unselected
demand during lead time
Unselected
½ of the EOQ
Unselected
the ratio of (demand during lead time + safety stock) to container size
the ratio of (demand during lead time + safety stock) to container size
Lead time for computers is 7 days with daily demand of 5 computers and a safety stock of 1 day. Each kanban holds 8 computers. What is the correct number of kanbans?
(5 + 1) x 7 /8 = 5.2 and round it to 5 ?
ANSWER
Unselected
5
Unselected
7
Unselected
8
64
Which one of the following is an example of JIT being used for competitive advantage?
ANSWER
Unselected
Lafourche Metals increases the number of suppliers to be less dependent on just a few
Unselected
Houma Fabricators is proud to announce that incoming goods are inspected
Unselected
Jones Company has decreased the number of job classifications to just a few
Jones Company has decreased the number of job classifications to just a few
65
Which of the following is specifically characterized by a focus on continuous improvement, respect for people, and standard work practices?
ANSWER
Unselected
Lean Operations
Unselected
Just in Time
Unselected
Toyota Production System
Toyota Production System
66
A firm wants to develop a level material use schedule based on the following data. What should be the setup cost?
Desired lot size:
60
Annual demand:
40,000
Holding cost:
$20 per unit per year
Daily production rate:
320
Work days per year:
250
ANSWER
Unselected
$0.45
Unselected
$4.50
Unselected
$45
level schedule
Scheduling products so that each day’s production meets the demand for that day.
0.45
67
If the goals of JIT partnerships are met, which of the following is a result?
ANSWER
Unselected
For incoming goods, receiving activities are outsourced
Unselected
In-plant inventory replaces in-transit inventory
Unselected
In-transit inventory falls as suppliers are located closer to facilities
In-transit inventory falls as suppliers are located closer to facilities
68
What is the rate required to push orders through the production process?
ANSWER
Unselected
Throughput time
Unselected
Manufacturing cycle time
Unselected
Push time
Throughput time
The throughput time , on the other hand, is the time it takes a unit to go through production from start to end, with no waiting . (Throughput time describes the behavior in an empty system. In contrast, flow time describes the time to go through a production process from beginning to end, including idle time waiting for stations to finish working on other units.)
69
Which one of the following is a characteristic of a JIT partnership?
ANSWER
Unselected
Active pursuit of vertical integration
Unselected
Maximal product specifications imposed on supplier
Unselected
Removal of incoming inspection
removal of incoming inspection, why?
The philosophy behind just-in-time (JIT) is one of continuing improvement and enforced problem solving. JIT systems are designed to produce or deliver goods just as they are needed. JIT is related to quality in three ways:
◆ JIT cuts the cost of quality: This occurs because scrap, rework, inventory investment, and damage costs are directly related to inventory on hand. Because there is less inventory on hand with JIT, costs are lower. In addition, inventory hides bad quality, whereas JIT immediately exposes bad quality.
◆ JIT improves quality: As JIT shrinks lead time, it keeps evidence of errors fresh and limits the number of potential sources of error. JIT creates, in effect, an early warning system for quality problems, both within the firm and with vendors.
◆ Better quality means less inventory and a better, easier-to-employ JIT system: Often the purpose of keeping inventory is to protect against poor production performance resulting from unreliable quality. If consistent quality exists, JIT allows firms to reduce all the costs associated with inventory.
70
Which one of the following is not a layout tactic in a JIT environment?
ANSWER
Unselected
Fixed equipment
Unselected
Minimizing distance
Unselected
Work cells for families of products
Fixed equipment why?
71
Lead time for cakes is 2 days with daily demand of 10 cakes and safety stock of ½ a day. Each container (kanban) holds one cake. What is the correct number of kanbans?
ANSWER
Unselected
25
Unselected
10
Unselected
1
25
72
If a casual-dining restaurant is attempting to practice JIT and lean operations, which of the following would not be present?
ANSWER
Unselected
A kitchen set up to minimize unnecessary movement
Unselected
Close relationship with the restaurant’s suppliers of food, utensils, and equipment
Unselected
Food preparation in large batches
Food preparation in large batches
73
Which of the following statements is true about the kanban system?
ANSWER
Unselected
The customer workstation signals to the supplier workstation when production is needed.
Unselected
It is useful to smooth operations when numerous large and small lot sizes exist.
Unselected
The supplier workstation signals the customer workstation as soon as a batch is completed.
The customer workstation signals to the supplier workstation when production is needed.
Kanban
One way to achieve small lot sizes is to move inventory through the shop only as needed rather than pushing it on to the next workstation whether or not the personnel there are ready for it. As noted earlier, when inventory is moved only as needed, it is referred to as a pull system, and the ideal lot size is one. The Japanese call this system kanban . Kanbans allow arrivals at a work center to match (or nearly match) the processing time. Kanban is a Japanese word for card . In their effort to reduce inventory, the Japanese use systems that “pull” inventory through work centers. They often use a “card” to signal the need for another container of material—hence the name kanban. The card is the authorization for the next container of material to be produced. Typically, a kanban signal exists for each container of items to be obtained. An order for the container is then initiated by each kanban and “pulled” from the producing department or supplier. A sequence of kanbans “pulls” the material through the plant.
74
chapter 6
Which of the following is not an attribute of lean operations?
ANSWER
Unselected
Educating suppliers to accept responsibility for helping meet customer needs
Unselected
Pushing responsibility to the highest level through centralized decision making
Unselected
Eliminating almost all inventory through utilization of JIT
Pushing responsibility to the highest level through centralized decision making
75
Which of the following is specifically characterized by continuous and forced problem solving through a focus on throughput and reduced inventory?
ANSWER
Unselected
Lean Operations
Unselected
Just-in-Time
Unselected
Toyota Production System
Just-in-Time
76
Which of the following is not characteristic of a TPS employee?
ANSWER
Unselected
Empowered
Unselected
Strict job classifications
Unselected
Knowledgeable
Strict job classifications
77
JIT makes quality less expensive because __________.
ANSWER
Unselected
it hides quality improvement costs in inventory
Unselected
it prevents long runs of defects
Unselected
it uses larger batch production
it prevents long runs of defects
78
Which of the following is not a reason for variability?
ANSWER
Unselected
Customer demand is unknown
Unselected
Employees, machines, and suppliers follow production standards
Unselected
Engineering drawings are incomplete
Employees, machines, and suppliers follow production standards
79
Which of the following is not a goal of JIT Partnerships?
ANSWER
Unselected
Removal of engineering changes
Unselected
Removal of in-plant inventory
Unselected
Removal of receiving activities
Removal of engineering changes
80
Characteristics of JIT partnerships with respect to suppliers include:
ANSWER
Unselected
pursuit of vertical integration to reduce number of suppliers.
Unselected
supporting suppliers so they become or remain price competitive.
Unselected
frequent competitive bidding.
supporting suppliers so they become or remain price competitive.
81
```
Surgical packs are designed by physicians and stored in a local warehouse. At what time of the day are the requested packs delivered to Arnold Palmer Hospital from the warehouse?
A.
4 a.m.
B.
1 a.m.
C.
10 a.m.
D.
6:30 a.m.
```
4 a.m.
82
```
After surgical packs have been delivered to Arnold Palmer Hospital, who is responsible for sorting them and transferring them to the appropriate surgical suite on a daily basis?
A.
nurses
B.
central supply staff
C.
case managers
D.
aides
```
central supply staff
83
```
Before attempting the exercise, click here to watch a short video.
McKesson supplies Arnold Palmer Hospital with many supplies and they are delivered to them daily. How much of a drop in Central Supply average daily inventory has there been since JIT?
A.
$805,000 to $97,000
B.
$4,000 to $1,000
C.
$400,000 to $114,000
D.
$8,000 to $7,000
```
$400,000 to $114,000
84
Which of the following is false regarding control charts?
ANSWER
Unselected
Control charts are built so that new data can be quickly compared to past performance data.
Unselected
Values above the upper control limit always imply that the product’s quality is exceeding expectations.
Unselected
Control charts graphically present data.
Values above the upper control limit always imply that the product’s quality is exceeding expectations.
85
Companies with the highest levels of quality are about how many times more productive than their competitors with the lowest quality levels?
ANSWER
Unselected
5
Unselected
3
Unselected
4
5
86
Attribute inspection measures __________.
ANSWER
Unselected
if the product is good or bad
Unselected
the source of production
Unselected
the scale or strength of a product
if the product is good or bad
87
“Making it right the first time” is __________.
ANSWER
Unselected
a product-based definition of quality
Unselected
a user-based definition of quality
Unselected
a manufacturing-based definition of quality
a manufacturing-based definition of quality
88
The “four Ms” of cause-and-effect diagrams are __________.
ANSWER
Unselected
material, methods, manpower, and motivation
Unselected
material, management, manpower, and motivation
Unselected
material, machinery, manpower, and methods
material, machinery, manpower, and methods
89
What is the only internationally recognized quality standard?
ANSWER
Unselected
ISO 14000
Unselected
ISO 9000
Unselected
TQM
ISO 9000
90
Which of the determinants of service quality involves having the customer’s best interests at heart?
