Name: Class: Date:

MGMT 3060 Final Exam - Fall 2020

Indicate the answer choice that best completes the statement or answers the question.

1. The demand for trains between Marshdell and Deepbarrow varies throughout the year. The demand reaches its peak in
summer and drops during winter. This demand for trains can be categorized as .
a. static demand
b. overfull demand
c. unwholesome demand
d. dynamic demand

2. Harlose Suits owns more equipment than required for manufacturing goods during periods of regular demand in order
to tackle sudden demand surges. It also has a certain reserve of produced goods to tackle material shortages. In this case,
the reserve of equipment and produced goods are examples of .
a. a physical constraint
b. the capacity cushion
c. overbooking
d. capacity straddle

3. At Rues and West Bros., a spare parts manufacturing company, the most important competitive priority is quality. Only
a few key spare parts are produced using similar process designs. In this scenario, Rues and West Bros. .
a. is a focused factory
b. has no throughput
c. is an unfocused factory
d. uses a mass customization strategy

4. Harlose Suits faced a lot of complaints from customers when its recent batch of goods was dispatched. The employees
at Harlose Suits, hence, had to rework on the returned items, and in some cases, the company had to even replace the
faulty goods. In this case, the costs incurred by Harlose Suits are an example of .
a. prevention costs
b. appraisal costs
c. internal failure costs
d. external failure costs

5. Lumeris Inc., an automobile manufacturer, has an inflexible work schedule and requires its workers to work nine hours
a day and six days a week. Its laborers do not have adequate skills to perform their job efficiently. The inflexible work
schedule and inadequate labor skills are examples of .
a. physical constraints
b. nonphysical constraints
c. bottleneck activities
d. work orders

6. TekSupply Inc., an automobile parts supplier, held an average automobile parts inventory of $4 million last year. Its
cost of goods sold was $25 million. Therefore, the automobile parts experienced an inventory turnover of turns last
year.
a. 2.5
b. 4.25
c. 6.25
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 d. 9.5

7. Magnira Hotels is a leading chain of hotels. Its managers reserve 30% of the rooms available only to the members of its
club. They also provide the rooms at subsidized prices to these members. In this scenario, which of the following
components of revenue management system is most likely used by Magnira Hotels?
a. Investment
b. Allocation
c. Capacity expansion
d. Capacity sharing

8. The management of Elextric Corp., a computer manufacturing company, wants the employees in the organization to
contribute to the quality of the firm by making gradual, continuous improvements in their departments. Given this
information, Elextric Corp. embraces an approach known as .
a. poka-yoke
b. kaizen
c. Six Sigma
d. the 5-Why Technique

9. At Scorla Automobiles, a few machines in the assembly section were faulty and had to be shut down till they were
repaired. This reduced the output of automobiles for the quarter. In this case, the costs incurred by Scorla Automobiles for
repairing the machines are an example of .
a. prevention costs
b. appraisal costs
c. internal failure costs
d. external failure costs

10. CraftWare Inc., a furniture manufacturer, uses ABC analysis to define its inventory value. The inventory contains
wood, cast iron, adhesive, and carbon fiber. If wood accounts for 50 percent of the items and 5 percent of the total dollar
value; carbon fiber accounts for 10 percent of the items and 60 percent of the total dollar value; cast iron accounts for 25
percent of the items and 18 percent of the total dollar value; and adhesive accounts for 15 percent of the items and 17
percent of the total dollar value, can be classified as a class C item.
a. wood
b. carbon fiber
c. cast iron
d. adhesive

11. The managers at Blyrie Corp. think that their company's products are of higher quality than the products of other
companies in the market. However, contrary to their perception, the customers rate the company's products as below
average. This is due to the inferior process design specifications in the company. This is an example of in the GAP
model.
a. Gap 2
b. Gap 3
c. Gap 4
d. Gap 5

12. Alex, the manager at Rues and West Inc., wants to know the sequence of the production process in the company to
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