Supply chain MCQs

Capacity planning involves answering all of the following questions EXCEPT

What kind of capacity is needed?

How much is needed?

When is it needed?

Who is going to decide?

Which one of the following refers to the volume of output at which total cost equals total

revenue?

Optimal operating rate

Break even point Feasible volume

Utilization

A technique that averages the number of recent actual values and forms a new value is called:

Exponential smoothing

Weighted moving average

Moving average None of the above

The advantages of specialization to management include all of the following EXCEPT:

Rapid training of the workforce

Ease in recruiting new workers

Fewer turnovers

Less boredom for workers

The forecasting model that is based upon estimates of salesperson's expected sales is likely to be

called ________.

Delphi method

Sales force combination Consumer market survey

Panel of executive opinion

Which of the following is not an attribute to classify services?

Tangibility Perishability

Simultaneity

Degree of Customer Contact

Most of the organizations adopt a defensive design R&D Strategy in an attempt to prolong the

life of the product by employing new packaging, redesigning it, improving its reliability. This is

__________ phase in product life cycle.

Growth

Maturity

Saturation

Decline

Which method of forecasting is most widely used?

Regression analysis

Adaptive forecasting

Weighted moving average Exponential smoothing

Which of the following influences on the sales of a product is the most difficult to forecast?

Seasonal

Trend

Nonlinear trend

Cyclical

All of the following are steps in forecasting process EXCEPT:

Determine the purpose of the forecast

Establish a time horizon

Assigning weights to the criteria

Monitor the forecastThe method that considers several variables related to the variable being predicted is:

Exponential smoothing

Weighted moving average

Multiple regressions

Moving average

__________ is central to the philosophy of continuous improvement:

Management involvement

Employee involvement

Organization’s operations

Employee involvement is central to the philosophy of continuous improvement. Employee retention rates.

Group Consensus relates to which of the following judgmental forecasting technique?

Sales force

Consumer surveys

Delphi method

Executive opinions

The total weight assigned to actual occurrences should be equal to:

0

1

2

3

Which of the following is not the true representation the concept of time series model?

Exponential smoothing

Moving averages

Naïve approach

Linear regression

In statistical process control, some tools are used primarily to detect production of defective products / services or process changes. What those tools are known as?

Regression charts

Pareto charts

Control charts

Histograms

If the final inspector at an automobile paint shop discovers that the paint on the car has a poor finish, the car may have to be completely rescinded and repainted. This would result in ________ incurred.

Internal failure cost External failure cost Appraisal cost Prevention cost (zh,vuzs,may2011) ___ costs are incurred in assessing the level of quality attained by the operating system. Prevention Appraisal Operating Failure

(zh,vuzs,may2011)

Question # 1 of 15 Productivity refers to the ratio of output to input, in your views what are the measures by which productivity can be increased? Inputs increase while outputs remain the same Outputs decrease while inputs remain the same Inputs and outputs increase proportionately Inputs decrease while outputs remain the same Productivity is a measure of output from a production process, per unit of input. Total productivity = Output quality and quantity / Input quality and quantity

Question # 2 of 15 The technical aspect of Six Sigma includes all of the following Except: Improving process performance Use of statistical methods Top management commitment Reduction in variations The Technical aspects of Six Sigma include: 1. Improving process performance

2. Reducing variation

3. Utilizing statistical models

4. Designing a structured improvement strategy

www.vuzs.net Question # 3 of 15 Which one of the following statements is NOT correct about cycle time? It represents daily operating time divided by desired production It is the maximum allowable time at each work station It determines the time often items take to roll off in assembly line

It is the time required to complete a product from start to finish Cycle time is the maximum time allowed at each workstation to complete its set of tasks on a unit. Question # 4 of 15 A double sampling plan specifies all of the following Except Size of the initial sample Size of second sample Lot size Double acceptance number A double sampling plan specifies the lot size, the size of the initial sample, accept/reject criteria for the initial sample, the size of the second sample and a single acceptance number.

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Which one of the following layout type is also called line layout? Fixed Position layout Process layout Product layout Cellular layout Product layout: These layouts are also known as the line layouts or the layout by sequence. In such layouts, the manufacturing cycle is small with minimum material handling. The space required is small and quality control is easy to exercise.

Which one of the following is an example of site related factors that affect location decision? Transportation Quality of life Location of new markets Location of raw materials Site Related Factors:

Land

Transportation

Environmental Legal

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In decision making theory the next step after implementing the best possible alternative is to: Develop Alternatives Develop results Monitor the results Implementation The decision making process involves the following six important steps

1. Specify Objectives and the Criteria for decision making

2. Develop Alternatives

3. Analyze and compare alternatives. 4. Select the best alternative. 5. Implement the chosen Alternative

6. Monitor the results to ensure the desired results are achieved.

In exponential smoothing model, a denotes: Smoothing constant Previous forecast Forecast error Actual forecast α = Alpha smoothing constant

Which one of the following is a productivity measure based on all inputs? Capital productivity Multifactor productivity Partial productivity Total productivity Multifactor productivity (MFP) measures the changes in output per unit of combined inputs.

___________ is a philosophy of continually seeking ways to improve operations Poke – yoke Kaizen Robustness Quality deployment Kaizen is the Japanese word for continuous improvement.

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Which one of the following factors provides a basis for comparing alternative forecasting techniques? Time dimension Reliability factor Degree of accuracy Measuring units Accuracy: Forecasts should be accurate. In fact it should carry the degree of accuracy, so the users are aware of the limitations of the forecast.

Which one of the following is NOT the input in the transformation process? Informations Services Facilities Materials Information is the output of any input.

ABC Freight Company is overflowed with customer complaints of poor quality services. To achieve quality in the services being provided, managers can make use of which of the following strategy? Cost leadership strategy Statistical process control strategy Service differentiation strategy Conditional service guarantee strategy Statistical Process Control is one important tool to ensure that Service Quality is achieved before a defect is introduced in the service being offered or product being manufactured.

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Which of the following is NOT an emerging trend in the workplace? Increasing workplace diversity Decreasing work schedule flexibility Increasing number of part time jobs Increasing use of temporary labor

The concept of Agile organization refers to: Flexibility Quality Quick Response Profitability Quick response aka also known as Agility and an organization on this basis is often known as Agile Organization.

TQM is being criticized on the basis of factors which show:

Weak implementation of TQM practices or strong management perspective Strong implementation of TQM practices or weak management perspective Weak implementation of TQM practices or weak management perspective Strong implementation of TQM practices or strong management perspective Which of the following factors are important for choosing a strategy for aggregate planning? Select correct option: Cost and company policy Cost and layout decision Company policy and layout decision Company policy and capacity options Which of the following shows the quality and timing of specific end items for a

scheduled horizon?

Select correct option: Simulation model Master schedule

Aggregate plan

Critical path model

In terms of operations management the forecast which projects a company’s sales is called:

Economic forecast

Technological forecast

Demand forecast

Associative model

Ref:

Demand forecasting is the activity of estimating the quantity of a product or service that consumers will

purchase. A demand forecast is the prediction of what will happen to your company's existing product

sales.

In which one of the following techniques, the least squares method models uses one

dependent and one or more independent variables? Trend adjusted forecast

Simple moving average

Regression analysis Exponential smoothing

Regression analysis that uses two or more independent variables to forecast values of the dependent variable is called a multiple regression analysis.

The operational strategy must be in line with the:

Department goals

Organizational goals

Management goals

None of the above

Operational Strategy is:

Narrower in scope and in more detail Prepared by middle management. Should be in line with the Organization strategy.

Which one of the following strategies specifies how the firm will employ its production capabilities to

support its corporate strategy?

Tactical

Operations

Manufacturing

Production

Ref:

Operations Management is concerned with managing the operations strategy, which specifies how the

firm will employ its production capabilities to support its corporate strategy.

The systematic processing of data to yield information is a part of __________.

Management science

Information sciences

Industrial engineering

Scientific management

Collaborative Planning, Forecasting, and Replenishment (CPFR) a Web based tool used to coordinate

demand forecasting, ____________ and inventory replenishment between supply chain trading partners.

Production and purchase planning

Demand and supply planning

Quantitative forecasting

Demand management

Collaborative Planning, Forecasting, and Replenishment (CPFR) a Web-based tool used to coordinate

demand forecasting, production and purchase planning, and inventory replenishment between supply

chain trading partners. You will learn about this in your later part of the semester.

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Parabolic, exponential and growth are element of:

Linear trends

Non linear Trends

Forecast accuracy

None of the above

Which of the following ensures that the design meets the performance characteristics that are specified in

the product concept?

Functional design

Production design

Service design

Product design

Functional design is ensuring that the design meets the performance characteristics that are specified in

the product concept.

The forecasting time horizon that would typically be easiest to predict would be:

Medium-range

Long-range

Short-range

Intermediate range

Most of the organizations adopt a defensive design R&D Strategy in an attempt to prolong the life of the

product by employing new packaging, redesigning it, improving its reliability. This is __________ phase

in product life cycle.

Growth

Maturity

Saturation

Decline

DECLINE: In this phase, most of the organizations adopt a defensive design R&D Strategy in an attempt

to prolong the life of the product by employing new packaging, redesigning it, improving its reliability.

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The three major business functions necessary to all organizations are:

Accounting, personnel, operations

Marketing, finance/accounting, operations

Marketing, accounting, personnel

Marketing, finance, operations

As the time horizon increases the accuracy of the forecast:

Decreases

Increases

Is not affected with time horizon

None of the above

Forecast accuracy decreases as time horizon increases indicating it is safe to make short range forecasts

instead of long term forecasts.

Four important pillars capital, quality, ________ and technology. are responsible for positively as well as

negatively affecting on the Productivity of the organization.

Customers

Process

System

Management

Productivity stands tall on four important pillars of Capital, Quality, Management and Technology. These

pillars are also responsible for positively as well as negatively affecting the Productivity of the

Organization.

Releasing products with defects should be informed to the customers. This statement comes under ______

frame work.

Legal

Ethical

Environmental

None of the above

Ethical: Operations Manager should understand that he is under Contractual agreement not to exhibit

unethical behavior. Releasing products with defects should be informed to the customers.

Sequence of data points that are measured typically at successive times at regular time intervals is known

as:

Moving average

Weighted moving average

Time series

Forecasts

In statistics, signal processing, econometrics and mathematical finance, a time series is a sequence of data

points, measured typically at successive times spaced at uniform time intervals.

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Planning workforce requirements, scheduling of the equipment and financial analysis are the major uses

of__________.

Productivity ratios

Productivity Growth

Multifactor productivity

Operations strategy

Which one of the following is not a step of decision process:

Specify objectives

Determine the product of chance probabilities

Analyze and select alternative

Implement and monitor the result

The forecasting time horizon that would typically be easiest to predict would be:

Medium-range

Long-range

Short-range

Intermediate range

_____ means that the relevant parameters such as cost, capacity and demand have known values.

Risk

Certainty

Uncertainty

None of above

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The forecasting model that is based upon estimates of salesperson's expected sales is likely to be called

________.

Delphi method

Sales force combination

Consumer market survey

Panel of executive opinion

Completion of any operations depends upon the slowest process in the assembly line. What operations

managers need to do in order to be successful?

Target and eliminate bottlenecks

Identify the bottlenecks

Make slowest process more slow

Non of the above

In forecasting, planning the use of system relates to the ______ plans. Long term

Short term

Both long and short term

None of the above (zubair,vuzs,Jun2011)

Flexible operations comes under the example of: Select correct option: Strategy Tactics

Mission

Goals (zubair, vuzs, Jun2011)

When using exponential smoothing how the smoothing constant can be determined? With the help of the accuracy of the previous forecasts By using MAD (Mean Absolute deviation) By choosing to maximize positive bias

By using random variations Decision Tree is read from: Right to left

Left to right

Top to bottom

Bottom to top

Decision Trees: The tree is read from left to right.

A strategy that is narrower in scope and in more detail is:

Organizational Strategy

Time and Quality Strategy

Operational Strategy

Manufacturing/Service Strategy

More routine purchasing, handling and inspection is an example of:

Customization

Mass Customization

Standardization

None of the above

Advantages of Standardization: More routine purchasing, handling, and inspection procedures

(These indicate a decrease in cost and can improve reliability as well as over all design and

manufacturing processes)

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Forecasting or prediction for organizations will always be:

Failure

Success

Sometimes failure and sometimes success

Complex

“Business forecasting is only used for predicting demand”. This statement is:

Totally right

Totally wrong

Partially right

None of the above

Business forecasting pertains to more than predicting demand. Forecasts are also used to predict

profits, revenues, costs, productivity changes & prices.

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Operational strategies mostly function on two dimensions that are:

Quality management and Service/Manufacturing Strategy

Quality and Operation Management

Service/Manufacturing Strategy and Functional Management

Operation and Functional Management

Operational strategies mostly function on two dimensions of quality management and

service/manufacturing strategy.

The main constituents of the Quantitative methods of forecasting are?

Sales force composite

Panel of executive opinion

Consumer market survey

Exponential smoothing

Exponential smoothing:

1. Quantitative forecasting

2. Weighted average of two variables.

The ratio of the real value of output to the combined input of labor and capital is called:

Labor Productivity

Capital Productivity

Energy Productivity

Multifactor Productivity

A purchaser needs unique, low-money value part. This part is a critical component of a

product manufactured by the purchaser. The part is patented and can only be obtained

from two suppliers and is often on back order. The purchaser‟s company does not have

expertise in the manufacturing of this particular component. In this scenario what is the

most appropriate action for the purchaser?

To select a similar part from other reliable supplier and substitute the part

To set up a cross-functional team to make the part internally

To seek other suppliers through seeking a quotation or proposal

To recommend a change in product design to remove the need for that unique part. ( Answer

requsted).

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Increases in productivity are difficult to achieve if one of the following situation occurs

The task is more intellectual and personal

The task is more quantitative and repetitive

The task is more physical and tangible

The task is more good-producing and standardized

The systematic plan of action with defined resources is called:

Competitiveness

Strategy

Productivity

Flexibility

Strategy is an elaborate and systematic plan of action with defined resources.

In a Process layout, work stations are arranged according to the general function they perform without regard to any particular product.

True. A product layout is more suited to situations where product demand is stable than when it is fluctuating.

True. Fixed position layouts are used in projects where the product cannot be moved, and therefore equipment, workers, and materials are brought to it.

False. In general, work-in-process inventory is large for a process layout and small for a product layout.

Low Volume is associated with process layout.

problems for Inventory Management:

1. When developing inventory cost models, which of the following are not included as costs to place an order?

A) Phone calls B) Taxes C) Clerical D) Calculating quantity to order E) Postage

Answer: B

2. Which of the following is not included as an inventory holding cost?

A) Annualized cost of materials B) Handling C) Insurance D) Pilferage E) Storage facilities

Answer: A 3. Which of the following is not an assumption of the basic fixed-order quantity inventory model?

A) Ordering or setup costs are constant B) Inventory holding cost is based on average inventory C) Diminishing returns to scale of holding inventory D) Lead time is constant E) Demand for the product is uniform throughout the period

Answer: C 4. Assuming no safety stock, what is the re-order point (R) given an average daily demand of 50 units, a lead

time of 10 days and 625 units on hand? A) 550 B) 500 C) 715 D) 450 E) 475

Answer: B

5. If annual demand is 12,000 units, the ordering cost is $6 per order and the holding cost is $2.50 per unit per

year, which of the following is the optimal order quantity? A) 576 B) 240 C) 120.4 D) 60.56 E) 56.03

Answer: B

6. Using the economic order quantity model, which of the following is the total ordering cost of inventory given

an annual demand of 36,000 units, a cost per order of $80 and a holding cost per unit per year of $4? A) $849 B) $1,200 C) $1,889 D) $2,267 E) $2,400

Answer: E 7. A company has recorded the last five days of daily demand on their only product. Those values are 120, 125,

124, 128, and 133. The time from when an order is placed to when it arrives at the company from its

vendor is 5 days. Assuming the basic fixed-order quantity inventory model fits this situation and no

safety stock is needed, which of the following is the reorder point (R)? A) 120 B) 126 C) 630 D) 950 E) 1,200

Answer: C

8. The Pareto principle is best applied to which of the following inventory systems? A) EOQ B) Fixed-time period C) ABC classification D) Fixed-order quantity E) Optional replenishment system

Answer: C 9. Using the ABC classification system for inventory, which of the following is a true statement?

A) The “C” items are of moderate dollar value B) You should allocate about 15 % of the dollar volume to “B” items C) The “A” items are of low dollar value D) The “A” items are of high dollar value E) Inexpensive and low usage items are classified as “C” no matter how critical

Answer: D

10.Which one of the following descriptions best defines the cycle-service level as a measure of customer

service? a. The preferred proportion of annual demand instantaneously filled from stock b. The number of stockouts tolerated per year c. The preferred proportion of days in the year when an item is in stock d. The desired probability of not running out of stock in any one inventory cycle Answer: d

11.Which one of the following statements is best?

a. A P system requires more safety stock than a Q system. b. A P system lends itself more to quantity discounts than does a Q system. c. A P system requires more administrative control and computer support than does a Q system. d. In a periodic review system, the value of Q is kept the same from one cycle to another. Answer: a

12.Sark Incorporated is out of stock for a key item, which has a backorder of 200 units. An open order of 750

units is scheduled for arrival on the following Monday. What is the current inventory position at Sark? a. Less than or equal to 0 units b. Greater than 0 but less than or equal to 500 units

c. Greater than 500 but less than or equal to 750 units d. Greater than 750 units Answer: c

13.For an item under continuous review, the on-hand inventory is only 20 units and the reorder point R is 100

units. There are no backorders, but there is one open order for 90 units. Which one of the following

statements is TRUE? a. There is no need to order at the present time. b. The current inventory position is 100 units. c. An order should be placed now for 20 units. d. An order should be placed now for 10 units. Answer: a

14.The Franklin County Hospital is currently using a continuous review system to control its inventory. One

of the items in inventory is an elastic band. The average demand for this item is 200 boxes per week, and

the standard deviation in weekly demand is 50 boxes. If the lead time is 3 weeks and the hospital wants a

99 percent cycle-service level, what is the reorder point for this item? a. Less than 650 boxes b. Greater than 650 boxes but less than 750 boxes c. Greater than 750 boxes but less than 850 boxes d. Greater than 850 boxes Answer: c

Table 1

A company operating under a continuous review system has an average demand of 50 units per

week for the item it produces. The standard deviation in weekly demand is 20 units. The lead time

for the item is 6 weeks, and it costs the company $30 to process each order. The holding cost for

each unit is $10 per year. The company operates 52 weeks per year.

15.Use the information in Table 1. What is the economic order quantity (EOQ) for this item?

a. Less than 175 units b. Greater than 175 units but less than or equal to 200 units c. Greater than 200 units but less than or equal to 225 units d. Greater than 225 units a

16.Use the information in Table 1. What is the desired safety stock level if the company has a policy of

maintaining a 90 percent cycle-service level? a. Less than 50 units b. Between 50 units and 100 units c. Between 100 units and 150 units d. Greater than 150 units b

17.Use the information in Table 1. What is the reorder point if the company finally decides to have a 95

percent cycle-service level? a. Less than or equal to 300 units b. Between 300 and 325 units c. Between 325 and 350 units d. Greater than 350 units d

18. A company has recorded the last five days of daily demand on their only product. Those values are 120, 125,

124, 128, and 133. The time from when an order is placed to when it arrives at the company from its

vendor is 5 days. Assuming the basic fixed-order quantity inventory model fits this situation and no

safety stock is needed, which of the following is the reorder point (R)? A) 120 B) 126 C) 630 D) 950 E) 1,200

Answer: C

19. If it takes a supplier four days to deliver an order once it has been placed and the standard deviation of daily

demand is 10, which of the following is the standard deviation of usage during lead time?

A) 10 B) 20 C) 40 D) 100 E) 400

Answer: B 20. A company wants to determine its reorder point (R). Demand is variable and they want to build a safety stock

into R. If the average daily demand is 12, the lead time is 5 days, the desired “z” value is 1.96, and the

standard deviation of usage during lead time is 3, which of the following is the desired value of R? A) About 6 B) About 16 C) About 61 D) About 66 E) About 79

Answer: D

21. A store has collected the following information on one of its products:

Demand = 10,000 units/year Standard deviation of weekly demand = 25 units Ordering costs = $30/order Holding costs = $4/unit/year Cycle-service level= 95% Lead time = 2 weeks Number of weeks per year = 50 weeks

If a firm uses the continuous review system to control the inventory, what would be the order

quantity and reorder point?

Answer:

= 387.30 387 units 258 units

22. Assuming no safety stock, what is the re-order point (R) given an average daily demand of 100 units and a

lead time of 5 days? Answer: 500

Which of the following is a function of inventory? a. to decouple or separate parts of the production process b. to provide a stock of goods that will provide a selection for customers c. to take advantage of quantity discounts d. to hedge against inflation e. all of the above are functions of inventory

2. Which of the following would not generally be a motive for a firm to hold inventories? a. to decouple or separate parts of the production process b. to provide a stock of goods that will provide a selection for customers c. to take advantage of quantity discounts d. to minimize holding costs 3. All of the following statements about ABC analysis are true except a. inventory may be categorized by measures other than dollar volume b. it categorizes on-hand inventory into three groups based on annual dollar volume c. it is an application of the Pareto principle d. it states that all items require the same degree of control e. it states that there are the critical few and the trivial many inventory items 4. ABC analysis is based upon the principle that a. all items in inventory must be monitored very closely b. there are usually a few critical items, and many items which are less critical c. an item is critical if its usage is high d. the safety stock in terms of volume should be higher for A items than for C items 5. Which of the following statements about ABC analysis is false? a. ABC analysis is based on the presumption that controlling the few most important items produces the vast majority of inventory savings. b. In ABC analysis, "A" Items are tightly controlled, have accurate records, and receive regular review by major decision makers. c. In ABC analysis, "C" Items have minimal records, periodic review, and simple controls. d. ABC analysis is based on the presumption that all items must be tightly controlled to produce important cost savings. 6. ABC analysis divides on-hand inventory into three classes, generally based upon a. item quality b. unit price c. the number of units on hand d. annual demand e. annual dollar volume 7. Cycle counting a. is a process by which inventory records are verified once a year b. provides a measure of inventory accuracy c. provides a measure of inventory turnover d. assumes that all inventory records must be verified with the same frequency 2 8. Among the advantages of cycle counting is that it a. does not need to be performed for less expensive items b. does not require the detailed inventory records necessary when annual physical inventory is used c. does not require highly trained people d. allows more rapid identification of errors and consequent remedial action than is possible with annual physical inventory 9. The two most basic inventory questions answered by the typical inventory model are a. timing and cost of orders b. quantity and cost of orders c. timing and quantity of orders d. order quantity and service level 10. A certain type of computer costs $1,000, and the annual holding cost is 25%. Annual demand is 10,000 units, and the order cost is $150 per order. What is the approximate economic order quantity? a. 70 b. 110 c. 250 d. 12,000 11. Most inventory models attempt to minimize a. the likelihood of a stockout

b. the number of items ordered c. total inventory based costs d. the number of orders placed 12. In the basic EOQ model, if the cost of placing an order doubles, and all other values remain constant, the EOQ will a. increase by about 41% b. increase by 100% c. increase by 200% d. either increase or decrease 13. In the basic EOQ model, if D = 6,000 per year, S = $100, H = $5 per unit per month, the Economic Order Quantity is approximately a. 527 b. 100 c. 490 d. 142 14. Which of the following statements about the basic EOQ model is true? a. If the ordering cost were to double, the EOQ would rise. b. If annual demand were to double, the EOQ would increase. c. If the carrying cost were to increase, the EOQ would fall. d. All of the above statements are true. 15. Which of the following statements about the basic EOQ model is false? a. If the setup cost were to decrease, the EOQ would fall. b. If annual demand were to increase, the EOQ would increase. c. If the ordering cost were to increase, the EOQ would rise. d. If annual demand were to double, the EOQ would also double. 3 16. A product whose EOQ is 40 experiences a decrease in ordering cost from $90 per order to $10. The revised EOQ is a. three times as large b. one-third as large c. nine times as large d. one-ninth as large 17. A product whose EOQ is 400 experiences a 50% increase in demand. The new EOQ is a. unchanged b. increased by less than 50% c. increased by 50% d. increased by more than 50% 18. For a certain item, the cost-minimizing order quantity obtained with the basic EOQ model was 200 units and the total annual inventory cost was $600. The inventory carrying cost per unit per year for this item is a. $1.50 b. $3.00 c. $2.00 d. $6.00 19. A product has demand of 4,000 units per year. Ordering cost is $20 and holding cost is $4 per unit per year. The EOQ model is appropriate. The cost-minimizing solution for this product will cost _____ per year in total annual inventory costs. a. $400 b. $800 c. $1,200 d. $16,000