ANSWER
Unselected
Responsiveness
Unselected
Credibility
Unselected
Courtesy
Credibility
91
ISO 9000 seeks standardization in terms of __________.
ANSWER
Unselected
suppliers’ specifications
Unselected
production procedures
Unselected
procedures to manage quality
procedures to manage quality
92
Based on his 14 Points, Deming is a strong proponent of __________.
ANSWER
Unselected
training and knowledge
Unselected
inspection at the end of the production process
Unselected
an increase in the numerical quotas to boost productivity
training and knowledge
93
Pareto charts are used to __________.
ANSWER
Unselected
identify inspection points in a process
Unselected
show material flow
Unselected
organize errors, problems, or defects
organize errors, problems, or defects
整理错误，问题或缺陷
94
A device or technique that ensures production of a good unit every time is a __________.
ANSWER
Unselected
PDCA
Unselected
benchmarking
Unselected
Poka-yoke
Poka-yoke
95
A successful TQM program incorporates all of the following except __________.
ANSWER
Unselected
centralized decision-making authority
Unselected
continuous improvement
Unselected
benchmarking
centralized decision-making authority
96
In which of the four major categories of quality costs would the costs associated with scrap and rework belong?
ANSWER
Unselected
Prevention
Unselected
External failure
Unselected
Internal failure
Internal failure
97
Which of the four major categories of quality costs is particularly hard to quantify?
ANSWER
Unselected
Prevention costs
Unselected
Internal failure costs
Unselected
External failure costs
External failure costs
98
Which of the following is not a typical inspection point?
ANSWER
Unselected
After a costly process
Unselected
Before the product is shipped
Unselected
When production or service is complete
After a costly process
99
Quality “lies in the eyes of the beholder” is __________.
ANSWER
Unselected
a product-based definition of quality
Unselected
a manufacturing-based definition of quality
Unselected
a user-based definition of quality
a user-based definition of quality
100
PDCA is most often applied to which aspect of TQM?
ANSWER
Unselected
Continuous improvement
Unselected
Employee empowerment
Unselected
Benchmarking
Continuous improvement
101
Costs of dissatisfaction, repair costs, and warranty costs are elements of cost in the __________.
ANSWER
Unselected
PDCA
Unselected
Taguchi Quality Loss Function
Unselected
Pareto chart
Taguchi Quality Loss Function
102
Which of the following is true about the ISO 9000 certification?
ANSWER
Unselected
It deals with environmental management.
Unselected
One of the core-elements is a life-cycle assessment.
Unselected
Certified organizations must be audited every three years
Certified organizations must be audited every three years
103
Total quality management emphasizes __________.
ANSWER
Unselected
the responsibility of the quality control staff to identify and solve all quality-related problems
Unselected
a commitment to quality that goes beyond internal company issues to suppliers and customers
Unselected
a system where strong managers are the only decision makers
a commitment to quality that goes beyond internal company issues to suppliers and customers
104
A customer service manager at a retail clothing store has collected numerous customer complaints from the forms they fill out on merchandise returns. To analyze trends of patterns in these returns, she has organized these complaints into a small number of sources or factors. This is most closely related to the __________ tool of TQM.
ANSWER
Unselected
Taguchi Quality Loss Function
Unselected
cause-and-effect diagram
Unselected
scatter diagrams
cause-and-effect diagram
105
One of Britain’s largest children’s hospital's working with Ferrari Racing is an example of __________.
ANSWER
Unselected
external benchmarking
Unselected
internal benchmarking
Unselected
Taguchi concepts
external benchmarking
106
Building high-morale organizations and building communication networks that include employees are both elements of __________.
ANSWER
Unselected
ISO 9000
Unselected
Taguchi methods
Unselected
employee empowerment
employee empowerment
| 员工授权
107
A six sigma program has how many defects per million?
ANSWER
Unselected
3.4
Unselected
34
Unselected
6 times the standard deviation
3.4
108
A production manager at a pottery factory has noticed that about 70 percent of defects result from impurities in raw materials, 15 percent result from human error, 10 percent from machine malfunctions, and 5 percent from a variety of other causes. This manager is most likely using __________.
ANSWER
Unselected
a Pareto chart
Unselected
a Taguchi Quality Loss Function
Unselected
a cause-and-effect diagram
a Pareto chart
109
```
The Arnold Palmer Hospital uses _______________ to give hospital personnel a quick, visual overview of what's happening in house, versus internal goals and external national norms.
A.
check sheets
B.
scatter diagrams
C.
histograms
D.
Pareto charts
```
Pareto charts
110
```
Of the following list of tools used at Arnold Palmer Hospital, which one graphically describes a process or system?
A.
OM charts
B.
flip charts
C.
flow charts
D.
check sheets
```
flow charts
111
Before attempting the exercise, click here to watch a short video.
How does Arnold Palmer Hospital empower employees?
A.
Employees can provide gifts of up to $200 to patients with a complaint.
B.
Employees are given gift certificates to give to patients with a complaint.
C.
They don't because of the strict assignment of duties in a hospital.
D.
Only doctors are given options of patient care.
Employees can provide gifts of up to $200 to patients with a complaint.
112
```
Patient surveys reflect scores of overall patient satisfaction. Where does Arnold Palmer Hospital rank?
A.
top 10%
B.
top 2%
C.
top 28%
D.
top 19%
```
top 10%
113
chapter 16 practice assignment
```
Which of the following is NOT one of Taiichi Ohno's seven wastes?
A.
energy
B.
transportation
C.
queues
D.
motion
```
energy
114
```
Inventory reduction via JIT is an effective tool for identifying
A.
inefficiencies in warehouse layout.
B.
causes of variability.
C.
holding costs.
D.
setup costs.
```
causes of variability.
115
```
The 5Ss developed by the Japanese do NOT include
A.
simplify/straighten.
B.
standardize.
C.
sort/segregate.
D.
safety.
```
safety.
116
```
What is a concept that results in material being produced only when requested and moved to where it is needed just as it is needed?
A.
push system
B.
requisition system
C.
procrastination system
D.
pull system
```
pull system
117
```
What is an arrangement in which the supplier maintains title to the inventory until it is used?
A.
consignment inventory
B.
supplier control
C.
postponement
D.
delayed transfer
```
Consignment inventory
118
```
Which of the following is NOT a Lean inventory tactic?
A.
reduce lot size
B.
use group technology
C.
use a push system to move inventory
D.
reduce setup time
```
use a push system to move inventory
119
```
Which of the following words means continuous improvement in Japanese?
A.
sensei
B.
kanban
C.
poka-yoke
D.
kaizen
```
kaizen
120
Which of the following is NOT one of the principles for standard work practice at Toyota?
A.
Improvements in the system must be made in accordance with the "scientific method," at the highest possible level in the organization.
B.
Material and service flows are to be simple and direct.
C.
Internal and external customer-supplier connections are direct, specifying personnel, methods, timing, and quantity.
D.
Work is completely specified as to content, sequence, timing, and outcome.
Improvements in the system must be made in accordance with the "scientific method," at the highest possible level in the organization.
121
```
JIT has an internal focus while lean production begins with an external focus on
A.
customers.
B.
logistics.
C.
design.
D.
supplier relationships.
```
customers.
122
Which of the following attributes is NOT for lean operations?
A.
Empower employees.
B.
Develop worker flexibility.
C.
Develop collaborative partnerships with suppliers.
D.
Build processes that increase variability.
Build processes that increase variability.
123
```
Excess bags of basic commodities such as flour and sugar that are stored in a restaurant's kitchen represent which of the following wastes?
A.
overproduction
B.
queues
C.
defective product
D.
transportation
E.
inventory
```
inventory
124
```
Kanban is associated with all EXCEPT which of the following?
A.
reductions in inventory
B.
small lot sizes
C.
increased material handling
D.
moving inventory only as needed
E.
signals, such as cards, lights, or flags
```
increased material handling
125
```
The cook in a fast-food restaurant knows that 2 hamburger patties and an order of fries should be started for each car that is waiting in line. This is best an example of:
A.
kaizen.
B.
keiretsu.
C.
kanban.
D.
EOQ.
E.
push production.
```
kanban.
126
Which of the following is FALSE regarding the links between JIT and quality?
A.
Inventory hides bad quality; JIT immediately exposes it.
B.
JIT increases the cost of obtaining good quality.
C.
JIT reduces the number of potential sources of error by shrinking queues and lead times.
D.
If consistent quality exists, JIT allows firms to reduce all costs associated with inventory.
E.
As quality improves, fewer inventory buffers are needed; in turn, JIT performs better.
JIT increases the cost of obtaining good quality.
127
Which of the following is NOT an attribute of lean operations?
A.
educating suppliers to accept responsibility for helping meet customer needs
B.
eliminating almost all inventory through just-in-time techniques
C.
building worker flexibility through cross-training and reducing job classifications
D.
pushing responsibility to the highest level possible through centralized decision making
E.
minimizing space requirements by reducing the distance a part travels
pushing responsibility to the highest level possible through centralized decision making
128
```
The 5s technique is used on the tarmac at Alaska Airlines to
A.
organize the galley.
B.
mark location of ground equipment.
C.
position ground staff.
