Liberty
University BUSI 411 exam 4 solutions answers right
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many versions: 6 different versions
Question 1 The Operations Manager for
Shadyside Savings & Loan orders cash from her home office for her very
popular "BIG BUCKS" automated teller machine, which only dispenses
$100 bills. She estimates that this machine dispenses an average of 12,500
bills per month, and that carrying a bill in inventory costs 10 percent of its
value annually. She knows that each order for these bills costs $300 for
clerical and armored car delivery costs, and that order lead time is six days.
What is the economic order quantity?
Question 2 In the basic EOQ model, if D =
60 per month, S = $12, and H = $10 per unit per month, EOQ is:
Question 3 The manager of the Quick Stop
Corner Convenience Store (which never closes) sells four cases of Stein beer
each day. Order costs are $8.00 per order, and Stein beer costs $.80 per sixpack
(each case of Stein beer contains four sixpacks). Orders arrive three days
from the time they are placed. Daily holding costs are equal to 5 percent of
the cost of the beer. If he were to order 16 cases of Stein beer at a time,
what would be the daily total inventory costs, EXCLUDING the cost of the beer?
Question 4 In a twobin inventory system,
the amount contained in the second bin is equal to the:
Question 5 Which of the following is not
true for the economic production quantity model?
Question 6 Which one of the following is
not one of the building blocks that is the foundation of the lean philosophy?
Question 7 A system of lights used at each
workstation to signal problems or slowdowns is:
Question 8 Having a vendor be responsible
for managing the restocking of inventory is what is meant by the term:
Question 9 Breakdown programs often are
prioritized such that some equipment gets a lot of attention and other
equipment gets very little. This typically reflects the fact that breakdowns
are consistent with:
Question 10 The goal of maintenance is to
maintain the productive system in good working order while minimizing:
Question 11 It is especially the case for
small businesses that closer interactions and increased agility make __________
relatively more attractive.
Question 12 Which of the following is not a
goal of supply chain management?
Question 13 The website and order
fulfillment are essential features of:
Question 14 The two types of decisions that
are relevant to supply chain management are:
Question 15 Which of the following is a
principle required for ethical behavior in purchasing? (I) loyalty to employer
(II) justice to those you deal with (III) faith in your profession
Question 16 In theory of constraints
scheduling, the synchronization of the sequence of operations is referred to as
the:
Question 17 A work center can be a: (I)
machine. (II) group of machines. (III) department. (IV) facility.
Question 18 The president of a consulting
firm wants to minimize the total number of hours it will take to complete four
projects for a new client. Accordingly, she has estimated the time it should
take for each of her top consultants—Charlie, Betty, Johnny, and Rick—to
complete any of the four projects, as follows: In how many different ways can
she assign these consultants to these projects?
Question 19 Scheduled due dates are the
result of:
Question 20 Which sequencing rule is
designed specifically to minimize job tardiness?
Question 21 To provide satisfactory levels
of customer service while keeping inventory costs within reasonable bounds, two
fundamental decisions must be made about inventory: the timing and the size of
orders.
Question 22 Returned goods are part of
reverse logistics.
Question 23 Disintermediation refers to the
phenomenon that the traditional retailer or service provider is reduced or
eliminated in a supply chain.
Question 24 If optimal sequencing through
three work centers is desired, Johnson's rule II is used rather than Johnson's
rule.
Question 25 The assignment method is
limited to a maximum of two jobs per resource
1. One important use of inventories in
manufacturing is to decouple operations through the use of work-inprocess
inventories.
True False
2. The objective of inventory management is
to minimize the cost of holding inventory.
True False
3. A retail store that carries twice as much
inventory as its competitor will provide twice the customer service level.
True False
4. The overall objective of inventory
management is to achieve satisfactory levels of customer service while keeping
inventory costs reasonable.
True False
5. The two main concerns of inventory control
relate to the costs and the level of customer service.
True False
6. To provide satisfactory levels of customer
service while keeping inventory costs within reasonable bounds, two fundamental
decisions must be made about inventory: the timing and the size of orders.
True False
7. In the EOQ formula, holding costs under 10
percent are expressed as percentages, above 10 percent are expressed as annual
unit costs.
True False
8. DVD recorders would be an example of
independent-demand items.
True False
9. Reorder point models are primarily used
for dependent-demand items.
True False
10. An example of inventory holding cost is
the cost of moving goods to temporary storage after receipt from a supplier.
True False
11. Decoupling operations applies to the
railroad industry.
True False
12. Interest, insurance, and opportunity
costs are all associated with holding costs.
True False
13. The A-B-C approach involves classifying
inventory items by unit cost, with expensive items classified as A items and
low-cost items classified as C items.
True False
14. An inventory buffer adds value and lowers
cost in all supply chains.
True False
15. In the A-B-C approach, C items typically
represent about 15 percent of the number of items, but 60 percent of the dollar
usage.
True False
16. EOQ inventory models are basically
concerned with the timing of orders.
True False
17. The average inventory level is inversely
related to order size.
True False
18. The average inventory level and the
number of orders per year are inversely related: As one increases, the other
decreases.
True False
19. The EOQ should be regarded as an
approximate quantity rather than an exact quantity. Thus, rounding the
calculated value is acceptable.
True False
20. Carrying cost is a function of order
size; the larger the order, the higher the inventory carrying cost.
True False
21. Understocking an inventory item is a sure
sign of inadequate inventory control.
True False
22. Annual ordering cost is inversely related
to order size.
True False
23. The total cost curve is relatively flat
near the EOQ.
True False
24. Because price is not a factor in the EOQ
formula, quantity discounts will not affect EOQ calculations.
True False
25. In the quantity discount model, if
holding costs are given as a percentage of unit price, a graph of the total
cost curves will have the same EOQ for each curve.
True False
26. In the quantity discount model, the
optimum quantity will always be found on the lowest total cost curve.
True False
27. ROP models indicate to managers the time
between orders.
True False
28. When to order can be calculated by the
ROP and expressed as a quantity.
True False
29. The rate of demand is an important factor
in determining the ROP.
True False
30. The inventory value of the supply chain
exceeds the inventory value of the organization's work-in-process inventory.
