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1. Your instructor has now been notified that you have received this test. 2. Your responses will not be recorded until you press the submit button below. 3. You will be given 120 minutes to finish. Please mark your responses to the questions below. 1. Which one of the following statements regarding operations management is true? A. Inputs to a production system include capital and materials, but not human resources. B. Operations management deals only with manufacturing organizations because service organizations do not have tangible outputs. C. Typical inputs to a production system are processes and consumer goods. D. Customer participation and information on performance are two special types of inputs to a production system.
2. Operations management is part of a production system that can be described in the following manner: Organization: inputs-processes-outputs. Which one of the following correctly describes a production system? A. Airline: pilots-planes-transportation B. Bank: tellers-computer equipment-deposits C. Furniture manufacturer: wood-sanding-chair D. Telephone company: satellites-cables-communication
D. Which of the following skill areas is NOT fundamental to operations managers? A. It is impossible for a firm to improve cost and quality simultaneously. Advertising tactics 4. A firm offering little customization cannot compete simultaneously on the dimension of consistent quality. Competitive priorities define the dimensions on which companies should excel in producing their products or services. Quantitative analysis B. Competitive priorities state the dimensions on which a firm can excel. C. C. is giving particular emphasis to which dimension of competitive priorities? A. 5. A firm that competes on the dimension of customization tends have operating systems that are inflexible. McDonald's is a typical example of an organization that excels at volume flexibility rather than quality consistency.3. four-hour. Price . B. 6. Emphasizing low price is most appropriate for differentiated products in the growth stage of demand. in serving a lovely. Knowledge of information systems C. Which one of the following statements about each dimension is TRUE? A. D. A firm that intends to excel at high-performance design quality can succeed only when its production volume is very high. A firm that competes on the dimension of volume flexibility is more likely to manufacture products that experience a seasonal demand variation. B. seven-course dinner for two for $150. Which one of the following statements is TRUE? A. For a firm that gives top priority to customization. Understanding of international business D. An ethnic restaurant. volumes for any individual product tend to be low.
make-to-stock strategy. A firm producing medical equipment to customer specifications is most likely using a A. make-to-stock strategy. to meet customers" selection of fabric and wood. Consistent quality C. 10. Assemble-to-order service strategy C. . B. Standardized-services strategy B. make-to-order strategy. assemble-to-order service strategy. Customized-services strategy D. C. C. 9. assemble-to-order strategy. D. flexible-flow strategy. are most likely to use a A. make-to-stock strategy. no two alike.B. B. The manufacturer is most likely using a A. make-to-order strategy. High-performance quality 7. A manufacturer of upscale upholstered furniture can produce hundreds of a particular style of sofa. D. Make-to-stock services strategy 8. mass production strategy. for which reasonably accurate forecasts are available. Fast delivery time D. Which of the service strategies amounts to designing operations to include processes devoted to producing standardized services and processes devoted to assembling standardized offerings for a specific customer's needs? A. Firms that produce high volumes of relatively few standardized products.
A job process would be preferred when A. capital intensity. installation of robotic welding equipment on the factory floor . resource flexibility. B. 13. C. customization is high and volume is low. capital intensity. Which of the following is an example of BACKWARD integration for an automobile manufacturer? A. products are made to stock type. Five dimensions must be considered in making decisions on process. 11. resource flexibility. product or service life cycle. D. a process with more of its products or services in the early stage of their life cycles B. process choice. and process choice B. and customer involvement D. facility location. resource flexibility. inventory placement. Which one of the following correctly identifies all five major process decisions? A. a process with a flexible flows 14. assemble-to-order strategy.B. vertical integration. and customer involvement C. process choice. mass production strategy. vertical integration. Which one of the following processes is more likely to have the greatest capital intensity? A. vertical integration. capital intensity. workforce and equipment are specialized. a process using customization as its competitive priority C. customization is low and volume is high. capital intensity. make-to-order strategy. and process choice 12. C. a process with high production volumes D. D. customer involvement.
acquisition of a sheet metal company that is a major supplier to the automobile industry 15. less customer involvement 17. Which of the following process decisions would be more likely? A. higher demand volumes. C. longer cycle time. more resource flexibility C. MORE fixed automation typically means A. Reengineering is the fundamental rethinking and radical design of business processes. a personal computer manufacturer deciding to produce its own keyboards B. D. opening new company-owned car dealerships D. a personal computer manufacturer opening retail computer sales stores 16. . Suppose that competitive priorities call for offering a wide variety of customized services. Information technology is a major enabler of reengineering. Which one of the following statements concerning process reengineering is NOT true? A. Reengineering efforts should focus on functional departments. lower sales. a local bank opening branch offices in neighboring states C. B. decreased labor productivity. less outsourcing D. an automobile company opening a plant to manufacture spark plugs D.B. B. more capital intensity B. 18. Which one of the following is an example of FORWARD integration? A. creation of a marketing plan to offer a factory rebate upon the purchase of a new car C. C.