D.
arrange baggage as it is moved to the plane.
```
mark location of ground equipment.
129
```
Gemba walks at Alaska Airlines are called
A.
management reviews.
B.
observation walks.
C.
employee empowerment.
D.
customer imitation walks.
E.
waste walks.
```
waste walks.
130
```
Kaizen means
A.
mistake-proofing of processes.
B.
bringing the entire person to work.
C.
a focus on continuous improvement.
D.
standard practice.
E.
empowered employees.
```
a focus on continuous improvement.
131
chapter 6
The American Society for Quality defines quality as
A.
how well a product fits patterns of consumer preferences.
B.
the degree of excellence at an acceptable price and the control of variability at an acceptable cost.
C.
even though it cannot be defined, you know what it is.
D.
the totality of features and characteristics of a product or service that bears on its ability to satisfy stated or implied needs.
D.
the totality of features and characteristics of a product or service that bears on its ability to satisfy stated or implied needs.
132
```
Which of the following costs is NOT a cost of quality?
A.
scrap 废料
B.
research and development
C.
lost goodwill
D.
rework
```
Research and development
133
```
Which of the following is NOT an external failure cost?
A.
lost goodwill
B.
costs to society
C.
returned goods
D.
scrap
```
D.
| scrap
134
```
Which of the following is the Japanese term used to describe continuous improvement efforts?
A.
kaizen
B.
poka-yoke
C.
kanban
D.
six sigma
```
A.
| kaizen
135
Which of the following is NOT one of the techniques for building employee empowerment?
A.
Build high-morale organizations.
B.
Build communication networks that include employees.
C.
Develop open, supportive supervisors.
D.
Eliminate formal organization structures such as teams and quality circles.
A. Eliminate formal organization structures such as teams and quality circles.
136
The phrase Six Sigma has two meanings. One is statistical, referring to an extremely high process, product, or service capability; the other is a comprehensive system for achieving and sustaining business success.
True
False
true
137
Continuous improvement is based on the philosophy that any aspect of an operation can be improved.
True
False
true
138
Benchmarking requires the comparison of your firm to other organizations; it is not appropriate to benchmark by comparing one of your divisions to another of your divisions.
True
False
false
139
```
A Six Sigma program has how many defects per million?
A.
3.4
B.
6 times the standard deviation
C.
34
D.
2,700
E.
1,000
```
3.4
140
```
Which of the following is NOT a common TQM tool?
A.
check sheets
B.
scatter diagrams
C.
queuing models
D.
histograms
```
queuing models
141
```
Which of the following TQM tools would be best suited for displaying the number of students majoring in each business discipline?
A.
flowchart
B.
histogram
C.
cause-and-effect diagram
D.
scatter diagram
```
B.
| histogram
142
```
Which of the TQM tools would be best suited for determining why a student's course registration is never correct?
A.
Pareto chart
B.
cause-and-effect diagram
C.
flowchart
D.
check sheet
```
B.
| cause-and-effect diagram
143
Inspections should NOT take place
A.
after costly or irreversible processes.
B.
at your supplier's plant while the supplier is producing.
C.
during the step-by-step production process.
D.
at your facility upon receipt of goods from your supplier.
after costly or irreversible processes
144
```
Poka-yoke is the Japanese term for:
A.
foolproof.
B.
card.
C.
just-in-time production.
D.
continuous improvement.
E.
fishbone diagram.
```
foolproof.
145
```
A checklist is a type of:
A.
kaizen.
B.
Pareto chart
C.
kanban.
D.
flowchart
E.
poka-yoke.
```
poka-yoke
146
```
How might you measure service quality in a hotel?
A.
Number of minutes waiting to check in.
B.
Room available by 3:00 PM.
C.
Accuracy of room bill.
D.
Response time for room service.
E.
Any unserviceable item in the room (light, TV, radio, mini-bar, etc.)
F.
All of the above.
```
F.
| All of the above.
147
The objective of a statistical process control (SPC) system is to
A.
provide a statistical signal when natural causes of variation are present.
B.
assess customer expectations.
C.
eliminate natural variations.
D.
provide a statistical signal when assignable causes of variation are present.
D.
| provide a statistical signal when assignable causes of variation are present.
148
Some degree of variability is present in almost all processes.
True
False
true
149
Assignable causes:
A.
depend on the inspector assigned to the job.
B.
are also referred to as "chance" causes.
C.
are not as important as natural causes.
D.
are causes of variation that can be identified and investigated.
E.
are within the limits of a control chart.
C.) are causes of variation that can be identified and investigated
150
Natural variations:
A.
are tolerated, within limits, when a process is under control.
B.
when grouped, form a pattern, or distribution.
C.
affect almost every production process.
D.
are the many sources of variation that occur when a process is under control.
E.
All of the above are true.
All of the above are true.
151
```
Control charts for variables are based on data that come from:
A.
averages of large samples.
B.
averages of small samples.
C.
individual items.
D.
acceptance sampling.
E.
the entire lot.
```
B.
| averages of small samples.
152
The R-chart
A.
control limits are computed using sample standard deviations.
B.
is used to measure changes in the central tendency.
C.
is used to indicate gains or losses in uniformity.
D.
generally uses control limits set at plus or minus 2 standard deviations of the distribution, rather than plus or minus 3 which is commonly used on the x-bar chart.
C.
| is used to indicate gains or losses in uniformity.
153
According to the plant manager, Tom Rao, the four keys to maintaining potato chip quality at Frito-Lay are
A.
ingredients, recipe (consumer preference), process parameters, and "quality wall."
B.
ingredients, total customer complaints, weight, and bag integrity.
C.
ingredients, process parameters, "quality wall," and bag integrity.
D.
total customer complaints, bag integrity, center line performance on SPC chart, and process parameters.
E.
None of the above is correct.
A.
| ingredients, recipe (consumer preference), process parameters, and "quality wall."
154
```
Frito-Lay production personnel obtain a sample every ______ minutes.
A.
60
B.
50
C.
40
D.
30
E.
None of the above.
```
30
155
```
At Frito-Lay, the sample size for each sample (i.e., the size of n) is
A.
n = 3.
B.
n = 5.
C.
n = 2.
D.
n = 4.
E.
None of the above.
```
A.
| n = 3.
156
Averages of small samples, not individual measurements, are generally used in statistical process control.
True
False
TRUE
157
If a sample of items is taken and the mean of the sample is outside the control limits, the process is:
A.
likely out of control and the cause should be investigated.
B.
in control, but not capable of producing within the established control limits.
C.
monitored closely to see if the next sample mean will also fall outside the control limits.
D.
within the established control limits with only natural causes of variation.
E.
producing high quality products.
likely out of control and the cause should be investigated.
158
```
Of all the total quality control tools available, which one is used to confirm the average weight of the food product?
A.
xbar chart
B.
capability histogram
C.
p-chart
D.
capability plot
```
A.
| xbar chart
159
```
Darden Restaurants received a prestigious award for its commitment to quality. Which one did it receive?
A.
Alden Award
B.
Vision Award
C.
Black Pearl Award
D.
Loyal Award
```
Black Pearl Award
160
```
What is Darden's annual sales revenue at the time of the video?
A.
$4.4 billion
B.
$4.5 billion
C.
$5.2 billion
D.
$2 billion
```
5.2
161
```
What title does Anne Hooper have at Darden Restaurants?
A.
General Manager
B.
Executive Director
C.
Senior Director
D.
Vice President of Total Quality
```
Vice President of Total Quality
162
Process capability
A.
exists when CPK is less than 1.0.
B.
exists only in theory; it cannot be measured.
C.
is assured when the process is statistically in control.
D.
means that the natural variation of the process must be small enough to produce products that meet the standard.
C. means that the natural variation of the process must be small enough to produce products that meet the standard.
163
chapter 6 managing quality page 252
| Quality
The ability of a product or service to meet customer needs.
164
why quality is important:
1. Company reputation: An organization can expect its reputation for quality—be it good or bad—to follow it. Quality will show up in perceptions about the firm’s new products, employment practices, and supplier relations. Self-promotion is not a substitute for quality products.
2. Product liability: The courts increasingly hold organizations that design, produce, or distribute faulty products or services liable for damages or injuries resulting from their use. Legislation such as the Consumer Product Safety Act sets and enforces product standards by banning products that do not reach those standards. Impure foods that cause illness, nightgowns that burn, tires that fall apart, or auto fuel tanks that explode on impact can all lead to huge legal expenses, large settlements or losses, and terrible publicity.
3. Global implications: In this technological age, quality is an international, as well as OM, concern. For both a company and a country to compete effectively in the global economy, products must meet global quality, design, and price expectations. Inferior products harm a firm’s profitability and a nation’s balance of payments.
165
ISO 9000
A set of quality standards developed by the International Organization for Standardization (ISO).
Its focus is to enhance success through eight quality management principles: (1) top management leadership, (2) customer satisfaction, (3) continual improvement, (4) involvement of people, (5) process analysis, (6) use of data-driven decision making, (7) a systems approach to management, and (8) mutually beneficial supplier relationships.
166
Cost of quality (COQ)
The cost of doing things wrong—that is, the price of nonconformance.
