Operations Management - MCQs

1. Operations Management deals with the production of ______ and ______.

Ans. Goods and services

2. Through careful plan and control of the ______, the organisation can keep ______ to the minimum and
definitely below „revenues‟ obtained from the market.
Ans. Operations, costs

3. Innovations in the 18th century replaced ______ with ______.

Ans. Human power, machine power

4. In the 1930s, three co-workers at Bell Telephone Labs ______, ______ and ______ developed statistical
procedures for sampling and quality control.
Ans. Dodge, Romig and Shewart

5. Every Organisation has ______ layers.

Ans. Five

6. What are two major issues in Operating Management?

Ans. Design, Operational Control Analysis

7. India also has a unique advantage in abundant availability of ______ and ______.
Ans. Low cost labour and technical manpower

8. If a system fails to give desirable results, then the fault is not with the ______ or the level of technology or
labour.
Ans. Culture

9. Under the World Class Manufacturing, the company‟s products should have a specification closer to the
______ than those made by any competitor.
Ans. Customers needs,

10. The growth of the service sector in India in the last ___ years has been very significant.
Ans. Five

11. The basic inputs to an operating system are ______, ______ and ______.
Ans. Labour, Capital, Material

12. ______ helps Operations Management to estimate demands for goods and services.
Ans. Forecasting

13. Indian industry enjoyed undue advantages due to ______.

Ans. High import tariffs

14. One of the serious drawbacks of Indian manufacturing organisations operating in a controlled economy was
the ______ in their approach to business
Ans. Predominant domestic focus

15. Advancement in ______ and global competition has influenced the major trends.
Ans. IT
16. The three basic activities of organizations are ______, ______ and ______.
Ans. Operations, Marketing and Finance

17. ______ seeks to reduce cost.

Ans. Finance

18. ____ and ____ should be, equal partners in the success of the organisation.
Ans. Marketing and Operations

19. There are ______ dimensions of competitiveness.

Ans. Six

20. ______ closely related to delivery.

Ans. Speed

21. Price over-recovery replicates a situation where prices of products are increased more than the costs of
resources.
Ans. True

22. Operating system of Apple computers is an example of order qualifier.

Ans. False

23. Productivity can be simply defined as the ratio of ______.

Ans. Outputs to Inputs

24. Competitiveness of a firm is simply its propensity and ability to ___ with other firms in the industry.
Ans. Compete

25. _____,_____,_____,____,____,___ are the factors that influence the competitive position of a firm.
Ans. Cost \price, quality, delivery speed, reliable delivery, flexibility in supply, flexibility in new product
introduction

26. Competitive Strategy is a combination of the ______for which the firm is striving, and the ______through
which it is seeking to get there.
Ans. Goals, Policies

27. Industry opportunities and threats with its attendant risks and potential rewards define the______.
Ans. Competitive environment

28. The Corporate Strategy defines the ______vision of a company.

Ans. The long-term vision

29. ________„form the heart of operations strategy.

Ans. Mission, Distinctive Competencies, Objectives and Policies

30. ____, ____, _____, and _____ are the „four common objectives of Operations‟.
Ans. Cost, Quality, Delivery and Flexibility

31. Due to rapid globalisation, industries in most countries are facing ______.
Ans. Intense competition
32. Consequently, many companies today are no more satisfied with delivering „acceptable quality‟ but strive
for ____ & _____.
Ans. Perfect product; Service quality

33. Both Manufacturing, as well as, service industries has experienced far-reaching impact on their operations
because of______.
Ans. Automation

34. ______, _____, ____ have become popular among companies in their attempts to keep costs low.
Ans. Restructuring, Downsizing, Outsourcing

35. A strong and steady ______ is necessary for the growth of service sector.
Ans. Manufacturing sector

36. ______ and ____ are operations-driven dimensions with major impact for marketing.
Ans. Delivery time and Delivery consistency

37. Order qualifier is your ticket to go into the race.

Ans. True

38. Kano is a Chinese artist.

Ans. False

39. Product life cycle has five stages.

Ans. False

40. Cell is an intermediate stage between batch and assembly line.

Ans. True

41. Operations strategies and decisions should fulfil the needs of the business and should add ______ to the
firm.
Ans. Competitive advantage