The five categories of activities (operation. Only process improvement programs make use of cross-functional teams. transportation. C. statistical estimates of seasonal factors are more precise than any other approach. Horizontal B. Using sales force estimates for forecasting has the advantage that A. delay. fFow diagram 21. Capital budgeting D. forecasts of individual sale force members can be easily combined to get regional or national sales totals. D. Multiple activity chart B. Cyclical 22. Reengineering starts with a "clean slate" whereas process improvement looks for ways to incrementally improve. Seasonal C. Reengineering requires a "clean slate" philosophy. Process improvement focuses only on critical or core processes.D. B. Random D. inspection. and storage) are used in which of the following methods of process analysis? A. 20. B. Only reengineering focuses on business processes. Process chart C. . such as order fulfillment. 19. C. no biases exist in the forecasts. Which one of the following basic patterns of demand is difficult to predict because it is affected by national or international events or because of a lack of demand history reflecting the stages of demand from product development to decline? A. Which statement on reengineering and process improvement is best? A.
a simple moving average forecast with n = 20 should perform about the same as a simple moving average forecast with n = 3. historical data is available and the best basis for making projections is to use past demand patterns. D.01. a systematic approach to creating and testing hypotheses is needed and the data are usually gathered by sending a questionnaire to consumers. 23. B. a simple moving average forecast with n = 3 should outperform a simple moving average forecast with n = 20. D. a simple moving average forecast with n = 20 should outperform a simple moving average forecast with n = 3. Trend-adjusted exponential smoothing D. Cumulative sum of forecast errors . The Delphi method of forecasting is useful when A. A. 26. cyclical. Which one of the following is most useful for measuring the bias in a forecast? A. When the underlying mean of a time series is very stable and there are no trend. judgment and opinion are the only bases for making informed projections. an exponential smoothing forecast with alpha = 0. Survey analysis B. historical data are available and the relationship between the factor to be forecast and other external or internal factors can be identified. B. Market research 24. or seasonal influences. confusion between customer "wants" (wish list) and customer "needs" (necessary purchases) is eliminated. 25. Delphi method C.D. C.30 should outperform a exponential smoothing forecast with alpha = 0. Which one of the following is an example of a time series forecasting technique? A. C.
110 in period 2.B. Percentage forecast error in period t 27. Mean absolute deviation of forecast errors D. You are . and subsequently it is observed that the forecast method did not accurately predict the actual demand. The forecast has a positive bias and a positive standard deviation of errors. B. C. linear regression C. Which one of the following is an example of causal forecasting technique? A. Assume that a time series forecast is generated for future demand. exponential smoothing D. D. The forecast has a positive bias and a standard deviation of errors equal to zero. 170 in period 4. What is the forecast for period 7 if the company uses the simple moving average method with n = 4? A. 81 in period 5 and 130 units in period 6. Standard deviation of forecast errors C. Greater than 125 30. weighted moving average B. It is now near the end of May and you must prepare a forecast for June for a certain product. Less than or equal to 115 B. Demand for a new five-inch color TV during the last six periods has been as follows: 109 units in period 1. the forecast errors were found to be: Mean absolute percent error = 10% Cumulative sum of forecast errors = 0% Which one of the statements concerning this forecast is TRUE? A. Specifically. The actual demand for May was 1000 units. 103 in period 3. The forecast has no bias but has a positive standard deviation of errors. Greater than 115 but less than or equal to 120 C. Delphi method 29. The forecast for May was 900 units. 28. Greater than 120 but less than or equal to 125 D. The forecast has no bias and has a standard deviation of errors equal to zero.
Less than 925 units. Greater than or equal to 1000 units. 31. Greater than or equal to 950 units but less than 1000 units. electrical utilities only. . 33. Greater than or equal to 925 units but less than 950 units. High interest or opportunity cost B.20. supply uncertainties. Need for better labor or equipment utilization D. setup cost. It is a portion of inventory that is used to absorb only the variation in demand. D. C. B. It is a portion of inventory that is used to absorb variation in demand or supply. It is a portion of inventory that is used to absorb only the variation in supply. D. On-time delivery requests from customers C.using the exponential smoothing method with alpha = 0. B. a trucking company making emergency shipments. One of the secondary levers for reducing safety stock inventory is to reduce A. gasoline suppliers only. C. B. Need for reduction in total payments to suppliers 32. C. B. Which one of the following reasons creates a pressure for reducing inventories? A. 34. Pipeline inventory is a type of inventory that is usually maintained by A. The forecast for June is A. Which one of the following statements about anticipation inventory is TRUE? A. D. It is a portion of inventory that is reserved for the best customer. any manufacturer moving materials from point to point.