167
Four major categories of costs are associated with quality. Called the cost of quality (COQ) , they are:
Prevention costs: costs associated with reducing the potential for defective parts or services (e.g., training, quality improvement programs).
◆ Appraisal costs: costs related to evaluating products, processes, parts, and services (e.g., testing, labs, inspectors).
◆ Internal failure costs: costs that result from production of defective parts or services before delivery to customers (e.g., rework, scrap, downtime).
◆ External failure costs: costs that occur after delivery of defective parts or services (e.g., rework, returned goods, liabilities, lost goodwill, costs to society).
168
Total quality management (TQM)
Management of an entire organization so that it excels in all aspects of products and services that are important to the customer.
We develop these into seven concepts for an effective TQM program: (1) continuous improvement, (2) Six Sigma, (3) employee empowerment, (4) benchmarking, (5) just-in-time (JIT), (6) Taguchi concepts, and (7) knowledge of TQM tools.
169
PDCA
A continuous improvement model of plan, do, check. act.
170
Six Sigma
A program to save time, improve quality, and lower costs.
171
DMAIC
DMAIC . This five-step process improvement model (1)
Defines the project’s purpose, scope, and outputs and then identifies the required process information, keeping in mind the customer’s definition of quality; (2)
Measures the process and collects data; (3)
Analyzes the data, ensuring repeatability (the results can be duplicated) and reproducibility (others get the same result); (4)
Improves , by modifying or redesigning, existing processes and procedures; and (5)
Controls the new process to make sure performance levels are maintained.
172
Employee empowerment
page 261
Enlarging employee jobs so that the added responsibility and authority is moved to the lowest level possible in the organization
173
The objective of a statistical process control (SPC) system is to
A.
eliminate natural variations.
B.
provide a statistical signal when assignable causes of variation are present.
C.
provide a statistical signal when natural causes of variation are present.
D.
assess customer expectations.
provide a statistical signal when assignable causes of variation are present
174
Averages of small samples, not individual measurements, are generally used in statistical process control.
True
False
True
175
The Central Limit Theorem:
A.
is the theoretical foundation of the c-chart.
B.
allows managers to use the normal distribution as the basis for building some control charts.
C.
states that the average range can be used as a proxy for the standard deviation.
D.
states that the average of assignable variations is zero.
E.
controls the steepness of an operating characteristic curve.
allows managers to use the normal distribution as the basis for building some control charts
176
The causes of variation in statistical process control are:
A.
Type I and Type II.
B.
mean and range.
C.
cycles, trends, seasonality, and random variations.
D.
natural causes and assignable causes.
E.
producer's causes and consumer's causes.
d. natural causes and assignable causes
177
The R-chart
A.
generally uses control limits set at plus or minus 2 standard deviations of the distribution, rather than plus or minus 3 which is commonly used on the x-bar chart.
B.
is used to indicate gains or losses in uniformity.
C.
is used to measure changes in the central tendency.
D.
control limits are computed using sample standard deviations.
A. is used to indicate gains or losses in uniformity.
178
To measure the voltage of batteries, one would sample by attributes.
True
False
F
179
A process range chart illustrates the amount of dispersion within the samples.
True
False
T
180
If a sample of items is taken and the mean of the sample is outside the control limits, the process is:
A.
likely out of control and the cause should be investigated.
B.
within the established control limits with only natural causes of variation.
C.
producing high quality products.
D.
in control, but not capable of producing within the established control limits.
E.
monitored closely to see if the next sample mean will also fall outside the control limits
likely out of control and the cause should be investigated.
181
If the process average is in control, then the process range must also be in control.
True
False
F
182
Mistakes stemming from workers' inadequate training represent an assignable cause of variation.
True
False
T
183
```
The number of late insurance claim payouts per 100 should be measured with what type of control chart?
A.
c-chart
B.
R-chart
C.
x-bar chart
D.
p-chart
E.
either p-chart or c-chart
```
D.
| p-chart
184
Statistical process control charts:
A.
indicate to the process operator the average outgoing quality of each lot.
B.
display upper and lower limits for process variables or attributes and signal when a process is no longer in control.
C.
display the measurements on every item being produced.
D.
indicate to the operator the true quality of material leaving the process.
E.
are a graphic way of classifying problems by their level of importance, often referred to as the 80-20 rule
display upper and lower limits for process variables or attributes and signal when a process is no longer in control.
185
chapter 4
Given an actual demand of 103, a previous forecast value of 99, and an alpha of .4, the exponential smoothing forecast for the next period would be:
100.6
？？？？
186
Time-series patterns that repeat themselves after a period of days or weeks are called
seasonality
187
The tracking signal is the
ratio of cumulative error / MAD
188
The last four weekly values of sales were 80, 100, 105, and 90 units. The last four forecasts were 60, 80, 95, and 75 units. These forecasts illustrate:
bias
189
Quantitative methods of forecasting include
Exponential Smoothing
190
A seasonal index for a monthly series is about to be calculated on the basis of three years’ accumulation of data. The three previous July values were 110, 150, and 130. The average over all months is 190. The approximate seasonal index for July is:
0.684
191
Which of the following statements about time-series forecasting is true?
It is based on the assumption that the analysis of past demand helps predict future demand.
192
Which time-series model assumes that demand in the next period will be equal to the most recent period's demand?
Naive Approach
193
Forecasts are usually classified into three categories including:
Short-Range, Medium-Range, Long-Range
194
For a given product demand, the time-series trend equation is 53 – 4X. The negative sign on the slope of the equation:
is an indication that product demand is declining
195
Given forecast errors of -1, 4, 8, and -3, what is the mean absolute deviation?
4
196
Forecasts used for new product planning, capital expenditures, facility location or expansion, and R&D typically utilize a
Long-range time horizon
197
The degree or strength of a relationship between two variables is shown by the
correlation coefficient
198
The last four months of sales were 8, 10, 15, and 9 units. The last four forecasts were 5, 6, 11, and 12 units. The Mean Absolute Deviation (MAD) is:
3.5
199
If demand is 106 during January, 120 in February, 134 in March, and 142 in April, what is the 3-month simple moving average for May?
132
200
A regression model is used to forecast sales based on advertising dollars spent. The regression line is y=500+35x and the coefficient of determination is .90. Which is the best statement about this forecasting model?
The correlation between sales and advertising is positive
201
Which of the following smoothing constants would make an exponential smoothing forecast equivalent to a naïve forecast?
1
202
Which of the following uses three types of participants: decision makers, staff personnel, and respondents?
The Delphi Method
203
A forecast that projects a company’s sales is a(n):
demand forecast
204
Given last periods forecast of 65, and last periods demand of 62, what is the simple exponential smoothing forecast with an alpha of .4 for the next period?
63.8
205
Given an actual demand of 61, a previous forecast value of 58, and an alpha of .3, the exponential smoothing forecast for the next period would be:
58.9
206
A time-series trend equation is 25.3 + 2.1X. What is your forecast for period 7?
40
207
The primary purpose of the mean absolute deviation (MAD) in forecasting is to:
measure forecast accuracy
208
Given the following data about monthly demand, what is the approximate forecast for May using a four month moving average?
44
209
Which of the following is determined during the forward pass?
Early Start
210
An activity on a PERT network has these time estimates: optimistic = 2, most likely = 5, and pessimistic = 10. Its expected time is:
5.33
211
An activity on a PERT network has these time estimates: optimistic =2, most likely = 3, and pessimistic 8. Its expected time and variance (if it is a critical activity) are:
3.67 and 1
212
The Beta distribution is used in project management to
a. calculate expected activity times.
213
The EF of an activity is the:
ES + Activity time
214
Which of the following statements regarding PERT analysis is true?
Only critical activities contribute to the project variance.
215
PERT analysis computes the variance of the total project completion time as:
the sum of the variances of all activities on the critical path.
216
An activity on a PERT network has these time estimates: optimistic = 1, most likely = 2, and pessimistic = 5. Its expected time is:
The expected time is 2.33.
Expected time (t) is calculated using the following formula: t = (a + 4m + b)/6, where
a = optimistic time estimate (in this case 1); m = most likely time estimate (in this case 2); and b = pessimistic time estimate (in this case 5). Therefore;
t = (1 + 4*2 + 5)/6
t = 14/6
t = 2.33
217
With respect to PERT and CPM, slack__________
is the amount of time a task may be delayed without changing the overall project completion time
218
A simple CPM network has five activities, A, B, C, D, and E. A is an immediate predecessor of C and of D. B is also an immediate predecessor of C and of D. C and D are both immediate predecessors of E. Given the above scenario, which of the following is correct?
There are four paths in the network.
219
Which of the following is a basic assumption of PERT?
No activity in the network must be repeated.
220
Which of the following statements regarding Gantt charts is true?
Gantt charts are visual devices that show the duration of activities in a project.
221
A project’s critical path is composed of activities A (variance .33), B (variance .67), C (variance .33), and D (variance .17). What is the standard deviation on the critical path?
1.22
222
In a PERT network, non-critical activities that have little slack need to be monitored closely__________
because near-critical paths could become critical paths with small delays in these activities
223
The critical path of a network is the
longest time path through the network
224
The critical path for the network activities shown below is _______ with duration _______.