True False
31. Safety stock is held because we
anticipate future demand.
True False
32. Variability in demand and/or lead time
can be compensated for by safety stock.
True False
33. Solving quality problems can lead to
lower inventory levels.
True False
34. ROP models assume that demand during lead
time is composed of a series of dependent daily demands.
True False
35. Profit margins tend to be inversely
related to inventory turns.
True False
36. In the fixed-order-interval model, the
order size is the same for each order.
True False
37. The fixed-order-interval model requires a
continuous monitoring of inventory levels.
True False
38. Discrete stocking levels are used when an
organization does not want visibility of inventory levels.
True False
39. The fixed-order-interval model requires a
larger amount of safety stock than the ROP model for the same risk of a
stockout.
True False
40. The single-period model can be very
helpful in determining when to order.
True False
41. The single-period model can be very
helpful in determining how much to order.
True False
42. Monitoring inventory turns over time can
be used as a measure of performance.
True False
43. A single-period model would be used
mainly by organizations going out of business.
True False
44. The basic EOQ model ignores the
purchasing cost.
True False
45. When the item is offered for resale,
shortage costs in the single-period model can include a charge for loss of
customer goodwill.
True False
46. In the single-period model, the service
level is the probability that demand will not exceed the stocking level in any
period.
True False
47. A quantity discount will lower the
reorder point.
True False
48. It is critical that the exact quantity
calculated in the EOQ model be ordered.
True False
49. Safety stock eliminates all stockouts.
True False
50. The calculation of safety stock requires
knowledge of demand and lead time variability.
True False
51. The two basic issues in inventory are how
much to order and when to order.
True False
52. Cycle counting can be used in motorcycle
inventory control.
True False
53. Using the EOQ model, the higher an item's
carrying costs, the more frequently it will be ordered.
True False
54. A stock or store of goods is called a(n):
A. bundler.
B. servicer.
C. retailer.
D. supply chain.
E. inventory.
55. Which of the following is typically the
largest of all inventory costs?
A. shortage cost
B. purchase cost
C. holding cost
D. ordering cost
E. pipeline cost
56. Even though it is often the case that no
cash outflows result when demand exceeds capacity, __________ can nevertheless
be experienced in those circumstances.
A. foreorder costs
B. service costs
C. shortage costs
D. holding costs
E. setup costs
57. If there are shipping cost economies that
result from bundling orders for different items together, the __________ model
becomes a relatively more attractive option.
A. multi-period
B. reorder-point
C. fixed-order-quantity
D. fixed-order-interval
E. multi-item
58. Average demand for a particular item is
1,200 units per year. It costs $100 to place an order for this item, and it
costs $24 to hold one unit of this item in inventory for one year. If the
fixed-order-interval model is chosen in this instance, how often (on average)
will this item be ordered?
A. once a month
B. once every other month
C. twice a month
D. twice every three months
E. three times every two months
59. Weekly demand for a particular item
averages 30 units, with a standard deviation of 4. This item is managed with a
fixed-order-interval model. The order interval is three weeks, and this item
has a certain lead time of one week. The desired service level is 97.5 percent.
Assume that it is now time to place another order, and there are 43 units on
hand. How many units should be ordered?
A. 120
B. 93
C. 136
D. 46
E. 84
60. Which of the following is not one of the
assumptions of the basic EOQ model?
A. Annual demand requirements are known and
constant.
B. Lead time does not vary.
C. Each order is received in a single
delivery.
D. Quantity discounts are available.
E. Ordering and holding costs have been
estimated reasonably accurately.
61. Which of the following interactions with
vendors would potentially lead to inventory reductions?
A. reduced lead times
B. increased safety stock
C. less frequent purchases
D. larger batch quantities
E. longer order intervals
62. A nonlinear cost related to order size is
the cost of:
A. interest.
B. insurance.
C. taxes.
D. receiving.
E. space.
63. In a two-bin inventory system, the amount
contained in the second bin is equal to the:
A. ROP.
B. EOQ.
C. amount in the first bin.
D. optimum stocking level.
E. safety stock.
64. When carrying costs are stated as a
percentage of unit price, the minimum points on the total cost curves:
A. line up.
B. equal zero.
C. do not line up.
D. cannot be calculated.
E. depend on the percentage assigned.
65. Dairy items, fresh fruit, and newspapers
are items that:
A. do not require safety stocks.
B. cannot be ordered in large quantities.
C. are subject to deterioration and spoilage.
D. require that prices be lowered every two
days.
E. have minimal holding costs.
66. Which of the following is least likely to
be included in order costs?
A. processing vendor invoices for payment
B. processing purchase order
C. inspecting incoming goods for quantity
D. taking an inventory to determine how much
is needed
E. temporary storage of delivered goods
67. In an A-B-C system, the typical
percentage of the number of items in inventory for A items is about:
A. 10.
B. 30.
C. 50.
D. 70.
E. 90.
68. In the A-B-C classification system, items
which account for 15 percent of the total dollar volume for a majority of the
inventory items would be classified as:
A. A items.
B. B items.
C. C items.
D. A items plus B items.
E. B items plus C items.
69. In the A-B-C classification system, items
which account for 60 percent of the total dollar volume for few inventory items
would be classified as:
A. A items.
B. B items.
C. C items.
D. A items plus B items.
E. B items plus C items.
70. The purpose of cycle counting is to:
A. count all the items in inventory.
B. count bicycles and motorcycles in
inventory.
C. reduce discrepancies between inventory
records and actual quantities.
D. reduce theft.
E. count 10 percent of the items each month.
71. The EOQ model is most relevant for which
one of the following?
A. ordering items with dependent demand
B. determination of safety stock
C. ordering perishable items
D. determining fixed-interval order
quantities
E. determining fixed order quantities
72. Which is not a true assumption in the EOQ
model?
A. Production rate is constant.
B. Lead time does not vary.
C. No more than three items are involved.
D. Usage rate is constant.
E. No quantity discounts.
73. In a supermarket, a vendor's restocking
the shelves every Monday morning is an example of:
A. safety stock replenishment.
B. economic order quantities.
C. reorder points.
D. fixed order intervals.
E. blanket ordering.
74. A cycle count program will usually
require that A items be counted:
A. daily.
B. once a week.
C. monthly.
D. quarterly.
E. more often than annually.
75. A risk avoider would want ______ safety
stock.