38. 35. Even though the economic order quantity (EOQ) is optimal only when five assumptions are satisfied. estimate average volume per dollar value.41. The amount of an order received is exactly equal to what was ordered. close to suppliers. The Lemma Company manufactures and sells 10 products. . capacity cushions. within the plant as work-in-process. without any "short shipments" from a supplier or scrap losses in the shop. D. C. B. estimate dollar value per pound. C. to identify the A items for better inventory control. it serves as a reasonable first approximation even when these assumptions do not quite apply. C.C. Decisions for one item can be made independently of decisions made for other items. closer to the customer. equally distributed between the plants and warehouses. Which one of the following is not an assumption of the EOQ? A. D. They will be reduced by a factor of 1. What effect will this have on the economic order quantities of the 10 products? A. 37. D. For a company that manufactures most of its products as standards. delivery size. There is no uncertainty in lead time. B. more inventory should be placed A. B. Ways have been found to cut both the setup and inventory holding costs in half. The goal of ABC analysis is to A. 36. determine the profitability of items. D. Quantity discounts can be taken advantage of for large lot sizes.
The cost of processing an order was $64.41. Which one of the following questions is NOT answered by EOQ sensitivity analysis? A. Fixed replenishment intervals are possible. D. quite convenient. on average. and setup cost (S)? B. They will be increased by a factor of 1. What should happen to lot sizes if interest rates drop? C. Last year the hospital ordered bandages. administratively. and the cost of holding one box throughout a full year was 20 percent of the value of the material. What extra cost did the hospital incur that could have been avoided if the EOQ concept had been applied? A. Which one of the following statements represents an advantage of a Q system over the P system? A. What should happen to lot sizes if supply and lead-time uncertainty increase? 40. Sensitivity analysis on the economic order quantity (EOQ) formula can help the operations manager answer several questions on how to manage inventories. The price of bandages was $80 per box. The Q system is more suited for quantity discounts and physical limitations. They will not change. once every two weeks. 39.00. and the hospital operates 52 weeks per year. Orders for multiple items from the same supplier can be combined more easily. which can be. Wood County Hospital consumed 400 boxes of bandages per week last year. C. B.B. They will be reduced by a factor of 2. C. D. More than $650 and less than $1050 C. each time ordering 800 boxes. How critical are errors in estimating demand (D). 41. inventory holding cost (H). What should happen to cycle inventory if the demand rate increases? D. A perpetual inventory system is not mandatory. Less than $650 B. More than $1050 and less than $1450 D. More than $1450 .
The number of periods between orders (P) for red #69 is 15 workdays. Greater than 750 boxes but less than or equal to 850 boxes D. The average demand for this item is 200 boxes per week. Demand = 30 units/workday Standard deviation of daily demand = 4 units/workday Lead time = 7 workdays Desired cycle-service level = 85% A normal table is appended to this exam. these shoes are in high demand: 50 pairs of shoes are sold per week.) Additional information concerning red #69 follows. A. Less than or equal to 550 B. Too small C. (The store operates 50 weeks/year. Greater than 850 boxes 44. If the store operates 52 weeks a year.42. A neighborhood sportswear store sells a pair of Nike sneakers for $40. The Franklin County Hospital is currently using a continuous review system to control its inventory. What is the target inventory level T for red #69? A. and the standard deviation in weekly demand is 50 boxes. Cannot tell from the information given 43. Greater than 650 . Greater than 550 but less than or equal to 600 C. what can you say about the current lot size of 235? A. Due to the recent fitness craze. Jan Tuttle is the inventory manager of an art supply store. One of the items in inventory is an elastic band. If the lead time is 3 weeks and the hospital wants a 99 percent cycle-service level. and the annual holding cost is 20 percent of selling price. Greater than 650 boxes but less than or equal to 750 boxes C. what is the reorder point for this item? A normal table is appended to this exam. The ordering cost is $20/order. Greater than 600 but less than or equal to 650 D. Too large B. She uses a periodic review system for all oil paints. 5 workdays/week. Just right D. Less than or equal to 650 boxes B.
45. Please click here for the Normal Distribution table .
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