CA5104: Operations Management and Total Quality Management

1ST Departmental Exams Reviewer

PART I: MULTIPLE CHOICE

1. All the following statements are true, except?

A. Product designs are often easier to patent than service designs.
B. Many services require higher labor content than manufacturing.
C. Service activities tend to be smooth and efficient, whereas manufacturing services
sometimes appear to be slow and awkward.
D. Evaluation of output in manufacturing is less demanding than it is for services.

2. Who introduced the moving assembly line which had a tremendous impact on production
across industries?
A. Henry Ford
B. Frank Gilbreth
C. Harrington Emerson
D. Henry Gantt

3. Arrange the following statements to describe the steps in the forecasting process.
1- Establish a time horizon
2- Select a forecasting technique
3- Determine the purpose of the forecast
4- Make the forecast
5- Obtain, clean, and analyze the appropriate data
6- Monitor the forecast

A. 5, 1, 3, 2, 4, 6
B. 3, 1, 2, 5, 4, 6
C. 3, 2, 1, 5, 3, 6
D. 1, 5, 3, 2, 4, 6

4. The elements of good forecasts include the following, except?

A. Forecasts should be timely
B. Forecasts should be in writing
C. Forecasts should be reliable
D. Forecasts should be complex

5. This time series behavior refers to residual variations that remain after all the other
behaviors have been accounted for.
A. Irregular Variations
B. Seasonality
C. Random Variations
D. Trends

6. It has the advantage of bringing together considerable talents and knowledge of various
managers. This approach is often used as a part of long-range planning and new product
development.
A. Associative model
B. Judgmental forecasts
C. Time-series forecasts
 D. Both A and C

7. Out of the three major functional areas in an organization, what department is responsible
for producing the goods or providing the services offered by the organization?
A. Financing
B. Marketing
C. Operations
D. Both B and C are correct

8. What is the key issue if the operations manager needs to consider the quality, worker, and
product safety?
A. Ethical Issues
B. The Need for Supply Chain Management
C. Sustainability
D. Economic Decisions

9. Who proposed the Two Factor Theory in 1959?

A. Henry Gantt
B. Frank Gilbreth
C. Frederick Hertzberg
D. Elton Mayo

10. Which of the following operations interfaces deals with the recruitment and training of
personnel or employees?
A. Public Relations
B. Human Resources
C. Legal
D. Management

11. Which of the following statements is true?

A. If the supply is greater than demand, it will result in a shortage.
B. If the demand is greater than supply, it will result in a surplus.
C. The ideal concept is supply is greater than demand.
D. If the supply is less than demand, it will result in opportunity loss.

12. What type of variation is concerned if the Christmas season is coming?

A. Structural variation in demand
B. Variety of goods or services being offered
C. Assignable variation
D. Random variation

13. Which among the following best offers psychological value than tangible value to a
customer?
A. iPhone 13
B. House and lot
C. Flowers on Valentine’s Day
D. Tutoring sessions

14. Which of the following statements are false?

A. Incorrect work processes can be classified as an assignable variation.
B. External influences happen under structural variation.
 C. Seasonal variation is usually observed in capacity planning.
D. When a company produces a larger variety of products, the more requirements are
needed in production.

15. Which type of decision-making process determines how to adjust production capacity and
meet expected demands?
A. System accounting decisions
B. System operation decisions
C. System design decisions
D. System public relation decisions

16. The following are accurate descriptions of a model, except:

A. Less expensive and easier to use
B. Standardizes prospect solutions for a more accurate evaluation
C. Models do not assure good decisions
D. Equations fall under schematic representations

17. What are the standards managers use when making management, control or operation
decisions?
A. Performance metrics
B. Scientific management
C. International Accounting Standards
D. Pareto phenomenon

18. In which period did the motivation of employees become prominent in operation
management?
A. Industrial Revolution
B. Scientific management
C. Human relations movement
D. Influence of Japanese manufacturers

19. The more recent values in a series are given more weight in computing the forecast.
A. Weighted moving average
B. Moving average
C. Exponential smoothing
D. Forecasting

20. All are services EXCEPT:

A. Financial service
B. Audited report
C. Consulting
D. Auditing

PART II: TRUE OR FALSE

1. Production of goods and services is the main heart of Operations Management as it

oversees effective systems, processes, and implementation.
2. E-commerce involves the use of the internet to transact business during the Digital Age.
 3. The operations function consists of all activities indirectly related to producing goods or
providing services.
4. When we say model, it refers to simplification of something by vomiting unimportant
details and focusing only on the most important aspects of the real-life system.
5. A model has no limitations as it is done with a sophistication that guarantees a good
decision.
6. There was no regard for the workers in the history of operations management.
7. Planning the use of the system is one of the uses of the forecast.
8. The forecast should be timely, accurate, reliable, expressed in meaningful units, in
writing, complex, and cost-effective.
9. Seasonality refers to the wavelike variations on a forecast that lasts more than a year.
10. The better forecast is the one that has a lower MSE.