A. less
B. more
C. the same
D. zero
E. 50 percent
76. In the basic EOQ model, if annual demand
doubles, the effect on the EOQ is:
A. It doubles.
B. It is four times its previous amount.
C. It is half its previous amount.
D. It is about 70 percent of its previous
amount.
E. It increases by about 40 percent.
77. In the basic EOQ model, if lead time
increases from five to 10 days, the EOQ will:
A. double.
B. increase, but not double.
C. decrease by a factor of 2.
D. remain the same.
E. increase, but more information is needed
to calculate exactly how much.
78. In the basic EOQ model, an annual demand
of 40 units, an ordering cost of $5, and a holding cost of $1 per unit per year
will result in an EOQ of:
A. 20.
B. square root of 200.
C. 200.
D. 400.
E. 600.
79. In the basic EOQ model, if D = 60
per month, S = $12, and H = $10 per unit per month, EOQ is:
A. 10.
B. 12.
C. 24.
D. 72.
E. 144.
80. In the basic EOQ model, if annual demand
is 50, carrying cost is $2, and ordering cost is $15, EOQ is approximately:
A. 11.
B. 20.
C. 24.
D. 28.
E. 375.
81. Which of the following is not true for
the economic production quantity model?
A. Usage rate is constant.
B. Production rate exceeds usage rate.
C. Run size exceeds maximum inventory.
D. There are no ordering or setup costs.
E. Average inventory is one-half maximum
inventory.
82. Given the same demand, setup/ordering
costs, and carrying costs, the EPQ calculated using incremental replenishment
will be ____________ if instantaneous replenishment was assumed.
A. greater than the EOQ
B. equal to the EOQ
C. smaller than the EOQ
D. greater than or equal to the EOQ
E. smaller than or equal to the EOQ
83. The introduction of quantity discounts
will cause the optimum order quantity to be:
A. smaller.
B. unchanged.
C. greater.
D. smaller or unchanged.
E. unchanged or greater.
84. A fill rate is the percentage of _____
filled by stock on hand.
A. shipments
B. demand
C. inventory
D. safety stock
E. lead time
85. In the quantity discount model, with
carrying cost stated as a percentage of unit purchase price, in order for the
EOQ of the lowest curve to be optimum, it must:
A. have the lowest total cost.
B. be in a feasible range.
C. be to the left of the price break quantity
for that price.
D. have the largest quantity compared to
other EOQs.
E. have smaller ordering costs than the
others.
86. Which one of the following is not
generally a determinant of the reorder point?
A. rate of demand
B. length of lead time
C. lead time variability
D. stockout risk
E. purchase cost
87. If no variations in demand or lead time
exist, the ROP will equal:
A. the EOQ.
B. expected usage during lead time.
C. safety stock.
D. the service level.
E. the EOQ plus safety stock.
88. If average demand for an inventory item
is 200 units per day, lead time is three days, and safety stock is 100 units,
the reorder point is:
A. 100 units.
B. 200 units.
C. 300 units.
D. 600 units.
E. 700 units.
89. Which one of the following is implied by
a lead time service level of 95 percent?
A. Approximately 95 percent of demand during
lead time will be satisfied.
B. Approximately 95 percent of inventory will
be used during lead time.
C. The probability is .95 that demand during
lead time will exactly equal the amount on hand at the beginning of lead time.
D. The probability is .95 that demand during
lead time will not exceed the amount on hand at the beginning of lead time.
E. The probability is .95 that the order will
arrive after the on-hand inventory is exhausted.
90. Which one of the following is implied by
an annual service level of 95 percent?
A. Approximately 95 percent of demand during
lead time will be satisfied.
B. The probability is .95 that demand will
exceed supply during lead time.
C. The probability is .95 that demand will
equal supply during lead time.
D. The probability is .95 that demand will
not exceed supply during lead time.
E. Approximately 95 percent of all demand
will actually be satisfied directly from on-hand inventory.
91. Daily usage is exactly 60 gallons per
day. Lead time is normally distributed with a mean of 10 days and a standard
deviation of 2 days. What is the standard deviation of demand during lead time?
A. 60 times 2
B. 60 times the square root of 2
C. 60 times the square root of 10
D. 60 times 10
E. 10 times the square root of 2
92. Lead time is exactly 20 days long. Daily
demand is normally distributed with a mean of 10 gallons per day and a standard
deviation of 2 gallons. What is the standard deviation of demand during lead
time?
A. 20 times 2
B. 20 times 10
C. 2 times the square root of 20
D. 2 times the square root of 10
E. 400 times the square root of 10
93. All of the following are possible reasons
for using the fixed-order-interval model except:
A. supplier policy encourages use.
B. grouping orders can save in shipping
costs.
C. the required safety stock is lower than
with an EOQ/ROP model.
D. it is suited to periodic checks of
inventory levels rather than continuous monitoring.
E. continuous monitoring is not practical.
94. Which of these products would be most apt
to involve the use of a single-period model?
A. gold coins
B. hammers
C. fresh fish
D. calculators
E. frozen corn
95. In a single-period model, if shortage and
excess costs are equal, then the optimum service level is:
A. 0.
B. .33.
C. .50.
D. .67.
E. .75.
96. In a single-period model, if shortage
cost is four times excess cost, then the optimum service level is ___ percent.
A. 100
B. 80
C. 60
D. 40
E. 20
97. In the single-period model, if excess
cost is double the shortage cost, the approximate stockout risk, assuming an
optimum service level, is ___ percent.
A. 100
B. 67
C. 50
D. 33
E. 5
98. In a single-period inventory situation,
the probabilities that demand will be 1, 2, 3, or 4 units are .3, .3, .2, and
.2, respectively. If two units are stocked, what is the probability of selling
both of them?