B-C-E; 12
??????
225
WBS stands for which of the following project management tools?
Work Breakdown Structure
226
The three phases involved in the management of large projects are:
planning, scheduling and controlling.
227
Dummy activities__________
are used when two activities have identical starting and ending events.
228
An activity has an optimistic time of 11 days, a most likely time of 15 days, and a pessimistic time of 23 days. What is its variance?
4
229
Which of these statements regarding time-cost tradeoffs in CPM networks is true?
Crashing shortens the project duration by assigning more resources to one or more of the critical tasks.
230
An activity has an optimistic time of 15 days, a most likely time of 18 days, and a pessimistic time of 27 days. What is the expected time?
19 days
231
____ is the amount of time an individual activity in a network can be delayed without delaying the entire project.
Slack time
232
Which of the following statements is NOT true regarding forecasting?
A.
Forecasting is exclusively an objective prediction.
B.
Forecasting may involve taking historical data and projecting them into the future with a mathematical model.
C.
Forecasting is the art and science of predicting future events.
D.
A forecast is usually classified by the future time horizon that it covers.
Forecasting is exclusively an objective prediction.
233
```
The forecasting time horizon that would typically be easiest to predict for would be the
A.
intermediate range.
B.
medium range.
C.
long range.
D.
short range.
```
short range.
234
1. Why is forecasting important to Disney?
A.
It helps set the parks' open/close hours.
B.
It helps determine how many workers should be scheduled.
C.
It projects attendance each day.
D.
All of the above.
D.
| All of the above.
235
```
2 The FASTPASS system
A.
was originally developed for use at Disney's EPCOT park.
B.
keeps track of how many hours each guest stays in the theme park.
C.
drives the Disney forecasting system.
D.
helps minimize wait times in queues.
```
helps minimize wait times in queues.
236
3 Every business needs to forecast the future because
A.
planning helps determine the mission.
B.
forecasts are needed to schedule deliveries.
C.
forecasts help plan for labor, material, and budget needs.
D.
inventory systems require customer plans.
forecasts help plan for labor, material, and budget needs.
237
```
Which of the following is a quantitative forecasting method?
A.
market survey
B.
sales force composite
C.
jury of executive opinion
D.
exponential smoothing
```
D.
| exponential smoothing
238
```
Which of the following is a qualitative forecasting method?
A.
Delphi method
B.
trend projection
C.
linear regression
D.
naive approach
```
A.
| Delphi method
239
```
Which forecasting model is based upon salespersons' estimates of expected sales?
A.
sales force composite
B.
market survey
C.
Delphi method
D.
jury of executive opinion
```
A.
| sales force composite
240
```
What is a data pattern that repeats itself after a period of days, weeks, months, or quarters?
A.
seasonality
B.
trend
C.
cycle
D.
random variation
```
A.
| seasonality
241
```
"Today's forecast equals yesterday's actual demand" is referred as
A.
the naive approach.
B.
the Delphi method.
C.
exponential smoothing.
D.
a moving average.
```
A.
| the naive approach
242
```
A six-month moving average forecast is generally better than a three-month moving average forecast if demand:
A.
exceeds one million units per year.
B.
follows a downward trend.
C.
has been changing due to recent promotional efforts.
D.
is rather stable.
E.
follows an upward trend.
```
D.
| is rather stable.
243
```
The primary purpose of the mean absolute deviation (MAD) in forecasting is to:
A.
remove random variations.
B.
seasonally adjust the forecast.
C.
eliminate forecast errors.
D.
estimate the trend line.
E.
measure forecast accuracy.
```
measure forecast accuracy
244
chapter 7
| Smooth FM Radio uses a __________ approach when it mixes pre-recorded local segments with its national music blocks.
mass customization
245
Which of the following technologies would enable a cashier to scan the entire contents of a shopping cart in seconds?
ANSWER
Unselected
AGV
Unselected
RFID
Unselected
ASRS
RFID
246
Which of the quadrants in the service process matrix has high labor intensity and high customization?
Professional service
247
The crossover point is that production quantity where __________.
ANSWER
Unselected
total costs equal total revenues for a process
Unselected
total costs for one process equal total costs for another process
Unselected
fixed costs of a process are equal to its variable costs
total costs for one process equal total costs for another process
248
Low-volume, high-variety production is best suited for which of the following process strategies?
ANSWER
Unselected
Product-focused
Unselected
Repetitive focus
Unselected
Process-focused
Process-focused
249
Which of the following transformations generally has the highest equipment utilization?
ANSWER
Unselected
Product-focused process
Unselected
Process-focused process
Unselected
Repetitive process
Product-focused process
250
In mass service and professional service, the operations manager should focus on __________.
ANSWER
Unselected
equipment maintenance
Unselected
automation
Unselected
human resources
human resourse
251
A job shop is an example of __________.
ANSWER
Unselected
a specialized process
Unselected
a repetitive process
Unselected
an intermittent process
an intermittent process
252
In many applications, human quality inspectors can be replaced effectively by __________.
ANSWER
Unselected
automated storage and retrieval systems
Unselected
FMSs
Unselected
vision systems
vision systems
253
A system using an automated work cell controlled by electronic signals from a common centralized computer facility is called __________.
ANSWER
Unselected
a flexible manufacturing system
Unselected
an AGV system
Unselected
a computer numeric control system
a flexible manufacturing system
254
In the mass service and service factory quadrants of the service process matrix, the operations manager could focus on all of the following except __________.
ANSWER
Unselected
automation
Unselected
customization
Unselected
standardization
customizaiotn
255
The use of information technology to monitor and control a physical process is known as __________.
ANSWER
Unselected
process control
Unselected
numeric control
Unselected
computer-aided design
process control
256
“Automatic placement and withdrawal of parts and products into and from designated places in a warehouse” describes __________ technologies.
ANSWER
Unselected
ASRS
Unselected
CIM
Unselected
AGV
ASRS
257
Which one of the following technologies is used only for material handling, not actual production or assembly?
ANSWER
Unselected
AGV
Unselected
CIM
Unselected
FMS
AGV
258
Three types of processes are __________.
ANSWER
Unselected
process focus, repetitive focus, and product focus
Unselected
modular, continuous, and technological
Unselected
input, transformation, and output
process focus, repetitive focus, and product focus
259
One fundamental difference between a process chart and a process map is that __________.
ANSWER
Unselected
the process chart includes the supply chain, while the process map stays within an organization
Unselected
the process chart uses a time dimension, while a process map is not time oriented
Unselected
the process chart is more like a table, while the process map is more like a schematic diagram
the process chart is more like a table, while the process map is more like a schematic diagram
260
Service blueprinting __________.
ANSWER
Unselected
determines the best time for each step in the process
Unselected
focuses on the provider’s interaction with the customer
Unselected
provides the basis to understand how to negotiate with suppliers
focuses on the provider's interaction with the customer
261
Which of the quadrants in the service process matrix has high labor intensity and low customization?
ANSWER
Unselected
Professional service
Unselected
Mass service
Unselected
Service factory
Mass service
262
High-volume, low-variety production is best suited for which of the following process strategies?
ANSWER
Unselected
Process-focused
Unselected
Product-focused
Unselected
Repetitive focus
Product-focused
263
Which of the following is not a strategy for improving service productivity?
ANSWER
Unselected
Mass customization
Unselected
Automation
Unselected
Scheduling
Mass customization
264
This type of process-analysis tool is a schematic of the movement of material, product, or people.
ANSWER
Unselected
Process mapping
Unselected
Value stream mapping
Unselected
Process charts
Process mapping
265
Of the five tools used for process analysis and design, which one focuses on the customer interaction?
ANSWER
Unselected
Service blueprinting
Unselected
Flowchart
Unselected
Time-function mapping
Service blueprinting
266
Strategies for improving productivity in services are __________.
ANSWER
Unselected
high interaction, mass customization, just-in-time processing, lean production
Unselected
reduce inventory, reduce waste, reduce rework, reduce material costs
Unselected
separation, self-service, automation, and scheduling
separation, self-service, automation, and scheduling
267
An assembly line is an example of a __________.
ANSWER
Unselected
repetitive process
Unselected
product-focused process
Unselected
process-focused process
repetitive process
268
Which of the following industries is most likely to have low equipment utilization?
ANSWER
Unselected
Chemical processing
Unselected
Commercial banking
Unselected
Restaurants
restaurant
269
```
chapter 3
Which of the following is NOT a technique that allows managers to plan, schedule, and control projects?
A.
Gantt charts
B.
CPM
C.
Factor-rating method
D.
PERT
```
Factor-rating method
270
```
Gantt charts are
A.
not widely used.
B.
planning charts used to schedule resources and allocate time.
C.
not easy to understand.
D.
widely used network techniques.
```
planning charts used to schedule resources and allocate time.
271
Which of the following is NOT true about Gantt charts?
A.
Gantt charts adequately illustrate the interrelationships between the activities and the resources.
B.
Gantt charts also can be used for scheduling repetitive operations.
C.
Gantt charts are low-cost means of helping managers make sure that activities are planned.
D.
Gantt charts are planning charts used to schedule resources and allocate time.
