1. What may have contributed to the failure of the safety training program at Pro’s Choice?

Explain. 2. What would you suggest doing to make the safety training program successful?
Explain. 3. What role should supervisors play in any safety training program? Explain. While a
large number of organizations have succes

1. Do you think that TI took the right approach to achieving better customer satisfaction by
training its executives first? Would TI have achieved quicker results by training its front-line
employees prior to its executives? 2. If you were an HR manager at TI, to what sources would
you have looked to find information w

Suppose your company needs $15 million to build a new assembly line. Your target debt-equity
ratio is 90. The flotation cost for new equity is 8 percent, but the flotation cost for debt is only 5
percent. Your boss has decided to fund the project by borrowing money because the flotation
costs are lower and the needed f

Determining Portfolio Weights What are the portfolio weights for a portfolio that has 100 shares
of Stock A that sell for $40 per share and 130 shares of Stock B that sell for $22 per share?

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Compare computer-based instruction with the lecture method in regard to the way the two
methods involve the different psychological principles of learning.

1. An earlier chapter section, “Why Employees Unionize,” describes several factors that
motivate people to become union members. Based on this scene, which factors do you think
drive these janitors to want to join a union? You also can refer to Figure, “The Labor
Relations Process,” for guidance with this quest

In what ways are American managers likely to experience difficulties in their relationships with
employees in foreign operations? How can these difficulties be minimized?

Calculating Expected Return Based on the following information, calculate the expected return:

Calculating conversion value a $1,000 par convertible debenture has a conversion price for
common stock of $40 per share. With the common stock selling at $55, what is the conversion
value of the bond?

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Option to Walt Your Company is deciding whether to invest in a new machine. The new
machine will increase cash flow by $350,000 per year. You believe the technology used in the
machine has a 10-year life; in other words, no matter when you purchase the machine, it will be
obsolete 10 years from today. The machine is cu
Option Rise true or false: The unsystematic risk of a share of stock is irrelevant in valuing the
stock because it can be diversified away; therefore, it is also irrelevant for valuing a call option
on the stock. Explain.

Convertible Calculations Rayne Inc., has a $ 1.000 face value convertible bond issue that is
currently selling in the market for $950. Each bond is exchangeable at any time for 25 shares of
the company’s stock. The convertible bond has a 7 percent coupon payable semiannually.
Similar nonconvertible bonds are priced t

Calculating Portfolio Betas You own a stock portfolio invested 25 percent in Stock Q, 20 percent
in Stock R, 15 percent in Stock 5, and 40 percent in Stock T. The betas for these four stocks are .
75, 1.24, 1.09, and 1.42, respectively, what is the portfolio beta?

Portfolio Expected Return you have $10,000 to invest in a stock portfolio. Your choices are
Stock X with an expected return of 15 percent and Stock Y with an expected return of 10
percent. If your goal is to create a portfolio with an expected return of 12.2 percent, bow much
money will you invest in Stock X, In Stock

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Calculating option values the price of dimension, Inc., stock will be either $65 or $85 at the end
of the year. Call options are available with one year to expiration. T-bills currently yield 5
percent. a. Suppose the current price of Dimension stock is $75. What is the value of the call
option if the exercise price is

Selling Rights Atlas Corp wants to raise $4.1 million via a rights offering. The company
currently has 490,000 shares of common stock outstanding that sell for share. Its underwriter has
set a subscription price of $36 per share and will charge the company a 6 percent spread. If you
currently own 5,000 shares of stock

Calculating Returns and Standard Deviations Based on the following information, calculate the
expected return and standard deviation for the twostocks:

Abandonment Decisions Allied Products, Inc., is considering a new product launch. The firm
expects to have annual operating cash flow of $25 million for the next 10 years. Allied Products
uses a discount rate of 20 percent for new product launches. The initial investment is $100
million. Assume that the project has no

Book Values versus Market Values in calculating the WACC, if you had to use book values for
either debt or equity, which would you choose? Why?

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Beta and CAPM Is it possible that a risky asset could have a beta of zero? Explain. Based on the
CAPM, what is the expected return on such an asset? Is it possible that a risky asset could have a
negative beta? What does the CAPM predict about the expected return on such an asset? Can you
give an explanation for your a

Abandonment and Expansion in the previous problem, suppose the scale of the project can be
doubled in one year in the sense that twice as many units can he produced and sold. Naturally,
expansion would be desirable only if the project is a success. This implies that if the project is a
success, projected sales after ex

SML and WACC an all equity firm is considering the following projects: The T-bill rate is 5
percent, and the expected return on the market is 12 percent. a. Which projects have a higher
expected return than the firm’s 12 percent cost of capital? b. Which projects should be
accepted? c. Which projects would be incor

Portfolio Expected Return you own a portfolio that has $2,300 invested in tock A and $3,400
invested in Stock B. If the expected returns on these stocks are 11 percent and 16 percent,
respectively, what is the expected return on the portfolio?

SML Suppose you observe the following situation: a. Calculate the expected return on each
stock. b. Assuming the capital asset pricing model holds and stock A’s beta is greater than
stock B’s beta by .25, what is the expected market riskpremium?

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WACC and NPV stranger Inc., is considering a project that will result in initial after tax cash
savings of $3.5 million at the end of the first year, and these savings will grow at a rate of 3
percent per year indefinitely. The firm has a target debt-equity ratio of .70, a cost of equity of 13
percent, and an after tax

Calculating Option Values T-bills currently yield 6.2 percent. Stock in Pinta Manufacturing is
currently selling for $55 per share. There is no possibility that the stock will be worth less than
$50 per share in one year. a. What is the value of a call option with a $45 exercise price? What is
the intrinsic value? b. W

Using CAPM A stock has a beta of 1.25 the expected return on the market is 14 percent, and the
risk-free rate is 5.2 percent. What must the expected return on this stock be?

Equity as an option Buckeye industries has a bond issue with a face value of $1,000 that is
coming due in one year. The value of Buckeye’s assets is currently $1,200. Jim Tressell, the
CEO, believes that the assets in the firm will be worth either $900 or $1.500 in a year. The going
rate on one-year T-bills is 7 perc

Using CAPM A stock has a beta of 1.30 and an expected return of 17 percent. A risk-free asset
currently earns 5 percent. a. What is the expected return on a portfolio that is equally invested in
the two assets? b. If a portfolio of the two assets has a beta of .75, what are the portfolio weights?
c. If a portfolio of t

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Calculating cost of debt Decline, Inc., is trying to determine its cost of debt. The firm has a debt
issue outstanding with 12 years to maturity that is quoted at 94 percent of face value. The issue
makes semiannual payments and has an embedded cost of 7 percent annually. What is the
company’s pretax cost of debt? If

Using the pricing equation a one-year call option contract on Cheesy Poofs Co. stock sells for
$1.200. In one year, the stock will be worth $45 or $65 per share. The exercise price on the call
option is $60. What is the current value of the stock if the risk-free rate is 9 percent?