A. .5
B. .6
C. .7
D. .8
E. .9
99. The management of supply chain
inventories focuses on:
A. internal inventories.
B. external inventories.
C. both internal and external inventories.
D. safety stock elimination.
E. optimizing reorder points.
100.An operations strategy for inventory
management should work toward:
A. increasing lot sizes.
B. decreasing lot sizes.
C. increasing safety stocks.
D. decreasing service levels.
E. increasing order quantities.
101.Cycle stock inventory is intended to deal
with:
A. excess costs.
B. shortage costs.
C. stockouts.
D. expected demand.
E. quantity discounts.
102.An operations strategy which recognizes
high carrying costs and reduces ordering costs will result in:
A. unchanged order quantities.
B. slightly decreased order quantities.
C. greatly decreased order quantities.
D. slightly increased order quantities.
E. greatly increased order quantities.
103.The need for safety stocks can be reduced
by an operations strategy which:
A. increases lead time.
B. increases lead time variability.
C. increases lot sizes.
D. decreases ordering costs.
E. decreases lead time variability.
104.If average demand for an item is 20 units
per day, safety stock is 50 units, and lead time is four days, the ROP will be:
A. 20.
B. 50.
C. 70.
D. 80.
E. 130.
105.With an A-B-C system, an item that had a
high demand but a low annual dollar volume would probably be classified as:
A. A.
B. B.
C. C.
106.The fixed-order-interval model would be
most likely to be used for this situation:
A. A company has switched from mass
production to lean production.
B. Production is done in batches.
C. Spare parts are ordered when a new machine
is purchased.
D. Grouping orders can save shipping costs.
E. Demand is highly variable
107.Which item would be least likely to be
ordered under a fixed-order-interval system?
A. textbooks at a college bookstore
B. auto parts at an assembly plant
C. cards at a gift shop
D. canned peas at a supermarket
108.Which one of these would not be a factor
in determining the reorder point?
A. the EOQ
B. the lead time
C. the variability of demand
D. the demand or usage rate
E. all are factors
109.A manufacturer is contemplating a switch
from buying to producing a certain item. Setup cost would be the same as
ordering cost. The production rate would be about double the usage rate.
Compared to the EOQ, the economic production quantity would be approximately:
A. the same.
B. 20 percent larger.
C. 40 percent larger.
D. 20 percent smaller.
E. 40 percent smaller.
110.A manufacturer is contemplating a switch
from buying to producing a certain item. Setup cost would be the same as
ordering cost. The production rate would be about double the usage rate.
Compared to the EOQ, the maximum inventory would be approximately:
A. 70 percent higher.
B. 30 percent higher.
C. the same.
D. 30 percent lower.
E. 70 percent lower.
111.The manager of the Quick Stop Corner
Convenience Store (which never closes) sells four cases of Stein beer each day.
Order costs are $8.00 per order, and Stein beer costs $.80 per six-pack (each
case of Stein beer contains four six-packs). Orders arrive three days from the
time they are placed. Daily holding costs are equal to 5 percent of the cost of
the beer. At what point should he reorder Stein beer?
A. 0 cases remaining
B. 4 cases remaining
C. 12 cases remaining
D. 16 cases remaining
E. 20 cases remaining
112.The manager of the Quick Stop Corner
Convenience Store (which never closes) sells four cases of Stein beer each day.
Order costs are $8.00 per order, and Stein beer costs $.80 per six-pack (each
case of Stein beer contains four six-packs). Orders arrive three days from the
time they are placed. Daily holding costs are equal to 5 percent of the cost of
the beer. If he were to order 16 cases of Stein beer at a time, what would be
the length of an order cycle?
A. .25 days
B. 3 days
C. 1 day
D. 4 days
E. 20 days
113.The manager of the Quick Stop Corner
Convenience Store (which never closes) sells four cases of Stein beer each day.
Order costs are $8.00 per order, and Stein beer costs $.80 per six-pack (each
case of Stein beer contains four six-packs). Orders arrive three days from the
time they are placed. Daily holding costs are equal to 5 percent of the cost of
the beer. If he were to order 16 cases of Stein beer at a time, what would be
the average inventory level?
A. 4 cases
B. 12 cases
C. 8 cases
D. 20 cases
E. 16 cases
114.The manager of the Quick Stop Corner
Convenience Store (which never closes) sells four cases of Stein beer each day.
Order costs are $8.00 per order, and Stein beer costs $.80 per six-pack (each
case of Stein beer contains four six-packs). Orders arrive three days from the
time they are placed. Daily holding costs are equal to 5 percent of the cost of
the beer. If he were to order 16 cases of Stein beer at a time, what would be
the daily total inventory costs, EXCLUDING the cost of the beer?
A. $2.00
B. $4.00
C. $1.28
D. $3.28
E. $2.56
115.The manager of the Quick Stop Corner
Convenience Store (which never closes) sells four cases of Stein beer each day.
Order costs are $8.00 per order, and Stein beer costs $.80 per six-pack (each
case of Stein beer contains four six-packs). Orders arrive three days from the
time they are placed. Daily holding costs are equal to 5 percent of the cost of
the beer. What is the economic order quantity for Stein beer?
A. 8 cases
B. 11 cases
C. 14 cases
D. 20 cases
E. 32 cases
116.Ann Chovies, owner of the Perfect Pasta
Pizza Parlor, uses 20 pounds of pepperoni each day in preparing pizzas. Order
costs for pepperoni are $10.00 per order, and carrying costs are 4 cents per
pound per day. Lead time for each order is three days, and the pepperoni itself
costs $3.00 per pound. At what point should she reorder pepperoni?
A. 20 pounds remaining
B. 40 pounds remaining
C. 60 pounds remaining
D. 80 pounds remaining
E. 100 pounds remaining
117.Ann Chovies, owner of the Perfect Pasta
Pizza Parlor, uses 20 pounds of pepperoni each day in preparing pizzas. Order
costs for pepperoni are $10.00 per order, and carrying costs are 4 cents per
pound per day. Lead time for each order is three days, and the pepperoni itself
costs $3.00 per pound. If she were to order 80 pounds of pepperoni at a time,
what would be the length of an order cycle?