20. A product has demand of 4,000 units per year. Ordering cost is $20 and holding cost is $4 per unit per year. The cost-minimizing solution for this product is to order a. all 4,000 units at one time b. 200 units per order c. 1000 units per order d. 400 units per order 21. The EOQ model with quantity discounts attempts to determine a. what is the lowest amount of inventory necessary to satisfy a certain service level b. what is the lowest purchasing price c. whether to use fixed-quantity or fixed period order policy d. how many units should be ordered 22. 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. 100 is the reorder point, and 14 is the order quantity. b. 14 is the reorder point, and 100 is the order quantity. c. The number 100 is a function of demand during lead time. d. 14 is the safety stock, and 100 is the reorder point. 23. Which of the following statements regarding the Production Order Quantity model is true? a. It applies only to items produced in the firm's own production departments. b. It relaxes the assumption that all the order quantity is received at one time. c. It relaxes the assumption that the demand rate is constant. d. It minimizes the total production costs. 4 24. The Production Order Quantity model a. relaxes the assumption of known and constant demand b. uses Ordering Cost, not Setup Cost, in its formula c. is appropriate when units are sold/used as they are produced d. results in larger average inventory than an equivalent EOQ model 25. When quantity discounts are allowed, the cost-minimizing order quantity a. minimizes the sum of holding and ordering costs b. minimizes the unit purchase price c. may be a quantity below that at which one qualifies for that price d. minimizes the sum of holding, ordering, and product costs 26. A specific product has expected demand during lead time of 100 units, with a standard deviation of 25 units. What safety stock (approximately) provides a 95% service level? a. 41 b. 55 c. 133 d. 140 27. Demand for dishwasher water pumps is 8 per day. The standard deviation of demand is 3 per day, and the order lead time is four days. The service level is 95%. What should the reorder point be? a. about 18 b. about 24 c. about 32 d. about 33 e. more than 35 28. The purpose of safety stock is to a. replace failed units with good ones b. eliminate the possibility of a stockout c. eliminate the likelihood of a stockout due to erroneous inventory tally d. control the likelihood of a stockout due to the variability of demand during lead time 29. The proper quantity of safety stock is typically determined by a. minimizing an expected stockout cost b. carrying sufficient safety stock so as to eliminate all stockouts

c. meeting 95% of all demands d. setting the level of safety stock so that a given stockout risk is not exceeded 30. If demand is not uniform and constant, then stockout risks can be controlled by a. increasing the EOQ b. placing an extra order c. raising the selling price to reduce demand d. adding safety stock 31. A disadvantage of the fixed-period inventory system is that a. it involves higher ordering costs than the fixed quantity inventory system b. additional inventory records are required c. the average inventory level is decreased d. since there is no count of inventory during the review period, a stockout is possible 5 Chapter 12: Multiple Choice Answers 1. e 2. d 3. d 4. b 5. d 6. e 7. b 8. d 9. c 10. b 11. c 12. a 13. d 14. d 15. d 16. b 17. b 18. d 19. b 20. b 21. d 22. b 23. b 24. c 25. d 26. a 27. e 28. d 29. d 30. d 31. d

PROJECT MANAGEMENT

1. All of the following are advantages of the pure project organizational structure EXCEPT:

A. the project manager has full authority over the project.

B. equipment and people are shared across projects.

C. lines of communication are shortened.

D. high team pride and commitment. .

E. team members report to one boss.

2. Which of the following is NOT an advantage of the matrix project structure?

A. communication between functional divisions is enhanced

B. duplication of resources is minimized

C. policies of the parent organization are followed

D. there are two bosses - functional managers and project managers

E. team members have a functional area after the project is completed

3. Which of the following factors are of concern in project management?

I. time

II. cost

III. resource availability

A. I only

B. II only

C. III only

D. I and II only

E. I, II and III

4. For critical path scheduling techniques to be most applicable, the jobs or tasks of a project

must be:

A. well-defined.

B. independent.

C. ordered.

D. a and b only.

E. all of the above.

5. The early finish time equals:

A. the earliest possible time that the activity can begin.

B. the earliest start time plus the time needed to complete the activity.

C. the latest time an activity can end without delaying the project.

D. the earliest time an activity can start minus the activity time.

E. the latest start time minus the activity time.

6. The critical path of a project can be characterized in the following way:

A. The slack times for each task in the project are zero.

B. The chain of activities (from start to finish) that has the largest sum of activity durations.

C. The early start date and early finish date are always the same for each activity on the critical

path.

D. To reduce the project duration, you must reduce the slack time of a task on the critical path.

E. None of the above are correct.

7. You have just been asked to oversee 100 people on a two-year project, to develop a new MRI

machine similar to a current product, which will have twice the effectiveness and cost less to

manufacture. You are uncertain about the time required to complete many of the activities.

Which project management technique should you use?

A. CPM with a single time estimate

B. MRP

C. CPM with three time estimates

D. GANTT

E. Any of the above will work.

8. Which of the following is a major disadvantage of the Matrix method of project management?

A. A single project manager is held responsible for the successful completion of the project.

B. Team members must leave their functional "home" - jeopardizing their career path.

C. Communication between functional disciplines is discouraged.

D. Team members report to two bosses - creating a potential conflict.

E. The combined functional knowledge of many similarly-trained employees can be used to

create synergistic solutions to problems as they arise over the duration of the project

9. The early finish time for an activity equals:

A. The earliest possible time that the activity can begin.

B. The earliest start time plus the time needed to complete the activity.

C. The latest time an activity can end without delaying the project.

D. The earliest time an activity can start minus the activity time.

E. The latest start time minus the activity time.

10. What is the expected duration of the path BCDEGH?

Activity Predecessors Optimistic Most Likely Pessimistic

A 2 3 4

B 2 4 6

C A, B 3 4 8

D C 2 3 7

E D 4 6 8

F E 5 8 13

G E 4 4 4

H F, G 2 4 6

A. 17

B. 26

C. 25

D. 37.33

E. 39

ANSWERS:

1B, 2D, 3E, 4E, 5B, 6B, 7C, 8D, 9B, 10B

A supply chain is defined as the group of firms that provide all processes required to make a

finished product available to the customer. A) True B) False

2

SCM can include having suppliers actually on site producing products or services in a

manufacturers facility. A) True B) False

3

SCM suppliers should be viewed as "partners." A) True B) False

4

Wal-Mart's EDI system issues electronic purchase orders and receives electronic invoices from

virtually all of Wal-Mart's suppliers. A) True B) False

5

Which of the following is NOT a reason that companies are depending more on their suppliers?

A) More focus on core competencies B) Need for more flexibilities

C) Desire to share risks D) More control over their suppliers

6

The trend in organizations is to place the SCM function: A) Under the

manufacturing function B) Under the finance function C) Under the

engineering function D) At the same level as the other major functions

7

Which of the following is NOT a factor impacting the supply chain? A) Reduced

number of suppliers B) Increased competition C) Longer product life

cycles D) Increased opportunities to strategically use technology

8

If two potential suppliers can deliver a part with the same quality and prices, the selection should

be based on: A) Age of the firms B) A coin flip C)

Outside evaluation D) The capabilities and flexibilities of the firms

9

Just-in-time/SCM purchasing requires the following condition: A) Many suppliers

B) Short-term contracts C) Cooperation between purchasing and

suppliers D) Continuous competitive bidding

10

The amount of inventory kept at each stock point in a warehouse network is usually based on:

A) Minimizing transportation costs B) Constant demand C)

Tradeoffs between warehousing, inventory, and transportation costs D)

Product pricing strategy

11

Which of the following is NOT a benefit of SCM/JIT Purchasing? A) Consistent

quality B) Savings on resources C) Lower costs D) Less

dependence on suppliers

12

Purchased items account for approximately what % of costs of goods sold? A) 30-

40% B) 40-50% C) 50-60% D) 60-70% E)

70-80%

According to Total Quality Management approach, ____________ is responsible for process design.

Design department

Operations department

Logistic department

Logistic department

Operations Dept: A Design process that facilitates doing the job right the first time.

Identify the time span covered by aggregate planning. 3-7 months 2-10 months 2-12 months 4-8 months

Aggregate planning: Intermediate-range capacity planning, usually covering 2 to 12 months.

ISO 14000 is a series of how many standards? Three Five Seven Ten

(Reference by Umeed-e-Subh)

ISO 14000 is a series of five standards that cover a number of areas.

www.vuzs.net

Which one of the following is a characteristic of a continuous process? High lead times Short process times

The ability to handle high variety The ability to handle high volumes

In manufacturing, a continuous process is a method that is used by manufacturing or production companies to churn out the greatest quantity of a product over the least time.

As preventive measures improve quality, _____ costs decreases. Failure Appraisal Operating Opportunity As preventive measures improve quality, appraisal costs decrease, because fewer resources are needed for quality inspections and the subsequent search for the causes of any problems that are detected.

An organization has described its distinctive characteristics. So, what is the next step in formulating the strategy? Productivity Measures Environmental scanning Selecting the market segment Competitor’s distinctiveness Strategy Formulation: Service Organizations are no exceptions and work diligently to identify, nurture and protect their distinctive competencies. Service Organizations are busy carrying out detailed environmental scanning and also periodically carryout SWOT Analysis.

www.vuzs.net

Which of the following department is responsible for measuring costs of poor quality? Accounting department Finance department Quality control department Operations department Cost Of Poor Quality (COPQ): Cost of Poor Quality (COPQ) in Quality Control.

Which of the following forecasting techniques induce personal bias in a forecast?

Qualitative Quantitative Associative Trend forecast

As a quantitative measure, the "forecast bias" can be specified as a probabilistic or statistical property of the forecast error. A typical measure of bias of forecasting procedure is the arithmetic mean or expected value of the forecast errors, but other measures of bias are possible.

Which one of the following is an example of an intermediate range plan? Machine loading Backorder Facilities layout Product design

Intermediate plans (General levels)

1. Employment

2. Finished Good inventories

3. Subcontracting, Backorders

4. Output

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Capacity options are usually of ________ range in nature Short Long Intermediate Periodical

Long-range plans

1. Long term capacity

2. Location / layout

Which one of the following formula can be used to compute break even point? Q = FC / (R + VC) Q = VC / (R + FC) Q = VC / (R - VC) Q = FC / (R - VC)

QBEP = FC/ R-VC

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Which of the following contributes in customer’s perception of Expected Service? Service features Past experience Reliability of service After service guarantee

All of the following are dimensions of service quality Except: Assurance Responsiveness Intangibles Reliability

Service Quality Dimensions

Reliability

Responsiveness

Assurance

Empathy

Tangibles

G.S.Radford demonstrated the connections between:

High quality, decreased quality and higher cost

High quality, increased quality and higher cost

High quality, decreased quality and lower cost

High quality, increased quality and lower cost

G.S. Radford introduced the concept of quality in the product design stage and linked high quality with increased productivity and lower costs.

www.vuzs.net

Reliability and safety of service is ensured through which of the following?

Quality in design

Quality in system

Quality in equipment

Quality in training

The thing to remember here is that Quality in design ensures the safe as well as reliable operations of the service.

Averages of accepted and rejected batches in operating curve is known as__________.

Average lot tolerance percent defective

Average outgoing quality

Average outgoing quality limit

Average acceptance quality level

Average Outgoing Quality (AOQ): Average of rejected lots and accepted lots.

In SERVQUAL model, all of the following makes sure that no gap exists between the

service provided and service demanded Except:

System design

Service quality

Communication with customers

Well trained workforce

SERVQUAL measuring tool “remains the most complete attempt to conceptualize and

measure service quality”. Gap 4 is the gap between the delivery of the customer

experience and what is communicated to customers. Gap 5 is difference between

perceived and expected services. The key to closing gap in thoughtful system design.

Which one of the following mathematical expressions can be used to compute output

capacity?

OT/CT

CT/OT

CT+OT

CT-OT

OC = Output capacity = OT/CT

Total Quality Management stresses on all of the following principles except:

Customer satisfaction

Employee involvement

Continuous improvement in quality

Quality as competitive advantage

www.vuzs.net

Which one of the following is an example of a short range plan?

Machine loading

Back order

Facilities layout

Product design

Short-range plans (Detailed plans)

1. Machine loading

2. Job assignments

External failure cost also includes:

Litigation costs

Process redesigning costs

Employee training costs

Rework costs

Which of the following is NOT a dimension of quality that makes a company

competitive?

Performance

Special features

Leadership

Reliability

www.vuzs.net

______ method of evaluation of quality allows the inspectors to make decisions about

whether a product / service meets the specifications?

Measuring attributes

Measuring variables

Measuring dimensions

None of the above

Fitness for Purpose - Customer specification: It identifies quality in terms of the extent to which a product or service meets the specifications of the customer.

Seagate, a disk driver manufacturer advertises that its high performance disk drivers

have a mean time failure of 1.2 million hours. If the disk lived upto that claim, it would

come under which TQM customer driven dimension of quality?

Value

Fitness for use

Conformance to specification

Quality in design

Conformance - how well product/service conforms to customer’s expectations.

Ali got his mobile repaired from UNITED MOBILES which was situated very near to his

home. Which dimension of service quality is referred in this example?

Assurance

Reliability

Convenience

Responsiveness

www.vuzs.net

The forecasting model that attempts to predict the future value based on the past data is

known as:

Delphi Method

Time series Analysis

Associative Models

Naïve Forecasting

Time series: It uses historical data assuming the future will be like the past and depend on developing relationships between variables that can be expressed to predict future values.

Which of the following is referred to as plans for achieving goals?

Tactics

Strategies

Policies

Mission

Strategies are plans for achieving goals.

Which one of the following refers to a team having representatives from different

functional areas of the organization?

Traditional work group

Self-directed team

Cross-functional team

Self motivated team

These cross-functional benchmarking teams contain representatives from different

functional areas of each company.

www.vuzs.net

XYZ organization is ISO 9000 certified. It now requires a plan to improve performance in

resource use and pollutant output. For this, the organization requires certification of ________.

ISO 9003

ISO 14000

ISO 9004

None of the above

The ISO 14000 environmental management standards exist to help organizations (a)

minimize how their operations (processes etc.) negatively affect the environment (i.e.

cause adverse changes to air, water, or land); (b) comply with applicable laws,

regulations, and other environmentally oriented requirements, and (c) continually

improve in the above.

The role of a ------------ manager is to sustain, protect, and project the company’s

operations side.

Project Manager

Operations Manager

Finance Manager

Marketing Manager Whether profit or non profit, the role of an OPERATIONS MANAGER is to sustain, protect, and project the company’s operations side.

All are six sigma teams except:

"Black belts"

Master "black belts"

"Green belts"

Master "green belts"

Six Sigma Teams are formed for implement of Six Sigma in true spirit keeping in mind both managerial as well as technical aspects.

1. Top management

2. Program champions

3. Master “black belts”

4. “Black belts”

5. “Green belts”

Solved and Referenced by Zubair hussain

Which of the following terms reflects the notions of “do it right” and “if it does not right, fix it”? ? Competitive benchmarking

? Quality at the source

? Continuous improvement

? Customer focus

(zh,vuzs,feb11)

Choose the correct value of alpha by solving the Kanban formula.

? 7.88

? 8.88

? 9.7

? 6.89

Find the value of alpha

Working :-

500 = 1500 (0.5 + 0.25) (1+ alpha) / 20

(1+ alpha) = 500 x 20 / 1500(0.5 + 0.25)

(1+ alpha) = 10,000 / 1500 (0.75)

(1+ alpha) = 10,000 / 1125

(1+ alpha) = 8.88

alpha = 8.88 – 1

alpha = 7.88

(huzifa, vuzs.net,feb11)

For 10 numbers of jobs, cumulative flow time is 180. Under First Come First

Served (FCFS) rule of sequencing which of the following is average flow time?

? 18 days

? 13 days

? 15 days

? 10 days

cumulative flow/number of jobs = average flow time

Which of the following is a time ordered diagram that is used to determine whether observed variations are abnormal? Select correct option: Control charts Scatter diagram Histograms Pareto charts

Control Chart: A time ordered plot representative sample statistics obtained from

an on going process purpose : to monitor process output to see if it is random

Q.2 In TQM, appearance, style, durability, reliability, craftsmanship and serviceability comes under which determinant of quality? Select correct option: Quality of design Quality of conformance Quality of fitness for use Quality of service after delivery

Fitness for use

· How well the product/service performs its intended purpose

· Based on mechanical features of the product, convenience of service,

appearance, style, durability, reliability, craftsmanship, and serviceability

· Example: quality = if it was easy to assemble a desk and if it served well

Which of the following terms are important for financial analysis? Select correct option: Cash flow and profit Cash flow and present value Present value and fixed cost Cash flow and fixed cost (vuzs.net,zh,jan10) stevenson’s book page 208

Which of the following does not enhance developing capacity alternatives? Select correct option:

Designing flexibility into the system Taking a big picture approach Staying focused on quantitative factors Smoothing capacity requirements

(Vuzs.net , zh, jan10, setvesons book page 199)

What are the chances of the batch containing defect exceeding LTPD will be accepted is known as? Select correct option: Acceptance risk Consumer risk Producer risk None of the above mentioned

(Vuzs.net , zh, jan10, setvesons book page 456)

Which one of the following is an example of a long range plan? Select correct option: Machine loading Backorders Facilities layout Work schedule

Which method of forecasting is the most widely used?

Select correct option:

Regression analysis

Adaptive forecasting

Weighted moving average

Exponential smoothing

(Vuzs.net, vuzs,jan2010) Stevenson’s book page 479

_________ is a set of standards governing documentation of a quality program

Select correct option:

ISO 9000

ISO 14000

ISO 9002

ISO 9004

Reference: vuzs.net

“Respect for worker” is the basic principle of which of the following management systems? ? American management system ? Japanese management system ? Asian management system ? European management system

Reference

Which of the following is a characteristic of linear regression?

It is superior to a moving average

It is a causal forecasting model

It compensates for both trend and seasonal variations in demand

It is superior to a exponential smoothing

If the goal is prediction, or forecasting, linear regression can be used to fit a

predictive model to an observed data set of y and X values. After developing such

a model, if an additional value of X is then given without its accompanying value

of y, the fitted model can be used to make a prediction of the value

Which of the following relates to estimating both the level and timing of resourcesneeded over the project duration?

Project estimating

Project planning

Project control Project crashing

Referenced by vuzs.net

Which of the following is referred to as plans for achieving goals? Select correct option: Tactics Strategies Policies Mission

Strategies are Plans for achieving organizational goals

Mission is the reason for existence for an organization

Mission Statement answers the question “What business are we in?”

Goals provide detail and scope of mission

Tactics are the methods and actions taken to accomplish strategies

Which of the following statements is not true while comparing Quality Assurance with Strategic Approach? Select correct option: Strategic Approach is reactive while Quality Assurance is a proactive approach Strategic Approach is the superlative form of Quality Assurance Quality Assurance places emphasis on finding and correcting defects before reaching market Strategic Approach is proactive rather than reactive

Quality Assurance vs. Strategic Approach

Strategic Approach is the SUPERLATIVE form of Quality Assurance

Quality Assurance places emphasis on finding and correcting defects before

reaching

market

Strategic Approach is Proactive, focusing on preventing mistakes from occurring

and places

greater emphasis on customer satisfaction.

________costs are incurred in assessing the level of quality attained by the operating system.

Multiple-Choice Quiz

(See related pages)

Please answer the following questions.

1 The advantages of standardization include: I. early freezing of the design. II. Fewer parts to

deal with in inventory. III. Reduced training cost and time. IV. More routine purchasing.

A) I, II

B) I, IV

C) I, II, III

D) II, III, IV

E) I, II, III, IV

2 The term that pertains to incorporating customer ideas in product design is:

A) TQM

B) CAD

C) QFD

D) Robust design.

E) Reverse engineering

3 Product designs that use computers is referred to as:

A) QFD

B) CED

C) RFD

D) CAD

E) TQM

4 Taking apart a competitor's product to better understand how it operates is:

A) Remanufacturing

B) Concurrent engineering

C) Robust design

D) Illegal

E) None of the above.

5 Which of these is a stage in the life cycle of a product or service?

A) Incubation.

B) Growth.

C) Maturity.

D) Saturation.

E) All of the above are stages.

6 The Taguchi Approach is most closely associated with:

A) Total Quality Management

B) Standardization.

C) Quality function deployment.

D) Robust design.

E) Concurrent engineering.

7 Which one of these is not related to mass customization?

A) Standardization

B) Reverse engineering

C) Delayed differentiation

D) Modular design

E) Manufacturability

8 Remanufacturing means:

A) Reassembling a defective product.

B) Redesigning the layout of the factory.

C) Refurbishing used products.

D) Redesigning the product.

E) Retraining the workers.

9 Basic research, applied research and development are all part of the product life cycle.

A) True

B) False

10 The Uniform Commercial Code specified that a product must be suitable for its intended

purpose.

A) True

B) False

11 The term robust design refers to a product that has exceptional strength.

A) True

B) False

12 The term concurrent engineering refers to bringing engineering and manufacturing personnel

together early in the design phase.

A) True

B) False

13 Modular design is a form of standardization.

A) True

B) False

14 CAD uses computer graphics for product design.

A) True

B) False

15 Quality function deployment is a method of integrating the "voice of the customer" into the

design process.

A) True

B) False

16 Equipment breakdowns is a frequent cause of delayed differentiation.

A) True

B) False

17 Standardized parts are interchangeable parts.

A) True

B) False

18 Designing for disassembly and designing for recycling are nearly synonymous terms.

A) True

B) False

19 The name Taguchi is associated with robust design.

A) True

B) False

20 Recycling is essentially remanufacturing.

A) True

B) False

21 A major consideration in product design is manufacturability.

A) True

B) False

22 Environmental scanning refers to checking environmental regulations before proceeding with

product design.

A) True

B) False

23 The term concurrent engineering refers to bringing engineering and manufacturing personnel

together early in the design phase.

A) True

B) False

24 Delayed differentiation and modular design are two tactics useful for mass customization.

A) True

B) False

25 Quality function deployment is a method of integrating the "voice of the customer" into the

design process.

A) True

B) False

26 Product designs that use computers is referred to as:

A) QFD

B) CAM

C) RFD

D) CAD

E) TQM

27 Which of the following may be a dimension of quality?

A) Performance.

B) Conformance.

C) Reliability.

D) Durability.

E) All may be dimensions of quality.

28 Remanufacturing means:

A) Reassembling a defective product.

B) Redesigning the layout of the factory.

C) Replacing worn out components in products and reselling the products.

D) Redesigning the product.

E) Retraining the workers.

29 One possible disadvantage of modular design is that:

A) Replacement and repair is more difficult.

B) Failure diagnosis is more complex.

C) Number of configurations of modules decreases.

D) Individual parts lose their identities.

E) Inventory problems arise.

30 As part of a strategy for improving competitiveness, a manager may have to initially sacrifice:

A) Research and development

B) Short-term performance

C) Employee pay rises

D) Product or service quality

E) all of the above

31 Service design generally differs from product design in which of the following ways?

A) Service design tends to focus on tangible factors.

B) There is less latitude in detecting and correcting errors prior to delivery.

C) There is a lesser requirement to be aware of competitors' offerings.

D) There is less visibility to customers.

E) None of the above

1 Which one was not listed in the textbook as a reason that organizations fail?

A) Not putting enough emphasis on short-term performance.

B) Neglecting operations strategy.

C) Neglecting investment in capital and human resources.

D) Failure to consider customer wants and needs.

E) Failure to take advantage of strengths

2 Organizational strategies should support

A) the firm's mission

B) functional strategies

C) the firm's tactics

D) operational procedures

E) the firm's employees

3 Which strategies have the Japanese employed since World War II?

A) Low labor cost

B) Scale based strategies

C) Focused factories

D) Flexible factories

E) All of the above.

4 Which formula correctly describes productivity?

A) (Output - Input)/Output

B) (Input - Output)/Input

C) Output/Input

D) Input/Output

5 Which of these best relates to environmental scanning?

A) Pollution control

B) Environmental legislation

C) Scanning the media for upcoming environmental protests

D) Threats and opportunities

E) OSHA inspections

6 An order winner is:

A) the firm that got the order.

B) a superior characteristic.

C) a superior salesperson.

D) a superior customer.

E) the largest order.

7 If inputs decrease while output remains constant, what will happen to productivity?

A) It will increase.

B) It will decrease.

C) It will remain the same.

D) It is impossible to tell.

E) It depends on which input decreases.

8 Order qualifiers refer to:

A) distinctive competencies.

B) minimum standards of acceptability.

C) value added in manufacturing

D) environmental scanning.

E) price competition.

1 The mission of a firm should be designed to support the firm's overall strategy.

A) True

B) False

2 Operations managers measure productivity as the ratio of input to output.

A) True

B) False

3 Increased emphasis on pollution control and the environment has led companies to adopt

an environmental scanning approach.