Option Pricing you notice that shares of stock in the Patel Corporation are going for $50 per
share. Call options with an exercise price of $35 per share are selling for $10. What’s wrong
here? Describe how you can take advantage of this mispricing if the option expires today.

Reward-to-Risk Ratios Stock Y has a beta of 1.40 and an expected return of 19 percent. Stock Z
has a beta of .65 and an expected return of 10.5 percent. If the risk-free rate is 6 percent and the
market risk premium is 8.8 percent, are these-stocks correctly priced?

Intuition and Option Value suppose a share of stock sells for $75. The risk-free rate is 5 percent,
and the stock price in one year will be either $85 or S95. a. What is the value of a call option
with a $85 exercise price? b. What’s wrong here? What would you do?

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Abandonment Value We are examining a new project. We expect to sell 7,000 units per year at
$65 net cash flow apiece for the next 10 years. In other words, the annual operating cash flow is
projected to be $65 X 7,000 = $455.000. The relevant discount rate is 16 percent, and the initial
investment required is $1,800,00

Put Options what is the value of a put option at maturity? Based on your answer, what is the
intrinsic value of a put option?

The city street corporation’s common stock has a beta 1.2. If the risk-free rate is 4.5 percent
and the expected return on the market is 13 percent, what is the company’s cost of equity
capital?

Option to abandon what is the option to abandon? Explain why we underestimate NPV if we
ignore this option.
Returns and Standard Deviations consider the following information: a. What is the expected
return on an equally weighted portfolio of these three stocks? b. What is the variance of a
portfolio invested 20 percent each in A and B and 60 percent inC?

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Using CAPM A stock has an expected return of 15 percent, its beta is 1.45, and the expected
return on the market is 12 percent. What must the risk-free rate be?

Calculating Option Values The price of Time Squared Corp. stock will be either $77 or $93 at
the end of the year. Call options are available with one year to expiration. T-bills currently yield
6 percent. a. Suppose the current price of Time Squared stock is $80. What is the value of the
call option if the exercise pri

Calculating cost of debt for the firm in problem 7, suppose the book value of the debt issue is
$70 million. In addition, the company has a second debt issue on the market, a zero coupon bond
with seven years left to maturity; the book value of this issue is $50 million, and the bonds sell
for 61 percent of par. What i

Using CAPM A stock has an expected return of 13 percent, the risk-free rate is 4.5 percent, and
the market risk premium is 7 percent. What must the beta of this stock be?

Portfolio Returns and Deviations consider the following information about three stocks: a. If
your portfolio is invested 40 percent each in A and B and 20 percent in C, what is the portfolio
expected return, the variance the standard deviation? b. If the expected T-bill rate is 3.80 percent,
what is the expected risk p

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Options what is a call option a put option under what circumstances might you want to buy each?
Which one has greater potential profit? Why?

Option to expand what is the option to expand? Explain why we underestimate NPV if we ignore
this option.

Intrinsic Value what is the intrinsic value of a call option? How do we interpret this value?

Employee Stock Options you own stock in the Hendrix Guitar Company. The company has
implemented a plan to award employee stock options. As a shareholder, does the plan benefit
you? If so, what are the benefits?

Equity as an Option Rackin Pinion Corporation’s assets are currently worth $1,040. In one
year, they will be worth either $1,000 or $1,350. The risk-free interest rate is 6 percent. Suppose
Rackin Pinion has an outstanding debt issue with a face value of $1,000. a. What is the value of
the equity? b. What is the valu
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Analyzing a Portfolio you have $100,000 to invest in a portfolio containing Stock X, Stock Y,
and a risk-free asset. You must invest all of your money. Your goal is to create a portfolio that
has an expected return of 13 percent and that has only 70 percent of the risk of the overall
market. If X has an expected return

Flotation cost Goodbye, Inc., recently issued new securities to finance a new TV show. The
project cost $10.5 million, and the company paid $750,000 in flotation costs. In addition, the
equity issued had a flotation cost of 8 percent of the amount raised, whereas the debt issued had a
flotation cost of 3 percent of the

Cost of capital suppose Tom O’Bedlam president of Bedlam Products, Inc., has hired you to
determine the firm’s cost of debt and cost of equity capital. (a) The stock currently sells for
$50 per share, to use the stockholders’ money this year, so the cost of equity is equal to 10
percent ($5/50). “What is wrong

Intuition and Convertibles which of the following two sets of relationships at time of issuance of
convertible bonds is more typical,why

Project Risk if you can borrow all the money you need for a project at 6 percent, doesn’t it
follow that 6 percent is your cost of capital for the project?

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Estimate the DCF Growth Rate suppose in a snap Ltd, just issued a dividend of $1.25 per share
on its common stock. The company paid dividends of $.85, $.90, $1.04, and $1.10 per share in
the last four years. If the stock currently sells of $45, what is your best estimate of the
company’s cost of equity capital using

Using the SML Asset W has art expected return of 15 percent and a beta of 1.2, if the risk-free
rate is 5 percent, complete the following table for portfolios of Asset W and a risk-free asset,
Illustrate’ the relationship between portfolio expected return and portfolio beta by plotting
the expected returns against th

Corporate Downsizing In recent years, it has been common for companies to experience
significant stock price changes in reaction to announcements of massive layoffs. Critics charge
that such events encourage companies to fire longtime employees and that Wall Street is
cheering them on. Do you agree or disagree?

WACC on the most basic level, if a firm’s WACC is 12 percent, what does this mean?

Company Risk versus Project Risk both Dow chemical Company, a large natural gas user, and
Superior Oil, a major natural gas producer, are thinking of investing in natural gas wells near
Houston. Both companies are all equity financed. Dow and Superior are looking at identical
projects. They’ve analyzed their respecti

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Divisional Cost of Capital under what circumstances would it is appropriate for a firm to use
different costs of capital for its different operating division? If the overall firm WACC were used
as the hurdle rate for all divisions, would the riskier divisions or the more conservative divisions
tend to get most of the i

Reward-to-Risk Ratios In the previous problem, what would the risk-free rate have to be for the
two stocks to be correctly priced?

Contingent Liabilities when you takeout an ordinary student loan, it is usually the case that
whoever holds that loan is given a guarantee by the U.S. government, meaning that the
government will make up any payments you skip. This is just one example of the many loan
guarantees made by the U.S. government. Such guaran

Cost of Debt estimation how do you determine the appropriate cost of debt for a company? Does
it make a difference if the company’s debt is privately placed as opposed to being publicly
traded? How would you estimate the cost of debt for a firm whose only debt issues are privately
held by institutional investors?