A. 0 days
B. 0.25 days
C. 3 days
D. 4 days
E. 5 days
118.Ann Chovies, owner of the Perfect Pasta
Pizza Parlor, uses 20 pounds of pepperoni each day in preparing pizzas. Order
costs for pepperoni are $10.00 per order, and carrying costs are 4 cents per
pound per day. Lead time for each order is three days, and the pepperoni itself
costs $3.00 per pound. If she were to order 80 pounds of pepperoni at a time,
what would be the average inventory level?
A. 20 pounds
B. 40 pounds
C. 60 pounds
D. 80 pounds
E. 100 pounds
119.Ann Chovies, owner of the Perfect Pasta
Pizza Parlor, uses 20 pounds of pepperoni each day in preparing pizzas. Order
costs for pepperoni are $10.00 per order, and carrying costs are 4 cents per
pound per day. Lead time for each order is three days, and the pepperoni itself
costs $3.00 per pound. If she were to order 80 pounds of pepperoni at a time,
what would be the total daily costs, including the cost of the pepperoni?
A. $60.00
B. $63.20
C. $64.00
D. $64.10
E. $65.00
120.Ann Chovies, owner of the Perfect Pasta
Pizza Parlor, uses 20 pounds of pepperoni each day in preparing pizzas. Order
costs for pepperoni are $10.00 per order, and carrying costs are 4 cents per
pound per day. Lead time for each order is three days, and the pepperoni itself
costs $3.00 per pound. What is the economic order quantity for pepperoni?
A. 20 pounds
B. 40 pounds
C. 60 pounds
D. 80 pounds
E. 100 pounds
121.The Operations Manager for Shadyside
Savings & Loan orders cash from her home office for her very popular
"BIG BUCKS" automated teller machine, which only dispenses $100
bills. She estimates that this machine dispenses an average of 12,500 bills per
month, and that carrying a bill in inventory costs 10 percent of its value
annually. She knows that each order for these bills costs $300 for clerical and
armored car delivery costs, and that order lead time is six days. Assuming a
30-day month, at what point should bills be reordered?
A. 0 bills remaining
B. 417 bills remaining
C. 2,500 bills remaining
D. 10,000 bills remaining
E. 12,500 bills remaining
122.The Operations Manager for Shadyside
Savings & Loan orders cash from her home office for her very popular
"BIG BUCKS" automated teller machine, which only dispenses $100 bills.
She estimates that this machine dispenses an average of 12,500 bills per month,
and that carrying a bill in inventory costs 10 percent of its value annually.
She knows that each order for these bills costs $300 for clerical and armored
car delivery costs, and that order lead time is six days. Assuming a 30-day
month, if she were to order 6,000 bills at a time, what would be the length of
an order cycle?
A. .48 days
B. 2.08 days
C. 6 days
D. 8.4 days
E. 14.4 days
123.The Operations Manager for Shadyside Savings
& Loan orders cash from her home office for her very popular "BIG
BUCKS" automated teller machine, which only dispenses $100 bills. She
estimates that this machine dispenses an average of 12,500 bills per month, and
that carrying a bill in inventory costs 10 percent of its value annually. She
knows that each order for these bills costs $300 for clerical and armored car
delivery costs, and that order lead time is six days. If she were to order
6,000 bills at a time, what would be the dollar value of the average inventory
level?
A. $3,000
B. $6,000
C. $12,500
D. $300,000
E. $600,000
124.The Operations Manager for Shadyside
Savings & Loan orders cash from her home office for her very popular
"BIG BUCKS" automated teller machine, which only dispenses $100
bills. She estimates that this machine dispenses an average of 12,500 bills per
month, and that carrying a bill in inventory costs 10 percent of its value
annually. She knows that each order for these bills costs $300 for clerical and
armored car delivery costs, and that order lead time is six days. If she were
to order 6,000 bills at a time, what would be the average monthly total costs,
EXCLUDING the value of the bills?
A. $625
B. $1,250
C. $2,500
D. $3,125
E. $37,500
125.The Operations Manager for Shadyside
Savings & Loan orders cash from her home office for her very popular
"BIG BUCKS" automated teller machine, which only dispenses $100
bills. She estimates that this machine dispenses an average of 12,500 bills per
month, and that carrying a bill in inventory costs 10 percent of its value
annually. She knows that each order for these bills costs $300 for clerical and
armored car delivery costs, and that order lead time is six days. What is the
economic order quantity?
A. 600 bills
B. 3,000 bills
C. 949 bills
D. 6,215 bills
E. 12,500 bills
126.The materials manager for a billiard ball
maker must periodically place orders for resin, one of the raw materials used
in producing billiard balls. She knows that manufacturing uses resin at a rate
of 50 kilograms each day, and that it costs $.04 per day to carry a kilogram of
resin in inventory. She also knows that the order costs for resin are $100 per
order, and that the lead time for delivery is four days. At what point should
resin be reordered?
A. 0 kilograms remaining
B. 50 kilograms remaining
C. 200 kilograms remaining
D. 400 kilograms remaining
E. 500 kilograms remaining
127.The materials manager for a billiard ball
maker must periodically place orders for resin, one of the raw materials used
in producing billiard balls. She knows that manufacturing uses resin at a rate
of 50 kilograms each day, and that it costs $.04 per day to carry a kilogram of
resin in inventory. She also knows that the order costs for resin are $100 per
order, and that the lead time for delivery is four days. If order size was
1,000 kilograms of resin, what would be the length of an order cycle?
A. .05 days
B. 4 days
C. 16 days
D. 20 days
E. 50 days
128.The materials manager for a billiard ball
maker must periodically place orders for resin, one of the raw materials used
in producing billiard balls. She knows that manufacturing uses resin at a rate
of 50 kilograms each day, and that it costs $.04 per day to carry a kilogram of
resin in inventory. She also knows that the order costs for resin are $100 per
order, and that the lead time for delivery is four days. If the order size was
1,000 kilograms of resin, what would be the average inventory level?
A. 50 kilograms
B. 200 kilograms
C. 500 kilograms
D. 800 kilograms
E. 1,000 kilograms
129.The materials manager for a billiard ball
maker must periodically place orders for resin, one of the raw materials used
in producing billiard balls. She knows that manufacturing uses resin at a rate
of 50 kilograms each day, and that it costs $.04 per day to carry a kilogram of
resin in inventory. She also knows that the order costs for resin are $100 per
order, and that the lead time for delivery is four days. If the order size was
1,000 kilograms of resin, what would be the daily total inventory costs,
EXCLUDING the cost of the resin?