A) True

B) False

4 Productivity gains can curb inflation.

A) True

B) False

5 Standardizing processes can lead to increased productivity.

A) True

B) False

6 Productivity can be measured only on workers.

A) True

B) False

7 Productivity and efficiency are different names for the same thing.

A) True

B) False

8 A company can compete with other companies manufacturing a similar product only by

reducing its price

A) True

B) False

9 Much of the responsibility for improving productivity rests with management.

A ) True

B) False

10 A time-based strategy may include reducing the time needed to respond to a customer's

complaint.

A) True

B) False

1 The mission of a firm should be designed to support the firm's overall strategy.

A) True

B) False

2 Productivity is the ratio of input to output.

A) True

B) False

3 A company can compete with other companies manufacturing a similar product only by

reducing its price.

A) Tue

B) False

4 Much of the responsibility for improving productivity rests with management.

A) True

B) False

5 Which one of the following is not generally cited as a negative impact on productivity?

A) Government regulations

B) Liability claims

C) Increased emphasis on services

D) Emphasis on short-term performance

E) All are reasons.

6 Which is the correct hierarchy of operations management decisions (highest first)?

A) Operating, tactical, strategic

B) Operating, strategic, tactical

C) Tactical, strategic, operating

D) Strategic, operating, tactical

E) Strategic, tactical, operating

7 Operations strategy is affected by both internal and external factors. Which one of the

following would come under both headings (internal and external)?

A) Competition

B) Technology

C) Suppliers

D) Markets

E) Facilities and equipment

8 A measure of productivity which reflects a combination of some or all of the resources used

to obtain a certain output is:

A) labor productivity

B) machine productivity

C) multi-factor productivity

D) materials productivity

E) overhead productivity

9 Distinctive competencies in organizations generally relate to:

A) price (cost)

B) quality

C) time

D) flexibility

E) all of the above

1 Frederick W. Taylor is generally credited with introducing the moving assembly line.

A)True

B)False

2 Human effort, technology, raw materials, information and time are all examples of the necessary inputs to operations. A)True

B)False

3 Outputs of operations may be classified as goods, raw materials and profits. A)True

B)False

4 It is easier to measure productivity for an operation that provides services than for one that produces goods. A)True

B)False

5 According to the Pareto principle, a relatively few factors are very important in achieving an objective or solving a problem. A)True

B)False

6 Two recent trends in operations management are supply chain management and specialization. A)True

B)False

7 Which one of the following would not generally be considered an aspect of operations management?

A)Schedule work

B)Secure financial resources

C)Maintain quality

D)Oversee the transformation process

E)Manage inventories

8 Which one of these was not mentioned in the list of recent trends in operations management?

A)Total quality management B)Worker involvement C)Global competition. D)Automation. E)Environmental issues. 9 Which came last in the development of manufacturing techniques?

A)Lean production. B)Division of labor. C)Mass production. D)Craft production. E)Interchangeable parts. 10 Which of the following is not a type of operations?

A)goods production

B)storage/transportation

C)entertainment D)communication

E)price reduction

11 Which of the following is not true about a lean production system?

A)It puts emphasis on quality, flexibility, and time reduction. B)It puts emphasis on reducing a company's labor force. C)It is involved in maintaining and improving the system with lower amounts of inventory. D)It uses small production batch sizes. E)It relies on buffers against unforeseen occurrences.

12 Which one of the following is not a typical question dealt with by an operations managers?

A) How much capacity will be needed in the months ahead?

B) What is a satisfactory location for a new facility?

C) Which products/services should be offered?

D) How to motivate employees?

E) All are typical of operations decisions. 13 Which one does not use operations management?

A) A CPA firm. B) A bank. C) A hospital D) A supermarket E) They all use it. 14 Which one is not generally considered to be an advantage of using models for decision making?

A) Providing a systematic approach to problem solving. B) Emphasizing quantitative information. C) Providing an exact representation of reality. D) Enabling managers to answer "what if" questions

E) Requiring users to be specific about objectives. 15 Which came last in the development of manufacturing techniques?

A) Lean production.

B) Division of labor. C) Mass production. D) Craft production. E) Interchangeable parts.

16 The three primary functions of a firm are financial management, operations management, and accounting. A) True

B) False

18 The principal activity in all production operations is to convert inputs into outputs that satisfy consumer wants. A) True

B) False

19 The father of scientific management was Henry Ford. A) True

B) False

20 A model is an abstraction of reality. A) True

B) False

21 It is easier to measure productivity for an operation that provides services than for one that produces goods. A) True

B) False

22 Both inputs and outputs are more uniform for an operation that provides services than for one that produces goods. A) True

B) False

23 The difference between the cost of inputs and the price of outputs is known as value added. A) True

B) False

24 Craft production involves the use of interchangeable parts. A) True

B) False

25 A supply chain is a sequence of organizations that are involved in producing goods and/or producing services. A) True

B) False

26 According to the Pareto principle, a relatively few factors are very important in achieving an objective or solving a problem. A) True

B) False

27 Two recent trends in operations management are flexibility and specialization. A) True

B) False

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28 Mass production is based on the division of labor. A) True

B) False

Which of the following forecasting techniques generates trend forecasts?

Delphi method

Weighted moving average

Moving averages

Single exponential smoothing

None of the above

What is the MAD for forecast errors of +4, -2, +1, -1?

0.00

0.50

1.00

1.50

2.00

Which one of these is not an element of a good forecast?

Low cost

In writing

Meaningful units

Timely

Measure of accuracy

Select the statement about moving averages and exponential smoothing that is not true.

Both tend to lag changes in a time series.

Both smooth data.

Both involve fairly simple calculations

Both can be used obtain seasonal index numbers.

Both are easy to interpret.

Data that have large variation will result in:

a low MAD but a high MSE

a high MAD but a low MSE.

a low MAD and a low MSE.

.ESM dna DAM lauqe na

The cumulative forecast error is important for determining the:

Mean squared error.

Bias in forecast error.

Mean absolute deviation.

Control limits.

Of these values, the value of that would track the data most closely is:

0

.01

.10

.20

.30

Who advocated the concept of “zero defects”?

Edwards. Deming

Joseph Juran

Kaoru Ishikawa

Philip Crosby

1960’s - Zero defects championed by Quality Guru Phillip Crosby.

Which of the following is the origin of the term “Poka –Yoke”?

America

China

Spain

Japan

Poka Yoke is the Japanese word for mistake proof.

Which of the following is INCORRECT about TQM?

Meeting the needs and expectations of customers

Primarily a “worker” rather than a management activity

Inclusion of every person in the organization

Covering all the functional areas of the organization

Meeting customer expectations: Knowledge management has historically maintained an inward focus, battling to help a company's employees relate to each other better with the help of diverse new technologies. All the organization should be involved.

www.vuzs.net

Which of the following refers to the length of time a job is in the shop at a particular workstation?

Job lateness

Job flow time

Make-span

Slack time

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1. Key issues in inspection include where to inspect, how often to inspect and whether to inspect on site or in a lab.

2. Total Quality Management TQM has two important aspects first being problem solving and second being process improvement

3. Sampling Plans specify lot size, sample size, number of samples and acceptance/rejection criteria.

4. Aggregate planning establishes general level of employment, output and inventories for periods of 2 to 12 Months.

5. Master schedule is prepared by desegregating the Aggregate Plan.

6. Inventory levels must be carefully planned in order to balance the Holding Costs of inventory and cost of providing levels of customer service

7. Economic Order Quantity (EOQ) and Economic Production Quantity (EPQ) make use of the same set of assumptions except orders are received incrementally during production. .

8. To be successful MRP requires a computer program, accurate master schedule, bills of material, and inventory data.

9. Manufacturing Resources Planning (MRP II) and Enterprise Resource Planning (ERP) are natural extensions of MRP, which cover broader scopes as well as Supply Chain Managements.

10. Process Layouts group similar activities into departments or other work centers.

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11. Fixed Position Layouts are used when size, fragility, cost or other factors make it undesirable or impractical to move a product through a system.

12. The design of work systems involves job design, work measurements and compensation

13. The primary location options available to an existing organization include expanding the existing location, move to a new location, maintain existing facilities while adding additional facility or do nothing.

14. Most organizations are influenced by location of raw materials, labor supply, market considerations, community related factors, site related factors and climate.

15. ISO 9000 and ISO 14000 represent quality standards and environment standards respectively.

16. Two basic tools of process control are control charts and run tests.

17. The decision to shift or convert from Traditional Manufacturing System to Just in Time or Lean Systems could be sequential in order to help management have better control, first hand learning experience and more time for conversion from one system type to another.

18. The ultimate goal of a Just in Time System is to achieve a balanced, smooth flow of production.

19. Logistics involve movement of materials to and from the organization including shipment and distribution.

20. Electronic Data Interchange has increased productivity and accuracy in Supply Chain Management Systems.

21. Eliminating the disruptions and making the system flexible are __________goals of the JIT. (supporting)

22. Incremental Holding Cost incurred by using slower alternative is computed through Incremental Holding Cost =________________.( H*(d/365) )

23. One of the basic elements of the Supply Chain Management is ____________ for evaluating suppliers and supporting operations.( purchasing)

24. CPFR stands for______________________________.(Collaborative Planning Forecasting and Replacement)

25. ________________reflects company’s efforts to achieve response from EDI and bar codes.(Efficient Consumer Response(ECR) )

26. The rate at which inventory goes through the supply chain is ____________(Inventory velocity)

27. In ____________we establish the timing of the use of equipment, facilities and human activities in an organization.( Scheduling)

28. Scheduling for high-volume flow system is referred to as _______________.(Flow-shop Scheduling)

29. ____________ is used as a visual aid for loading and scheduling.(Gantt chart)

30. Executive responsibilities, project selection, project manager selection, and organizational structure are major administrative issues of _(Project Management)__.

PRACTICE EXAM 1. All of the following statements concerning shortage costs are true except

a) shortage costs can relate to temporary, as well as permanent, loss of sales

b) shortage costs are many times just educated guesses

c) shortage costs increase as carrying costs increase

d) shortage costs decrease as inventory on hand increases

e) all of the above are true

(Answer: c)

{Text on pages 458 – 459 in the section on Inventory Costs and the lecture in the section

on Inventory Costs: The first two statements are true. Shortages can result in a temporary

loss of sale (a backorder) if the customer is willing to wait or the loss of sale can be

permanent. The shortage costs are notoriously difficult to estimate involving things like

loss of customer good will. Statement (c) is false since increasing carrying costs result

from larger inventories which means that shortages would be less likely, not more likely.

This would decrease shortage costs, which makes statement (d) the only correct

statement.}

2. Which of the following statements concerning the basic EOQ model is true?

a) a decrease in demand will increase the EOQ value

b) if an actual order quantity is smaller than the EOQ the annual holding cost is

less than the annual ordering cost

c) an increase in holding cost will increase the EOQ value

d) as annual ordering costs increase, so do annual carrying costs

e) none of the above statements are true

(Answer: b)

{Text on pages 464-467 in the section on The Basic EOQ Model and the lecture in the

section on The Basic EOQ Model: Statement (a) is false because a decrease in demand

will result in less need for inventory and a lower order quantity. Statement (b) is true

because if the actual order quantity is smaller than the EOQ that means that we are

ordering more often than we should be and carrying less inventory than we should. Thus,

the annual holding costs will be low and the annual ordering costs will be high. Statement

(c) is false because an increase in the holding costs will make it more costly to hold

inventory and therefore reduce the quantity ordered to reduce the average inventory

levels. Statement (d) is also false because annual order costs and annual carrying costs

vary inversely, as one increases the other decreases.}

3. The basis for the ABC classification system in determining which inventory items should

receive the greatest control is

a) the size of the inventory of each item

b) the rate of turnover of each item

c) the demand for each item

d) the annual dollar usage of each item

(Answer: d)

{Text on page 462 in the section on The ABC Classification System and the lecture in the

section on The ABC Classification System: The basis for the ABC classification is the annual

dollar usage of each item which is the annual usage of an item multiplied by its unit cost.}

4. Which of the following are differences between periodic inventory and continuous inventory

systems?

a) Continuous inventory systems are time phased while periodic inventory systems are

not

b) Periodic inventory systems have regular order times while continuous inventory

systems have irregular order times

c) Periodic inventory systems have regular order quantities while continuous inventory

systems have irregular order quantities

d) none of the above

(Answer: b)

{Text on pages 459-462 in the sections on Continuous Inventory Systems and Periodic

Inventory Systems: Statement (a) is false since the periodic inventory systems are time

phased, i.e. orders are replaced every certain time period. Statement (b) is true because

periodic system order at predictable intervals while continuous systems can order at

different times depending on how much demand occurs. If demand is somewhat light it

may take a little longer to reach the reorder point and trigger an order than if demand is

somewhat heavier. Statement (c) is false because, although they may order at irregular

intervals, continuous system always place an order for the same amount (usually the

EOQ) while the order quantities in periodic systems may vary depending on demand

during the period between orders.}

5. The XYZ firm is using a continuous inventory quantity system and is currently ordering 500

units every time an order is placed. Their annual order costs are $800 and their annual carrying

costs are $400. To minimize their total annual inventory costs the firm should

a) reduce the order quantity so that it is less than 500 units

b) increase the order quantity so that it is greater than 500 units

c) leave the order quantity at 500 units since it is the optimal order quantity

d) use a periodic inventory system to reduce costs

(Answer: b)

{Text on pages 464-467 in the section on The Basic EOQ Model and the lecture in the section

on The Basic EOQ Model: If the firm’s annual order costs are higher than their annual carrying

costs then them are placing orders too often and carrying too little inventory. For the lowest costs

they should order less often in larger quantities, i.e., the EOQ must be greater than 500 units so

they should increase their order quantity.}

6. A fixed time between orders and a variable order quantity are characteristics of a

a) continuous inventory system

b) two-bin system

c) periodic inventory system

d) MRP system

(Answer: c)

{Text on pages 459-461 in the section on Inventory Control Systems: A periodic inventory

system is one in which orders are placed at regular time intervals, usually depending on vendor

deliveries, but the quantity ordered can vary depending on demand during the time between

orders.}

7. For a company with an average daily demand of 38 units with a standard deviation of 4 units,

an average lead time of 13 days, and a 95% service level, which of the following statements is

true?

a) the reorder point is about 518 units

b) the reorder point is about 494 units

c) the reorder point is about 522 units

d) the safety stock is about 96 units

(Answer: a)

{Text on pages 477-479 in the section on Reorder Points with Variable Demand and the

lecture in the section on Reorder Point with Variable Demand: When demand is variable, the

reorder point is the average demand during lead time plus safety stock to protect against a

stockout during the lead time period. The equation is

R = L + z

For a 95% service level the z value is 1.65 and the result is

R = (38)(13) + (1.65)( )

= 494 +

23.796638418

1 = 518}

Carrying Cost: $11.25/unit/per/yr

Ordering Cost: $55/order

Demand: 15 units/week

Note: The current order quantity is 94 units. Assume 50 weeks per year

8. Using the data above, which of the following statements concerning the current order quantity

and EOQ quantity are true? (Note: round EOQ value to nearest whole number)

a) the EOQ is 7,333 units

b) the ordering cost for the EOQ is $483.75

c) the current order quantity is too small to minimize total inventory costs

d) the carrying cost for the current order quantity is $528.75

(Answer: d)

{Text on pages 464-467 in the section on The Basic EOQ Model and the lecture in the

section on The Basic EOQ Model: The equation for the EOQ model is

Qopt =

The total cost equations is

TCmin = +

In this case statement (a) is false because

Qopt =

=

85.634

883857

8 = 86

Statement (b) is also false because the annual order costs for the optimal quantity are

=

=

$479.65

Statement (c) is also false because the current order quantity is actually larger than the

optimum EOQ. Statement (d) is true since the carrying costs of the current order quantity

can be calculated as

C

=

= 528.75}

Carrying Cost: $0.50/unit/per/yr

Ordering Cost: $100/order

Demand: 10,000 units/year

Daily Production Rate 80 units

Daily Demand Rate 60 units

9. Using the data above and the EOQ model with noninstantaneous receipt, which of the

following statements is true?

a) the optimum order quantity is 2000

b) the ordering cost is $275

c) the total inventory cost is $500

d) the maximum amount of inventory on hand is 2500 units

(Answer: c)

{Text on pages 468-469 in the section on The EOQ Model with Noninstantaneous

Receipt and the lecture in the section on The EOQ Model with Noninstantaneous

Receipt: Statement (a) is false because the optimum order quantity for the EOQ model

with noninstantaneous receipt is calculated as

Qopt =

Or

Qopt =

= 4000

Statement (b) is also false. The annual ordering costs can be calculated as

or

Statement (c) is true because the annual carrying costs are

or

so that the total annual inventory costs are the sum of the annual ordering costs and the

annual carrying costs or $250.00 + $250.00 = $500.00

Statement (d) is false because the maximum inventory can be computed as

or

}

10. A periodic inventory system requires a larger safety stock than a continuous inventory

system.

a) True

b) False

(Answer: a)

{Text on pages 479-480 in the section on Order Quantity for a Periodic Inventory

System: Since stockouts can occur during the time between orders, since inventories are

not monitored, a larger safety stock is normally required than in a continuous system.

This can also be seen in the safety stock formulas:

Continuous system

z

Periodic system

z

As can be seen, for the same service level and standard deviation, the safety stock in a

periodic system will be larger by a factor of }

11. The basic EOQ model is quite sensitive to errors in the estimates of the inventory costs.

a) True

b) False

(Answer: b)

{Text on page 467: Because the optimal order quantity is computed by a square root,

errors in the cost parameters and in demand tend to be dampened making the model quite

robust. For example, if one of the cost estimates is 30% too high then the resulting order

quantity will vary by under 10%.}

12. Scanners used in grocery stores are part of a periodic Inventory system.

a) True

b) False

(Answer: b)

{Text on page 460 in the section on Continuous Inventory Systems: Very sophisticated

continuous inventory systems are operated by many retail stores where scanners read the

bar code on the package and instantly update the inventory records for that item.

Management has real time information on the status of all inventory levels.}

13. In practice, it is acceptable to round the quantity obtained with the EOQ formula to the

nearest whole number.

a) True

b) False

(Answer: a)

{ Text on page 467: In practice, it is acceptable to round the order quantities off to the

nearest whole number. Since the total cost curve is quite flat in the region of the EOQ

value, slight deviations from the optimal quantity have very little impact on total

inventory costs.}

14. If the optimal order quantity or any of the inventory costs change in a continuous inventory

system, the reorder point must be recalculated.

a) True

b) False

(Answer: b)

{The order quantity and the reorder point are totally independent in a continuous

inventory system. To see this consider the equation for the reorder point:

R = L + z

Notice that none of the inventory costs appear in the equation nor does the order quantity.

Stockout costs are factored into the equation implicitly via the service level; the higher

the stockout costs the higher the service level should be.}

15. Shortage costs vary inversely with carrying costs; as carrying costs increase, shortage costs

decrease.

a) True

b) False

(Answer: a)

{Text on page 459 in the section on Inventory Costs: Shortages result because carrying

inventory is costly. As a result shortage costs have an inverse relationship to carrying

costs. As the amount of inventory on hand increases, the carrying costs increase but

shortage costs will decrease because there will be fewer opportunities for stockouts.}

PRACTICE EXAM

1. Economies of scale hold when

a) construction costs do not increase linearly with output levels

b) production efficiency increases as workers gain experience

c) quantity discounts are available for material purchases

d) all of the above

(Answer: d)

{Text on page 395: Economies of scale hold when fixed costs can be spread over a larger

number of units, when construction costs do not increase linearly with output levels,

when quantity discounts are available for materials and when production efficiency

increases are workers gain experience.}

2. Which of the following companies follows a pure chase strategy of aggregate planning?

a) Hershey’s

b) Nordstrom’s

c) Ford

d) Mars Inc.

(Answer: a)

{Text on page 402: Hershey’s is a good example of a situation where a chase strategy fits

well with the needs of the workforce. Hershey’s hires idle farmers in the winter months

when demand is high and then lets them return to farming full time in the summer months

when demand for chocolate is low.}

3. A chase demand strategy should be followed when

a) worker skill qualifications are high

b) unemployment rates are low

c) inventory costs are high

d) all of the above

(Answer: c)

{Text on page 398 in the section on Adjusting Capacity to Meet Demand and the

Lecture in the section on Strategies for Meeting Demand: A chase strategy should not

be pursued when worker skill qualifications are high because hiring and firing workers

will soon make them difficult to find. Similarly, hiring and firing workers is not a good

strategy when workers are scarce because of low unemployment rates. However, a chase

strategy is a very good strategy when inventory costs are high since this strategy

minimizes inventory levels.}

4. Which of the following aggregate planning techniques guarantees an optimal solution?

a) linear programming

b) search decision rule

c) trial and error with a spreadsheet

d) management coefficients model

(Answer: a)

{Text on pages 405 through 408 and the lecture in the section on General Linear

Programming Model. The linear programming method guarantees an optimal solution to

the problem provided the assumptions of the method are satisfied. The search decision

rule searches for a good solution but cannot guarantee that it has found the best one. The

quality of the solution using a trial and error approach depends on the quality of the

alternatives tested by the managers and certainly cannot guarantee the best solution. The

management coefficients method simply represents a regression model of past decisions

and therefore cannot guarantee the optimum solution.}

5. All of the following statements concerning the characteristics of aggregate planning for

services is true except

a) most services cannot be inventoried

b) demand is difficult to predict

c) capacity is easy to predict

d) labor is the most constraining resource

e) all of the above statements are true

(Answer: c)

{Text on pages 416-417 in the section on Aggregate Planning for Services and the

Lecture in the section on Aggregate Planning for Services: It is true that most services

cannot be inventoried which removes one of the possible options in aggregate planning. It

is also true that demand is often difficult to predict in services because demand variations

occur frequently and are often severe. It is also true that labor is the most constraining

resource in services because services tend to be labor intensive. However, it is not easy to

predict capacity requirements in services because of the variety of services offered and

the individualized nature of many of these services.}

6. All of the following statements concerning level production are true except

a) level production strategy sets production at a fixed rate

b) the main costs of level production involve hiring and firing

c) level production strategy uses inventory to absorb variations in demand

d) all of the above statements are true

(Answer: b)

{Text on page 398 in the section on Adjusting Capacity to Meet Demand and the

Lecture in the section on Strategies for Meeting Demand: The level production strategy

produces at a constant rate by definition. This strategy also uses inventory to absorb

variations in demand. However, since production is at a fixed rate, hiring and firing are

not necessary and so these costs are not involved.}

Quarter Forecast

1 80,000

2 120,000

3 90,000

4 100,000

Hiring Cost $100 per worker

Firing Cost $150 per worker

Inventory Carrying Cost $5 per unit

Production Per Employee 1000 units per/qtr

Beginning Work Force 100 workers

7. Using the data above, which of the following statements is true if the company maintains a

level production strategy?

a) the total number of units inventoried for the 4 quarters is 40,000 units

b) the cost of the level production plan is $18,000

c) there are 12,500 units inventoried in quarter 3

d) a work force of 14 workers is maintained during the 4th

quarter period

e) more than one statement above is true

(Answer: a)

{Text on pages 403–404 in the section on APP Using Pure Strategies and Mixed

Strategies and the lecture in the section on Aggregate Production Planning by Trial and Error:

Given the forecasts and a total of 100 workers initially the following situation results

Forecast Production Workers Hiring Firing Inventory

Qtr 1 80,000 100,000 100 0 0 20,000

Qtr 2 110,000 100,000 100 0 0 10,000

Qtr 3 100,000 100,000 100 0 0 10,000

Qtr 4 110,000 100,000 100 0 0 0

The total cost of this plan is $200,000 so that option b is false. There are only 10,000

units inventories in quarter 3 so that option c is false and there are 100 workers in the

4th

quarter making option d false. The only true statement is a in that there are a total of

40,000 units inventoried over the four quarters.}

Quarter Forecast

1 7,000

2 15,000

3 40,000

4 380,000

Hiring Cost $200 per worker

Firing Cost $350 per worker

Inventory Carrying Cost $0.30 per unit

Production Per Employee 500 units per/qtr

Beginning Work Force 50 workers

8. A company wishes to develop a linear programming model that will satisfy demand at a

minimum cost. Using the data above, which of the following statements contains the correct

formulation of the workforce constraint for quarter 4 for this problem?

a) W4 - W3 + H4 - F3 = 0

b) W4 - W3 - H3 - F3 = 0

c) W4 - W3 + H3 + F3 = 0

d) W4 - W3 - H4 + F4 = 0

e) none of the above

(Answer: d)

{Text on pages 405 – 408 in the section on General Linear Programming Model and the