SML cost of equity estimation what are the advantages of using the SML approach to finding the
cost of equity capital? What are the disadvantages? What specific pieces of information are
needed to use this method? Are all of these variables observables or do they need to be
estimated? What are some of the ways in which

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Using CAPM A stock has an expected return of 10 percent, its beta is .70, and the risk-free rate
is 5.5 percent. What must the expected return on the market be?

DCF cost of Equity Estimation what are the advantages of using the DCF model for determining
the cost of equity capital? What are the disadvantages? What specific piece of information do
you need to find the cost of equity using this model? What are some of the ways in which you
could get this estimate?

Value of a Right show that the value of a right just prior to expiration can be written as: Value of
right = PRO – Px = (PRO – PS) / (N + 1) where PRO, PS and Px stand for the rights-on-
price, the subscription price, and the ex-rights price, respectively, and N is the number of rights
needed to but one new share at

Calculating Values for Convertibles You have been hired to value a new 30-year callable,
convertible bond. The bond has a 7 percent coupon, payable annually, and its face value is
$1,000. The conversion price is $60, and the stock currently sells for $50. a. What is the
minimum value of the bond? Comparable nonconverti

Calculating Payoffs Use the option quote information shown here to answer the questions that
follow. The stock is currently selling for $114. a. Suppose you buy 10 contracts of the February
110 call option. How much will you pay, ignoring commissions? b. In part (a), suppose that
Macro soft stock is selling for $130 pe

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Option to suspend natural resource extraction facilities (such as oil wells or gold mines) provides
a good example of the value of the option to suspend operations. Why?

WACC and Taxes why do we use an after tax figure for cost of debt but not for cost of equity?

Options and Stock Risk if the risk of a stock increases, what is likely to happen to the price of
call options on the stock to the price of put options why?

Calculating Portfolio Betas you own a portfolio equally invested in a risk-free asset and two
stocks. If one of the stocks has a beta of 1.65 and the total portfolio is equally as risky as the
market, what must the beta be for the other stock in your portfolio?

Option pricing suppose a certain stock currently sells for $30 per share if a put option and a call
option are available with $30 exercise prices, which do you think will sell for more, the put or
the call? Explain.

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Pricing Convertibles you have been hired to value a new 25-year callable, convertible bond. The
bond has a 7.20 percent coupon, payable annually. The conversion price is $1.60, and the stock
currently sells for $38.50. The stock price is expected to grow at 11 percent per year. The bond is
callable at $1,200, but, base

Calculating WACC Mullineaux Corporation has a target capital structure of 50 percent common
stock, 5 percent preferred stock, and 45 percent debt. Its cost of equity is 15 percent, the cost of
preferred stock is 6 percent, and the cost of debt is 8 percent. The relevant tax rate is 35 percent.
a. What is Mullineaux’s

CAPM Using the CAPM, show that the ratio of the risk premiums on two assets is equal to the
ratio of their betas.

Calculating expected return based on the following information calculate the expectedreturn
Returns and Standard Deviations consider the following information. a. Your portfolio is
invested 30 percent each in A and C, and 40 percent in-B. What is the expected return of the
portfolio? b. What is the variance of this portfolio, the standarddeviation?

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Calculating Warrant Values A bond with 20 detachable warrants has just been offered for sale at
$1,000. The bond matures in 15 years and has an annual coupon of $105. Each warrant gives the
owner the right to purchase two shares of stock in the company at $15 per share. Ordinary bonds
(with no warrants) of similar qual

Calculating Expected Returns A portfolio is invested 10 percent in Stock, 75 percent in Stock 3, -

and 15 percent in Stock K. The expected returns on these stocks are 8 percent, 15 percent, and 24
percent, respectively. What is the portfolio’s expected return? How do you interpret your
answer?

Capital Budgeting Options in Chapter 10, we discussed Porsche’s launch of its new Cayenne.
Suppose sales of the Cayenne go extremely well and Porsche is forced to expand output to meet
demand. Porsche’s action in this case would be an example of exploiting what kind of
option?

Portfolio Returns and Deviations consider the following information about three stocks: a. If
your portfolio is invested 40 percent each in A and B and 20 percent in C, what is the portfolio
expected return, the variance the standard deviation? b. If the expected T-bill rate is 3.80 percent,
what is the expected risk p

Portfolio Returns using information from the previous chapter on capital market history,
determine the return on a portfolio that is equally invested in large-company stocks and long-
term government bonds. What is the return on a portfolio that is equally invested in small-
company stocks and Treasury bills?

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The Mays Co just issued a dividend of $2.60 per share on its common stock. The company is
expected to maintain a constant 6 percent growth rate in its dividends indefinitely. If the stock
sells for $60 a share, what is the company’s cost of equity?

Abandonment in the previous problem, suppose you think it is likely that expected sales will be
revised upward to 9.000 units if the first year is a success and revised downward to 4.000 units if
the first year is not a success. a. If success and failure are equally likely, what is the NPV of the
project? Consider the

Convertible Bonds The following facts apply to a convertible bond making semiannual
payments: a. What is the minimum price at which the convertible should sell? b. What accounts
for the premium of the market price of a convertible bond over the total market value of the
common stock into which it can beconverted?

Calculating Flotation Costs Southern Alliance Company needs to raise $30 million to start a new
project and will raise the money by selling new bonds. The company has a target capital
structure of 60 percent common stock, 10 percent preferred stock, and 30 percent debt. Flotation
costs for issuing new common stock are

Calculating cost of debt Jiminy’s Cricket Farm issued a 30-year, 9 percent semiannual bond
7 years ago. The bond currently sells for 108 percent of its face value. The company’s tax
rate is 35 percent. a. What is the pretax cost of debt? b. What is the after tax cost of debt? c.
Which is more relevant, the pretax o

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Earnings and Stock Returns As indicated by a number of examples in this chapter. Earnings
announcements by companies are closely followed by, and frequently result in, share price
revisions. Two issues should come to mind. First, earnings announcements concern past periods.
If the market values stocks based on expectat

Finding the WACC Titan Mining Corporation has 8.5 million shares of common stock
outstanding, 200,000 shares of 7 percent preferred stock outstanding and 85,000 8.5 percent
semiannual bonds outstanding, par value $1,000 each. The common stock currently sells for $34
per share and has a beta of 1.20 the preferred stock

Valuing a right Knight inventory Systems, Inc., has announced a rights offer. The company has
announced that it will take four rights to buy a new share in the offering at a subscription price of
$40. At the close of business the day before the ex-rights day, the company’s stock sells for
$80 per share. The next morn

SML Suppose you observe the following situation: Assume these securities are correctly priced.
Based on the CAPM, what is the expected return on the market? What is the risk-freerate?