A. $5
B. $10
C. $20
D. $25
E. $40
130.The materials manager for a billiard ball
maker must periodically place orders for resin, one of the raw materials used
in producing billiard balls. She knows that manufacturing uses resin at a rate
of 50 kilograms each day, and that it costs $.04 per day to carry a kilogram of
resin in inventory. She also knows that the order costs for resin are $100 per
order, and that the lead time for delivery is four days. What is the economic order
quantity for resin?
A. 50 kilograms
B. 100 kilograms
C. 250 kilograms
D. 500 kilograms
E. 1,000 kilograms
1. The goal of maintenance is to minimize cost.
True False
2. The goal of maintenance is to maintain the productive
system in good working order while minimizing or eliminating the cost of
preventive maintenance.
True False
3. Breakdown maintenance includes activities such as
equipment inspection and adjustment.
True False
4. Degree of technology is a factor affecting the
decision of how much preventive maintenance is desirable.
True False
5. Breakdown maintenance is best performed on a regularly
scheduled basis.
True False
6. One basis for scheduling preventive maintenance is
passage of time.
True False
7. Ideally, preventive maintenance will be performed
before a breakdown or failure.
True False
8. In the broadest sense, preventive maintenance extends
back to the installation stage of equipment and facilities.
True False
9. Pareto analysis (using the 80/20 rule) is one method
of determining when preventive maintenance activities should be performed.
True False
10. In the area of maintenance, the Pareto phenomenon is
reflected in the fact that, regardless of problem classification, all equipment
will justify about the same expense.
True False
11. As a piece of equipment begins to break down more
often, the manager is often faced with a trade-off in which __________ are
weighed against the __________.
A. failure rates; maintenance probabilities
B. maintenance intervals; maintenance programs
C. operating costs; variable costs
D. replacement costs; continued maintenance costs
E. fixed costs; maintenance costs
12. Suppose that for a particular piece of machinery, the
frequency distribution of monthly breakdowns is as follows: The cost of a
breakdown is $2,000, and the cost of a preventive maintenance program is $2,000
per month. If the preventive maintenance program is adopted, the probability of
a machine breakdown is negligible. How much better off per month would the firm
be if it adopted preventive maintenance?
A. $100 worse off
B. $200 worse off
C. $100 better off
D. $200 better off
E. $2,000 better off
13. Suppose that for a particular piece of machinery, the
frequency distribution of monthly breakdowns is as follows: The cost of a
breakdown is $2,000, and the cost of a preventive maintenance program is $2,000
per month. If the preventive maintenance program is adopted, the probability of
a machine breakdown is negligible. How much better off per month would the firm
be if it adopted preventive maintenance?
A. $100 worse off
B. $200 worse off
C. $100 better off
D. $200 better off
E. $2,000 better off
14. Suppose that the average time before breakdown is
normally distributed with a mean of 2.5 weeks and a standard deviation of .4
weeks. If breakdowns cost an average of $1,200 and preventive maintenance costs
$800, what is the optimal maintenance interval?
A. Every .67 weeks
B. Every .33 weeks
C. Every 2.67 weeks
D. Every 3.25 weeks
E. Every 3.12 weeks
15. Maintenance activities are often organized into the following
two groups:
A. breakdown maintenance and preventive maintenance
B. breakdown maintenance and predictive maintenance
C. preventive maintenance and predictive maintenance
D. equipment maintenance and breakdown maintenance
E. equipment maintenance and buildings maintenance
16. Breakdown maintenance is _____________; preventive
maintenance is _________.
A. reactive; proactive
B. proactive; reactive
C. expensive; inexpensive
D. inexpensive; expensive
E. easy; hard
17. The goal of maintenance is to maintain the productive
system in good working order while minimizing:
A. total preventive maintenance costs.
B. total breakdown maintenance costs.
C. total maintenance costs.
D. the difference between preventive and breakdown costs.
E. the ratio of breakdown to preventive maintenance
costs.
18. ___________ is most closely associated with breakdown
maintenance.
A. Equipment adjustment
B. Equipment cleaning
C. Equipment inspection
D. Repair of broken parts
E. Replacement of worn parts
19. Factors affecting the decision of how much preventive
maintenance is desirable typically include all of the following except:
A. age of equipment.
B. type of product.
C. degree of technology.
D. type of production process.
E. how critical to the production process.
20. Cost of equipment breakdown does not include:
A. loss of output.
B. cost of idle workers.
C. damage to other equipment.
D. replacement costs.
E. potential safety hazard.
21. The optimum amount of preventive maintenance occurs
when:
A. total breakdown costs are at a minimum.
B. total preventive maintenance costs are at a minimum.
C. each maintenance component cost is at a minimum.
D. total maintenance costs are at a maximum.
E. total maintenance costs are at a minimum.
22. The type of maintenance which is periodic in nature
is:
A. breakdown maintenance.
B. predictive maintenance.
C. preventive maintenance.
D. corrective maintenance.
E. all of the choices.
23. Preventive maintenance is generally scheduled on the
basis of:
A. planned inspections.
B. passage of time.
C. number of operating hours.
D. all of the choices.
E. none of the choices.
24. Ideally, preventive maintenance will be performed:
A. after a planned inspection.
B. after the passage of a specified period of time.
C. after a predetermined number of operating hours.
D. just prior to the start of the workday.
E. just prior to a breakdown or failure.
25. Attempting to determine when preventive maintenance
activities should be performed is called:
A. breakdown maintenance.
B. forecastive maintenance.
C. preventive maintenance.
D. predictive maintenance.
E. corrective maintenance.
26. "Total productive maintenance" is best
described as:
A. avoiding all breakdown maintenance.
B. doing a great deal of preventive maintenance to try to
avoid breakdown maintenance.