Lecture in the section on General Linear Programming Model: The workforce constraint for

each quarter is that the total number of workers in that quarter must be equal to the number of

workers in the previous quarter plus the number of workers hired minus the number of workers

fired. In the fourth quarter:

W4 = W3 + H4 – F4

Or

W4 - W3 - H4 + F4 = 0}

9. In production planning, the level of detail from highest to lowest is

a) master production schedule, aggregate plan, material requirements plan

b) aggregate plan, material requirements plan, master production schedule

c) aggregate plan, master production schedule, material requirements plan

d) material requirements plan, master production schedule, aggregate plan

(Answer: c)

{Text on page pages 414-415 in the section on Hierarchical Planning Process and the

lecture in the section on Hierarchical Planning Process: The correct order is from the

aggregate plan which is then disaggregated into specific products as part of the master

production scheduling process. The master production schedules then determine the

requirements for materials and drive the material requirements planning process.}

10. The linear decision rule for aggregate planning is based on the assumption that production

costs are linear.

a) True

b) False

(Answer: b)

{Text on page 412 in the section on Other Quantitative Techniques: The linear

decision rule soles a set of four quadratic questions that describe the major decisions

involved in the aggregate planning problem. The cost functions are quadratic rather than

linear.}

11. Some industries maintain a negative capacity cushion.

a) True

b) False

(Answer: a)

{Text on page 394: Some industries such as the airlines practice overbooking which is

essentially a negative capacity cushion}

12. The capacity lag strategy is the most moderate of the strategies and the least conservative.

a) True

b) False

(Answer: b)

{Text on page 393 and the lecture in the section on Capacity Planning: The capacity lag

strategy increases capacity only after an increase in demand has been documented. This

conservative strategy produces a higher return on investment but may lose customers in

the process. It is used in industries with standard products and cost-based or weak

competition. The strategy assumes that lost customers will return from competitors after

capacity has expanded.}

13. The costs involved in using a chase strategy are mainly in holding inventory, including the

cost of obsolete or perishable items that may have to be discarded.

a) True

b) False

(Answer: b)

{Text on page 397-401 and the lecture in the section on Strategies for Meeting

Demand: The chase strategy attempts to track demand exactly so that inventories are

minimized. If executed properly there will be no inventory at all.}

14. The aggregate planning problem is purely a manufacturing problem and should be solved by

manufacturing personnel.

a) True

b) False

(Answer: b)

{Text on page 396-397: The aggregate production plan should not be determined by

manufacturing personnel alone; rather it should be agreed upon by top management from

all the functional areas of the firm.}

15. Diseconomies of scale occur when a company has too little capacity.

a) True

b) False

(Answer: b)

{Text on page 395 and the lecture in the section on Capacity Planning: Diseconomies of

scale occur when volumes become so large that coordination and management activities

become difficult.}

PRACTICE EXAM

1. Forecasting cannot be done with perfect accuracy if which of the following patterns exists?

a) trend variation

b) seasonal variation

c) random variation

d) cycle variation

e) all of the variations listed can be handled with perfect accuracy

(Answer: c)

{Text on page 338 in the section on Demand Behavior and the Lecture in the section

on Demand Behavior: Random variations are movements that are not predictable and

follow no pattern. Therefore, since they are not predictable, it is not possible to forecast

perfectly if there are random variations (almost always the case). The other components

listed can all be calculated in one way or another.}

2. A linear trend line for 12 months of data is y = 339.02 + 23.96x. What is the forecast

for the next period?

a) 626.51

b) 650.50

c) 339.02

d) 362.98

(Answer: b)

{Text on pages 352-353 in the section on Linear Trend Line and the Lecture in the

section on Linear Trend Line: Forecasting with the linear trend model is simply a matter

of plugging in the appropriate value for the time period into the equation

y = a + bx

In this case the value of x is 13 (the next month) and

y = 339.02 + 23.96(13)

y = 650.5}

3. If the cumulative error for a forecasting model is large and negative, then

a) the model has been forecasting too low

b) subjective adjustments have been made to the forecasts

c) regression analysis has been used

d) the model has been forecasting too high

e) none of the above

(Answer: d)

{Text on page 359 in the section on Cumulative Error and the Lecture in the section

on Cumulative Error: The forecast error is the difference between the actual demand and

the forecast (Dt - Ft). The cumulative error is the sum of these errors. If the forecast error

is negative, then the forecast is larger than demand. Thus, if the cumulative error is large

and negative, the forecasts have been consistently high.}

4. A linear regression model indicates there is a high correlation between the percentage

of unemployment in a specific area and the demand for a certain product. If the

correlation coefficient is -.843., what is the coefficient of determination?

a) -.843

b) .711

c) 34.95%

d) .9182

e) none of the above

(Answer: b)

{Text on page 369 in the section on Correlation and the Lecture in the section

on Correlation: The coefficient of determination is the square of the correlation

coefficient or r2 = (-.843)(-.843) = 0.710649 = .711}

5. Changing the smoothing constant in a simple exponential smoothing model from .2 to

.5 would make

a) the forecasts more variable

b) no difference in the forecasts

c) the forecasts slower to respond to changes in demand

d) the equation invalid

(Answer: a)

{Text on page 347 in the section on Exponential Smoothing: The larger the value of the

smoothing coefficient, the more the forecast reacts to changes in demand. This means

that the forecasts will be less "smooth" or more variable. If the changes in demand are

only because of random variation, then this will make the forecasts more inaccurate

because of the increased variability.}

6. Which of the following is not a use of short-to-medium term forecasts according to the

lecture?

a) determine how much inventory is needed

b) determine how much material to purchase from suppliers.

c) plan and develop production and service facilities.

d) determine transportation needs, distribution and warehouse locations, and

staffing levels.

(Answer: c)

{Lecture in the section on Supply Chain Management: According to the lecture, short-

to-medium term forecasts are used to determine how much inventory is needed, how

much product to make, how much material to purchase from suppliers, and to determine

transportation needs, distribution and warehouse locations, and staffing levels. Planning

and developing actual production and service facilities requires longer range forecasting

because of the lag time in building these facilities.}

7. When using the exponential smoothing forecasting method, if alpha = 1.0, the next

forecast will be

a) the same as the previous forecast

b) the same as the most recent sales value

e) greater than the previous forecast

d) less than the previous forecast

(Answer: b)

(Text on page 347 in the section on Exponential Smoothing and the Lecture in the

section on Exponential Smoothing Exponential Smoothing: The formula for the

exponential smoothing model is

Ft + 1 = Dt + (1 - )Ft

Substituting in 1.0 for alpha gives

Ft + 1 = 1Dt + (1 - 1)Ft = Dt

Thus in using an alpha value of one the forecast will be equal to the most recent sales

value. Therefore, an exponential smoothing model with a smoothing coefficient of 1.0 is

equivalent to the naïve or intuitive forecasting method.}

Table 1

Month Sales($000)

January 42

February 49

March 59

April 39

May 56

June 59

July 50

August 49

September 50

October 53

November

8. Using the data in Table 1, what is the forecast for November if a 3-month moving

average is used?

a) 50.60

b) 53.00

c) 50.67

d) 51.00

(Answer: c)

{Text on pages 343 – 344 in the section on Moving Average and the Lecture in the

section on Moving Average: The moving average forecast is the simple average of a

certain number of periods (3 months in this case). The following table illustrates the

moving average for each of the months in Table 1:

Month Sales($000) Moving Average

January 42

February 49

March 59

April 39 50.00

May 56 49.00

June 59 51.33

July 50 51.33

August 49 55.00

September 50 52.67

October 53 49.67

November 50.67

}

Table 2

Period Sales Forecast Error

1 250.1 255.1 -5.0

2 268.1 254.6 13.5

3 254.9 256.0 -1.1

4 261.3 255.9 5.4

5 245.3 256.3 -11.0

6 255.3

9. Using the data in Table 2, what is the MAPD?

a) -14%

b) 2.81%

c) 13.58

d) 4.488

(Answer: b)

{Text on page 358 in the section on Mean Absolute Deviation and the Lecture in the

section on Mean Absolute Percent Deviation: The mean absolute percent deviation

(MAPD) measures the absolute error as a percentage of demand. It is computed by

dividing the MAD by the total demand for the periods used in the forecast. The

computational equation is

MAPD =

In this problem the values are

MAPD = (5 + 13.5 + 1.1 + 5.4 + 11.0)/(250.1 + 268.1 + 254.9 + 261.3 + 245.3)

MAPD = 36/1279.7 = 0.0281315933 = 2.81%}

10. The proportion of the variation in the dependent variable that can be explained by its

linear relationship with the independent variable is called the "correlation coefficient".

a) True

b) False

(Answer: b)

{Text on page 369 in the section on Regression and the Lecture in the section

on Correlation: The proportion of the variation in the dependent variable that can be

explained by its relationship with the independent variable is the coefficient of

determination. This value is the square of the correlation coefficient.}

11. Qualitative forecasting methods generally are for short-range timeframes.

a) True

b) False

(Answer: b)

{Text on page 340 in the section on Forecasting Methods and the lecture in the section

on Forecasting Methods: Qualitative methods are used for long-term strategic planning.}

12 All forecasting methods require continuous monitoring to be sure of reasonable

accuracy.

a) True

b) False

(Answer: a)

{Text in Figure 8.2 on page 342 and the Lecture in Figure 8.2: All forecasting systems

must be monitored to make sure that they are attaining an acceptable degree of accuracy.

This monitoring may be with a formal tracking signal or it may be by more informal

means. In either case, close attention should be paid to the errors in forecasting to make

sure that the forecasting model does not need to be revised.}

13. Determining whether a forecast is "short range" or "long range" depends to a large

extent on how rapidly the product market or technology changes.

a) True

b) False

(Answer: a)

{Text on page 338 in the section on Time Frame: The classifications into time "ranges"

is somewhat arbitrary. For some organizations a short range forecasts can be in terms of

years while for others a long range forecast may be in terms of months. A good example

of this is the rapidly changing computer industry where forecasts of more than 6 to 12

months may be considered to be long range forecasts.}

14. If there is no seasonal variation in quarterly data, the seasonal factors of the

seasonally adjusted forecast will all be equal to .25.

a) True

b) False

(Answer: a)

{Text on page 354 in the section on Seasonal Adjustments: If there is no seasonal

variation, then the seasonal factors have to be equal. Also, since the seasonal adjustments

have to add up to 1.0 and we have quarterly data, then the seasonal factors must all be

equal to .25 or 1.0/4.}

15. When demand is relatively stable without any trend, using exponential smoothing

with a large value for alpha is best.

a) True

b) False

(Answer: b)

{Text on pages 347 in the section on Exponential Smoothing: When demand is

relatively stable without any trend, a small value of is more appropriate to smooth out

the forecast. On the other hand, if there is a trend a larger value of will react to the

changing demand more quickly.}

PRACTICE TEST CHAPTER 7

1. Which of the following is not one of the ways of managing the uncertainty associated with the

supply chain as described in the lecture?

a) inventory

b) just-in-time systems

c) TQM

d) vertical integration

(Answer: c)

{Lecture in the section on Supply Chain Design -- A Strategic Issue: Some

organizations carry inventory to guard against unexpected events. Increasingly companies

are adopting just-in-time practices to ensure a steady flow of information and materials.

Still other companies choose to vertically integrate to own the supplies and thereby

exercise control and reduce uncertainty.}

2. Which mode of transportation is the least expensive per ton-mile?

a) trucking

b) railroads

c) air

d) waterways

(Answer: d)

{Text on page 291-292 in the section on Transportation and Distribution Systems: The

cheapest modes of transportation are pipelines and water, each averaging less than 2 cents per

tone-mile.}

3. _____________ limits suppliers to gain more control over quality and delivery.

a) electronic data interchange

b) single-sourcing

c) multiple sourcing

d) direct-response

(Answer: b)

{Text on page 280 in the section on Single-Sourcing: With single-sourcing a company

purchases a part or material from a very few suppliers and therefore has more direct influence

and control over the quality and delivery performance of the supplier.}

ABC Company is considering the location for its new distribution center It has assembled the

following information about its five retail stores, including the location coordinates and number

of monthly shipments:

Retail Store Coordinates Monthly Shipments

A (5, 2) 300

B (5, 5) 400

C (3, 7) 450

D (2, 6) 150

E (6, 4) 250

4. Using the data above, determine the least cost location using the center-of-gravity method.

Which of the following identifies the correct coordinates?

a) (4.94, 4.29)

b) (4.20, 4.80)

c) (73.81, 64.58)

d) (4.3, 4.9)

e) none of the above

(Answer: d)

{Text on pages 203-204 in the section on the Center-of-Gravity Technique and the

Lecture in the section on Center-of-Gravity Technique: In this technique, the x and y

coordinates are calculated as the sum of the corresponding coordinates multiplied by the

traffic amount divided by the sum of the amounts shipped. In this case

}

5. Supply chain management includes all of the following except

a) purchasing or procurement

b) inventory control

c) advertising

d) customer service

(Answer: c)

{Text on page 267 in the introductory section and the Lecture in the section on Supply Chain

Design -- A Strategic Issue: Supply chain management includes planning and managing supply

and demand, acquiring materials, producing and scheduling the product or service; warehousing,

inventory control, and distribution; and delivery and customer service. Functions within the

supply chain include forecasting, sourcing, procurement, inventory control, scheduling

production, shipping and delivery, information management, quality management and customer

service.}

6. Which of the following is used by companies to speed distribution and reduce delivery cost to

customers?

a) trucking

b) outsourcing distribution

c) electronic data interchange

d) location factor rating

(Answer: b)

{Text on page 291 in the section on Distribution Outsourcing: . . . outsourcing allows the

company to focus on its core competencies. It aslo takes advantage of the expertise that

distribution companies have developoed. Outsourcing distribution activities tends to lower

inventory levels and reduce costs for the outsourcing company.}

7. Which of the following factors makes the sourcing and procurement decisions strategic

decisions for a company

a) cost of transporting goods

b) the interdependence of organizations in a supply chain

c) the number of suppliers or vendors used

d) multiple warehouses for distribution

(Answer: b)

{Text on page 268 in the section on Supply Chain Design: A Strategic Issue: This level of

interdependence of the organizations in the supply chain makes the selection of suppliers

(sourcing) and the purchasing process (procurement) important strategic decisions for a

company}

8. In the United States, the greatest volume of freight is shipped by trucking.

a) True

b) False

(Answer: b)

{In the text on page 291 in the section on Transportation and Distribution Systems: In the

United States the greatest volume of freight is shipped by railroads (approximately one third of

the total).}

9. Intermodal transportation refers to shipments that are transported over more than one railroad.

a) True

b) False

(Answer: b)

{Text on page 292 in the section on Transportation and Distribution Systems: Combining

different modes of transportation is referred to as intermodal transportation.}

10. In single-sourcing or partnering, the supplier is sometimes also given product design

responsibilities.

a) True

b) False

(Answer: a)

{Text on page 280 in the section on Single-Sourcing and in the Lecture in the section on Single-

Sourcing: An additional aspect of the partnering relationship in single-sourcing is the

involvement of the supplier in the product design process. In many cases the supplier is given the

responsibility of designing a new part or component to meet the quality standards and features

outlined by the company.}

11. Measuring current performance against where a company wants performance to be is called

cross docking.

a) True

b) False

(Answer: b)

{Text on page 283 in the section on Wal-Mart: Goods "cross" from one loading dock to another

in 48 hours or less. This feature is known as cross-docking.}

PRACTICE EXAM

1. In a CPM/PERT network a dummy activity is necessary when

a) two activities have the same starting node

b) two activities have the same ending node

c) a node does not actually connect to another node

d) when two activities share the same starting and ending node

e) none of the above

(Answer: d)

{Text on page 24 and the lecture in the section on The Project Network: A dummy

activity is necessary when two activities share the same starting and ending nodes.

Dummy activities are especially necessary when the network is analyzed by computer

since the computer would not be able to tell the two activities apart if they have the same

starting and ending nodes.}

2. Shared slack in an activity network is defined as

a) the amount of time an activity can be delayed without delaying the entire

project.

b) the amount of slack that an activity has in common with another activity.

c) the amount of unused resources for an activity.

d) the amount by which a time estimate can be in error without affecting the

critical path computations.

(Answer: b)

{Text on page 230: There is an important distinction between activity slack and shared

slack. Activity slack is the amount of time an activity can be delayed without delaying the

entire project. However, often activities in sequence that both have activity slack share

some of that slack. For example suppose Activity A has 4 days of slack and is

immediately followed by Activity B with 8 days of slack.. If Activity A is delayed by 4

days then the project will not be delayed (it had 4 days slack). However, now Activity B

will no longer have 8 days of slack but only 4. That is because 4 of the 8 days were

shared with Activity A and it used up that shared slack. Shared slack is the amount of

slack shared by two activities. Sometimes a concept of "free" slack is defined which is

the amount of time an activity can be delayed without delaying the start of another

activity.}

3. The objective of project crashing is to

a) reduce the project duration

b) revise the network critical path and completion times when the schedule falls

hopelessly behind

c) minimize the cost of crashing

d) reduce indirect costs such a interest on investments

e) more than one statement above is true

(Answer: e)

{Text on pages 243 in the section on Project Crashing and Time-Cost Trade-Off and

the lecture in the section on The General Relationship of Time and Cost: The primary

objective of project crashing is usually to reduce the duration of the project, possibly to

avoid cost penalties associated with missing a deadline. However, indirect costs usually

increase as a project increases in duration so that it may be economical to spend resources

to crash the project to save on indirect costs.}

4. If an activity has zero activity slack it

a) means that the project is expected to be delayed.

b) must be a dummy activity.

c) is on the critical path.

d) all of the above

e) none of the above

(Answer: c)

{Text on pages 230-231 in the section on Activity Slack and the lecture in the section

on Activity Slack: Activities on the critical path have zero slack, i.e. if they are delayed at

all the entire project is delayed. Therefore, if an activity has zero slack it must be on the

critical path.}

5. Assume that activity G has the following times:

Early start time = 7 days

Early finish time = 13 days

Late start time = 15 days

Late finish time = 21 days

Which of the following statements is true about activity G?

a) activity G takes 9 days to complete

b) activity G has a slack time of 8 days.

c) activity G is on the critical path.

d) activity G takes 8 days to complete

(Answer: b)

{The activity time is the difference between the early start and early finish times or the

late start and late finish times. Therefore the activity time of activity G is 13-7 = 6 days.

Thus statements (a) and (d) are false. The slack time for an activity is the difference

between its early start and late start times or between its early finish and late finish times.

Thus the slack for activity G is 15 – 7 = 8 days and statement (b) is true. Activity G is not

on the critical path since it has positive slack so statement (c) is false.}

6. Assuming a beta distribution is being used, if the most likely time for an activity

increases by 1 week, what will happen to the expected time for that activity?

a) it will increase by 4 weeks.

b) it will increase by 1 week.

c) it will remain the same.

d) it would increase by 2/3.

(Answer: d)

{Text on page 232 and the lecture in the section on Probabilistic Time Estimates: The

equation for the expected time of an activity when there are probabilistic time estimates is

t =

Increasing the most likely time by 1 unit will increase the numerator by 4 because of the

multiplication. The expected time however, will only increase by a factor of 4/6 or 2/3

because of the division by 6 in the denominator.}

7. Using the network above, which of the following statements is true?

a) the critical path is 1-3, 3-5, 5-7

b) the earliest start data for activity 5-7 is 10

c) the latest start date for activity 2-5 is 11

d) the project completion time is 15 weeks

(Answer: a)

{Text on pages 227 – 229 in the section on Activity Scheduling and the lecture in the

section on Activity Scheduling: The table of early and late start and finish times, along

with slack are given below.

Activity Late Start Early Start Late Finish Early Finish Slack

1 – 2 2 0 9 7 2

1 – 3 0 0 7 7 0

2 – 4 11 7 13 9 4

2 – 5 9 7 12 10 2

3 – 5 7 7 12 12 0

3 – 6 11 7 12 8 4

4 – 7 13 9 17 13 4

5 – 7 12 12 17 17 0

6 – 7 12 8 17 13 4

As can be seen, statement (a) is true as the critical activities are those with no slack. As can be

seen, the other statements are also false.

Time Estimates

(weeks)

Activity a m b

1 – 2 2 3 10

1 – 3 8 12 20

1 – 4 10 14 16

2 – 5 6 10 12

3 – 5 14 20 25

3 – 7 3 5 7

4 – 6 8 12 20

5 – 7 1 1 1

6 – 8 6 10 12

7 – 8 1 3 7

8. Using the data above to calculate the expected time and variance for each activity,

which of the following statements is true?

a) the expected time for activity 1-3 is 12.67

b) the variance for activity 3-5 is 3.36

c) the largest expected time occurs for activity 1-4

d) the largest variance is for activity 1-3

e) more than one statement above is true

(Answer: e)

{Text on pages 232 and the lecture in the section on Probabilistic Time Estimates: The

table with the expected times and the activity time variances is given below.

Activity a m b Mean Variance

1 – 2 2 3 10 4.00 1.78

1 – 3 8 12 20 13.00 4.00

1 – 4 10 14 16 13.67 1.00

2 – 5 6 10 12 9.67 1.00

3 – 5 14 20 25 19.83 3.36

3 – 7 3 5 7 5.00 0.44

4 – 6 8 12 18 12.33 2.78

5 – 7 1 1 1 1.00 0.00

6 – 8 6 10 12 9.67 1.00

7 – 8 1 3 7 3.33 1.00

As can be seen from the table both (b) and (d) are true so that more than one of the

statements are correct.}

9. There is usually more pressure, real and perceived, associated with project

management than in a normal management position.

a) True

b) False

(Answer: a)

{Text on page 218: Project management can be a very intense job subject to a great deal

of pressure. Projects have definite milestones that have to be met and there can be many

things that can go wrong on a project.}

10. In the PERT approach, using the project mean time and standard deviation to perform

probabilistic analysis should be done with caution unless the number of activities is large

enough to support the assumptions of the central limit theorem.

a) True

b) False

(Answer: a)

{Text on page 236 in the section on Probabilistic Network Analysis: The project mean

time and standard deviation can always be obtained by adding the times and variances on

the critical path. However, the use of the normal distribution to calculate probabilities can

only be done if the individual activity times have normal distributions, which they usually

do not, of there are enough activities (30 or more) on the critical path for the central limit

theorem to apply. If this is not true then the probabilistic analysis should be interpreted

with caution.}

11. As activities are crashed, the critical path may actually change.

a) True

b) False

(Answer: a)

{Text on page 243: When activities on the critical path are crashed, often activities that

were not previously on the critical path can become critical. In other words, as we shorten

the longest path in the network , the critical path, by crashing, another path can become

the longest path.}

12. Once the individual activity times have been determined, the computations to find the

critical path in PERT are the same as in CPM.

a) True

b) False

(Answer: a)

{The computations for the critical path are exactly the same whether we are using PERT

or CPM. The only difference is that in PERT the activity times used are expected or

average times while they are a fixed time estimate in CPM.}

13. Slack is something a project manager wishes to avoid if possible because it means the

activity time estimates were inaccurate.

a) True

b) False

(Answer: b)

{Text on page 230: Slack is actually beneficial for project managers because if gives

some flexibility in the allocation of resources from activities with slack to more critical

activities, and it also gives protection against when things go wrong and activities are

delayed.}

PRACTICE EXAM

1. Locating all the drills in one work center, lathes in another work center, and milling

machines in yet another work center represents what type of layout?

a) fixed-position layout

b) product layout

c) cellular layout

d) process layout

e) none of the above

(Answer: d)

{Text page 273 in the section on Process Layouts and the Lecture in the section

on Process (Functional) Layouts: Process or functional layouts group similar activities

together in departments or work centers according to the process or function they

perform.}

2. Cycle time is not:

a) daily operating time divided by desired production

b) the maximum allowable time at each work station

c) how often items roll off the assembly line

d) the time required to complete a product from start to finish

e) Cycle time is all of the above

(Answer: d)

{Text on page 287 in section on Line Balancing and the Lecture in the section

on Designing Product Layouts/Line Balancing: The cycle time can be viewed in a

number of ways. First it is calculated as the daily operating time divided by the desired

production. This determines the maximum allowable time at each work center and, since

it is the time that an item remains at each workstation, it is also the time between

completed items rolling off the assembly line. The cycle time is not the time required to

complete a product from start to finish. This value would be the cycle time multiplied by

the number of workstations}

3. A common goal in designing process layouts is:

a) minimizing the number of workers

b) minimizing idle time

c) minimizing material handling costs

d) balancing the work at each station

e) maximizing output

(Answer: c)

{Text on page 278 in the section on Designing Process Layouts and the Lecture in the

section on Designing Process Layouts: The primary objective in designing process

layouts in manufacturing, and in many services, is to minimize material handling costs

which is a function of the amount of material moved and the distance it has to move.}