Option Price and Interest Rates suppose the interest rate on T-bills suddenly and unexpectedly
rises. All other things being the same, what is the impact on call option values? On put option
values?

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Understanding Option Quotes Use the option quote information shown here to answer the
questions that follow. The stock is currently selling for $94. a. Are the call options in the money?
What is the intrinsic value of an RWJ Corp. call option? b. Are the put options in the money?
What is the intrinsic value of an RWJ C
Systematic versus Unsystematic Risk Consider the following information about Stocks I and II:
The market risk premium is 8 percent, and the risk-free rate is 4 percent. Which stock has the
most systen1aic risk? Which one has the most unsystematic risk? Which stock is “riskier”?
Explain.

Calculating the cost of Debt Ying Import has several bond issues outstanding, each making
semiannual interest payments. The bonds are listed in the following table. If the corporate tax
rate is 34 percent, what is the after tax cost of Ying’debt.

Options complete the following sentence for each of these investors: a. A buyer of call options.
b. A buyer of put options. c. A seller (writer) of call options. d. A seller (writer) of put options.
“The (buyer/seller) of a (put/call) option (pays/receives) money for the (right/obligation) to
(buy/sell) a specified a

Calculating cost of equity stock in country road industries has a beta of 1.25. The market risk
premium is 7 percent, and T-bills are currently yielding 5 percent. Country Road’s most
recent dividend was $2.10 per share, and dividends are expected to grow at a 5 percent annual
rate indefinitely. If the stock sells fo

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Finding the Target Capital Structure Fama’s LIamas has a weighted average cost of capital
of 10.2 percent. The company’s cost of equity is 14 percent, and its pretax cost of debt is 8.4
percent. The tax rate is 35 percent. What is the company’s target debt-equity ratio?

Finding the WACC given the following information for Bellevue Power Co, find the WACC.
Assume the company’s tax rate is 35 percent. Deb: 5,000 7 percent coupon bonds
outstanding, $1,000 par value, 20 years to maturity selling for 92 percent of par; the bonds make
semiannual payments. Common Stock: 100,000 shares outs

Portfolio Expected Return you own a portfolio that is 50 percent invested in Stock X. 30 percent
in Stock Y, and 20 percent in Stock Z. The expected returns on these three stocks are 10 percent,
16 percent, and 12 percent, respectively. What is the expected return on the portfolio?

Calculating cost of preferred stock Holdup Bank has an issue of preferred stock with a $5 stated
dividend that just sold for $87 per share. What is the bank’s cost of preferred stock?

Portfolio Risk if a portfolio has a positive investment in every asset, can the standard deviation
on the portfolio be less than that on every asset in the portfolio? What about the portfolio beta?

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Taxes an WACC Cookie Dough Manufacturing has a target debt-equity ratio of .80. Its cost of
equity is 17 percent, and its cost of debt is 10 percent. If the tax rate is 35 percent, what is the
company’s WACC?
What are the tradeoffs between the different types of pointing devices?

What are the key elements of OSHA's proposed ergonomics program?

You have estimated the life of your design to be three years. You expect that a capital investment
of $20,000 will be required to get it into production. You also estimate, based on sales forecasts,
that the design will result in an after-tax profit of $12,000 the first year and $16,000 the second
year, and a $5,000 lo

Explain in detail how a 'point' plan works.

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What advantages does the continuous method of watch recording offer over the snapback
method?

How is a fair day's pay determined?

What are some of the ways that a company could try to keep its workers' comp costs down?

Give an example of a task to which signal detection theory can be applied. What effect would a
shift in the criterion have on task performance?

Perform a cost/benefit analysis using fault-tree analysis on a stairway. Assume that over the last
year, three accidents were caused by slippery surfaces, five were caused by inadequate railings,
and three by someone negligently leaving tools or other obstacles on the steps. The average cost
for each accident was $200

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Widgets are painted and cured with heat from a drier in the paint shop. Three components are
required to start a fire in the paint shop and cause major damage: fuel, ignition and oxygen.
Oxygen is always present in the atmosphere and thus has a probability of 1.0. Ignition can occur
either from a spark due to static el

How much capital could be invested in a new method if it is estimated that $5,000 would be
saved the first year, $10,000 the second year, and $3,000 the third year? Management expects a
30 percent return on invested capital.

Compare and contrasts AND and OR gates?

What is the difference between compensatory and punitive damages?

What are the principal negative considerations that should be understood prior to the installation
of a point job evaluation system?
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Which three considerations constitute a successful job evaluation plan?

The US Air Force is trying to hire the best videogame players to run their Predator (drone
aircraft) control system. They are trying to decide whether to hire Spec. John Doe or Sgt. Joe
Brown. Their performances on a simulated task button pressing task (hand on Start and move to
Button A or B as fast as possible) is as

What techniques can be used to improve memory?

Calculate the system reliability. Assume events are independent.

For the following injury data, answer the following questions: a) What are the incidence and
severity rates for each department? b) Which department has significantly more injuries than the
others? c) Which department has a significantly higher severity rate than the others? d) As a
safety specialist, which departm

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What is redundancy? Give a good everyday example of redundancy.

a) What is the amount of information in a set of 8 signal lights if each light has an equal
probability of occurrence? b) The probabilities of the lights are changed as shown below.
Calculate the amount of information and the redundancy in this configuration. Stimulus 1 2 3
4 5 6 7 8 Probability 0

Is time a common denominator of labor cost? Why or why not?

What are some of the biases that may negatively affect a person's decision making?

The dial shown below represents a pressure gage. The operational range is 50 psi. The operator
must read the scale to the nearest 1 psi. Critically evaluate the dial indicating the poor design
practices. Then redesign the dial following recommended design practices. Original poor design
Improved design (Figure 7-14)

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JB is the inspector for ACME, Inc. Is he a good inspector? Support your decision quantitatively.
What is his d'?

How does one define the benefits, especially related to health and safety, in cost-benefit
analysis?

What is a third party suit?

What is the relationship between return on capital investment and the risk associated with the
anticipated sales of the product for which a new method will be used?

What is a safety factor?

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An engineer was adjusting the gear box of a large steam engine while it was in operation and
dropped a wrench into the path of the gears. As a result the engine was thrown out of alignment
and badly wrecked. Luckily the engineer only suffered minor lacerations from ejected pieces of
metal. It was hypothesized by the en

Explain the significance of using Chi-square analysis in accident prevention.