C. a JIT approach that takes advantage of cross-training.
D. extending preventive maintenance back to design.
E. none of these.
27. In the broadest sense, equipment and facilities
preventive maintenance extends back to the:
A. design and selection stage.
B. procurement stage.
C. installation stage.
D. pilot-testing stage.
E. implementation stage.
28. The major approaches used in plans to deal with
breakdowns include all of the following except:
A. standby equipment.
B. inventories of spare parts.
C. operator repair of minor problems.
D. readily available repair personnel.
E. All are major approaches.
29. In the area of maintenance, the Pareto phenomenon is
reflected in the fact that:
A. all equipment justifies about the same expense.
B. a majority of equipment will justify considerable
expense.
C. a few pieces of equipment will justify little expense.
D. a few pieces of equipment will justify considerable
expense.
E. no piece of equipment will justify major expense; it's
better to replace.
30. Reactive maintenance is _____________ maintenance.
A. planned
B. after the event
C. proactive
D. predictive
E. preventive
31. The total maintenance curve (preventive maintenance
cost plus breakdown and repair cost):
A. slopes up as the number of preventive maintenances
increases.
B. slopes down as the number of preventive maintenances
increases.
C. starts low, increases rapidly, and then drops back
down as the number of preventive maintenances increases.
D. starts high, drops gradually, but then goes back up as
the number of preventive maintenances increases.
E. remains relatively flat as the number of preventive
maintenances increases.
32. The average time before breakdown of a machine is
normally distributed and has a mean of nine weeks and a standard deviation of
1.5 weeks. If breakdown cost averages $1,500 and preventive maintenance costs
$500, what is the optimal preventive maintenance interval?
A. 3.8 weeks
B. 8.4 weeks
C. 9.6 weeks
D. 6.9 weeks
E. 7.2 weeks
33. The average time before breakdown of a machine is
normally distributed and has a mean of 18 weeks and a standard deviation of
three weeks. If breakdown cost averages $2,000 and preventive maintenance costs
$1,400, what is the optimal preventive maintenance interval?
A. 16.4 weeks
B. 14.6 weeks
C. 16.9 weeks
D. 19.6 weeks
E. 21.3 weeks
34. Which of the following is the primary consideration
with regard to preventive maintenance?
A. what technology to use
B. how varied the maintenance will be
C. how often the maintenance will occur
D. which products it will be provided to
E. who will do it
35. Which of the following would not improve the
performance of a breakdown program?
A. more trained personnel
B. short lead times for replacement parts
C. standby equipment
D. cross-training repair personnel
E. reducing inventories of spare parts
36. Breakdown programs often are prioritized such that
some equipment gets a lot of attention and other equipment gets very little.
This typically reflects the fact that breakdowns are consistent with:
A. Pareto phenomena.
B. production interruptions.
C. supply disturbances.
D. cross-trained workers.
E. lean operations.
1. A company's supply chain involves the flow
of materials and information from suppliers, through production, to the end
users.
True False
2. In supply chain organizations, functions
must operate independently of each other.
True False
3. In purchasing, one's only ethical
obligation is to one's suppliers.
True False
4. Using third-party logistics involves using
your organization's logistics function to ship to customers that are not
officially part of the supply chain.
True False
5. Every business organization is part of at
least one supply chain.
True False
6. Frequent deliveries of small shipments can
reduce inventory but also result in an increase in the transportation cost per
unit.
True False
7. The materials in the supply chain flow
toward the end of the chain, while the information and the dollars move toward
the beginning of the chain.
True False
8. Managing supply chain visibility involves
making sure that potential supply chain partners are aware of your
organization's needs.
True False
9. The goal of supply chain management is to
synchronize supply and demand of all of the organizations that are part of the
chain.
True False
10. The need for supply chain management
increases as globalization increases.
True False
11. The design of the supply chain and
establishing partnerships with vendors and distributors are examples of
operational issues in a supply chain.
True False
12. Traffic management refers to truck
movement within our parking areas.
True False
13. One of the major reasons for a company to
adopt third-party logistics is to concentrate on one's core business.
True False
14. E-commerce refers to the use of
electronic technology to facilitate business transactions.
True False
15. E-commerce involves business-to-business
(B2B) interaction only.
True False
16. Disintermediation refers to the
phenomenon that the traditional retailer or service provider is reduced or
eliminated in a supply chain.
True False
17. Most people working for a business
organization are somehow involved with the supply chain of that business.
True False
18. Strategic partnering is encouraged when
two or more business organizations have complementary products or services that
would benefit the others.
True False
19. Forming strategic partnerships is
beneficial for two or more business organizations that have the same products
or services.
True False
20. Inventory velocity refers to the average
speed (in miles/hour) of material handling equipment in a warehouse.
True False
21. Global supply chains make purchasing
easier because there are more options.
True False
22. Centralized or decentralized purchasing
is directly related to the size of an organization.
True False
23. The optimization of the supply chain uses
a mathematical model to determine the optimal number of business organizations
to be included in the chain.
True False
24. Information technology is the key to
success of global supply chains.
True False
25. Bullwhip effect refers to a phenomenon in
which demand variations that exist at the customer end of the supply chain are
magnified as orders are generated back through the supply chain.
True False
26. Starting with the final customer and
moving backward through the supply chain, batch sizes and the level of safety
stock tend to decrease.
True False
27. Scheduling and maintaining equipment are
operational decisions.
True False
28. To avoid temporary storage in a
warehouse, cross-docking can be used.
True False
29. Delayed differentiation is a means of
increasing product variety without building the customized product from scratch
or keeping large inventories of custom products.
True False
30. Returned goods are part of reverse
logistics.
True False
31. A 30 percent reduction in product and
service variety will not affect the efficiency of a supply chain.
True False
32. The service function of purchasing
interfaces with many areas, including legal, accounting, and engineering
functions.
True False
33. Gatekeeping manages the cost of shipping
returned goods.
True False
34. Outsourcing logistics gives a company
less flexibility because it forces them to focus more on core businesses.
True False
35. Vendor analysis examines the function of
purchased parts and materials with a view toward improvement or cost reduction.
True False
36. Using third-party fulfillment means
losing control of fulfillment.
True False
37. Price is the primary determining factor
in choosing a vendor since most products are essentially the same.
True False
38. RFID eliminates the need for counting and
bar-code scanning.