4. An assembly line consists of 5 tasks with times of 12, 9, 8, 7, and 11 minutes. The

cycle time for the line is 25 minutes. The theoretical minimum number of workstations

for this situation is

a) 1

b) 2

c) 3

d) 4

e) 5

(Answer: b)

{Text on page 289 and the Lecture in the section on Theoretical Minimum Number of

Workstations: The theoretical minimum number of workstations represents the lower

bound on the line balancing problem. We cannot design a solution that would be more

efficient than this. It is calculated as the sum of the task times divided by the cycle time

rounded up to the nearest integer. In this case the theoretical minimum number of

workstations is (12+9+8+7+11)/25 = 47/25 = 1.88 or 2 workstations.}

5. The flexible manufacturing system layout which is the most complex and most flexible

is called

a) open-field system

b) ladder layout

c) closed-loop system

d) progressive layout

e) none of the above

(Answer: a)

{Text on page 300 and the Lecture in the section on Flexible Manufacturing Systems:

The open-field layout is the most complex and flexible of the FMS layout schemes. It

allows material to move among the work centers in any order.}

6. Another term for a process layout is

a) job shop layout

b) functional layout

c) mixed-model layout

d) group technology layout

(Answer: b)

{Text on page 273 in the section on Process Layouts and the Lecture in the section

on Process (Functional) Layouts: Process layouts are also known as functional layouts

because they group activities by the function that is performed.}

Table 1

From\To A B C D E F

A 15 50 125

B 20 75

C 50 120 120

D 25

E 50 100 100

F 110 100

Table 2

Proposed Layout

A B C

D E F

7. Using the information in Tables 1 and 2, calculate the nonadjacent loads.

a) 118

b) 450

c) 270

d) 180

e) 335

(Answer: e)

{Text on pages 279 - 281 in the section on Block Diagramming and the Lecture in the

section on Block Diagramming: In this diagram the nonadjacent cell pairs are (A,C),

(A,F), (D,C) and (D,F). The sum of the nonadjacent loads are then

(50+50+125+110+0+0+0+0) = 335.}

8. Which of the following is an advantage of cellular layouts?

a) It is easier to balance the flow of work through a cell

b) It requires less training of workers

c) It has reduced work-in-process inventory

d) It requires less capital investment

(Answer: c)

{Text pages 295 - 296 and the Lecture in the section on Cellular Layouts: One of the

advantages of the cellular layout is that it reduces work-in-process (WIP) inventory. The

other items are, in fact, among the disadvantages of a cellular layout. It is more difficult

to balance the flow of work through a cell than through a single assembly line. Cellular

layouts also require more worker training and are require greater capital investments.}

9. In general, work-in-process inventory is ______ for a process layout, and _______ for

a product layout.

a) small, large

b) large, small

c) large, large

d) small, small

(Answer: b)

{Text on page 277 and Table 7.1 and the Lecture in Table 7.1: The work-in-process

inventories are generally high in a process layout and small in a product layout.}

10. In a cellular layout, the layout between manufacturing cells resembles a product

layout

a) True

b) False

(Answer: b)

{Text on pages 291-292 in the section on Cellular Layouts and the Lecture in the section

on Cellular Layouts: A cellular layout contains elements of both product and process

layouts. The layoutwithin cells corresponds to a product layout (assembly line), while the

flow of products between cells follows a process layout.}

11. The process of equalizing the amount of work at each workstation is called

precedence diagramming.

a) True

b) False

(Answer: b)

{Text on page 185 in the section on Designing Product Layouts and the Lecture in the

section on Designing Product Layouts: The process of equalizing the amount of work at

each workstation is called line balancing.}

12. The main advantage of the product layout is flexibility and the main disadvantage is

efficiency.

a) True

b) False

(Answer: b)

{Text on page 275 in the section on Product Layouts and Table 7.1 and the Lecture in

Table 7.1: This advantages and disadvantages are just the opposite. The advantage of the

product layout is its efficiency. The main disadvantage is its inflexibility.}

13. For an assembly line if balance delay is high then efficiency will be low and vice

versa.

a) True

b) False

(Answer: a)

{Text on page 289 and the lecture in the section on Line Balancing: Balance delay is the

percentage of time that workstations are idle or

Balance delay = 1 - efficiency

Thus when balance delay is high then efficiency must be low and vice versa.}

14. Cellular layouts are based on the concept of group technology to organize parts into

part families.

a) True

b) False

(Answer: a)

{Text on page 291 in the section on Cellular Layouts and the Lecture in the section

on Cellular Layouts: Among the preconditions for cellular layouts is group technology, a

technique used to group parts into families based on similar shapes, materials, or

processing requirements, which must be used to categorize parts made in the

manufacturing facility.}

15. Although product and process layouts tend to look different and use different material

handling methods, the same goals and objectives in designing the layout.

a) True

b) False

(Answer: b)

{Text on page 277 in the section on Product Layouts: Product and process layouts look

different, use different material handling methods and have different layout concerns.

The objective in a process layout is to minimize material handling cost while the

objective in a product layout is to balance the work across workstations.}

PRACTICE EXAM

1. A document which lists materials and components that go into a product is known as

a) an assembly chart

b) an operations process chart

c) a process flow chart

d) a bill of material

e) none of the above

(Answer: d)

{Text page 242 in the section on Process Plans and Lecture in the section on Process

Plans: A bill of materials is a list of the materials and parts that go into a product.}

2. A company will usually choose to produce parts or products in-house when

a) a level workforce is not important

b) demand is uncertain

c) the company is operating at less than full capacity

d) when demand is volatile in nature

e) none of the above

(Answer: c)

{Text on page 239 in the section on Make-or-Buy Decisions and Lecture in the section

on Process Planning/Make-or-Buy Decisions: If a company is not operating at or near

full capacity, they will usually make parts in-house, especially if maintaining a level

work force is important.}

3. Which of the following processes usually involves a large investment of funds and

resources, and produces one item at a time to customer order?

a) project

b) continuous

c) batch

d) mass

e) none of the above

(Answer: a)

{Text on page 229 in the section on Projects and Lecture in the section on Types of

Processes/Projects: Projects are one-of-a-kind production for a single customer and tend

to involve large sums of money and last a long time.}

ABC, Inc. is a new company and must decide which of three processes to use in producing their

product. The product is expected to sell for $14 per unit and the costs associated with each

process appear below.

Table 1

Process Fixed Costs Variable Costs

A $6,000 $8

B $8,000 $4

C $9,000 $3

4. Using the information in Table 1, what is the breakeven point for Process A?

a) 1,000 units

b) 571 units

c) 6,000 units

d) 429 units

e) none of the above

(Answer: a)

{Text on page 233-235 in the section on Process Selection with Break-Even

Analysis and Lecture in the section Process Selection with Break-Even Analysis: The

break-even point is the volume level at which total costs are equal to total revenues and

the total profit is zero. This is numerically equal to the fixed costs divided by the

difference between the price per unit and the variable costs per unit. In this case the break

even point for Process A is 6,000/(14 - 8) = 1,000 units.}

5. In Table 6.1 the point of indifference for Process A and Process B is

a) 7,000 units

b) 500 units

c) 2,667 units

d) 2,000 units

(Answer: b)

{Text on page 237 in the section on Process Selection with Break-Even Analysis and

Lecture in the section Process Selection with Break-Even Analysis: The point of

indifference is the volume level at which the total costs of the alternatives are equal. It is

found by setting the total cost equations of the two alternatives equal to one another and

solving for the indifference point. In this case 6000 + 8X = 8000 + 4X or 4X = 2000; X

= 500}

6. If demand is 1100 units would you recommend

a) adopting Process A

b) adopting Process B

c) adopting Process C

d) none of the above

(Answer: c)

{This problem can be solved by finding the point of indifference between each pair of

alternatives or by computing the total costs of each alternative and picking the one with

the lowest total costs providing that the total costs do not exceed the revenues generated,

i.e. that the volume is above the break-even point for that alternative. In this situation

Total Costs Process A = 6000 + 8(1100) = $14,800

Total Costs Process B = 8000 + 4(1100) = $12,400

Total Costs Process C = 9000 + 3(1100) = $12,300}

7. A driverless truck that follows a path of rails or wires embedded in the floor is called

a) an ATC

b) a FMS

e) an AS/RS

d) a DNC

e) an AGV

(Answer: e)

{Text on page 255 in the section on Automated Material Handling and the Lecture in

the section on Automated Material Handling: An automated guided vehicle (AGV) is a

driverless truck vehicle that follows a path of rails, wires, specially painted lines on the

floor, or radio signals.}

8. _______ is a strategy for organizing and controlling a factory rather than a technology

that can be purchased.

a) FMS

b) CAPP

c) CIM

d) CPSS

(Answer: c)

{Text on page 257-258 in the section on Computer-Integrated Manufacturing and

Lecture in the section on Computer-Integrated Manufacturing: CIM is a strategy for

organizing and controlling a factory rather than a specific technology that can be

purchased.}

9. Very high volume commodity products are best suited to

a) projects.

b) batch production.

c) mass production.

d) continuous processes.

(Answer: d)

{Text on page 232 in the section on Continuous Production and the Lecture in the

section on Continuous Process Production: Continuous processes are used for very

high-volume commodity products that are standardized.}

10. Process flowcharts incorporate nonproductive activities as well as productive

activities.

a) True

b) False

(Answer: a)

{Text on page 245 in the section on Process Analysis and the Lecture in the section

on Process Flowcharts: incorporating nonproductive activities as well as productive

activities process flowcharts can be used to analyze the efficiency of a process.}

11. Typically, it is better to produce in-house those parts or products with uncertain

demand patterns rather than subcontracting them out.

a) True

b) False

(Answer: b)

{Text on page 239 in the section on Make-or-Buy Decisions: The stability of demand is

also important to this decision. If demand is steady then it is usually better to produce in-

house but if demand patterns are uncertain or volatile then the part is usually

subcontracted.}

12. In general, more automated processes have higher fixed costs but lower variable

costs.

a) True

b) False

(Answer: a)

{Text page 236 in the section on Process Selection with Break-Even Analysis: Since

more automated processes have higher fixed costs but lower variable costs break-even

analysis is especially helpful in automation decisions.}

13. At the break-even point, total revenue equals total cost.

a) True

b) False

(Answer: a)

{Text on page 234 in the section on Process Selection with Break-Even Analysis and

the lecture in the section on in the section on Process Selection with Break-Even

Analysis: By definition, the break even point is when total profit is equal to zero or when

total revenue exactly equals total cost}

14. The main advantage of robots is that they can perform jobs much faster than humans

can.

a) True

b) False

(Answer: b)

{Text on page 257 in the section on Robotics: Robots do not necessarily perform a job

faster than human workers but they can tolerate hostile environments, work longer hours

and do the job more consistently.}

15. The reengineering process starts with a detailed map of the current process.

a) True

b) False

(Answer: b)

{Text on page pages246-247 in the section on Process Reengineering and the Lecture in

the section on Process Reengineering: The reengineering process starts with the goals

and specifications for system performance. It is only after a high-level process map is

completed that a detailed process map is done. Even here, the detailed map is a map of

the new process, not the current one. In fact, reengineering is often said to begin with a

"blank sheet", i.e. without reference to the current process.}

1. Process planning describes

a) how the product will perform

b) how the product will look

c) how the product will be made

d) how easily the product can be maintained

e) all of the above

(Answer: c)

{Text page 191-192 in the section on "Final Design and Process Planning" and the

lecture in the section on "Final Design and Process Planning": Process planning

involves describing which parts are to be made versus purchased, what equipment will be

used, how products will be assembled and other aspects of how a product is to be

manufactured.}

2. _________ ensures that manufacturing concerns are systematically incorporated into

the design process.

a) design for manufacture

b) modular design

c) design for robustness

d) quality function deployment

(Answer: a)

{Text on page 196 in the section on "Design for Manufacture" and lecture in the section

on "Design for Manufacture": Design for Manufacture involves designing a product so it

can be produced easily and economically. DFM insures that manufacturing concerns are

systematically incorporated into the design process.}

3. One solution to the problem of how you can gain the cost benefits of

standardization without losing the market advantages of product variety is a) design for robustness

b) quality function deployment

c) modular design

d) process planning

(Answer: c)

{Text on page 197 in the section on "Design for Manufacture": The issue is how can you

maintain the benefits of standardized parts without loosing flexibility in larger product

variety. Modular design is common in the electronics and automobile industries as a way

of producing a wide variety of products from a set of standardized modules," also links to

the lecture at the last sentence of Modular Design.)

4. The objective of failure mode and effects analysis is to

a) anticipate product failures and prevent them from occurring

b) devise ways of minimizing the impacts of product failures when they occur

c) describe the interrelationships among product failures

d) quantify the likelihoods of different product failures

(Answer: a)

{Text on pages 198-199 in the section on "Failure mode and effects analysis (FMEA)":

FMEA is a systematic approach to analyzing the causes and effects of product failures to

anticipate failures and prevent them from occurring.}

5. An effective design is one which

a) utilizes the latest technology

b) minimizes the revisions necessary to make a workable design

c) starts from ideas generated internally in the organization

d) is first to the market, even though the design may not be perfect

e) all of the above

(Answer: b)

{Text page 185 at the top of the page: An effective design process matches product or

service requirements with customer requirements, ensures that customer requirements are

met in the simplest and least costly manner, reduces the time required to design a new

product or service, and minimizes the revisions necessary to make a design workable}

6. Which of the following helps eliminate unnecessary features and functions?

a) VA

b) FMEA

c) DFE

d) DFA

e) FTA

(Answer: a)

{Text on page 199 in the section on "Value Analysis" and the lecture in the section on

"Design for Manufacture": Value analysis was developed by General Electric in 1947 to

eliminate unnecessary features and functions in product design. The goal of value

analysis is to improve the ratio of value to cost by reducing the cost of the item or

increasing its worth."

7. Which of the following components in a "House of Quality" drives the entire QFD

process?

a) roof matrix

b) product characteristics

c) relationship matrix

d) customer requirements

e) customer perceptions of competing products

(Answer: d)

{Text page 204 in the section "1. Customer requirements": Customer requirements drive

the entire QFD process. This is because the whole purpose of the QFD approach is to

translate the voice of the customer into technical requirements. Thus the customer

requirements drive the entire process}

8. New product ideas can come from

a) customers

b) competitors

c) suppliers

d) all of the above

(Answer: d)

{Text on page 187 in Figure 5.2 and the section on "Idea Generation" and the lecture in

the section on "Idea Generation": Ideas for new products come from many sources

including customers, suppliers, research & development and competitors.}

9. Using the data below, what is the system reliability?

a) 2.83

b) .9433

c) .8379

d) .9000

e) none of the above

(Answer: c)

{Text page 190-191 in the section on "Preliminary Design--Reliability" and lecture in the

section on "Design for Manufacture-- Reliability": The reliability of a system with

components entirely in series is the product of the reliabilities of the individual

components. In this case the system reliability is (.95)(.90)(.98) = .8379.}

10. Design engineers usually have a good understanding of the manufacturing process

and don’t have to involve manufacturing too early in the design process.

a) True

b) False

(Answer: b)

{Text on page 195 in the section on "Concurrent Design": In many cases, design

engineers do not have a good understanding of the capabilities or limitations of their

company’s manufacturing facilities. Increased contact with manufacturing through

concurrent engineering can sensitize them to the realities of making a product and

thereby improve the quality of product design.}

11. The concern for the environment during product design and manufacture is currently

limited to the United States and has not yet become important in other countries.

a) True

b) False

(Answer: b)

{Text on page 200 in the section on "Design for Environment" and the lecture in the

section on "Design for Environment": Around the world, concern for the environment is

growing. New standards are being developed so that products can be designed to reduce

their burden on the environment. Several European countries, such as Germany and The

Netherlands have passed laws related to the environmental consequences of products and

the ISO standards have a section dealing with environmental impacts.}

12. Reverse engineering refers to finding the best-in-class part, product, or process and

comparing one's performance to it.

a) True

b) False

(Answer: b)

{Text on page 188 in the section under "Idea Generation": and the lecture in the section

under "Idea Generation": Reverse engineering is the careful dismantling and inspecting

of a competitor’s product to look for design features that can be incorporated into your

own product}

13. Technical and strategic analysis is the first step in completing a feasibility study.

a) True

b) False

(Answer: b)

{Text on page pages 189-190 in the section on "Feasibility Study" and the lecture in the

section on "Feasibility Study": A feasibility study begins with a market analysis to

determine if the product has market potential. Then an economic analysis is performed to

assess the potential financial return of the product. Lastly, a technical and strategic

analysis is performed to assess any new technology needed for the product or process and

to evaluate the strategic fit of the product with the rest of the firm.}

14. One difference between sequential and concurrent design is that concurrent design

uses a "cost-plus" approach rather than a "price-minus" approach.

a) True

b) False

(Answer: b)

{Text pages 195-196 in the section on "Concurrent Design" and the lecture in the section

on "Concurrent Design": Concurrent engineering is also important for figuring out how

to price products. In the past, product pricing was based on a cost-plus basis, but

concurrent engineering requires a price-minus basis"

15. Maintainability refers to how long the product will perform its intended function.

a) True

b) False

(Answer: b)

{Text on page 191 in the section on "Preliminary Design--Maintainability":

Maintainability refers to the ease and/or cost with which a product is maintained or

repaired. Reliability refers to whether or not a product will continue to perform its

intended function.

!00% solved data from book

Name three basic layouts and three hybrid layout.

Product, process, fixed-position -- basic layouts

Cellular, FMS, mixed-model -- hybrid

1. What is the purpose of line balancing?

To equalize the work at each workstation as best as possible.

1. The first step in line balancing is determining a cycle time. What information is

needed to compute the cycle time? How would changing the output rate (amount

needed per day) change the theoretical minimum number of workstations needed.

Cycle time is computed by dividing the minutes or seconds in the workday by the output rate

(production rate). Increasing the output rate could increase the number of workstations needed

and vice-versa.

1. A process (functional layout) has a jumbled flow pattern, which creates many

disadvantages. What is its main advantage?

Flexibility

1. A product (assembly line) layout has a straight flow pattern, which is efficient.

What is its main disadvantage?

Standardized product or inflexibility

1. What are some techniques for evaluating different locations for facilities and how

are they used?

Location factor analysis -- using weights and ratings of several locations to calculate the best.

Center-of-gravity -- using loads and distances to determine a single centralized location

Load-distance -- using loads and distances to evaluate several site locations.

1. Compare the location criteria for a heavy industry to those for a service-related

business. Which is the most important location criteria for service businesses?

Most important for service businesses -- proximity to customers

1. Compare the location criteria for a high tech electronic business to that for a

heavy industry. Which is more likely to find "proximity to raw materials" more

important?

Heavy industry

1. What is the major advantage of each transportation mode -- water, air, trucking,

railroad?

Water -- cheap and bulk loads

Air -- quick

Trucking -- flexible

Railroads -- cheap and heavy loads

1. What are some types of trade restrictions?

Tariffs -- fees for importing goods

Subsidies -- government aid to make a particular country's goods cheaper in the market .

Quotas

1. What are the major types of time-series methods of forecasting?

Moving average, weighted moving average, exponential smoothing, linear trend

1. What does a trend look like? How about a cycle? What is the difference between

a cycle and a seasonal pattern?

Trend -- line straight up or down; cycle -- long term up-and-down; seasonal -- short-term

pattern.

1. What are MAD, MAPD, and bias? Ways of measuring forecast error.

1. Once a forecaster finds a mathematical model to fit some data, what must be done

next? See how well the model fits the data by calculating error or other evaluation

techniques; continuous monitoring for accuracy.

1. What are some ways to handle variation in demand in order to match supply to

demand?

Inventory, hiring/firing, part-time, temporary workers, backordering, subcontracting, high levels

of resources, overtime/undertime.

1. What does aggregate planning do?

Matches supply to demand by setting production rates, inventory strategy, and staffing strategy.

1. Describe different capacity strategies.

Capacity lead -- building in anticipation of growth

Capacity lag -- waiting for documented growth before adding capacity

Average capacity -- building somewhere between existing need and anticipated growth.

1. What are two pure aggregate planning strategies. List a way of following a mixed

aggregate planning strategy.

Level workforce and chase demand. These can be mixed with subcontracting, for example.

1. Describe worker levels and inventory levels in level production strategy. Describe

worker levels and inventory levels in chase demand strategy. What is the major

cost in each?

Level production -- high inventory change, but steady workforce

Chase demand -- high workforce level change, but steady or no inventory.

1. How can companies change demand to minimize fluctuations? Creating incentives

through sales promotions, price differentials, etc.

Problems

1.

Table 1

From\To A B C D E F

A 20 50 30

B 18 15 10

C 45 5

D 75

E 15

F 30 60

Table 2

Proposed Layout

A B C

D E F

Using the information in Tables 1 and 2, calculate the nonadjacent loads.

a) 138

b) 310

c) 295

d) 180

e) 160

(Answer: c)

2. An assembly line consists of 5 tasks with times of 3, 7, 5, 4, and 8 minutes. The cycle

time for the line is 9 minutes. The theoretical minimum number of workstations for this

situation is

a) 1

b) 2

c) 3

d) 4

e) 5

(Answer: c)

3. An assembly line consists of 5 tasks with times of 3, 7, 5, 4, and 8 minutes. The cycle time for

the line is 9 minutes. The proposed layout has 4 workstations. What is the efficiency of this

layout?

a) 100%

b) 75%

c) 27%

d) 36%

e) none of the above

(Answer: b)

4. A company wants to produce 80 units in an 8-hour day. The required cycle time is

a) 3 minutes

b) 10 minutes

c) 6 minutes

d) 8 minutes

(Answer: c)

5. A company wishing to locate a new video rental business in one of four locations, has

identified the top five factors to be considered in the analysis. A factor score of 1 indicates a poor

rating, and a factor score of 5 indicates an excellent rating.

Table 1

Factor Score by Location

Factor Weight A B C D

Income Level .35 5 5 3 4

Traffic .25 4 5 1 2

Labor Pool .20 5 3 4 5

Gov. Services .15 2 2 1 3

Taxes .05 2 1 2 1

Based on the data in Table 1 and the location factor rating technique, which location

should be recommended?

a) Location A

b) Location B

c) Location C

d) Location D

e) Additional information is needed.

(Answer: a)

6. A company trying to decide on a location for a new video rental business has identified five

possible locations and has assembled the following information:

Location Coordinates Monthly Shipments

A (4, 2) 35

B (5, 4) 25

C (9, 3) 55

D (8, 12) 45

E (4, 16) 20

Using the data above, determine the least cost location using the center-of-gravity

method. Which of the following identifies the correct coordinates?

a) (5.94, 4.29)

b) (4.20, 5.80)

c) (73.81, 64.58)

d) (6.67, 6.64)

(Answer: d)

7. A linear trend line for 3 years of data is y = 339.02 + 23.96x. What is the forecast for the next

year (yr. 4)?

a) 434.86

b) 807.74

c) 362.98

d) 410.90

e) none of the above

(Answer: a)

8. The annual demand for citrus fruits is y = 600 + 50x. If the seasonal factor for the 3rd

quarter

is .25. What is the demand for the 3rd

quarter of year 4?

a) 800

b) 600

c) 200

d) 100

(Answer: c)

Table 1

Month Sales($000)

January 42

February 49

March 59

April 39

May 56

June 59

July 50

August 49

September 50

October 53

November

9. Using the data in Table 1, what is the November forecast if exponential smoothing is

used with alpha = .11

a) 47.30

b) 47.00

c) 48.22

d) 46.73

(Answer: c)

10. Using the data in Table 1, what is the November forecast if a 3-month moving average is

used?

a) 50.00

b) 50.67

c) 47.87

d) 46.73

(Answer: b)

11.

Table 2

Year Qtr 1 Qtr 2 Qtr 3 Qtr 4

1996 177 152 49 286

1997 208 151 98 255

1998

Using the data in Table 2, what is the seasonal factor for the first quarter of 1998?

a) .25

b) .39

c) .21

d) .28

(Answer: d)

12.

Quarter Forecast

1 70,000

2 120,000

3 90,000

4 100,000

Hiring Cost $200 per worker

Firing Cost $250 per worker

Inventory Carrying Cost $10 per unit

Production Per Employee 1000 units per/qtr

Beginning Work Force 100 workers

Using the data above, which of the following statements is true if the company maintains

a level production strategy?

a) the total number of units inventoried for the 3rd

quarter period is 10,000 units

b) the cost of the level production plan is $1,250

c) there are 25,000 units inventoried in quarter 1

d) a work force of 80 workers is maintained during the 4th

quarter period

e) more than one statement above is true

(Answer: c)

Production /Operations Management (MGT-613)

For Mid Term

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distribute it. Please don‟t remove the links of group and website

1.Which one of the following is the overall objective of product and service des

ign?

a) Customer satisfaction and variety

b) Reliability and variety

c) Quality and reliability

d) Customer satisfaction and profitability

2. Which one of the following statements is true about OSHA?

a) To safeguard against potential hazards

b) To develop cost effective processes

c) To implement legal standards

d) To carry out implication of manufacturability and fitness

3.Which one of the following is the most significant disadvantage of standardi

zation?

a) Frozen designs

b) Interchangeable parts

c) Reduced variety

d) Customized parts

4. Which one of the following is the final stage of product life cycle?

a) Growth

b) Decline

c) Maturity

d) Planning

5._______________ is the bringing together of engineering design and manufa

cturing personnel early in the design phase.

a) Reverse engineering

b) Concurrent engineering

c) Manufacturability

d) Serviceability

6.