A job evaluation plan based on the point system uses the following factors: a) Education:
maximum weight 100 points; four grades. b) Effort: maximum weight 100 points; four grades. c)
Responsibility: maximum weight 100 points; four grades. A floor sweeper is rated as 150 points,
and this position carries an hourly

Use the information from Problem 12 in Chapter 8. Assume you are given the authority and the
appropriate funds to correct the problem. You can spend: i) $50 to replace batteries in all CO
monitors annually to reduce that probability to 0.0 ii) $500 on electricity over the holidays to
maintain ventilation and reduce t

What is the OSHA general duty clause so important?

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Which four methods of job evaluation are being practiced in this country today?

The following response-time data (in msec) was obtained on Farmer Brown and his son Big John
while operating a tractor using the right foot to control the clutch, brake and accelerator. The foot
is normally kept on the rest position. The location and sizes of the pedals are shown below as
well as some sample response t

The scale shown below represents a scale used to measure weight. The maximum weight
possible is 2 pounds and the scale must be read to the nearest 0.1 pound. Critically evaluate the
dial indicating the poor design practices. Then redesign the dial following recommended design
practices.

What is the weakness of using historical records as a means of establishing standards of

performance?

Because of recent West Virginia flooding deaths in the New River Valley (large drainage into
narrow valley), you have been hired by FEMA to design a warning system, which could be
activated at the first sign of river levels rising very quickly. Assume: 1) that the warning must be
quick, so as to allow sufficient time f

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Differentiate between constant and variable elements. Why should they be kept separate when
dividing the job into elements?

An ergonomist suggests replacing two mail clerks, each of whom sorts 3,000 pieces/h and gets
paid $10 per hour, with a machine vision system that can sort 6,000 pieces/h but costs $1 per
hour to maintain and $50,000 to purchase. How many hours would it take to pay off the system?

What two specific subjects should be emphasized in writing the job description?

What is the difference between liability and strict liability?

Explain the five stages of the human information processing model.

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What are the four possible outcomes explained by signal detection theory?

Why would a time study analyst who is hard of hearing have difficulty in performing a time
study?

Describe the "dominoes" of the domino theory? What is the key aspect to this approach?

Disregarding the digit 0, which keyboard is fastest for entering digits using one finger? Assume
that the home position is digit 5.

The knob with numbers and directional arrows on it shown below is used on refrigerators to
control temperature. In which direction, clockwise or counterclockwise, would you turn the knob
to make the refrigerator cooler? Why? How would you improve the control to avoid confusion?

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What are the steps in the accident prevention process?

What is a job evaluation?

The following performance data was collected under similar conditions on two inspectors
removing defective products from the assembly line. Comment on the relative performance of
the two inspectors. Which one is better at finding defects? Which would you hire if the cost of
releasing of a defective product would be hig

How does ADA enter into a methods change?

Explain why electronic stopwatches have increased the use of the snapback procedure.

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What is the meaning of sensitivity in signal detection theory? What techniques can be used to
increase sensitivity in an inspection task?

Pianists must often hit keys in very quick succession. The following figure displays a typical
piano keyboard. (a) Compare the index of difficulty for striking C, C#, F, and F#. Assume one is
starting from the A key and distances are measured center to center. (b) If starting from the A
key, it takes 200 msec to stri

One of the early propeller planes (a Ford Tri-Motor) had three engines, one directly in the middle
and one on each wing. In this configuration, the plane can fly one with any two engines or the
just the middle one alone. Assuming the reliability of each engine is .9, what is the reliability of
the overall plane?

A nuclear power plant uses 4 cooling lines to carry away heat from the central core reactor. Lines
A1 and A2 cool the top and bottom surfaces while lines B1 and B2 cool the top and bottom
halves of the cylindrical chamber. The reactor will not overheat if any one B lines is functioning
(i.e. both A and the other B line

Which factors influence the relative worth of a job?

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What is the purpose of risk analysis in accident prevention?

What is the difference between a hazard and danger?

Explain why a range of rates rather than just one rate should be established for every labor grade.

Given P(A)=0.6, P(B)=0.7, P(C)=0.8, P(D)=0.9, P(E)=0.1 and independent events, determine
P(T) for: a) T = AB + AC + DE b) T = A + ABC + DE c) T = ABD + BC + E d) T = A + B +
CDE e) T = ABC + BCD + CDE

What is the general approach used in hazard control?

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In the Dorben Company, the analyst has installed a point job evaluation plan covering all indirect
employees in the operating divisions of the plant. Ten factors were used in this plan, and each
factor was broken up into five degrees. In making the job analysis, the position of shipping and
receiving clerk was shown as
The USA Steel Co. uses coke and iron to produce steel in closed furnaces. Reduction of the iron
and oxidation of the coke produces various gases (including CO) which are vented through flues
to the atmosphere. On January 2th (the first day after the Christmas shutdown), a worker was
overcome with CO in the furnace area

NASA uses 4 identical on-board computers (i.e. 3 are redundant) to control the space shuttle.. If
the reliability of any computer is 0.9, what is the overall system reliability?

Design an EXIT sign which is to be displayed in a public auditorium. Explain the ergonomics
principles that need to be considered for this sign.

What are the main components of a good graphical user interface?

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Why are working conditions important in identifying the method being observed?

A job evaluation plan in the Dorben Company provides for five labor grades, of which grade 5
has the highest base rates and grade 1 the lowest. The linear plan involves a range of 50 to 250
points for skill, 15 to 75 points for effort, 20 to 100 points for responsibility, and 15 to 75 points
for job conditions. Each of

What key features are used to increase attention in an auditory display?

Bob and Bill are two weather forecasters for AccurateWeather. Bob is a veteran forecaster, while
Bill is fresh out of school. The following are the records (in number of predictions) on both
forecasters' ability to predict whether it will rain in the next 24 hours. a) Which forecaster would
you hire? Why? b) Who is a

What is red flagging?

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Discuss the difference between independent and mutually exclusive events.

What is criticality and what role does it play in cost-benefit analysis?

Explain why a deadman switch is a good example of a 'fail-safe' design. Give an example where
it might be used.

What are the principal benefits of a properly installed job evaluation plan?

How does multiple causation affect accident prevention?

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What is the difference between negligence, gross negligence, and negligence per se?
In the Dorben Company a materials handling operation in the warehouse is being done by hand
labor. Annual disbursements for this labor and for closely related expenses (social security,
accident insurance, and other fringe benefits), are $8,200. The methods analyst is considering a
proposal to build certain equipment t

Prior to Workers Comp, what three common law conditions were used by employers to
disqualify an injured worker from receiving benefits?

What is meant by the 'cash flow' appraisal technique?