42. Productivity is related to Operations Management as it focuses on ______ its resources‟.

Ans. Maximising

43. Is pay-back period analysis a measure of the investment‟s profitability? Answer „Yes‟ or „No‟.
Ans. Owning, maintaining

44. An organisation‟s stakeholders include all individuals, groups, and other entities that either ______ the
working of the organisation or are directly ______ by it.
Ans. Influence, influenced

45. Return on Investment (ROI) is a fundamental measure of the ______ with which a firm manages its ______.
Ans. Efficiency, assets

46. Operating Cash Flow measures the ability of the company to generate, through its ______, a flow of
______.
Ans. Operations, cash

47. EVA measures the difference between the ______ and ______ value for the business.
Ans. Pre-investment, post-investment
48. The Cost of an investment is not merely the cost of ______ the ______.
Ans. Acquiring, assets

49. Ownership Cost is the total cost of ______ and ______ an asset over a period of time including the
opportunity cost.
Ans. Owning and Maintaining

50. Discounted Cash Flow makes use of the ______ Value concept.
Ans. Present

51. What the ______ money is worth ______ is called the Present Value.
Ans. Future, today

52. ______, ______, ______ analysis is the most widely used investment appraisal technique.
Ans. Discounted, cash, flow

53. Cost – Benefit Ratio is a ratio between the ______, ______ of a decision, and the Costs likely to be
generated by that decision.
Ans. Anticipated Benefits

54. Two versions of the Cost-Benefit Ratio analysis are ______cost-benefit ratio analysis, and ______ cost-
benefit ratio analysis.
Ans. Discounted, undiscounted

55. Sensitivity analysis is a technique for assessing the extent to which the success of a preferred investment is
dependent on the ______, ______.
Ans. Key, assumptions

56. Sensitivity Analysis is sometimes referred to as ______, ______analysis.

Ans. What, if

57. Break-even Analysis is also known as the______–______ – ______ analysis.

Ans. Cost, volume, profit

58. The point (of level of production/sales) where the ______, ______ equals the ______, ______ is called the
„break-even‟ point.
Ans. Total, costs, total, revenues

59. Fixed Costs (in Production) are costs that remain constant irrespective of the ______ of ______.
Ans. Volume, production

60. Investment should be such that the break-even point is as ______as possible.
Ans. Low

61. ______, ______ comprise those costs which may be identified separately for each good or service produced.
Ans. Direct, costs

62. Operations Cost Management involves ____ and _____ all costs that add up to the Total Operations Cost.
Ans. Planning, controlling
63. Final Cost a product is given by the equation ______ .
Ans. Final Cost = Direct Material Cost + Direct Labour Cost + Factory Overheads Materials, labour

64. Operations Overheads can be sub-divided into Indirect______, Indirect _____ and other expenses.
Ans. Fixed, variable

65. Another division of total Operations Cost would be the ______ Costs and ______ Costs.
Ans. Economy of Scale refers to the reduction in costs achieved in manufacture due to high levels of
production.

66. If the scale of operations increases, then the unit cost of manufacture comes down. This theory is called as
______„.
Ans. True

67. “At Break-Even point, the operations neither registers a profit not incurs a loss.” (True / False)
Ans. Fixed, profit, margin

68. The Break-Even quantity of production / sale is obtained by dividing the total ____ cost by the unit____
_____.
Ans. Limited flexibility

69. In real business situations, if a company is into manufacture of only one type of product or service, the
operations manager has ______ over reducing the cost.
Ans. Leveraging

70. The market has a limit on such ______ since the demand for one single type of product tends to level off,
beyond some numbers.
Ans. Variety, products

71. „Economies of Scope‟ is an approach by which higher volumes are sought to be achieved through
manufacturing a ______ of ______.
Ans. Flexible, efficient

72. Manufacture of a variety of products is done by developing operations systems which are ______ and still
______.
Ans. Competitive market, broaden, higher

73. Pay-back Analysis tells us how long it will take to ______ ______ the money we spend on the ______.
Ans. Earn, assets

74. An asset with a ______ back period would rank higher than one with ______ paybacks.
Ans. Return on investment