Gantt charts adequately illustrate the interrelationships between the activities and the resources.
272
```
The critical path of a network is the
A.
longest time path through the network.
B.
path with the most activities.
C.
shortest time path through the network.
D.
path with the fewest activities.
```
longest time path through the network.
273
The main difference between PERT and CPM is that:
A.
PERT employs three time estimates for each activity.
B.
PERT is more accurate than CPM.
C.
PERT assumes that activity durations are known.
D.
PERT ignores activity costs.
E.
CPM assumes activity durations can vary.
PERT employs three time estimates for each activity.
274
```
A simple CPM network has five activities, A, B, C, D, and E. A is an immediate predecessor of C and of D. B is also an immediate predecessor of C and of D. C and D are both immediate predecessors of E.
Which of the following statements is true?
A.
There are 25 paths in this network.
B.
There are six paths in this network.
C.
There are four paths in this network.
D.
There are two paths in this network.
E.
There are five paths in this network.
```
There are four paths in this network
275
Which of these statements regarding time-cost tradeoffs in CPM networks is true?
A.
The crash time always exceeds the normal time.
B.
Crashing a project often reduces the length of long-duration, but noncritical, activities.
C.
Activities not on the critical path can never be on the critical path, even after crashing.
D.
Crashing is not possible unless there are multiple critical paths.
E.
Crashing shortens the project duration by assigning more resources to one or more of the critical tasks.
Crashing shortens the project duration by assigning more resources to one or more of the critical tasks.
276
With respect to PERT and CPM, slack
A.
is the amount of time a task may be delayed without changing the overall project completion time.
B.
is the latest time an activity can be started without delaying the entire project.
C.
is a task or subproject that must be completed.
D.
marks the start or completion of a task.
is the amount of time a task may be delayed without changing the overall project completion time.
277
chapter 7
Effective capacity is the:
A.
maximum output of a system in a given period.
B.
minimum usable capacity of a particular facility.
C.
average output that can be achieved under ideal conditions.
D.
sum of all of the organization's inputs.
E.
capacity a firm expects to achieve given the current operating constraints.
capacity a firm expects to achieve given the current operating constraints
278
```
What is the theoretical maximum output of a system in a given period under ideal conditions?
A.
utilization
B.
design capacity
C.
effective capacity
D.
efficiency
```
design capacity
279
Efficiency is given by
A.
design capacity divided by utilization.
B.
actual output divided by design capacity.
C.
actual output divided by effective capacity.
D.
effective capacity divided by actual output.
actual output divided by effective capacity.
280
```
Which of the following is a possible option to employ when demand exceeds capacity?
A.
temporarily lay-off workers
B.
schedule long lead times
C.
lower prices
D.
increase advertising expenditures
```
schedule long lead times
281
Price changes are useful for matching the level of demand to the capacity of a facility.
True
False
True
282
A useful tactic for increasing capacity is to redesign a product in order to facilitate more throughput.
True
False
Ture
283
```
What is the time of the slowest workstation in a production system?
A.
bottleneck time
B.
throughput time
C.
effective capacity
D.
utilization
```
bottleneck time
284
Which of the following is NOT a valid principle of bottleneck management?
A.
Release work orders to the system at the pace set by the bottleneck's capacity.
B.
Lost time at the bottleneck represents lost capacity for the whole system.
C.
Increasing the capacity of a non-bottleneck station is a mirage.
D.
Increasing the capacity of a non-bottleneck station increases the capacity for the whole system.
Increasing the capacity of a non-bottleneck station increases the capacity for the whole system.
285
Which of the following is not one of the four principles of bottleneck management?
A.
Bottlenecks should be moved to the end of the system process.
B.
Release work orders to the system at the bottleneck's capacity pace.
C.
Increased bottleneck capacity is increased system capacity.
D.
Lost time at the bottleneck is lost system capacity.
E.
Increasing capacity at non-bottleneck stations is a mirage.
Bottlenecks should be moved to the end of the system process.
286
The Theory of Constraints (TOC) strives to reduce the effect of constraints by:
A.
offloading work from constrained workstations.
B.
increasing constrained workstation capability.
C.
changing workstation order to reduce throughput time.
D.
A and B
E.
A, B, and C
A.
offloading work from constrained workstations.
B.
increasing constrained workstation capability.
C.
changing workstation order to reduce throughput time.
D.
A and B
E.
A, B, and C
Offloading work from constrained workstations, and increasing constrained workstation capability
287
Which of the following techniques is NOT a technique for dealing with a bottleneck?
A.
Schedule throughput to match the capacity of the bottleneck.
B.
Increase the capacity of the constraint.
C.
Have cross-trained employees available to keep the constraint at full operation.
D.
Develop alternate routings.
E.
All are techniques for dealing with bottlenecks.
All are techniques for dealing with bottlenecks.
288
```
In "drum, buffer, rope," what provides the schedule, i.e. the pace of production?
A.
rope
B.
buffer
C.
drum
D.
all three of the above in combination
E.
none of the above
```
drum
289
Break-even analysis for the single-product case requires an estimation of fixed costs, variable costs, and
A.
the percent of total dollar sales for each product.
B.
revenue.
C.
price.
D.
price, along with the percent of total dollar sales for each product.
revenue
290
```
The difference between selling price and variable cost is called
A.
the bottleneck.
B.
the break-even point.
C.
contribution.
D.
fixed cost.
```
contribution.
291
In manufacturing, excess capacity can be used to
A.
do fewer setups, shorten production runs, and drive down inventory costs.
B.
do more setups, shorten production runs, and drive down inventory costs.
C.
do fewer setups, lengthen production runs, and drive down inventory costs.
D.
do more setups, lengthen production runs, and drive down inventory costs.
do more setups, shorten production runs, and drive down inventory costs
292
```
Low-volume, high-variety production is best suited for which of the following process strategies?
A.
product focus
B.
repetitive focus
C.
process focus
D.
mass customization
```
process focus
293
```
High-volume, low-variety production is best suited for which of the following process strategies?
A.
repetitive focus
B.
product focus
C.
process focus
D.
mass customization
```
product focus
294
```
A process focus is
A.
based on the classical assembly line.
B.
a production facility organized around specific activities.
C.
a rapid, low-cost production system that caters to constantly changing unique customer desires.
D.
organized around products.
```
a production facility organized around specific activities.
295
```
A large quantity and large variety of products are produced in
A.
mass customization.
B.
process focus.
C.
repetitive focus.
D.
product focus.
```
mass customization.
296
ch 12
The appropriate level of safety stock is typically determined by
ANSWER
Unselected
taking the square root of the economic order quantity.
Unselected
minimizing the expected stockout costs.
Unselected
carrying sufficient safety stock so as to eliminate all stockouts.
Unselected
choosing the level of safety stock that assures a given service level.
choosing the level of safety stock that assures a given service level
297
A store wants to ensure a shelf full of marshmallow peeps as the holiday season approaches. Daily demand for peeps is normally distributed with a mean of 25 and a standard deviation of 5. Lead time is 3 days and the store intends a 98% service level. What is the appropriate reorder point?
93
298
A company wishes to determine the EOQ for an item that has an annual demand of 2,000 units, a cost per order of $75, and annual carrying cost of 7.50 per unit. What is the EOQ?
200
299
The primary purpose of the basic economic order quantity model shown below is
is
ANSWER
Unselected
to calculate the optimum reorder point.
Unselected
to minimize the sum of setup cost and holding cost.
Unselected
to maximize the customer service level.
Unselected
to calculate the optimum safety stock.
to minimize the sum of setup cost and holding cost.
300
Generally, inventory types are divided into four main categories. Which of the following is not one of the four main categories of inventory?
ANSWER
Unselected
Work-in-process inventory
Unselected
Raw material inventory
Unselected
Maintenance/repair/operating inventory
Unselected
Safety stock inventory
Safety stock inventory
301
ABC analysis generally divides on-hand inventory into three classes based upon
ANSWER
Unselected
item quality.
Unselected
annual demand.
Unselected
unit price.
Unselected
annual dollar volume.
annual dollar volume.
302
Inventory management policies based on ABC analysis might include investing
ANSWER
Unselected
more in inventory security for C items.
Unselected
the most time verifying the accuracy of records for B items.
Unselected
extra care in forecasting for C items.
Unselected
more in supplier development for A items.
more in supplier development for A items.
303
The two most important inventory-based questions answered by the typical inventory model are
ANSWER
Unselected
when to place an order and how many of an item to order.
Unselected
when to place an order and what is the cost of the order.
Unselected
how many of an item to order and with whom the order should be placed.
Unselected
how many of an item to order and what is the cost of this order.
when to place an order and how many of an item to order.
304
Extra units that are held in inventory to reduce stockouts are called __________.
ANSWER
Unselected
reorder point
Unselected
demand variance
Unselected
just-in-time inventory
Unselected
safety stock
safety stock
305
The production order quantity model
ANSWER
Unselected
assumes instantaneous delivery.
Unselected
is appropriate when units are produced and sold simultaneously.
Unselected
relaxes the assumption of known and constant demand.
Unselected
uses ordering cost, not setup cost, in its formula.