A large state university uses 3-digit mail stops to code mail on campus. The initial step in sorting
this mail is to sort according to the first digit (there are 10 possible) which signifies a general
campus zone. This step is accomplished by pushing a key with corresponding number, which
dumps the letter in an appropr

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Compare and contrast life-change-unit, motivation-reward-satisfaction, and ABC models. What

is the common link for all these models?

a) Draw the fault tree given by the Boolean expression T = AB + CDE + F. b) The severity of T
is 100 lost work days/accident. The probabilities of the basic events are: A=0.02, B=0.03,
C=0.01, D=05, E=0.04, and F=0.05. What is the expected loss of associated with the head event
T as given. c) Compare two alternative

Compare and contrast a decision table with value engineering.

Compare and contrast common law and statute law.

How do information processing stages act to prevent an information overload of the human
operator?

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Compare and contrast the four categories of disabilities recognized under Workers Comp.

The Dorben Electronics Co., manufacturer of resistors, screens potential quality control
inspectors before they are hired. Dorben has developed the following preemployment test. Each
potential employee is presented with the same set of 1000 resistors of which 500 are defective.
The results for two applicants are as fol

What are the principal concerns of management with regard to a new method that is relatively
costly to install?

What is meant by the payback method? How is it related to the return on investment method?
The USAF is thinking of purchasing a improved automatic controller (no human required) at a
cost of $100,000 that can make 4,000 target contacts per hour to replace USAF specialists that
can, on average, make 1,000 target contacts per hour. Note that a USAF Specialist is paid a
relatively low salary of $8/hour (but wit

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In what ways can the reliability of a system be improved?

What types of citations can be issued by OSHA?

What is the difference between schedule and non-schedule injuries?

What are the three main requirements to obtain workers compensation?

What is the difference between accident prevention and safety management?

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Explain 'queuing theory.'

How can the validity of work sampling be sold to the employee not familiar with probability and
statistical procedure?

Which company policies are included under nonfinancial incentives?

The MTM-2 (see Figure 13-20) describes a simple operation in which each hand gets a part, the
right hand regrasps it an puts it into a fixture. Pressure is applied to seat it. Next a pin is grasped,
regrasped and inserted into the assembly. A hand wheel is cranked six revolutions under
resistance until a pointer is ali

What is the fire triangle? Explain how its principles are used in fire extinguishers.

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Dorben Co. provides a 10% allowance for its operators. A work sampling study of one operator
over an 8-hr shift yields the following data. Average rated performance is 110%. a. What is the
observed time (in minutes) for loading? b. What is the normal time for unloading? c. What is the
overall standard time ? d. Wha

To get ±5 percent precision on work that is estimated to take 80 percent of the workers' time,
how many random observations are required at the 95 percent confidence level?

What are some of the advantages in using a predetermined time system as opposed to stopwatch
time study?
What is the relationship between the accuracy of time standards and production control? Does
the law of diminishing returns apply?

If the average handling activity during a 10-day study is 82 percent, and the number of daily
observations is 48, what is the confidence interval for each day's percentage activity?

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The Purdue Pegboard Task is a standard test for motor skills. It consists of a board with a series
of holes and pegs, stored in depressions at the top of the board (shown below). One version of a
standard task is done with both hands simultaneously as follows: 1) Both right and left hands
pick up pegs and insert them

What are some of the reasons for the failure of wage incentive schemes?

How many observations should be recorded in determining the allowance for personal delays in
a forge shop if it is expected that a 5 percent personal allowance will suffice, and if this value is
to remain between 4 and 6 percent 95 percent of the time?

Compare and contrast the different ways of determining a standard time.

Would it be easy or difficult to perform a GB get with the left hand while simultaneously
performing a PC place with the right hand? Explain.

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The analyst in the Dorben Reference Library decides to use the work sampling technique to
establish standards. Twenty employees are involved. The operations include cataloging, charging
books out, returning books to their proper location, cleaning books, record keeping, packing
books for shipment, and handling correspo

In what way is customer service improved through valid time standards?

Are standards established on the 'unnecessary delays' portion of indirect and expense work? Why
or why not?

The analyst in the Dorben Company wishes to measure the percentage of downtime in the drop
hammer section of the forge shop. The superintendent estimated the downtime to be about 30
percent. The desired results, using a work sampling study, are to be within ±5 percent of p with
a level of significance of 0.95. The ana

In the tool and die room of the Dorben Company, the work measurement analyst wishes to
determine a standard for the jig boring of holes on a variety of molds. The standard will be used
to estimate mold costs only, and it will be based on operator wait time for molds coming from a
surface grinding section and on operato
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Why has there been a marked increase in indirect workers?

Why will a universal standards system involving as few as 20 benchmark standards work in a
large maintenance department where thousands of different jobs are performed each year?

Why did measured daywork become popular in the 1930s?

Over how long a period is it desirable to collect observations?

If a day work shop was paying an average rate of $12.75 per hour and had 250 direct labor
employees working, what would be the true direct labor cost per hour if during a normal month
40,000 hours of work were produced? Assume 21 working days per month.

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Explain how inventory and storage areas can be predicted accurately.

Which office operations can be readily time studied?

What are the advantages of using predetermined times?

Calculate the equivalent in TMUs of 0.0075 hours per piece, of 0.248 minutes per piece, of
0.0622 hours per hundred, of 0.421 seconds per piece, of 10 pieces per minute.

What is the relationship between labor cost and efficiency?

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Explain the application of slotting for indirect or expense labor.

The arrivals at the company cafeteria are Poisson, with an average time between arrivals of 1.75
minutes during the lunch period. The average time for a customer to obtain lunch is 2.81
minutes, and this service time is distributed exponentially. What is the probability that a person
arriving at the cafeteria will have

A worker tests piston rings. He picks up an untested ring from the left-side stand with his left
hand, tries to pass it through the left-hand slot (a no-go slot, meaning a good ring should not go
through). He then pulls the ring back and tries the right-hand slot (a go slot, meaning a good ring
should go through). As i

Differentiate between individual wage payment plans and group-type plans.

Which other two terms are used frequently to identify predetermined times?

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What are the principal advantages of using a random reminder in connection with a self
observation study?

What are the characteristics of piecework? Plot the unit cost curve and operator learning curve
for day work and piecework on the same set of coordinates.

Data from an 8-hour work sampling study are shown below. a) What % of the time is the
machine running? b) What % of the time is the machine broken? c) What is the limit of accuracy
of this study? d) What is 95% confidence interval of the machine running? e) Your manager says
that the range in part d) is unacceptab

The following data was collected by an intern working at the Mole Hill Ski Resort regarding the
efficiency of the V-8 Ford engine that was used to power their rope tow for the bunny slope.
Management would like to know how many hours of service they can expect to achieve out of
their obviously failing engine out of a t

Determine the time for the dynamic component of M20 B20.