PART III: PROBLEM-SOLVING

1. Given the forecast errors of 4, -4, 5, and 0, what is the bias?

A. 4
B. -4
C. 5
D. 0

2. Given the historical data, what is the simple three-period moving average forecast for period
5?
Period Value

1 58

2 45

3 49

4 53

A. 51.25
B. 49
C. 51
D. 50.66

3. Using the data on number 2, compute for the weighted average forecast for period 5 using
weights .50 (most recent), .30, and ..20
A. 50.2
B. 23.7
C. 52
D. 56.5
For Numbers 4-6:

Period Actual Forecast

1 150 147

2 136 137

3 125 129

4 146 148

5 129 132

4. Based on the data above, solve for the MAD.

A. 7.8
B. 2.6
C. 1.93
D. 9.75

5. Based on the data above, solve for the MSE.

A. 7.8
B. 2.6
C. 1.93
D. 9.75

6. Based on the data above, solve for the MAPE

A. 7.8
B. 2.6
C. 1.93
D. 9.75

For numbers 7-9

Week Actual Naïve Forecast

1 17

2 21 17

3 19 21

4 23 19

5 18 23
7. Based on the data above, solve for the MAE.
A. 0.45
B. 1.36
C. 2.54
D. 1.15

8. Based on the data above, solve for the MSE.

A. 4.52
B. 5.45
C. 5.55
D. 4.32

9. Based on the data above, solve for the MAPE.

A. 6.79
B. 5.23
C. 7.89
D. 6.85

10. Based on the table below, compute the weighted average forecast using a weight of .50 for
the most recent period, .30 for the next most recent, .20 for the next…

Week Sales

1 110

2 115

3 135

4 125

A. 122
B. 127
C. 126
D. 124

For numbers 11-12:

Shown below are the sales for a 9-week period. Use this data to compute a 3-month moving
average of all available weeks.
Week 1 2 3 4 5 6 7 8 9

Sales(1000s) 5 6 2 4 8 9 8 4 7
11. What is the sales forecast for week 7?
A. 7
B. 4
C. 8
D. 9

12. What is the value of the Mean Average Deviation?

A. 7.83
B. 33.27
C. 2.42
D. 1

For numbers 13-14:

An assistant manager has been using a certain process to forecast demand for sachets of coffee
for the past six periods.

Period 1 2 3 4 5 6 7

Demand 90 85 91 92 95 88 92

13. What is the value for the 7th period using the 3-period moving average?
A. 91.6
B. 61.9
C. 19.6
D. 16.9

14. Compute using the Weighted Moving Average.

A. 7
B. 3.5
C. 5.6
D. 14

For numbers 15-16:

Develop a forecast for the next period, shown on the data below.

Period 1 2 3 4 5

Demand 19 20 18 19 17

15. What is the value for the 4th period using the 3-period moving average?
A. 15
B. 16
C. 17
 D. 19

16. Based on the data above, solve the MSE.

A. 5.56
B. 7.11
C. 8.33
D. 6.34

17. Using the data given below, develop a forecast for period 6 using a four-period weighted
moving average & weights of 0.4, 0.3, 0.2, and 0.1.

Period 1 2 3 4 5

Demand 19 20 18 19 17

A. 19.8
B. 18.9
C. 17.8
D. 18.8

18. With the data given below, using the exponential smoothing with a = 0.2, and assuming the
forecast for period 11 was 80. What would be the forecast for period 14?

Period 11 12 13

Demand 81 75 82

A. 79.16
B. 79.73
C. 80.20
D. 80.77

19. Compute Seasonal Relatives for this data using the SA method:

Quarter Year 1 Year 2 Year 3 Year 4

1 2 3 7 4

2 6 10 18 14

3 2 6 8 8

4 5 9 15 11
 A. 5
B. 6
C. 7
D. 8

20. Compute MAD for the fifth period, then update it period by period using exponential
smoothing with α = .3. What is the MAD for period 10?

Period Demand Predicted Forecast Error Absolute Error

(Forecast)

1 129 124

2 194 200

3 156 150

4 91 94

5 85 80

6 132 140

7 126 128

8 126 124

9 95 100

10 149 150

A. 3.911
B. 4.238
C. 3.267
D. 3.487

“Stick to the fight when your hardest hit – It's when things seem worst that you must not quit.”
-John Greenleaf Whittier
 ANSWER KEY:

PART I: MULTIPLE CHOICE

1. C 5. C 9. C 13. D 17. A

2. A 6. B. 10. B 14. B 18. C

3. B 7. C 11. D 15. C 19. A

4. D 8. A 12. A 16. D 20. B

PART II: TRUE OR FALSE PART III: PROBLEM-SOLVING

1. True 6. False 1. C 6. C 11. A 16. A

2. False 7. True 2. B 7. B 12. C 17. B

3. False 8. False 3. A 8. C 13. A 18. B

4. True 9. False 4. B 9. A 14. B 19. D

5. False 10. True 5. A 10. D 15. D 20. C

PREPARED BY:

Argañosa, Queen Alfea I.

Alberba, Kathleen Claire P.
Calle, Marc Danniell Alexie T.
Carlos, Christine Faith A.
Cuntapay, Francesca C.
Canonizado, Marella, L.
Perez, Darrell Ray Z.
Quiambao, Janisha Marie Pauliana C.
San Pablo, Ma. Danica SP.
Sim, Rioja Mae A.