Robustness of a product is _____________ related with the probability of failu

re.

a) Directly

b) Inversely

c) Linearly

d) Positively

7.Which one of the following mathematical expressions can be used to comput

e availability?

a) (MTBF)/ (MTBF+MTR)

b) (MTBF)/ (MTBF‐MTR)

c) (MTR)/ (MTBF+MTR)

d) (MTR)/ (MTBF‐MTR)

8.A product „A‟ is specified to work well up to 30 degree Celsius temperature

and 30% humidity. What would these specifications represent?

a) Reliability factor

b) Standard conditions

c) Normal operating conditions

d) Standard operating procedure

9. Which one of the following is a curve showing failure rate over time?

a) Cost curve

b) Bath tub curve

c) Fish bone diagram

d) Reliability curve

10.The frequency of capacity choice decisions is influenced by all of the followi

ng factors EXCEPT:

a) Stability of demand

b) Technological changes

c) Competitive forces

d) Cost factor

11.Which one of the following refers to the maximum output that a firm can p

roduce under ideal conditions?

a) Design capacity

b) Effective capacity

c) Capacity planning

d) Utilization rate

12.

The process selection should take into account all of the following EXCEPT:

a) Capacity planning

b) Design of work systems

c) Production forecasts

d) Selection of technology

13.The type of processing structure that is used for producing discrete produc

ts at higher volume is:

a) Continuous Flow

b) Assembly Line

c) Batch

d) Job Shop

14.The type of processing structure that is used to produce gasoline, chemicals

, and steel is known as.

a) Job Shop

b) Batch

c) Assembly Line

d) Continuous Flow

15.In which of the following layouts, work stations are arranged according to t

he general function they perform without regard to any particular product?

a) Product

b) Process

c) Fixed‐position

d) Storage

16.Which one of the following is the correct order of layout types from low vol

ume/high variety to high volume/low variety?

a) Fixed position, process, cell, product

b) Fixed position, cell, process, product

c) Fixed position, process, product, cell

d) Process, fixed position, cell, product

18.What would be the required cycle time for a process that operates 9 hours

daily with a desired output of 300 units per day?

a) 0.03 minutes

b) 1.8 minutes

c) 2700 minutes

d) 33.33 minutes

19.What would be the output capacity if an assembly line operates for 7 hours

per day with a cycle time of 2.0 minutes?

a) 210 units per day

b) 3.5 units per day

c) 0.004 units per day

d) 14 units per day

20. Which one of the following is TRUE about work sampling?

a) It describes individual human motions that are used in a job task

b)

It involves determining the length of time it will take to undertake a particular task

c)

It involves determining the amount of time a worker spends on various activiti

es

d) It providing standard times for micro motions such as reach, move and release

21. Which of the following forecasting techniques generates trend forecasts?

a. Delphi method

b. Moving averages

c. Single exponential smoothin

d. Naïve forecast

22. Which of the following smoothing constants would make an exponential

smoothing forecast equivalent to a naive forecast?

a. 0

b. 0.01

c. 0.5

d. 1.0

23. The temperature on Tuesday was 80 degrees, on Wednesday it was 82

degrees, on Thursday it was 78 degrees. A naive forecast for the temperature

on Friday would be:

a. 78 degrees

b. 80 degrees

c. 82 degrees

d. 84 degrees

24. A design that focuses on reducing the number of parts in a product and on

assembly methods and sequence is known as:

a. Design for manufacturing

b. Design for recycling

c. Design for assembly

d. Design for disassembly

25. DFM stands for:

a. Design for Maintenance

b. Design for Manufacturing

c. Design for Management

d. Design for Manpower

26. As the number of components in a series increases, the reliability of the

system:

a. Increases

b. Decreases

c. Remains the same

d. Becomes zero

27. The purpose of ________ is to arrive at a consensus forecast.

a. Naïve forecast

b. Associative models

c. Time series forecast

d. Delphi method

28. A system is composed of components A, B, C and D. The overall reliability

of the system is a measure of the reliability of the individual components.

Listed below are a few ways to improve reliability of the system:

1. Improve component design

2. Improve testing

3. Use backup components

4. Improve strategy formulation

5. Quality assurance

Which of the following combinations would be the best to improve reliability

of the system?

a. 1,2, 5

b. 1,2,3

c. 1,4,5

d. 3,4,5

29. As time horizon increases, forecast accuracy:

a. Increases

b. Decreases

c. Levels off

d. Becomes zero

30. If demand of a product „A‟ is 30 units, 45 units and 75 units in week 1, 2

and 3 respectively, the demand for week 4 according to moving average

method would be:

a. 105 units

b. 75 units

c. 40 units

d. 50 units

31. Who introduced the use of statistical control charts for monitoring

production?

a) G.S. Radford

b) Walter Shewhart

c) Frederick Taylor

d) Kaoru Ishikawa

32. Which of the following quality gurus advocated the “cost of quality”

concept?

a) Edwards. Deming

b) Joseph Juran

c) Kaoru Ishikawa

d) Philip Crosby

33. If you go to dine out at McDonalds and you observe a very cool and

pleasant atmosphere over there. It depicts which of the following dimensions

of quality?

a) Performance

b) Aesthetics

c) Reliability

d) Conformance

34. Mr. Ali purchased a TV set. After a period of a year, the picture quality

started deteriorating. He went to the company and complained. The company

responded subsequently. Which of the following dimensions of quality would

come into play?

a) Reliability

b) Conformance

c) Serviceability

d) Aesthetics

35. Which of the following reflects the meaning of the word “Poka –Yoke”?

a) Mistake proof

b) Low quality

c) Defective

d) Expensive

36. Which one of the following denotes QFD?

a) Quality Function Development

b) Quality Foundation Development

c) Quality Foundation Deployment

d) Quality Function Deployment

37. Which of the following terms best defines the nature of Total Quality

Management?

a) An art

b) A philosophy

c) A science

d) A social activity

38. Which of the following terms reflects Japanese view of continuous

improvement?

a) Kaizen

b) Poka-yoke

c) Six sigma

d) Control limits

39. Which of the following is NOT an element of TQM?

a) Leadership

b) Perceived quality

c) Employee empowerment

d) Customer focus

40. Which of the following is an example of appraisal cost?

a) Rework costs

b) Returned goods

c) Testing labs

d) Quality improvement programs

41. Warranty cost is an example of which of the following?

a) Internal failure cost

b) External failure cost

c) Prevention cost

d) Appraisal cost

42. Refer to the stage of PDCA (Plan, Do, Check, Act) cycle that involves

evaluating the improvement plan.

a) Plan

b) Do

c) Check

d) Act

43. Which of the following refers to a continuous measurement of an

organization‟s products and processes against a company recognized as a

leader in that industry?

a) Benchmarking

b) Gap analysis

c) Statistical process control

d) Continuous improvement

44. Which of the following is the focus of statistical process control?

a) Determining the efficiency of an operations system

b) Measuring the amount of re-work required to rectify faulty goods

c) Identifying the security needs of an operations system

d) Measuring and controlling process variations

45. Which of the following is a measure of how closely a product or service

meets the specifications?

a) Quality of Conformance

b) Continuous improvement

c) Competitive benchmarking

d) Statistical process control

46. -------------------- is the maximum output rate or service capacity an

operation, process or facility.

1.

a. Efficiency

b. Effective Capacity

c. Design Capacity

47. -------------- is the rate of output actually achieved.

1.

d. Actual Output

e. Design Capacity

f. Utilization

48. A knowledge of economies and diseconomies of scale is -----------

1.

g. Important for operations manager

h. Not Important for operations manager

i. It makes no difference

49. If the output rate is less than the optimal level, increasing output rate

results in -------------------- average unit cost

1.

j. Increasing

k. Decreasing

l. Stabilizing

50. As the output is increased, the unit cost is decreased because

1.

m. Of external factors

n. Because there are more units to absorb the fixed costs

o. None of the above

51. As the general capacity of the plant increased, the optimal output rate

increases and the minimal cost for the optimal rate

1.

p. Decreases

q. Increases

r. It has no effect with the output rate

52. The primary purpose of cost- volume analysis is:

1.

s. To estimate the income of an organization

t. To analyze initial costs incurred under different operating conditions

u. Both A and B

53. Variable costs vary ---------------- with volume of output

1.

v. Inversely

w. Directly

54. -------------- refers to the way, an organization chooses to produce its goods

or services

1.

x. Process selection

y. Capacity planning

z. Cost volume analysis

55. Ice cream is an example of

1.

aa. Batch processing

bb. Job shop

cc. Repetitive processing

56. The prime determinants of choosing a sampling plan include:

Cost

Time

Environment

Both cost and time

57.The ideal sampling plan requires ______ inspection of each lot.

a) 100%

b) 50%

c) 10%

d) 25%

58. As the lot quality decreases, the probability _________.

a) Increases

b) Decreases

c) Remains neutral

d) None of the given options

59. ________ represents maximum AOQ for a range of fractions defective.

a) Acceptable Quality Level (AQL)

b) Average Outgoing Quality Limit (AOQL)

c) Lot Tolerance Percent Defective (LTPD)

d) None of the given options

60. ___________ refers to intermediate range capacity planning, usually

covering 2 to 12 months.

a) Aggregate planning

b) Moderate planning

c) Long rang planning

d) Short range planning

61. _________ is an optimizing technique that seeks to minimize combined

costs, using a set of cost-approximating functions to obtain a single quadratic

equation.

a) Linear programming

b) Linear decision rule

c) Aggregate planning

d) Lot Tolerance Percent Defective (LTPD)

62. ________ takes physical count of items at periodic intervals.

a) Periodic inventory system

b) Perpetual inventory system

c) Two-bin system

d) Universal bar code system

63. _______ refers to the cost to carry an item in inventory for a length of

time.

a) Shortage cost

b) Ordering cost

c) Holding cost

d) None of the given options

64. Inputs to MRP include all of the following except:

a) Master schedule plan

b) Bill of materials

c) Inventory records

d) Control charts

65. ________ represents the process of determining short-range capacity

requirements.

a) Capacity requirements planning

b) Aggregate planning

c) Capacity planning

d) Schedule planning

66._______ allows the manager to anticipate the future so then can plan

accordingly.

Forecasting

Planning

Organizing

Leading

67. Forecasts are rarely perfect because of:

Internal factors

Randomness

External factors

All of the given options

68. Forecast accuracy ________ as time horizon increases.

Increases

Decreases

Remains the same

None of the given options

69. __________ use explanatory variables to predict the future.

Judgmental forecasts

Time series forecasts

Associative models

All of the given options

70. All of the following are examples of judgmental forecasts except:

Executive opinions

Consumer surveys

Delphi method

Naïve forecasts

71. _________ requires completing a series of questionnaires, each developed

from the previous one, to achieve a consensus forecast.

Naïve forecast

Time series analysis

Associative models

Delphi method

72. One of the drawbacks of naïve forecasts is:

Low accuracy

High cost

No ease at using

None of the given options

73. All of the following are responsible for irregular variations except:

Severe weather

Earthquake

Worker strikes

Cultural changes

74. _______ is a technique that averages a number of recent actual values,

updated as new values.

Moving average

Weighted moving average

Simple moving average

Exponential smoothing

75. MAPE stands for:

· Measure Actual Performance Error

· Mean Absolute Percent Error

· Mean Actual Percent Error

· Mean Absolute Performance Error

76.The goal of Total Quality Management is:

a) Customer satisfaction

b) Product differentiation

c) Brand equity

d) Acting globally

77. The most common form of quality control includes:

1.

a. Planning

b. Organizing

c. Inspection

d. Directing

78. Process selection is primarily considered during:

a. Planning

b. Organizing

c. Leading

d. Controlling

79. The type of operation being carried out by an organization depends upon:

a)Degree of standardization

b)Volume of output

c)Demand

d)Both (a) and (b)

80. Repetitive processing results in output that is:

a)Highly standardized

b)Highly customized

c)Partially customized

d)None of the given options

81. Job shop and batch processing are differentiated on the basis of:

a) Job requirements

b) Degree of standardization

c)Volume of output

d)Both (b) and (c)

82. Automation is preferred because it:

a) Offers lesser dependence on workers

b) Results in reduction in variable cost

c) Offers easy handling of repetitive work

d) All of the given options

83. Product layout is preferably used for:

a) Repetitive processing

b) Intermittent processing

c) Both (a) and (b)

d) Neither (a) nor (b)

84. Process layout is used for:

a) Repetitive processing

b) Intermittent processing

c) Both (a) and (b)

d) Neither (a) nor (b)

85. The most significant advantage of U-shaped layout is:

a)Cost minimization

b) Easy handling of process

c)Increased flexibility in work

d) All of the given options

86. The goal of motion study is to achieve:

a) Cost minimization

b) Maximum efficiency

c) Profitability

d) All of the given options

87. Location decisions are viewed primarily as part of:

a) Marketing strategy

b) Growth factors

c) Financial aspect

d) Both (a) and (b)

88. Regional factors for location planning include all of the following except:

a) Raw materials

b) Markets

c) Labor considerations

d) Attitudes

89. Transportation method is a __________ approach.

a) Quantitative

b) Qualitative

c) Scientific

d) All of the given options

90. Fredrick Taylor‟s concern for quality includes:

a) Product inspection

b) Gauging system

c) Statistical control chart

d) Both (a) and (b)

91. Kaoru Ishikawa is famous for:

a) Statistical quality control

b) Fish bone diagram

c) Loss function concept

d) All of the given options

92. Poor quality adversely affects:

a) Costs

b) Productivity

c) Profitability

d) All of the given options

93._________ is intended to assess a company‟s performance In terms of

environmental performance:

a) ISO 14000

b) ISO 9000

c) Six sigma

d) All of the given options

94. The purpose of ISO 9000 is to:

a) Promote quality standards to improve efficiency and productivity

b) Earn high profit

c) Avoid unfavorable outcomes

d) Gain high market share

95. A product performing consistently refers to which of the following

dimensions of quality:

a) Safety

b) Conformance

c) Durability

d) Reliability

96. All of the following are the major factors affecting design strategy

except:

· Cost

· Market

· Time-to-market

· Revenue

97.All of the following are the primary reasons for design process except:

· Economic

· Social and demographic

· Political, liability, or legal

· Personal

98.______ refers to a manufacturer being liable for an injury or damage

caused by a faulty product.

· Product liability

· Manufacturer’s liability

· Organizational liability

· All of the given options

99._________ is the postponement tactic.

· Product differentiation

· Delayed differentiation

· Service differentiation

· All of the given options

100.The situation in which a product, part or system does not perform as

intended is referred to as:

· Reliability

· Durability

· Failure

· Maturity

101.DFA stands for:

· Design for Assurance

· Design for Accuracy

· Design for Authenticity

· Design for Assembly

102.Taguchi approach helps in determining:

· Controllable factors only

· Un -controllable factors only

· Both controllable factors and un -controllable factors

· None of the given options

103.________ is the bringing together of engineering, design and

manufacturing personnel together early in the design phase.

· Robust design

· Concurrent engineering

· Cannibalization

· Design for Manufacturing (DFM)

104.Reliability can be measured effectively by using:

· Probability

· Durability

· Failure

· Forecasting

105. 105. _____________ determines the best possible outcome.

· Maximum

· Minimax

· Maximax

· Laplace

106. 106.Decision tree is analyzed from:

· Left to right

· Right to left

· Any side

· All of the above

107 107. Judgmental forecasts include all of the following except:

· Executive opinion

· Consumer surveys

· Delphi method

· Regression analysis

108 108.In order to design a new product or service, an organization takes

into account:

· External factors

· Internal factors

· a & b

· Economic, social and demographic conditions

109 109. FDA, OSHA and CRS resolve:

· Legal issues

· Political issues

· Ethical issues

· Environmental issues

110 110. Design that results in products or services that can function over a

broad range of conditions is called:

· Computer Aided Design

· Robust design

· Design for remanufacturing

· Modular design

111. 111. Which of the following is wrong with respect to Naïve forecast?

· Quick and easy to prepare

· Provides high accuracy

· Simple to use

· Can be a standard for accuracy

112 112 Steps in CPFR include all of the following except:

· Creation of a front end partnership agreement

· Sharing forecast

· Inventory replenishment

· Development of supply forecasts

113 113. Identify the right sequence in product or service life cycle.

· Introduction, Maturity, Growth, Decline, Saturation

· Introduction, Growth, Maturity, Saturation, Decline

· Introduction, Growth, Saturation, Maturity, Decline

· Introduction, Saturation, Growth, Maturity, Decline

114 114. In the absence of enough time, ________ forecasts are preferred.

· Qualitative

· Quantitative

· Naïve forecasts

· None of the given options

115 115. ___________ are based on samples taken from potential customers.

· Executive opinion

· Consumer surveys

· Delphi method

· All of the given options

116 116. Which of the following activities is unnecessary ,when an

organization decides to design its new product or service or refi design its

existing product or service:

a Translate customer wants and needs into product and service requirements

b Refine existing products and services

c Develop new products and services

d Manage the purchasing activities religiously and diligently.

117 117. While focusing on capacity planning, organizations look for which of

the following alternatives.

a. How much will it cost

b. How much holidays the workers can enjoy.

c. How much compensation they need to pay to their CEO.

d. None of the above

118. Which of the following is not one of the assumptions for Cost Volume

Analysis

e. One product is not involved

f. Everything produced can be sold

g. Variable cost per unit is the same regardless of volume

h. Fixed costs do not change with volume

119. Which of the following does not fall under Economic Production

Quantity ( EPQ)

i. Only two or more item are involved

j. Annual demand is known

k. Usage rate is constant

l. Usage occurs continually

120. Advantages of Process Layout Include

m. Equipment used is less costly

n. Low unit cost.

o. Labor specialization.

p. Low material handling cost

121. Common types of Operations include

q. Continuous Processing.

r. Intermittent Processing.

s. Automation

t. All of the above

122.System performance is measured by

u. Average number of customers being refused service

v. Average time customers wait

w. System utilization

x. b and c.

123. Inventory carrying costs are influenced by:

y. Order Quantity in Units

z. Holding carrying cost per unit.

aa. Demand

bb. a and b only.

124. Bar coding helps in determining the :

cc. Status of the inventory of an item in warehouse

dd. Price of the product

ee. Size of the lot as well as the size and specifications of the product

ff. All of the above

125. Therbligs are basic elemental motions which include:

gg. Search

hh. Select

ii. Throw

jj. a and b only

CHAPTER 10 FACILITY LAYOUT

1. Which of the following is not a mark of a good layout in manufacturing?

A. straight line flow pattern (or adaptation) B. predictable production time C. bottleneck operations

D. work stations close together E. open plant floors (high visibility)

2. Which of the following is also referred to as a layout by function? A. Process layout B. Product layout

C. Group technology layout D. Fixed-position layout E. Assembly line

3. A flow shop layout is often referred to as a: A. Process layout

B. Product layout C. Group technology layout D. Fixed-position layout

E. Batch process

4. According to the authors, when balancing an assembly line, it is best to start by: A. determining the required cycle time. B. computing the minimum number of work stations.

C. drawing a precedence diagram. D. establishing rules by which tasks are to be assigned to work stations. E. assigning tasks to individual work stations.

Use the following information for the next 3 questions. An assembly line operated 7.5 hours per day and produces 400 units per day. Following are the tasks that are performed with their performance time (SEC) and preceding

tasks. 5. Compute the required cycle time.

A. 1.125 seconds B. 53.3 seconds C. 67.5 seconds

D. 7.5 hours E. 62 seconds

6. What is the theoretical minimum number of work stations if the required cycle time is 62 seconds? A. 2.29

B. 69.75 C. 2.08 D. 3.29

E. 3.02

7. If the required cycle time is 62 seconds, which of the following assignment rules will result in the lowest number of work stations? A. Primary Rule: Most followers with secondary rule: longest operating time.

B. Primary Rule: Longest operating time with secondary rule: most followers. C. Both rules result in an equal number of work stations. D. Not enough information is available to make a determination

E. Neither rule results in a cycle time of 62 seconds. 8. If the required cycle time is 62 seconds, what is the efficiency of this balance using

the most followers as the primary rule and the longest operating time as the secondary rule? A. .80

B. .83 C. .82 D. .75

E. .77 9. According to the authors, possible answers to unequal work station times may be:

I. flexible line layouts II. U shaped assembly line

III. L shaped assembly lines IV. fixed location layouts

A. I and II only B. I and III only C. I, II, and IV only

D. I, III, and IV only E. I, II, III, and IV

10. Compute the required cycle time for a company which operates two identical production lines for 7.5 hours a day with a demand of 16,225 items per week (assume a five day work week.)

A. .1387 minutes B. .0277 minutes C. .0046 minutes

D. .2800 minutes E. .5600 minutes

11. All of the following are inputs to the facility layout decision EXCEPT: A. specifying system output and flexibility objectives. B. identifying bottleneck work stations.

C. estimating system demand. D. determine the number of operations and flows between departments. E. determining space availability.

12. When similar equipment or functions are grouped together the type of layout is referred to as a:

A. product layout.

B. fixed-position layout. C. process layout.

D. cellular layout. E. none of the above.

13. A shipyard is an example of a: A. process layout. B. product layout.

C. group technology layout. D. fixed-position layout. E. none of the above.

14. CRAFT is a computerized layout program meaning: A. Computerized Relative Allocation of Facilities Technique.

B. Computerized Research Assessment of Facility Technology. C. Computerized Relationships Among Factory Technology. D. Computerized Relative Attributes of Facility Training.

E. Computer Research About Facility Techniques. 15. Which of the following are CRAFT inputs?

I. a load matrix II. a distance matrix

III. cost-per-unit distance traveled A. I only

B. II only C. III only D. I and II only

E. I, II and III 16. The time between successive units coming off the end of the line is known as the:

A. makespan time. B. throughput time. C. value added time.

D. cycle time. E. assembly time.

17. An assembly line consisting of five work stations has a cycle time of 120 seconds. The total time required to complete all tasks is 480 seconds. The efficiency of this line as it is currently balanced is

A. 20% B. 25% C. 80%

D. 100% E. 125%

Which of the following refers to the cost associated with the order of

inventory and its receipt?

Select correct option:

Ordering cost

Holding cost Shortage cost

Stock out cost

Demand options are focused on which of the following? Select correct option:

Hiring / layoff options Backorders

Subcontracting

Matching demand period by period

Which of the following is a technique for fitting a line to a set of points?

Select correct option:

Regression

Trend Cycle

Moving average

Refer to the percentage of items in group A of ABC classification system for

inventory management Select correct option:

10%

50%

70%

30%

Which one of the following is concerned in short term capacity needs?

Select correct option:

Cycle

Trends Seasonality

Average

Explanation:Short term capacity decisions refer to seasonal, random or

irregular variations in demand

Which of the following is an example of an output of aggregate planning?

Select correct option:

Facilities layout

Demand forecast Projected inventory

Overtime cost

Which of the following forecasting techniques induce personal bias in a forecast?

Select correct option:

Qualitative

Quantitative

Associative

Trend forecast

Six Sigma is primarily centered towards all of the following except:

Select correct option:

Cost cutting Continuous improvement

Time saving

Quality improvement

Ref:Six Sigma Programs are always directed towards quality improvement,

cost cutting and time saving.(Page no.114)

Which of the following is NOT an assumption of EOQ model? Select correct option:

Delivery lead time does not vary

Annual demand requirements are known

There are no quantity discounts

Multiple products are involved

Ref: Single product is involved in EOQ model.

Which of the following is determined by the Lot Tolerance Percent Defective? Select correct option:

The lower limit on the percent of defects that the consumer is willing to accept

The upper limit on the percent of defects that the consumer is willing to accept

The middle limit on the percent of defects that the consumer is willing to accept

The total percent of defects that the consumer is willing to accept

Which one of the following refers to the length of time needed to complete a job?

Select correct option:

Work sampling methods

Work measurement Job design

Methods analysis

Ref provided by Banjara: Work Measurement determines how long it should

take to do a job(page 90)

Robustness of a product is ___________related with the probability of

failure. Select correct option:

Directly Inversely

Linearly

Positively

Ref:Robustness is the ability of a system to provide accurate predictions

given some degree of noise present in data.