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Develop a BasicMOST analysis of the cable-clamp assembly shown in Figure 4-17.

What is meant by crew balance? By interference time?

The following observations were obtained randomly over an 8-hour time period on the Zip
operator, during which time he assembled 20 Zip drives. a) How many minutes of a typical 8-
hour work day is the Zip operator working? b) What is the average performance of the Zip
operator? c) What is the normal time for the Zip

Using Monte Carlo methods, what would be the expected downtime hours because of the lack of
an operator for servicing if four operators were assigned to the work situation described in
Example 15-3 in the text?

In what way are time standards used for effective production control?

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Who pioneered the MTM system?

What are the pros and cons for using work sampling to establish standards of performance?

In which areas does work sampling have application?

What determines the length of the period between bonus payments under the cash plan? Why is
it poor practice to have the period too long? What disadvantages are there to the short period?
The Dorben Co. is deciding whether it is worth releasing a new 'improved' model of its Widget.
The following details have been collected: Standard time (min) = 1.00 Direct material costs er
widget = $0.50 Direct labor costs per widget = $1.00 Indirect labor costs per widget = $0.50
Expense labor costs per wi

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What are the three general categories under which the majority of wage incentive plans may be
classified?

How are simultaneous activities handled in BasicMOST?

Under the cash plan, what does the amount of money distributed depend on?

The discuss the statistical basis for the tradeoff between the number of observations collected
and the accuracy of work sampling.

Summarize the advantages of standards established on indirect work.

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A 3/4-inch diameter coin is placed within a 1-inch diameter circle. What would be the normal
time for the position element?

What are the characteristic features of the deferred profit sharing plan?

If MTM-3 were used to study an operation of approximately three minutes' duration, what could
you say about the accuracy of the standard?

How would you go about establishing a climate to increase worker motivation?

What would be the expected waiting time per shipment if a stopwatch time study established that
the normal time to prepare a shipment was 15.6 minutes? Twenty-one shipments are made every
shift (eight hours). The standard deviation of the service time has been estimated as 1.75
minutes. It is assumed that the arrivals

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Why do more unavoidable delays occur in maintenance operations than on production work?

Explain the relationship between time standards and plant capacity.

What is the time value of one TMU?

What considerations should be kept in mind when taking work sampling studies?
An audit revealed that a standard as originally established was 20 percent loose, explain the
methodology to be followed to rectify the rate.

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Operators assemble pumps at an hourly rate of $10.00. The standard time for the assembly is 20
minutes. Direct material costs are $19.50/pump. Indirect labor and other overhead is calculated
simply at a rate of $5.00/hr, while general office expenses are calculated at a rate of $2.00/hr.
What is the factory cost for on

Explain the different costs comprising factory cost. Which ones would a methods analyst have
most control over?

Which four divisions constitute indirect and expense work?

Why are standard data especially applicable to indirect labor operations?

Where was work sampling first used?

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In the XYZ Company, management is considering going from two 8-hour shifts per day to three
8-hour shifts per day or two 10-hour shifts per day in order to increase capacity. Management
realizes that shift start-up results in a loss of productivity that averages 0.5 hour per employee.
The premium for the third shift is

Develop an MTM-2 analysis of the cable-clamp assembly shown in Figure 4-17.

How is it possible to determine the time of day to make the various observations so that biased
results do not occur?

Why is the basis for the 'share and share alike' method of distribution?

When is it no longer necessary to follow up the installed method?

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Develop a BasicMOST analysis for the first complete assembly in Problem 7.

What are the fundamental prerequisites of a successful wage incentive plan?

What are advantages of work sampling over stopwatch time study?

The work measurement analyst in the Dorben Company is planning to establish standards on
indirect labor by using the work sampling technique. This study will provide the following
information: T = Total operator time represented by the study N = Total number of observations
involved in the study n = Total observatio
A time standard is established allowing the operator 11.28 minutes per piece. The sales
department expects to sell at least 2,000 of these parts in the next year. How many audits of this
standard would you recommend be scheduled during the next 12 months?

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How does developing time standards help maintain the quality of products?

Why is it fundamental to keep time standards up-to-date if a wage incentive plan is to succeed?

Discuss the tradeoffs of observing simultaneously ten clerks in a large bank.

The Purdue Pegboard Task is a standard test for motor skills. It consists of a board with a series
of holes and three types of pieces: pegs, washers and standoffs, stored in a depression at the top
of the board. The assembly, with the board rotated perpendicular to the operator's torso, is as
follows: a) Right hand pi

For which reasons was MTM-2 developed? Where does MTM-2 have special application?

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A 30-pound bucket of sand having a coefficient of friction of 0.40 is pushed 15 inches away
from the operator with both hands. What would be the normal time for the move?

What does unduly high performance indicate?

Explain how time standards could be established on janitorial operations.

A work sampling analyst notices that out of 50 observations, a worker is taking a break 2 times,
chatting to a co-worker 2 times, and is absent from the workstation once. The analyst is 95%
confident that the worker is actually working from _________% to __________% of the time. If
the statement is changed to: the anal

Explain the benefits of increasing production in relation to manufacturing cost.

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Develop a BasicMOST analysis of the proper sequence of activities in Figure 13-20.

How can valid time standards help develop an ideal plant layout?

Is there consistency between MTM-1 and MTM-2 in the handling of simultaneous motions?

How do time standards allow the accurate determination of labor costs?

The Dorben Company is using the work sampling technique to establish standards in its typing
pool section. This pool has varied responsibilities, including typing from tape recordings, filing,
Kardex posting, and copying. The pool has six typists who work a 40 hour week. Seventeen
hundred random observations were made

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Work measurement procedures establish an average time of 6.24 minutes per piece on the
inspection of a complex forging. The standard deviation of the inspection time is 0.71 minutes.
Usually, 60 forgings are delivered to the inspection station on the line every eight-hour turn. One
operator performs this inspection. As

The old-fashioned way of voting, by paper ballot, involves a voter picking up a pencil, placing
an X in the appropriate box for the candidate he/she chooses, returning the pencil to the table,
and then placing the ballot into the ballot box. Assume all items (ballot, pencil, ballot box) are
within a forearm reach. Calc

How does IMPROSHARE differ from the Rucker and the Scanlon plans?

What is meant by the term fringe benefits?

Differentiate between indirect labor and expense labor.

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To demonstrate various levels of performance to a group of union stewards, the time study
supervisor of the XYZ Company is using the metronome while dealing bridge hands. How many
times per minute should the metronome beat to demonstrate the following levels of performance:
60 percent, 75 percent, 100 percent, 125 perc

Which percentage allowance is usually provided for avoidable delays?

Based on the data provided in Figure 10-8, what would be the efficiency of an operator who set
up the machine and produced an order of 5,000 pieces in a 40-hour workweek?