Unselected
results in larger average inventory than an equivalent EOQ model.
is appropriate when units are produced and sold simultaneously.
306
A system that keeps track of each withdrawal or addition to inventory continuously is __________.
ANSWER
Unselected
a perpetual inventory system
Unselected
a fixed-quantity system
Unselected
a continuous inventory system
Unselected
a fixed-period inventory system
a perpetual inventory system
307
The difference between the basic Economic Order Quantity (EOQ) model and the production order quantity model is that
ANSWER
Unselected
the economic order quantity model does not require the assumption of known, constant lead time.
Unselected
the production order quantity model does not require the assumption of a known, constant demand.
Unselected
there are no holding costs in the production order quantity model.
Unselected
the production order quantity model does not require the assumption of instantaneous delivery.
a stockout is possible.
308
Most inventory models attempt to minimize __________.
ANSWER
Unselected
the number of orders placed
Unselected
the number of items ordered
Unselected
the likelihood of a stockout
Unselected
total inventory based costs
total inventory-based costs.
309
Inventory record accuracy would be decreased by __________.
ANSWER
Unselected
increasing stockroom accessibility
Unselected
increasing reorder points
Unselected
using cycle counting
Unselected
using ABC analysis
increasing stockroom accessibility.
310
In the probabilistic model, increasing the service level will __________.
ANSWER
Unselected
increase the cost of the inventory policy
Unselected
have no impact on the cost of the inventory policy
Unselected
have an indeterminate impact on the cost of the inventory policy
Unselected
reduce the cost of the inventory policy
increase the cost of the inventory policy
311
Which of the following should be higher in P systems than Q systems?
ANSWER
Unselected
Safety stock
Unselected
Demand
Unselected
Lead time
Unselected
Order size
Safety stock
312
Cycle counting __________.
ANSWER
Unselected
assumes that the most frequently used item must be counted more frequently
Unselected
provides a measure of inventory turnover
Unselected
assumes that all inventory records must be verified with the same frequency
Unselected
is a process by which inventory records are verified for accuracy
is a process by which inventory records are verified with the same frequency
313
An inventory decision rule states “when the inventory level goes down to 14 gearboxes, 100 gearboxes will be ordered.” Which of the following statements is true?
ANSWER
Unselected
100 is the lead point, and 14 is the safety stock.
Unselected
14 is the reorder point, and 100 is the order quantity.
Unselected
100 is the reorder point, and 14 is the order quantity.
Unselected
14 is the safety stock, and 100 is the reorder point.
Fourteen is the reorder point, and 100 is the order quantity.
314
Which of these conditions is not necessary for the economic order quantity model to be valid?
ANSWER
Unselected
The item has a constant lead time.
Unselected
The item has a constant order cost.
Unselected
The item has a constant demand.
Unselected
The item has a constant purchase price.
d. The item has a constant safety stock.
| The item has a constant purchase price.
315
A system that triggers ordering on a uniform time basis is called
ANSWER
Unselected
a fixed-quantity system.
Unselected
a reorder point system.
Unselected
an EOQ.
Unselected
a fixed-period system.
a fixed-period system
316
One use of inventory is __________.
ANSWER
Unselected
to tightly link production and distribution processes
Unselected
to ensure that item cost is maximized
Unselected
to tightly link a firm’s production with its customers’ demand
Unselected
to provide a hedge against inflation
to provide a hedge against inflation
317
If demand is not uniform and constant, the stockout risks can be controlled by __________.
ANSWER
Unselected
raising the selling price
Unselected
placing an extra order
Unselected
increasing the EOQ
Unselected
adding safety stock
adding safety stock
318
A production facility is trying to determine the best batch size for an item that is produced intermittently. This item has an annual demand of 1,000 units, an annual carrying cost of $10 per unit, and a setup cost of $400. They operate 50 weeks per year, and can produce 40 units per week. What is the best batch size for this item?
ANSWER
Unselected
400
Unselected
65
Unselected
800
Unselected
283
400
319
A specific product has expected demand during lead time of 100 units, with a standard deviation during lead time of 25 units. What safety stock (approximately) provides a 95% service level?
ANSWER
Unselected
75
Unselected
55
Unselected
41
Unselected
125
41
320
```
One use of inventory is
A.
to tightly synchronize production and distribution processes.
B.
to provide a hedge against inflation.
C.
to tightly synchronize a firm's production with its customers' demand.
D.
to ensure that item cost is maximized.
```
to provide a hedge against inflation
321
```
Which of the following is NOT a type of inventory?
A.
finished goods
B.
raw material
C.
MRP
D.
work-in-process
```
B) MRP
322
```
ABC analysis divides an organization's on-hand inventory into three classes based upon
A.
unit price.
B.
the number of units on hand.
C.
annual dollar volume.
D.
annual demand.
```
annual dollar volume
323
```
Which of the following does NOT belong to ordering costs?
A.
interest payments
B.
clerical support
C.
cost of supplies
D.
order processing
```
interest payments
324
```
Which of the following does NOT belong to holding costs?
A.
order processing
B.
storage costs
C.
pilferage, scrap, and obsolescence
D.
insurance on inventory
```
order processing
325
```
What is the cost to prepare a machine or process for production?
A.
preparation cost
B.
holding cost
C.
setup cost
D.
ordering cost
```
C.
| setup cost
326
Which of the following would NOT generally be a motive for a firm to hold inventories?
A.
to hedge against inflation
B.
to take advantage of quantity discounts
C.
to provide a selection of goods for anticipated customer demand and to separate the firm from fluctuations in that demand
D.
to decouple various parts of the production process
E.
to minimize holding costs
to minimize holding costs
327
All EXCEPT which of the following statements about ABC analysis are true?
A.
ABC analysis suggests that there are the critical few and the trivial many inventory items.
B.
ABC analysis categorizes on-hand inventory into three groups based on annual dollar volume.
C.
ABC analysis suggests that all items require the same high degree of control.
D.
ABC analysis is an application of the Pareto principle.
E.
In ABC analysis, inventory may be categorized by measures other than dollar volume.
ABC analysis suggests that all items require the same high degree of control.
328
Cycle counting:
A.
provides a measure of inventory turnover.
B.
assumes that the most frequently used items must be counted more frequently.
C.
assumes that all inventory records must be verified with the same frequency.
D.
eliminates annual inventory adjustments.
E.
is a process by which inventory records are verified once a year.
eliminates annual inventory adjustments.
329
```
A product whose EOQ is 40 units experiences a decrease in ordering cost from $90 per order to $10 per order. The revised EOQ is:
A.
one-third as large.
B.
three times as large.
C.
one-ninth as large.
D.
nine times as large.
E.
cannot be determined
```
one-third as large.
330
An inventory decision rule states, "When the inventory level goes down to 14 gearboxes, 100 gearboxes will be ordered." Which of the following statements is TRUE?
A.
The number 100 is a function of demand during lead time.
B.
One hundred is the reorder point, and 14 is the order quantity.
C.
Fourteen is the reorder point, and 100 is the order quantity.
D.
Fourteen is the safety stock, and 100 is the reorder point.
E.
None of the above is true.
Fourteen is the reorder point, and 100 is the order quantity.
331
```
As seen during the Stock Control Simulation, if the holding cost bar is longer (costs are higher) than the order cost bar, you should
A.
increase the order quantity.
B.
leave the order quantity alone.
C.
decrease the order quantity.
D.
do not have enough information to answer.
```
decrease the order quantity.????
332
```
During the Stock Control Simulation, what happens when you wait to order until the onhand quantity is too low?
A.
Holding costs are too high.
B.
Ordering costs are too high.
C.
You increase the risk of running out of stock.
D.
Both a and b
```
You increase the risk of running out of stock.
333
During the Stock Control Simulation, the best time to click the order button, to place an order, is
A.
when inventory is about twice the height of dL (lead-time demand).
B.
not based on the value of dL (lead-time demand).
C.
just as the onhand inventory drops to dL (lead-time demand).
D.
one day after the onhand inventory drops below dL (lead-time demand).
just as the onhand inventory drops to dL (lead-time demand).
334
```
As seen during the Stock Control Simulation, when demand varies instead of being constant, the best reorder point for a given service level
A.
is the same.
B.
sometimes is higher, sometimes is lower.
C.
is lower.
D.
is higher
```
Is higher
335
As seen during the Stock Control Simulation, what happens in a fixed order interval (FOI) system if the time between orders is too small?
A.
Holding costs are too high.
B.
Both holding costs and ordering costs are too high.
C.
It doesn’t cause any trouble with costs.
D.
Ordering costs are too high.
Ordering costs are too high.
336
A certain type of computer costs $1,000, and the annual holding cost is 25% of the value of the item. Annual demand is 10,000 units, and the order cost is $150 per order. What is the approximate economic order quantity?
110
337
chapter 13
Dependence on an external source of supply is found in which of the following aggregate planning strategies?
ANSWER
Unselected
Subcontracting
Unselected
Using part-time workers
Unselected
Hiring and laying off workers
Subcontracting
338
“An optimal plan for minimizing the cost of allocating capacity to meet demand over several planning periods” best describes __________.