Maintaining quality is the responsibility of ____ in the organization. Select correct option:

Operations Department Top Management

Quality Control Department

Everyone

Which of the following are dimensions of service quality Except: Select correct option:

Assurance Responsiveness

Intangibles

Reliability

Ref:Service Quality

Tangibles

Convenience

Reliability

Responsiveness

Time

Assurance

Courtesy

Which one of the following manufacturing process is associated with high

volume car manufacture? Select correct option:

Job shop

Assembly line

Batch

Automation

Read more about all manufacturing process

_______________ is the bringing together of engineering design and

manufacturing personnel early in the design phase. Select correct option:

Reverse engineering Concurrent engineering

Manufacturability

Serviceability

Increase in inspection results in the increase of which cost?

Select correct option:

Prevention costs

Appraisal costs Inspection costs

Rework costs

Manufacturability is the ease of fabrication and/or assembly which is

important for: Select correct option:

Cost and Productivity Productivity and Quality

Cost and Quality

Cost, productivity and Quality

Explanation:Manufacturability means the ease of fabrication or assembly of a

product as it directly affects cost, quality and productivity.

Following are all examples of distinctive competencies EXCEPT; Select correct option:

Price Quality

Planning

Flexibility

Ref:The special attributes or abilities that give an organization a competitive

edge are:

1. Price

2. Quality

3. Time

4. Flexibility

5. Service

6. Location

Partially completed units within a production system are known as:

Select correct option:

Economic order quantity

Safety stock Units-in-order

Work-in-process

XYZ organization is ISO 9000 certified. It now requires a plan to improve performance in resource use and pollutant output. For this, the organization

requires certification of________. Select correct option:

ISO 9003 ISO 14000

ISO 9004

None of the above

Reference:ISO 9004: Quality Management Systems -Guidelinesfor Improving

Performance". This standard, which is intended for internal use and not for contractual purposes, focuses particularly on continually improving

performance.

Which one of the following is the focus of predetermined motion time

system? Select correct option:

Individual human motions that are used in a job task Determining the length of time it will take to undertake a particular task

Determining the amount of time a worker spends on various activities

Providing standard times for micro motions such as reach, move and release

Explanation:Apredetermined motion time system (PMTS)is frequently used

to set labor rates in industry by quantifying the amount of time required to

perform specific tasks.

Which one of the following is an implication of laplace approach of decision

making? Select correct option:

The best of the worst possible payoff The best possible payoff

The best average payoff

The least of the worst regrets

Which of the following refers to changing the job role of one worker with

another? Select correct option:

Job rotation

Job enlargement

Job enrichment

Job design

Which one of the following is the correct order of layout types from low

volume/high variety to high volume/low variety? Select correct option:

Fixed position, process, cell, product Fixed position, cell, process, product

Fixed position, process, product, cell

Process, fixed position, cell, product

Ref: Please consult Slide no.19 and 20 for detailed answer.

Which one of the following is an example of a long range plan?

Select correct option:

Machine loading

Backorders

Facilities layout

Work schedule

Ref:Long-range plans

1. Long term capacity

2. Location / layout (Page no133)

Which one of the following is an index used to measure actual output

relative to design capacity? Select correct option:

Utilization

Efficiency

Effective capacity

Effectiveness

Utilization = actual out put / designed capacity

How can you compute the cost of subcontracting?

Select correct option:

Subcontracting cost per unit – subcontracted quantity

Subcontracting cost per unit + subcontracted quantity Subcontracting cost per unit × subcontracted quantity

Subcontracting cost per unit /subcontracted quantity

Generally most of the values in control charts fall within which range of

standard deviation? Select correct option:

+/- 1 +/- 3

+/- 4

+/- 5

Ref:Theoretically any value is possible as the distribution extends to infinity.

And 99.7% of all values will be within+3standard deviations.(Slide No.27)

Generally an Operations Manager should NOT inspect the process for defects_______.

Select correct option:

Before the supply of finished goods

Before a costly operation Before manufacturing high volume products

Before purchasing raw material

ABC organization, actively engaged in continuous improvements, trains its work teams to use the PDCA for problem solving. The documentation of

process by analyzing data, setting of qualitative goals comes in which of the

following stage of PDCA? Select correct option:

Plan

Do

Check

Act

Reference:PLAN STAGE

ØStudy & Document the existing process.

ØCollect data to identify problems.

ØSurvey data and develop a plan for improvement.

ØSpecify measures for evaluating the plan.

Which chart is used for controlling the proportion of defective products / service generated by the process?

Select correct option: p-chart

c-chart R-chart

X- chart

Which of the following is determined by the Lot Tolerance Percent Defective?

Select correct option:

The lower limit on the percent of defects that the consumer is willing to

accept The upper limit on the percent of defects that the consumer is willing to

accept

The middle limit on the percent of defects that the consumer is willing to

accept The total percent of defects that the consumer is willing to accept

The process selection should take into account all of the following EXCEPT: Select correct option:

Capacity planning Design of work systems

Production forecasts

Selection of technology

Ref:Process Selection refers to the way an organization chooses to produce its good or services. It takes into account selection of technology, capacity

planning, layout of facilities, and design of work systems.(Page no77)

Characteristics like taste, feel, expertise, image or reputation relates to ---------.

Select correct option: Subjective inputs

Objective inputs Quantitative technique

None of the given options

Which one of the following refers to inventory turnover?

Select correct option: A ratio of cost of goods sold to the average inventory investment

A ratio of work in process to the average inventory investment A ratio of cost of carrying cost to the average inventory investment

A ratio of cost of assets to the average inventory investment

Reference:Inventory turnover = Cost of goods sold / Average Inventory

Capacity options are usually of ________range in nature

Select correct option: Short

Long

Intermediate

Periodical Explanation:Demand options are short range in nature while Capacity

optionsare long duration (term or range). Which of the following is NOT considered while calculating the safety stock

level? Select correct option:

Order level Stock-out cost

Holding cost

Demand variation

Ref:Safety Stock - Stock that is held in excess of expected demand due to variable demand rate and/or lead time.

Cycle time for the economic run time is a function of which of the following? Select correct option:

Run time and usage rate Run time and production rate

Run size and production rate

Run size and usage rat

Ref:The Run time (the production phase of the cycle) is a function of the run size and production rate.

In the “Check” stage, team analyzes the data collected during the __ stage to find out how closely the results correspond to the specifications of __

stage. Select correct option:

Do, Plan

Plan, Do Do, Check

Plan, Check

Rationale:In Do stage weimplement the plan on a small scale. And in PLAN

stage we survey data and develop a plan for improvement. Which of the following is a difference of service organizations as compared to

manufacturing organizations? Select correct option:

Manufacturing organization are more specialized then service organizations Manufacturing firms have more variety then service organizations.

Service firms are more flexible then manufacturing organizations

Manufacturing decisions are made by maximizing the profit potential

Which of the following is not a basic process flow structure?

A) WorkCenter

B) Mass Attack

C) Assembly Line

D) Project Layout

E) Continuous Process

Feedback: B is the correct answer.

The type of processing structure that is used to produce gasoline, chemicals, and drugs is:

A) WorkCenter

B) Batch

C) Assembly Line

D) Project Layout

E) Continuous Process

Feedback: E is the correct answer. Job shop produces low standardized products, batch produces

multiple products and assembly line produces fewer major products. Project, on the other hand, is not a processing structure.

The type of processing structure that is used for producing discrete products at higher volume is:

A) WorkCenter

B) Batch

C) Assembly Line

D) Project Layout

E) Continuous Process

Feedback: C is the correct answer. The other options either produce small volume or cannot produce discrete products.

The major decision variables in equipment selection are:

A) Flexibility

B) Labor requirements

C) Manufacturer

D) Both A and B

E) Both B and C

Feedback: D is the correct answer. Manufacturer (Choice C) is a factor to consider under decision variable initial investment.

When comparing multiple processes to manufacture a product, the path of lowest total cost is always a straight line.

A) True

B) False

Feedback: Depending on the amount produced, the process that gives the lowest total cost will change so the path of lowest total cost combines the production cost line of multiple processes usually making it look more like a curve.

The product-process matrix:

A) shows as volume decreases an assembly line is the solution

B) shows as volume increase specialized equipment becomes cost effective

C) shows all process structures except work centers are inefficient

D) guides companies on what products to produce

E) allows a manager to justify buying new equipment

Feedback: The point of the matrix is to show that as volume increases and the product line narrows, specialized equipment and standardized material flow becomes feasible.

A process flow diagram shows how parts are put together to make a product.

A) True

B) False

Feedback: False. A process flow diagram shows the steps required to make a product. An assembly diagram shows how the parts go together.

A breakeven point indicates which of the following:

A) The point where profit is maximized

B) The point where cost is minimized

C) The point where we are indifferent between two options

D) The point where we are most efficient

E) All of the above

The type of processing structure that is used for producing discrete products at higher volume is:

A) WorkCenter

B) Batch

C) Assembly Line

D) Project Layout

E) Continuous Process

Feedback: C is the correct answer. The other options either produce small volume or cannot produce discrete products.

Q1.

Which of the following is NOT a sign that labour shortages are hitting a company.

(Select one answer)

(a) The need to outsource part of its production.

(b) A lack of accurate records as to staff training.

(c) The introduction of university place sponsorship.

(d) An increase in basic rates of pay for current employees.

Q2. External economies of scale are

(Select one answer)

(a) savings that are made possible by outside agencies.

(b) savings that can be made in distribution and selling.

(c) savings that are available to a firm as a result of the concentration of an industry in a region.

(d) savings that can be made in export markets only.

Q3. All of the following are justifications for holding large stocks of raw materials, except

(Select one answer)

(a) the seasonal supply of materials such as coffee beans or even garden peas.

(b) in anticipation of a future shortage and rapid rise in price.

(c) large quantities are available on the market.

(d) to take advantage of significant bulk buying reductions.

Q4. Which of the following are NOT a benefit thought to accompany the introduction of technology.

(Select one answer)

(a) Improved efficiency and reductions in waste.

(b) Increased strains in industrial relations.

(c) The introduction of new and better products.

(d) Advances in communication.

Q5. The opportunity cost to a business of an investment is

(Select one answer)

(a) the amount of capital that has to be borrowed to be able to make the investment.

(b) the cost of all the fixed assets that are to be purchased.

(c) the next best investment now foregone.

(d) the amount by which the project will have risen due to inflation, on a monthly basis.

Q6. When a firm in the secondary sector of the economy takes over a related business in the tertiary sector, this is an example of

(Select one answer)

(a) horizontal integration.

(b) backward integration.

(c) Forward vertical integration.

(d) Forward horizontal integration

Q7. A bank takes over a fishing company, a steel works, a vegetable processing firm and an airline. This is an example of

(Select one answer)

(a) forward integration

(b) a firm becoming a conglomerate.

(c) horizontal integration.

(d) company mergers.

Q8. Cell production is the modern production method where

(Select one answer)

(a) buildings are made from prefabricated units, or cells.

(b) production is done in small rooms.

(c) the output from the Prison Service factories.

(d) production on assembly lines is managed and run by groups of workers who are responsible for the quality of their work.

Q9. The long-run for a company is when

(Select one answer)

(a) the scale of production itself, and thus capacity can be increased.

(b) 5 years

(c) the time it takes to buy and install new plant.

(d) the time interval between the payment of a firms fixed costs.

Q10. In the interests of efficiency and obtaining more economies of scale, two firms agree to join together and become one. This is an example of a

(Select one answer)

(a) hostile take-over

(b) hostile merger.

(c) friendly merger.

(d) friendly take-over.

Q11. A firm can be considered to be efficient when it

(Select one answer)

(a) is producing its product or service at the lowest possible average cost.

(b) is fully utilising its capacity.

(c) has minimised the amount of waste that it produces.

(d) employs the maximum number of workers.

Q12. The short-run for a company is

(Select one answer)

(a) one month, being the payment base for salaries.

(b) the period where output can only be changed by altering the utilisation of existing plant and equipment.

(c) the time it takes to terminate staff.

(d) when it is working on a short-time basis.

Which one of the following is NOT a key internal factor in formulating operations strategy?

Select correct option: Competition Financial resources

Human resources Products and services Rationale: Competition is an external factor not internal.

Services differ from manufacturing in all the following ways EXCEPT:

Select correct option:

Customers typically interact directly with the service delivery process

Consumption and production take place simultaneously.

Services are intangible.

Services can be stored.

CBR stands for which one of the following? Select correct option:

Commercial Board of Revenue Central Board of Recycling

Central Board of Renovation Central Board of Revenue

The method that uses explanatory variables to predict the future is known as:

Select correct option: Delphi method Naïve forecast

Associative model Judgmental forecast Ref: Associative models - uses explanatory variables to predict the future for

example demand for a small car may be dependant upon increase in price of petrol or CNG.

OSHA stands for: which one of the following? Select correct option:

Occupational Safety Hygiene Administration Occupational Stock Hygiene Administration Occupational Safety Hygiene Agency

Occupational Science Hygiene Administration Which ONE of the following statement correctly explains the difference between operations management (OM) and operations research (OR)?

Select correct option: OM relies on mathematical modeling and OR focus on practical scenarios. OM is more powerful to improve the whole system OR relies on mathematical modeling.

OM is relies on practical scenarios and Or relies on Mathematical modeling. OM relies on mathematical modeling and OR is considered to be one of the critical tools of mangers. Page No.1 _______________is the bringing together of engineering design and manufacturing personnel early in the design phase.

Select correct option: Reverse engineering Concurrent engineering

Manufacturability Serviceability Page No.53 http://groups.google.com/group/vuZs

Which probability distribution is used most extensively in dealing with forecasting

errors? Select correct option: Normal

Exponential Beta Pareto Ref:http://highered.mcgraw-hill.com/sites/0073041912/student_view0/chapter3/interactive_quiz.html

Which one of the following is a curve showing failure rate over time?

Select correct option: Cost curve Bath tub curve

Fish bone diagram Reliability curve

Which one of the following refers to using some of the components of old products in the manufacture of new products?

Select correct option: Remanufacturing Robust design

Automation Manufacturability Ref: Design for Remanufacturing: Using some of the components of the old products in

the manufacture of new products. Remanufactured products are sold at 30 to 50% of the price of new product .e.g. Printers, copiers, cameras, PCs and Cell/Telephones. (Page No.51) A product „A‟ is specified to work well up to 30 degree Celsius temperature and 30% humidity. What would these specifications represent? Select correct option:

Reliability factor Standard conditions Normal operating conditions

Standard operating procedure Ref: The ability of a product, part, or system to perform its intended function under a prescribed set of conditions. (Page No.49) As the size of the smoothing constant increases: Select correct option:

More weight is put on historic demand data. More weight is put on recent demand data. The sensitivity of the model decreases.

The stability of the model increases Which one of the following correctly represents a set of time series forecats? Select correct option:

Averaging, cycle, seasonality, random variations Trend, seasonality, exponential smoothing Trend, cycle, seasonality, moving average

Trend, cycle, seasonality, random variations Which method of forecasting is most widely used? Select correct option:

Regression analysis Adaptive forecasting Weighted moving average

Exponential smoothing http://www.referenceforbusiness.com/encyclopedia/Fa-For/Forecasting.html For more contents http://groups.google.com/group/vuZs

An organization has described its distinctive characteristics. So, what is the next step in formulating the strategy?

Select correct option: Productivity Measures

Environmental scanning Selecting the market segment Competitor‟s distinctiveness

Which of the following favors adopting a “go for it” strategy? Select correct option:

Maximin Maximax Minimax regret

Laplace

Productivity ratios are used in;

Select correct option: Planning work force requirements

Scheduling equipments Financial analysis All of the above

Page No.19 How organizations assure that the designed strategy is giving the required output or results? Select correct option:

Increase in demand of the product By measuring the productivity

Environmental scanning Raw materials are effectively used

The industrial revolution came into; Select correct option: 1770

1920 1911

1815 Page No.8 Manufacturability is the ease of fabrication and/or assembly which is important for: Select correct option: Cost and Productivity Productivity and Quality

Cost and Quality Cost, productivity and Quality Ref: Manufacturability means the ease of fabrication or assembly of a product as it

directly affects cost, quality and productivity.Page 46 Which of the following is a technique for fitting a line to a set of points? Select correct option:

Regression Trend

Cycle Moving average Page 42 An automatic car wash is an example of which of the following? Select correct option:

Standardized service Customized service Batch processing

Intermittent processing

Which of the following forecasting technique is used when introducing new products, services, new features and new packaging?

Select correct option:

Quantitative technique

Associative model

Focus group

Judgmental forecast

Question # 2 of 15 ( Start time: 11:09:20 AM )

Total M a r k s: 1

Which ONE of the following forms a bridge between two islands of Engineering and

Management?

Select correct option:

Production Engineering

Operations Management

Industrial Management

Operations Engineering

Question # 3 of 15 ( Start time: 11:10:35 AM )

Total M a r k s: 1

Which of the following functions of an organization consists of all activities directly

related to production of a good or service?

Select correct option:

Operations

Marketing

Accounting

Finance

Question # 4 of 15 ( Start time: 11:11:08 AM )

Total M a r k s: 1

Which of the following statements corresponds to an order-winning characteristic?

Select correct option:

A factor which may be significant in other parts of the organization

A factor which gives an organization a competitive edge

A factor which serves as a minimum standard for purchase

A factor which increases the profitability of the organization

Question # 5 of 15 ( Start time: 11:11:58 AM )

An organization has described its distinctive characteristics. So, what is the next step in

formulating the strategy?

Select correct option:

Productivity Measures

Environmental scanning

Selecting the market segment

Competitor’s distinctiveness

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Question # 6 of 15 ( Start time: 11:13:27 AM )

As a manager, you have defined the purpose of the forecasts. What should be the next

step in forecasting process?

Select correct option:

Collecting and analyzing the appropriate data

Determining the purpose of the forecast

Choosing a forecasting technique

Setting up a time horizon or a time limit

Question # 7 of 15 ( Start time: 11:13:59 AM )

Total M a r k s: 1

MTBF refers to which of the following?

Select correct option:

Measure time before failure

Mean time between failures

Mean time before failure

Measure test before failure

Question # 8 of 15 ( Start time: 11:14:38 AM )

Total M a r k s: 1

Which one of the following correctly explains the elements of a good forecast?

Select correct option:

Timely, having a purpose, accurate, written, reliable, meaningful

Timely, accurate, judgmental, correctness, verbal, simple to use

Timely, accurate, reliable, meaningful, written, simple to use

Timely, accurate, reliable, consistent, meaningful, written, simple to use

Question # 9 of 15 ( Start time: 11:16:05 AM )

Total M a r k s: 1

Which of the following provide guidance and directions for carrying out operations?

Select correct option:

Tactics

Strategies

Policies

Mission

Question # 10 of 15 ( Start time: 11:17:24 AM )

Total M a r k s: 1

Product life cycle is based on:

Select correct option:

Price

Place

Demand

Supply

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Question # 11 of 15 ( Start time: 11:18:55 AM )

Total M a r k s: 1

Which one of the following statements relates to the final stage of product life cycle?

Select correct option:

Improved reliability, and reduced quality

Improved packaging, and reliability

Improved reliability, and reduced production costs

Improved reliability, and reduced promotion costs

Ref:DECLINE: In this phase, most of the organizations adopt a defensive design R&D Strategy

in

an attempt to prolong the life of the product by employing new packaging, redesigning it,

improving its reliability.(Page No.50)

Question # 12 of 15 ( Start time: 11:20:19 AM )

Total M a r k s: 1

Which one of the following is the final stage of product life cycle?

Select correct option:

Growth

Decline

Maturity

Planning

Question # 13 of 15 ( Start time: 11:20:56 AM )

Total M a r k s: 1

Which one of the following is an outcome of Maximin criterion?

Select correct option:

The best of the worst possible payoff

The best possible payoff

The best average payoff

The least of the worst regrets

Question # 14 of 15 ( Start time: 11:22:17 AM )

Total M a r k s: 1

Which one of the following is NOT the input in the transformation process?

Select correct option:

Informations

Services

Facilities

Materials

Question # 1 of 15 Which ONE of the following forms a bridge between two islands of Engineering and

Management? Select correct option: Production Engineering Operations Management Industrial Management Operations Engineering Question # 2 of 15 Which of the following forecasting techniques induce personal bias in a forecast? Select correct option: Qualitative Quantitative Associative Trend forecast Question # 3 of 15 ( Start time: 04:45:55 PM ) Total M a r k s: 1 Which of the following is NOT an attribute to classify services? Select correct option: Tangibility Perishability Simultaneity Degree of customer contact

Which of the following forecasting technique is used when introducing new products, services, new features and new packaging? Select correct option: Quantitative technique Associative model Focus group Judgmental forecast Question # 5 of 15 ( Start time: 04:48:33 PM ) Total M a r k s: 1 Services differ from manufacturing in all the following ways EXCEPT: Select correct option: Customers typically interact directly with the service delivery process Consumption and production take place simultaneously. Services are intangible. Services can be stored REF:production and consumption takes place at about the same time. This is a characteristic of Service Sector. for more contents visit http://groups.google.com/group/vuZs Question # 6 of 15 ( Start time: 04:49:04 PM ) Total M a r k s: 1 Organizational strategy is different from operations strategy because it is;

Select correct option: Prepared by middle managers Narrower in scope Longer in time horizon All of the above Question # 8 of 15 ( Start time: 04:50:54 PM ) Total M a r k s: 1 Which one of the following forms of productivity has units of output per dollar input? Select correct option: Capital Energy Labor Machine Question # 9 of 15 ( Start time: 04:51:20 PM ) Total M a r k s: 1 Which one of the following refers to a decision environment in which relevant

parameters have known values? Select correct option: Certainty Uncertainty Risk Bounded rationality Question # 10 of 15 ( Start time: 04:51:42 PM ) Total M a r k s: 1 Which one the following formula or function can be used to measure the performance? Select correct option: Flexibility + profit+ operations Work + profit + value Quality + speed + flexibility Profit + Incentives + standards for more contents visit http://groups.google.com/group/vuZs

Question # 11 of 15 ( Start time: 04:52:04 PM ) Total M a r k s: 1 All of the following are examples of Qualitative forecasting except: Select correct option: Judgmental Delphi Method Consumer Survey Naïve Forecasting Question # 12 of 15 ( Start time: 04:52:50 PM ) Total M a r k s: 1 Characteristics like taste, feel, expertise, image or reputation relates to -----------. Select correct option: Subjective inputs Objective inputs Quantitative technique None of the given options Question # 13 of 15 ( Start time: 04:53:43 PM ) Total M a r k s: 1 Materials, land, energy and human and capital resources are the examples of: Select correct option: Inputs Transformation

Outputs Productivity Question # 14 of 15 ( Start time: 04:54:56 PM ) Total M a r k s: 1 Forecasts help managers by reducing the degree of: Select correct option: Accuracy Precision Uncertainty Reliability for more contents visit http://groups.google.com/group/vuZs Question # 1 of 15 ( Start time: 05:09:23 PM ) Total M a r k s: 1 Techniques having numerical data include which of the following? Select correct option: Subjective inputs Qualitative technique Quantitative technique Delphi method Question # 2 of 15 ( Start time: 05:10:23 PM ) Total M a r k s: 1 To make operations strategy effective it should be: Select correct option: Independent of the organization‟s strategy Consistent with the organization’s strategy Developed by a first line manager Independent of time dimension Question # 3 of 15 ( Start time: 05:11:46 PM ) Total M a r k s: 1 Which one of the following forecasting techniques is used to identify a trend when data

is neither growing nor declining rapidly and has no seasonal characteristics. Select correct option: Simple moving average Delphi method Trend adjusted forecast Naïve forecast Ref:The Moving Average model takes the average of several periods of data; the result is a dampened or smoothed data set; use this model when demand is stable and there is no evidence of a trend or seasonal pattern. Read More: http://www.shmula.com/308/forecasting-unweighted-and-weighted-moving-average-model#ixzz0nQN1qeSi

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Question # 7 of 15 ( Start time: 05:15:05 PM ) Total M a r k s: 1 All of the following are examples of transformation process EXCEPT: Select correct option: Cutting Packing Facilitating Labeling Question # 8 of 15 ( Start time: 05:16:06 PM ) Total M a r k s: 1 A tool to measure effective use of resources and usually expressed as the ratio of output to input is known as; Select correct option: Production ratio Productivity Reliability Operations ratio Question # 9 of 15 ( Start time: 05:16:46 PM ) Total M a r k s: 1 Following are all examples of distinctive competencies EXCEPT; Select correct option: Price Quality Planning Flexibility Question # 10 of 15 ( Start time: 05:18:01 PM ) Total M a r k s: 1 Which of the following statements corresponds to an order-winning characteristic? Select correct option: A factor which may be significant in other parts of the organization A factor which gives an organization a competitive edge A factor which serves as a minimum standard for purchase A factor which increases the profitability of the organization for more contents visit http://groups.google.com/group/vuZs Question # 12 of 15 ( Start time: 05:19:22 PM ) Total M a r k s: 1 Which one of the following is NOT used for decision making under uncertainty? Select correct option: Maximax Mmaximin Mminimax regret EMV criterion Question # 1 of 15 ( Start time: 05:23:32 PM ) Total M a r k s: 1 Which one of the following formulae can be used to compute value? Select correct option:

(Quality + Speed – Flexibility) / Cost (Quality + Speed+ Flexibility) / Cost (Quality + Speed - Cost) / Flexibility (Quality + Speed+ Cost) / Flexibility Question # 2 of 15 ( Start time: 05:24:34 PM ) Total M a r k s: 1 The role of a -------------- manager is to sustain, protect, and project the company‟s operations side. Select correct option: Project Manager Operations Manager Finance Manager Marketing Manager Question # 3 of 15 ( Start time: 05:24:54 PM ) Total M a r k s: 1 Which of the following provide guidance and directions for carrying out operations? Select correct option: Tactics Strategies Policies Mission Question # 4 of 15 ( Start time: 05:25:51 PM ) Total M a r k s: 1 Techniques having numerical data include which of the following? Select correct option: Subjective inputs Qualitative technique Quantitative technique Delphi method Question # 5 of 15 ( Start time: 05:26:11 PM ) Total M a r k s: 1 Which one of the following factors makes a forecast LESS perfect? Select correct option: Randomness Non serious attitude Non availability of data Un qualified personnel for more contents visit http://groups.google.com/group/vuZs Question # 6 of 15 ( Start time: 05:27:39 PM ) Total M a r k s: 1 Within the operations function, which one of the following is a long-term management decision? Select correct option: Control decision

Non-operational decision Strategic decision Tactical decision

Question # 10 of 15 ( Start time: 05:30:44 PM ) Total M a r k s: 1 Which one of the following is NOT a business application of forecasting? Select correct option: Budgeting Capacity planning Inventory management Quality control for more contents visit http://groups.google.com/group/vuZs Question # 11 of 15 ( Start time: 05:31:52 PM ) Total M a r k s: 1 Which one of the following forecasts is quick and easy to prepare? Select correct option: Time series Delphi Naïve Associative Question # 15 of 15 ( Start time: 05:34:41 PM ) Total M a r k s: 1 Which one of the following reasons account for using moving average in forecasting? Select correct option: It eliminates the trend It smoothes the random fluctuations It counteracts the seasonal variations It approximates the period average Reference: Question # 1 of 15 ( Start time: 05:39:49 PM ) Total M a r k s: 1 In which one of the following decision environments it is impossible to assess the

likelihood of various future events? Select correct option: Certainty Uncertainty Risk Bounded rationality Question # 2 of 15 ( Start time: 05:40:09 PM ) Total M a r k s: 1 Which one of the following correctly represents a set of time series forecats? Select correct option:

Averaging, cycle, seasonality, random variations Trend, seasonality, exponential smoothing Trend, cycle, seasonality, moving average Trend, cycle, seasonality, random variations Question # 3 of 15 ( Start time: 05:41:35 PM ) Total M a r k s: 1 Which one of the following is an implication of laplace approach of decision making? Select correct option: The best of the worst possible payoff The best possible payoff The best average payoff The least of the worst reg

Materials, land, energy and human and capital resources are the examples of: Select correct option: Inputs Transformation Outputs Productivity Question # 2 of 15 ( Start time: 04:07:44 AM ) Total M a r k s: 1 Which of the following statement correctly explains the role of operations management? Select correct option: Sustain the company’s operation Protect the company’s operation Project the company’s operation All of the above REF:Whether profit or non profit, the role of an OPERATIONS MANAGER is to sustain, protect, and project the company’s operations side.(Page No.1) for more contents visit http://groups.google.com/group/vuZs Question # 3 of 15 ( Start time: 04:08:42 AM ) Total M a r k s: 1 Which of the following forecasting technique is used when introducing new products, services, new features and new packaging? Select correct option: Quantitative technique Associative model Focus group Judgmental forecast Question # 5 of 15 ( Start time: 04:10:22 AM ) Total M a r k s: 1 All of the following are examples of transformation process EXCEPT: Select correct option: Cutting Packing Facilitating Labeling

Question # 6 of 15 ( Start time: 04:10:46 AM ) Total M a r k s: 1 Forecasting accuracy has_______ relation with time horizon. Select correct option: Inverse Linear Direct Parallel for more contents visit http://groups.google.com/group/vuZs Question # 7 of 15 ( Start time: 04:11:02 AM ) Total M a r k s: 1 Which one of the following is a pessimistic approach in decision making theory? Select correct option: Maximin Maximax Minimax regret Laplace Question # 8 of 15 ( Start time: 04:11:47 AM ) Total M a r k s: 1 Which of the following is NOT usually considered a general characteristic of a service? Select correct option: Degree of customer contact is high Production and sales cannot easily be separated functionally Many services involve both tangible and intangible outputs Production and consumption can always be separated Note: We are not in a position to solve it either. If any member can solve it properly, Please post it on the group or at email address [email protected] Question # 9 of 15 ( Start time: 04:12:15 AM ) Total M a r k s: 1 Which one of the following mathematical expressions can be used to compute availability? Select correct option: (MTBF)/ (MTBF+MTR) (MTBF)/ (MTBF-MTR) (MTR)/ (MTBF+MTR)

(MTR)/ (MTBF-MTR) Question # 10 of 15 ( Start time: 04:12:33 AM ) Total M a r k s: 1 Which of the following statements is TURE about production system? Select correct option: A user of resources to transform inputs into some desired outputs Enhancing value added services Only desired output in the form of products or manufactured goods Making efficient use of Internet technology A productive system is defined as a user of resources to transform inputs into some desired outputs (products as well as services) where as production system refers specifically to only desired output in the form of products or manufactured goods. for more contents visit http://groups.google.com/group/vuZs Question # 11 of 15 ( Start time: 04:13:02 AM ) Total M a r k s: 1 For which of the following approaches, the forecast of any period equals the previous period’s forecast? Select correct option: Delphi method Naïve forecast Associative model Judgmental forecast Question # 12 of 15 ( Start time: 04:13:59 AM ) Total M a r k s: 1 Which one of the following is true about Taguchi approach? Select correct option: To test the robustness of a design To articulate the “voice of the customer” To reduce the degree of automation To create a concurrent design Question # 13 of 15 ( Start time: 04:14:35 AM ) Total M a r k s: 1 Which one of the following forms of productivity has units of output per dollar input? Select correct option: Capital Energy

Labor Machine Question # 14 of 15 ( Start time: 04:14:51 AM ) Total M a r k s: 1 Which ONE of the following forms a bridge between two islands of Engineering and Management? Select correct option: Production Engineering Operations Management Industrial Management Operations Engineering Question # 15 of 15 ( Start time: 04:15:11 AM ) Total M a r k s: 1 ______________ is a wave like variations of more than one year’s duration. Select correct option: Cycle Trend Seasonality Random variation

Operations based strategy involves all activities except;

Select correct option: Supply chain management

Quick response to customer needs Flexibility and inventory management

Identifying customer wants and needs

Reference: Identifying customer wants and needs refers to Market based

strategies.(Page No.10)

Which of the following statement is NOT correct with respect to models in

operations management? Select correct option:

Models are easy to use, less expensive Models have specific objectives

Models don’t have the standardized format Models enables “what if” questions

A gradual, long term upward or downward movement in data is referred to

as: Select correct option:

Cycle Trend

Seasonality Random variation

Which of the following provide guidance and directions for carrying out operations?

Select correct option: Tactics

Strategies Policies

Mission

Which one of the following is NOT a key external factor in formulating operations strategy?

Select correct option:

Economic conditions Human resources

Political conditions

Legal environment

Ref: It is the key internal factors, like recruitment etc)

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Which of the following is referred to as plans for achieving goals? Select correct option:

Tactics Strategies

Policies Mission

Which one of the following is used to generate consensus forecast?

Select correct option:

Delphi method Time series method

Exponential smoothing Associative model

Which one of the following is an outcome of Maximin criterion?

Select correct option: The best of the worst possible payoff

The best possible payoff The best average payoff

The least of the worst regrets

Which one of the following forecasts is quick and easy to prepare?

Select correct option: Time series

Delphi Naïve

Associative

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Organizational strategies relate to which of the following sets of factors?

Select correct option:

Survival, profitability, growth rate and market share

Profitability, survival, lead times and target market

Quality, operating resources, growth rate and market share

Scheduling, profitability, lead times and survival

Which one of the following forms of productivity has units of output per

dollar input? Select correct option:

Capital Energy

Labor Machine

Which one of the following refers to a decision environment in which relevant parameters have known values?

Select correct option: Certainty

Uncertainty Risk

Bounded rationality

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To make operations strategy effective it should be:

Select correct option:

Independent of the organization‟s strategy Consistent with the organization’s strategy

Developed by a first line manager Independent of time dimension

All of the following are examples of Qualitative forecasting except: Select correct option:

Judgmental

Delphi Method

Consumer Survey Naïve Forecasting

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Which one of the following is NOT a business application of forecasting?

Select correct option:

Budgeting

Capacity planning

Inventory management

Quality control

Rationale: Quality do not refer to estimation rather it is targeted at some specific standards.

Which one of the following forecasting techniques is used to identify a trend when data is neither growing nor declining rapidly and has no seasonal

characteristics. Select correct option:

Simple moving average

Delphi method Trend adjusted forecast

Naïve forecast

Which of the following statement is NOT correct with respect to models in operations

management?

Models are easy to use, less expensive

Models have specific objectives

Models don’t have the standardized format

Models enables “what if” questions

Which of the following functions of an organization consists of all activities directly related to

production of a good or service?

Operations

Marketing

Accounting

Finance

Reference:Operations management is in regard to all operations within the organization.

Which one of the following formulae can be used to compute value?

(Quality + Speed – Flexibility) / Cost

(Quality + Speed+ Flexibility) / Cost

(Quality + Speed - Cost) / Flexibility

(Quality + Speed+ Cost) / Flexibility

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A gradual, long term upward or downward movement in data is referred to as:

Cycle

Trend

Seasonality

Random variation

Techniques having numerical data include which of the following?

Subjective inputs

Qualitative technique

Quantitative technique

Delphi method

pioneers of transforming management to scientific domain are:

Fredrick Taylor

Lillian and Frank Gilbreths

Henry Fayol

Both A & B

As a manager, you have defined the purpose of the forecasts. What should be the next step in

forecasting process?

Choose a forecasting technique.

Determine the purpose of the forecast.

Set up a time horizon or a time limit

Collect and analyze the appropriate data.

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·Determine the purpose of the forecast meaning what is the purpose and when will it be

required.

This will provide the level of detail for resources required man, machine, time and capital.

·Establish a time horizon. We already know that as time increases the accuracy of the

Forecast

decreases

·Select a forecasting technique whether qualitative or quantitative

·Gather and analyze the appropriate data. It goes without saying that before a forecast can

be

delivered data is required. The closer the real life data more realistic would be the forecast. This

may be

the time when you would like to identify the important assumptions and suppositions.

·Prepare the forecast.

·Monitor the forecast. A forecast has to be closely monitored to determine whether it is fulfilling

its

basic purpose. This helps in re-examining the method, assumptions and validity of the data and

preparing a revised forecast.

Which of the following is referred to as plans for achieving goals?

Tactics

Strategies

Policies

Mission

Which one the following formula or function can be used to measure the performance?

Flexibility + profit+ operations

Work + profit + value

Quality + speed + flexibility

Profit + Incentives + standards

Organizational strategy is different from operations strategy because it is;

Prepared by middle managers

Narrower in scope

Longer in time horizon

All of the above

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Which of the following forecasting technique is used when introducing new products, services,

new features and new packaging?

Quantitative technique

Associative model

Focus group

Judgmental forecast

Which one of the following is NOT used for decision making under uncertainty?

Maximax

Mmaximin

Mminimax regret

EMV criterion

Which one of the following management functions is based on forecasting?

Planning

Organizing

Leading

Controlling

Answer provided by Usman Aslam .

Reference:Planning includes forecasting, establishing objectives, devising strategies,

developing policies, and setting goals,

(mgt603 page number 53)

Which one of the following reasons account for using moving average in forecasting?

It eliminates the trend

It smoothes the random fluctuations

It counteracts the seasonal variations

It approximates the period average

1.Who advocated the concept of “zero defects”?

Edwards. Deming

Joseph Juran

Kaoru Ishikawa

Philip Crosby

2. Which of the following is the origin of the term “Poka –Yoke”?

America

China

Spain

Japan 3. Which of the following is INCORRECT about TQM?

Meeting the needs and expectations of customers

Primarily a “worker” rather than a management activity Inclusion of every person in the organization

Covering all the functional areas of the organization

4. Which of the following is a unit of measurement as specified in Six Sigma quality?

Defects per hundred

Defects per thousand

Defects per hundred thousand

Defects per million 5. Which of the following is a descriptive technique that is used by a decision maker to evaluate

the behavior of a model under various conditions?

Linear programming

Simulation Critical path method

PERT

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6. EF stands for which of the following?

Equal Finish

Economic Finish

Early Finish Easy Finish

7. Which of the following refers to unnecessary extension of the project scope that hinders in-

time completion of the project?

Work creep

Plan creep

Scope creep Budget creep

8. Which of the following relates to monitoring the objectives of cost, time and quality as the

project progresses?

Project estimating

Project planning

Project control Project crashing

9. Which one the following is focused to reduce the incidence of failures in the plant or

equipment to avoid the associated costs?

Preventive maintenance Predictive maintenance

Reactive maintenance

Total productive maintenance

10. Which of the following refers to the length of time a job is in the shop at a particular

workstation?

Job lateness

Job flow time Make-span

Slack time

1. Who introduced the use ofstatistical control charts for monitoring production?

a)G.S. Radford

b)Walter Shewhart

c)Frederick Taylor

d)Kaoru Ishikawa

2.Which of the following quality gurus advocated the “cost of quality” concept?

a)Edwards. Deming

b)Joseph Juran

c)Kaoru Ishikawa

d)Philip Crosby

3.If you go to dine out at McDonalds and you observe a very cool and pleasant

atmosphere over there. It depicts which of the following dimensions of quality?

a)Performance

b)Aesthetics

c)Reliability

d)Conformance

4.Mr. Ali purchased a TV set. After a period of a year, the picture quality started

deteriorating. He went to the company and complained. The company responded

subsequently. Which of the following dimensions of quality would come into play?

a)Reliability

b)Conformance

c)Serviceability d)Aesthetics

5.Which of the following reflects the meaning of the word “Poka –Yoke”?

a)Mistake proof b)Low quality

c)Defective

d)Expensive

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6.Which one of the following denotes QFD?

a)Quality Function Development

b)Quality Foundation Development

c)Quality Foundation Deployment

d)Quality Function Deployment 7.Which of the following terms best defines the nature of Total Quality Management?

a)An art

b)A philosophy c)A science

d)A social activity

8.Which of the following terms reflects Japanese view of continuous improvement?

a)Kaizen b)Poka-yoke

c)Six sigma

d)Control limits

9. Which of the following is NOT an element of TQM?

a)Leadership

b)Perceived quality

c)Employee empowerment

d)Customer focus

10. Which of the following is an example of appraisal cost?

a)Rework costs

b)Returned goods

c)Testing labs d)Quality improvement programs

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11. Warranty cost is an example of which of the following?

a)Internal failure cost

b)External failure cost c)Prevention cost

d)Appraisal cost

12. Refer to the stage of PDCA (Plan, Do, Check, Act) cycle that involves evaluating the

improvement plan.

a)Plan

b)Do

c)Check d)Act

13. Which of the following refers to a continuous measurement of an organization’s products

and processes against a company recognized as a leader in that industry?

a)Benchmarking b)Gap analysis

c)Statistical process control

d)Continuous improvement

14. Which of the following is the focus of statistical process control?

a)Determining the efficiency of an operations system

b)Measuring the amount of re-work required to rectify faulty goods

c)Identifying the security needs of an operations system

d)Measuring and controlling process variations 15. Which of the following is a measure of how closely a product or service meets the

specifications?

a)Quality of Conformance b)Continuous improvement

c)Competitive benchmarking

d)Statistical process control

1. Which of the following activities is unnecessary ,when an organization decides to

design its new product or service or refine its existing product or service:

a Translate customer wants and needs into product and service requirements

b Refine existing products and services

c Develop new products and services

d Manage the purchasing activities religiously and diligently.

2. While focusing on capacity planning, organizations look for which of the following

alternatives.

a. How much will it cost b. How much holidays the workers can enjoy.

c. How much compensation they need to pay to their CEO.

d. None of the above

3. Which of the following is not one of the assumptions for Cost Volume Analysis

a. One product is not involved b. Everything produced can be sold

c. Variable cost per unit is the same regardless of volume

d. Fixed costs do not change with volume

4. Which of the following does not fall under Economic Production Quantity ( EPQ)

a. Only two or more item are involved b. Annual demand is known

c. Usage rate is constant

d. Usage occurs continually

5. Advantages of Process Layout Include

a. Equipment used is less costly b. Low unit cost.

c. Labor specialization.

d. Low material handling cost

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6. Common types of Operations include

a. Continuous Processing.

b. Intermittent Processing.

c. Automation

d. All of the above

7. System performance is measured by

a. Average number of customers being refused service

b. Average time customers wait

c. System utilization

d. b and c. 8. Inventory carrying costs are influenced by:

a. Order Quantity in Units

b. Holding carrying cost per unit.

c. Demand

d. a and b only.

9. Bar coding helps in determining the :

a. Status of the inventory of an item in warehouse

b. Price of the product

c. Size of the lot as well as the size and specifications of the product

d. All of the above

10. Therbligs are basic elemental motions which include:

a. Search

b. Select

c. Throw

d. a and b only

Which of the following is not an attribute to classify services?

>

Tangibility

Perish ability

Simultaneity

Degree of Customer Contact As a manager, you have defined the purpose of the forecasts. What should be the next step in forecasting process?

>

Collecting and analyzing the appropriate data

Determining the purpose of the forecast Choosing a forecasting technique

Setting up a time horizon or a time limit Forecasting accuracy has_______ relation with time horizon. >

Inverse

Linear Direct Parallel Ref: As time increases the accuracy of the Forecast decreases (Page No.34) ______________ is a wave like variations of more than one year’s duration. >

Cycle

Trend

Seasonality

Random variation

Ref: wavelike variations of more than one year’s duration these occurs because of political, economic and even agricultural conditions.(Page No.37) In which one of the following decision environments it is impossible to assess the likelihood of various future events?

>

Certainty

Uncertainty

Risk

Bounded rationality

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Which one of the following forms of productivity has units of output per dollar input?

>

Capital Energy

Labor Machine Which one of the following refers to a decision environment in which relevant parameters have known values?

>

Certainty

Uncertainty

Risk

Bounded rationality

Ref: Certainty: Means that the relevant parameter such as costs, capacity and demand have known values (Page No.24) To make operations strategy effective it should be: >

Independent of the organization’s strategy

Consistent with the organization’s strategy

Developed by a first line manager Independent of time dimension

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Organizational strategies relate to which of the following sets of factors?

>

Survival, profitability, growth rate and market share

Profitability, survival, lead times and target market Quality, operating resources, growth rate and market share

Scheduling, profitability, lead times and survival All of the following are steps in forecasting process EXCEPT: >

Determine the purpose of the forecast Establish a time horizon

Assigning weights to the criteria

Monitor the forecast

Determine the purpose of the forecast meaning what is the purpose and when will it be required. This will provide the level of detail for resources required man, machine, time and capital. ·Establish a time horizon. We already know that as time increases the accuracy of the Forecast

decreases

·Select a forecasting technique whether qualitative or quantitative

·Gather and analyze the appropriate data. It goes without saying that before a forecast can be

delivered data is required. The closer the real life data more realistic would be the forecast. This may be

the time when you would like to identify the important assumptions and suppositions.

·Prepare the forecast. ·Monitor the forecast. A forecast has to be closely monitored to determine whether it is fulfilling its

basic purpose. This helps in re-examining the method, assumptions and validity of the data and

preparing a revised forecast.

Which one of the following is a pessimistic approach in decision making theory?

>

Maximin

Maximax

Minimax regret Laplace

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Which one of the following is used to generate consensus forecast?

>

Delphi method

Time series method

Exponential smoothing

Associative model All of the following are examples of transformation process EXCEPT: >

Cutting

Packing Facilitating

Labeling All of the following are examples of Qualitative forecasting except: >

Judgmental Delphi Method

Consumer Survey

Naïve Forecasting

Choose the most appropriate answers in each of the following questions: 1. All of the following are the major factors affecting design strategy except: Cost Market Time-to-market Revenue 2. All of the following are the primary reasons for design process except: Economic

Social and demographic

Political, liability, or legal Personal 3. refers to a manufacturer being liable for an injury or damage caused by a faulty product. Product liability

Manufacturer’s liability

Organizational liability

All of the given options 4. _________ is the postponement tactic. Product differentiation

Delayed differentiation

Service differentiation

All of the given options 5. The situation in which a product, part or system does not perform as intended is referred to as: Reliability

Durability

Failure

Maturity

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6. DFA stands for: Design for Assurance

Design for Accuracy

Design for Authenticity

Design for Assembly 7. Taguchi approach helps in determining: Controllable factors only

Un -controllable factors only

Both controllable factors and un -controllable factors

None of the given options 8. ________ is the bringing together of engineering, design and manufacturing personnel together early in the design phase. Robust design

Concurrent engineering

Canabalization

Design for Manufacturing (DFM) 9. Reliability can be measured effectively by using: Probability

Durability

Failure

Forecasting 10. _____________ determines the best possible outcome. Maximum

Minimax

Maximax

Laplace

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11. Decision tree is analyzed from: Left to right Right to left Any side

All of the above 12. Judgmental forecasts include all of the following except: Executive opinion

Consumer surveys

Delphi method

Regression analysis 13. In order to design a new product or service, an organization takes into account: External factors

Internal factors

a & b Economic, social and demographic conditions

14. FDA, OSHA and CRS resolve: Legal issues

Political issues

Ethical issues

Environmental issues 15. Design that results in products or services that can function over a broad range of conditions is called: Computer Aided Design

Robust design

Design for re manufacturing

Modular design

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16. Which of the following is wrong with respect to Naïve forecast Quick and easy to prepare

Provides high accuracy

Simple to use

Can be a standard for accuracy 17. Steps in CPFR include all of the following except: · Creation of a front end partnership agreement · Sharing forecast · Inventory replenishment · Development of supply forecasts 18. Identify the right sequence in product or service life cycle. Introduction, Maturity, Growth, Decline, Saturation

Introduction, Growth, Maturity, Saturation, Decline

Introduction, Growth, Saturation, Maturity, Decline

Introduction, Saturation, Growth, Maturity, Decline 19. In the absence of enough time, ________ forecasts are preferred. Qualitative

Quantitative

Naïve forecasts

None of the given options 20. ___________ are based on samples taken from potential customers. · Executive opinion

Consumer surveys

Delphi method

All of the given options

1. Which of the following activities is unnecessary ,when an organization decides to design its new product or service or refine its existing product or service: a Translate customer wants and needs into product and service requirements

b Refine existing products and services

c Develop new products and services

d Manage the purchasing activities religiously and diligently. 2. While focusing on capacity planning, organizations look for which of the following alternatives. a. How much will it cost b. How much holidays the workers can enjoy. c. How much compensation they need to pay to their CEO. d. None of the above 3. Which of the following is not one of the assumptions for Cost Volume Analysis

a. One product is not involved

b. Everything produced can be sold

c. Variable cost per unit is the same regardless of volume

d. Fixed costs do not change with volume 4. Which of the following does not fall under Economic Production Quantity ( EPQ) a. Only two or more item are involved

b. Annual demand is known

c. Usage rate is constant d. Usage occurs continually 5. Advantages of Process Layout Include

a. Equipment used is less costly

b. Low unit cost. c. Labor specialization. d. Low material handling cost 6. Common types of Operations include

a. Continuous Processing. b. Intermittent Processing. http://vuzs.net c. Automation

d. All of the above 7. System performance is measured by

a. Average number of customers being refused service

b. Average time customers wait c. System utilization

d. b and c. 8. Inventory carrying costs are influenced by: a. Order Quantity in Units

b. Holding carrying cost per unit.

c. Demand

d. a and b only. 9. Bar coding helps in determining the : a. Status of the inventory of an item in warehouse

b. Price of the product c. Size of the lot as well as the size and specifications of the product d. All of the above 10. Therbligs are basic elemental motions which include: a. Search

b. Select c. Throw

d. a and b only