What are the effects of poor time standards?

Define 'profit sharing.'

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Give several reasons for not applying an 'extra' allowance to operations when the major part of
the cycle is machine controlled and the internal time is small compared to the cycle time.

A work measurement analyst in the Dorben Company took 10 observations of a high production
job. He performance rated each cycle and then computed the mean normal time for each element.
The element with the greatest dispersion had a mean of 0.30 minutes and a standard deviation of
0.03 minutes. If it is desirable to hav

What would be the required number of readings if the analyst wanted to be 87 percent confident
that the mean observed time was within ±5 percent of the true mean and he established the
following values for an element after observing 19 cycles: 0.09, 0.08, 0.10, 0.12, 0.09, 0.08,
0.09, 0.12, 0.11, 0.12, 0.09, 0.10, 0.1

How long would it take the preceding drill to drill through a casting 21/4 inches thick?

What is the danger of using too few studies in the derivation of a formula?

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What considerations should be given to the choice of the operator to be studied?

The time study analyst at the Dorben Company developed the following snapback stopwatch
readings where elemental performance rating was used. The allowance for this element was
assigned a value of 16 percent. What would be the standard time for this element?

Take a simple operation that you perform regularly such as brushing your teeth, shaving, or
combing your hair and estimate the time it takes you to perform the operation. Now measure the
time it takes while working at a standard pace. Is your estimate within plus or minus 20 percent
of the estimated time?

Compute the times for elements a, b, c, d, and e when elements a + b + c were timed at 0.057
minute and b + c + d were found to equal 0.078 minute; c + d + e, 0.097 minute; d + e + a, 0.095
minute; and e + a + b, 0.069 minute.

Define a qualified operator.

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Why is training in performance rating a continuous process?

Why is it usually more convenient to express standards in time per hundred pieces rather than
time per piece?

Develop an allowance factor for an assembly element where the operator is standing in a slightly
awkward position, regularly lifts a weight of 15 pounds, and has good light and atmospheric
conditions. The attention required is fine, the noise level is continuous at 70 dBA, and the mental
strain is low, as is the monoto

What is the significance of a 'circled' elapsed time?

Rate the overall study for each of the following jobs shown on the CD. a) Stamping extrusions b)
Stamping end couplings c) Flashlight assembly d) Union assembly e) Hospital bed rail assembly
f) Stitching (garments) g) Labeling (garments) h) Cut and tack (garments)

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Based on the ILO tabulation, what would be the allowance factor on a work element involving a
42-pound pulling force in inadequate light where exacting work was required?

You were using the General Electric guide sheet to determine the number of observations to
study. It developed that 10 cycles were required, and after taking the study you used the standard
error of the mean statistic to estimate the number of observations needed for a given confidence
level. The resulting calculation

Who was originally responsible for thinking in terms of developing standards for basic work
divisions? What was his contribution?

A plain milling cutter 3 inches in diameter with a width of face of 2 inches is being used to mill a
piece of cold-rolled steel 11/2 inches wide and 4 inches long. The depth of cut is inch. How long
would it take to make the cut if the feed per tooth is 0.010 inch and a 16 tooth cutter running at a
surface speed of 120

What would be the horsepower requirements of turning a mild steel shaft 3 inches in diameter if
a cut of 1/4 inch with a feed of 0.022 inch per revolution at a spindle speed of 250 rpm were
established?

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What are the two methods used in developing allowance standard data? Briefly explain the
application of each technique.

The work measurement analyst in the Dorben Company is developing standard data for pre
pricing work in the drill press department. Based on the following recommended speeds and
feeds, compute the power feed cutting time of ½-inch high-speed drills with an 118E included
angle to drill through material that is 1-inch th

Based upon Table 10-2, how many observations should be taken on an operation whose annual
activity is 750 pieces and whose cycle time is estimated at 15 minutes?

What equipment is needed by the time study analyst?

In what ways can an operator give the impression of high effort and yet produce at a mediocre or
poor level of performance?

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Why are allowances based on a percentage of the productive time?

What are the characteristics of a sound time study formula?

Develop a formula for the relationship between time and area from the following data:

Compare and contrast the three MOST systems.

When should individual elements of each cycle be rated?

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Give several examples of personal delays. Which percentage allowance seems adequate for
personal delays under typical shop conditions?

What are the advantages of having operators oil and clean their own machines?

Is the use of time study formulas restricted to machine shop operations where feeds and speeds
influence standard times? Explain.

For which reasons are temporary standards established?

What steps are taken in the computation of a time study conducted by the continuous overall
performance rating procedure?

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The work measurement analyst in the XYZ Company wishes to develop standard data involving
fast, repetitive manual motions for use in a light assembly department. Because of the shortness
of the desired standard data elements, the analyst is obliged to measure them in groups as they
are performed on the factory floor. O

What is the approximate ratio in the time required for setting standards by stopwatch methods
and by standard data methods?

What governs the frequency of performance rating during a given study?

The analyst in the Dorben Company made 10 independent time studies in the hand paint
spraying section of the finishing department. The product line under study revealed a direct
relation between spraying time and product surface area. Compute the slope and intercept
constant, using regression line equations. How much

How is MOST related to MTM?

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Explain the relationship of predetermined times to standard data.

What advantages does the formula offer over standard data in establishing time standards?

Why is it essential to record complete information on tools and the facility on the time study
form?

What main areas are allowances intended to cover?

Express the standard of 5.761 minutes in hours per hundred pieces. What would the operator's
efficiency be if 92 pieces were completed during a working day? What would his efficiency be if
he set up his machine (standard for setup = 0.45 hours) and produced 80 pieces during the eight-
hour workday?

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What are the three basic motion sequences used in BasicMOST?

What would be the lead of a 3/4-inch diameter drill with an included angle of 118E?

What factors enter into the determination of the number of cycles to observe?

Would there be any objection to studying an operator who was performing at an excessive pace?
Why or why not?

How is MTM related to the analysis of method?

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What fatigue allowance should be given to a job if it developed that it took 1.542 minutes to
perform the operation at the end of continuous work and but 1.480 minutes at the beginning of
continuous work?

What are the characteristics of a sound rating system?

What would be the allowance for problem #2 if the frequency increased to 5 per minute?

What are some of the major factors that affect fatigue?

Why should the supervisor sign the time study?

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Explain the Westinghouse system of rating.

The following data resulted from a time study taken on a horizontal milling machine: Mean
manual effort time per cycle: 4.62 minutes. Mean cutting time (power feed): 3.74 minutes. Mean
performance rating: 115% Machine allowance (power feed): 10 percent. Fatigue allowance: 15
percent. What is the standard time for