ANSWER
Unselected
Graphical models
Unselected
The management coefficients model
Unselected
The transportation method
the transportation method
339
Aggregate planning for service firms that provide intangible output deals mainly with __________.
ANSWER
Unselected
smoothing the production rate to meet demand
Unselected
planning for human resource requirements to manage demand
Unselected
capital investment decisions to ensure proper equipment is available
planning for human resource requirements and managing demand
340
The objective of aggregate planning is to meet demand while __________ over the planning period.
ANSWER
Unselected
minimizing stock out
Unselected
maximizing service level
Unselected
minimizing cost
minimizing cost
341
Which of the following aggregate planning strategies is a “capacity option”?
ANSWER
Unselected
Using promotions to build brand awareness
Unselected
Changing inventory levels
Unselected
Counterseasonal product mixing
changing inventory levels
342
In level scheduling, what is kept uniform from month to month?
ANSWER
Unselected
Inventory levels
Unselected
Product mix
Unselected
Production or workforce levels
production/workforce levels
343
The typical time horizon for aggregate planning is __________.
ANSWER
Unselected
Up to 3 months
Unselected
Between 1 and 3 years
Unselected
3 to 18 months
3 to 18 months
344
Yield management is best described as:
ANSWER
Unselected
capacity allocation to different classes of customers to maximize revenue
Unselected
a situation where the labor union yields to management decisions
Unselected
a process designed to increase the rate of output
capacity allocation to different classes of customers to maximize revenue
345
Which of these aggregate planning strategies adjusts capacity to match demand?
ANSWER
Unselected
Changing price
Unselected
Using part-time workers
Unselected
Counterseasonal product mixing
Using part-time workers
346
Which of these is among the demand options of aggregate planning?
ANSWER
Unselected
Back-ordering during high-demand periods
Unselected
Varying workforce size
Unselected
Subcontracting
Back-ordering during high-demand periods
347
To use yield management strategies a business should have which combination of costs?
ANSWER
Unselected
High variable and high fixed
Unselected
Low variable and high fixed
Unselected
High variable and low fixed
Low variable and high fixed
348
A firm uses the pure chase strategy of aggregate planning. It produced 900 units in the last period. Demand in the next period is estimated at 1000, and demand over the next six periods (its aggregate planning horizon) is estimated to average 1000 units.
In following the chase strategy, the firm would not ________ to meet next period’s production.
ANSWER
Unselected
subcontract
Unselected
lay off workers
Unselected
hire workers
lay off workers
349
Which of these is not a characteristic that makes yield management attractive to organizations with perishable inventory?
ANSWER
Unselected
Service can be sold in advance of consumption
Unselected
Demand can be segmented
Unselected
Capacity is easily changed
Capacity is easily changed
350
Which of the following aggregate planning models is a trial-and-error approach?
ANSWER
Unselected
Graphical methods
Unselected
The management coefficients model
Unselected
The transportation method
Graphical methods
351
Which of the following is the term used for intermediate-range capacity planning with a time horizon of three to eighteen months?
ANSWER
Unselected
Material requirement planning
Unselected
Aggregate planning
Unselected
Strategic planning
Aggregate Planning
352
Which of the following is not one of the four things needed for aggregate planning?
ANSWER
Unselected
A method for determining the relevant costs
Unselected
A mathematical model that will minimize costs
Unselected
A logical overall unit for measuring sales and output
A mathematical model that will minimize costs
353
Which of the following is not an ingredient for controlling labor cost in services?
ANSWER
Unselected
Contracting overseas labor to obtain lower wage scales
Unselected
An on-call labor pool that can be used (or not) to meet unexpected demand
Unselected
Accurate scheduling of labor-hours to assure quick response to consumer demand
Contracting overseas labor to obtain lower wage scales
354
A firm uses graphical techniques in its aggregate planning efforts. Over the next twelve months (its intended period) it estimates the sum of demands to be 105,000 units. The firm has 250 production days per year. In January, which has 22 production days, demand is estimated to be 11,000 units. A graph of demand versus level production will show that the __________.
ANSWER
Unselected
level production of 420 units per day is below the January requirement
Unselected
level production is approximately 1000 units per month
Unselected
level production is approximately 420 units per month
level production of 420 units per day is below the January requirement
355
A firm uses the pure chase strategy of aggregate planning. It produced 1000 units in the last period. Demand in the next period is estimated at 800, and demand over the next six periods (its aggregate planning horizon) is estimated to average 900 units. In following the chase strategy, what will the firm do?
ANSWER
Unselected
lay off workers to match the 200 unit difference
Unselected
Add 100 units to inventory in the next period
Unselected
Add 200 units to inventory in the next period
Lay off workers to match the 200 unit difference
356
Which of the following attempts to manipulate product or service demand?
ANSWER
Unselected
Inventories
Unselected
Subcontracting
Unselected
Price cuts
Price cuts
357
What directly results from disaggregation of an aggregate plan?
ANSWER
Unselected
A management coefficient analysis
Unselected
A transportation analysis
Unselected
A master production schedule
A master production schedule
358
A manager is applying the transportation model of linear programming to solve an aggregate planning problem. Demand in period 1 is 100 units and in period 2 demand is 150 units. The manager has 125 hours of regular employment available for $10 / hour each period. In addition, 50 hours of overtime are available for $15 / hour each period. If holding costs are $2 per unit each period, how many hours of regular employment should be used in period 1 (assume demand must be met in both periods 1 and 2 for the lowest possible cost and that production is 1 unit per hour).
ANSWER
Unselected
100
Unselected
125
Unselected
150
125
359
Which of the following is not consistent with a pure level strategy?
ANSWER
Unselected
Using built-up inventory to meet demand requirements
Unselected
Varying production levels and/or work force to meet demand requirements
Unselected
Finding alternative work for employees during low-demand periods
Varying production levels and/or work force to meet demand requirements
360
Which choice below best describes the counterseasonal demand option?
ANSWER
Unselected
Developing a mix of products that smoothes out their demands
Unselected
Producing products like lawnmowers and sunglasses in the winter
Unselected
Lowering prices when demand is low
Developing a mix of products that smoothes out their demands
361
Planning tasks associated with loading, sequencing, expediting, and dispatching typically fall under __________.
ANSWER
Unselected
intermediate range plans
Unselected
long-range plans
Unselected
short-range plans
Short-range plans
362
```
Job assignments are a focused issue in which of the following?
A.
sales and operations planning
B.
intermediate plans
C.
short-range plans
D.
long-range plans
```
short-range plans
363
```
Aggregate planning is concerned with determining the quantity and timing of production in the
A.
long term.
B.
next term.
C.
intermediate term.
D.
short term.
```
intermediate term
364
Which of the following is NOT one of the features that an S&OP process needs to generate a useful aggregate plan?
A.
A logical unit for measuring sales and output.
B.
A method to determine the relevant costs.
C.
A model that combines forecasts and costs.
D.
A forecast of demand for a reasonable long-term planning period in aggregate terms.
a forecast of demand for a reasonable LONG TERM planning period in aggregate terms
365
Which of the following statements is NOT true regarding aggregate plans?
A.
For service organizations, an aggregate schedule ties strategic goals to workforce schedules.
B.
An aggregate plan is the output of S&OP.
C.
An aggregate plan often examines a 3- to 18-month time horizon.
D.
Aggregate plans use information regarding individual products rather than product lines.
Aggregate plans use information regarding individual products rather than product lines
366
The objective of aggregate planning is usually to
A.
specify what is to be made and when.
B.
provide input to material requirements planning systems.
C.
to determine which plans are feasible in the coming months and which are not.
D.
meet forecast demand while minimizing cost over the planning period.
meet forecast demand while minimizing cost over the planning period
367
Which of the following is NOT a capacity option of aggregate planning?
A.
back ordering during high-demand periods
B.
varying production rates through overtime or idle time
C.
subcontracting
D.
changing inventory levels
back ordering during high-demand periods
368
Which of the following is NOT a demand option of aggregate planning?
A.
influencing demand
B.
using part-time workers
C.
counterseasonal product and service mixing
D.
back ordering during high-demand periods
using part-time workers
369
```
Which of the following would likely result in the LEAST amount of inventory?
A.
mixed strategy
B.
Inventory levels are unaffected by the aggregate plan.
C.
chase strategy
D.
level strategy
```
chase strategy
370
```
In level scheduling, what is kept uniform from month to month?
A.
product mix
B.
inventory levels
C.
demand levels
D.
sub-contracting levels
E.
production/workforce levels
```
production/workforce levels
371
A firm uses the chase strategy of aggregate planning. It produced 1000 units in the last period. Demand in the next period is estimated at 800, and demand over the next six periods (its aggregate planning horizon) is estimated to average 900 units. Which of the following tactics would be most representative of following a chase strategy?
A.
lay off workers to match the 200-unit difference
B.
implement a lower price point to increase demand
C.
hire workers to match the 100-unit difference
D.
add 100 units to inventory in the next period
E.
add 200 units to inventory in the next period
lay off workers to match the 200-unit difference
372
```
What is an alternative name for revenue management?
A.
yield management
B.
cash flow management
C.
income management
D.
price and demand management
```
yield management