True False
39. The importance of purchasing relates only
to the cost of parts and materials purchased, which is often 60 percent or more
of the cost of finished goods.
True False
40. Important factors in purchasing include
the cost of goods purchased, the quality of goods and services, and the timing
of deliveries of goods or services.
True False
41. Vendor analysis is the process that
evaluates the source of supply in terms of price, quality, reputation, and
service.
True False
42. In e-commerce, the front-end design is
significantly more important than the back-end design.
True False
43. One disadvantage to RFID is that it
requires a clear "line of sight" to operate.
True False
44. Decentralized purchasing can usually
offer quicker response than centralized purchasing.
True False
45. Some firms have structured their
procurement function to include both centralized and decentralized purchasing.
True False
46. Creating an effective supply chain
requires linking the marketing, distribution, and supplier channels.
True False
47. An advantage of decentralized purchasing
is the attention given to local needs.
True False
48. Event management is the advanced planning
required for major performances such as concerts or conferences.
True False
49. Strategies to address supply chain risks
include:
(I) risk avoidance.
(II) risk reduction.
(III) risk projection.
(IV) risk sharing.
A. I, II, and IV only
B. II and III only
C. I and IV only
D. II and IV only
E. I, II, III, and IV
50. Which of the following, while desirable
from some perspectives, might actually increase the risk of supply chain
reductions?
(I) fewer supply chain partners
(II) a shorter supply chain
(III) greater supply chain visibility
A. I and II only
B. II and III only
C. I and III only
D. I only
E. I, II, and III
51. One of the biggest ethical risks in
supply chain management is that the __________ supply chain member tends to be
the one that suffers the blame and/or lost goodwill when something goes wrong.
A. most responsible
B. buying
C. most visible
D. supplying
E. most ethical
52. The more __________ a company's supply
chain, the more difficult it is to ensure that the supply chain is managed
ethically.
A. interconnected
B. global
C. visible
D. shortened
E. competitive
53. It is especially the case for small
businesses that closer interactions and increased agility make __________
relatively more attractive.
A. domestic suppliers
B. centralized purchasing
C. global suppliers
D. decentralized purchasing
E. risk transfer
54. Which of these aspects of supply chain
management are especially concerning to small business?
(I) customer reliability
(II) inventory management
(III) purchasing costs
(IV) risk management
(V) international trade
A. III, IV, and V only
B. I, II, and III only
C. I, III, and IV only
D. I and II only
E. II, IV, and V only
55. Which of the following is not a goal of
supply chain management?
A. fewer suppliers and long-term
relationships
B. small lot sizes
C. on-time deliveries
D. lowest possible transportation costs
E. delivery often to the place of use
56. Logistics includes all of these except:
A. the movement of materials within a
production facility.
B. incoming shipments of goods or materials.
C. outgoing shipments of goods or materials.
D. customer selection.
E. returned goods processing.
57. Small changes in consumer demand can
result in large variations in orders placed because of the:
A. supply chain.
B. safety stock requirement.
C. lead time effect.
D. bullwhip effect.
E. FCFS scheduling.
58. RFID chips:
(I) are used to track goods in distribution.
(II) are used to track job progress in
production.
(III) are used to provide special
instructions to operators.
(IV) can be used in inventory record keeping.
A. II and III only
B. I and II only
C. II, III, and IV
D. I, II, and IV
E. IV only
59. Which of the following is not a benefit
of RFID?
A. increased productivity
B. elimination of paperwork
C. frequent deliveries of smaller shipments
D. reduction in clerical labor
E. increased accuracy
60. A factor that makes it desirable for
business organizations to actively manage their supply chains is:
A. more potential vendors.
B. increasing globalization.
C. downsizing.
D. the Internet.
E. RFIDs.
61. Which of the following is not a benefit
of effective supply chain management?
A. lower inventory costs
B. higher productivity
C. shorter lead times
D. greater customer loyalty
E. larger number of suppliers
62. Which of the following is not a measure
of the reliability of the supply chain?
A. supply chain response time
B. on-time delivery
C. fill rate
D. lead time variability
E. improving e-fulfillment statistics
63. The automatic identification of material
is part of/facilitated by:
A. holding costs.
B. RFID.
C. working capital reduction.
D. net present value calculations.
E. vendor analysis.
64. Which of the following is not an
application of E-business?
A. Internet buying and selling
B. e-mail
C. order and shipment tracking
D. electronic data interchange (EDI)
E. universal product codes
65. Which of the following is an advantage of
E-business?
(I) reduction of transaction costs
(II) shortened supply chain response time
(III) greater customer loyalty
A. I
B. II
C. I and II
D. II and III
E. I, II, and III
66. Which of the following is a barrier to
the integration of separate organizations in the supply chain?
(I) conflicting objectives of the companies
in the chain
(II) different capacity levels of the
companies in the chain
(III) reluctance of the organizations in the chain
to allow other organizations access to their data
A. I only
B. I and II
C. II and III
D. I and III
E. I, II, and III
67. _________ has/have helped firms to
concentrate on their core business.
A. Supply chains
B. Scheduling
C. Outsourcing
D. ERP
E. Lean production
68. Outsourcing followed by __________ is not
simple.
A. integration
B. unionization
C. backsourcing
D. computerization
E. just-in-time
69. The interface between the firm and its
suppliers is:
A. purchasing.
B. production.
C. distribution.
D. engineering.
E. accounting.
70. The two types of decisions that are
relevant to supply chain management are:
A. short- and long-term.
B. domestic and international.
C. location and layout.
D. in-sourcing and outsourcing.
E. tactical and operational.
71. One important objective of purchasing is
to:
A. set quality standards for purchased items.
B. be knowledgeable about new products.
C. maintain numerous sources of supply.
D. obtain the lowest prices on all purchased
items.
E. determine the processes that should be
used.
72. The purchasing cycle begins with:
A. selecting a supplier.
B. placing an order.
C. evaluating potential vendors.
D. conducting a value analysis.
E. receiving a requisition.
73. Examination of the sources of supply for
purchased parts or materials in order to improve performance is called:
A. vendor analysis.
B. value analysis.
C. negotiated purchasing.
D. reverse engineering.
E. disintegration.
74. Vendor analysis has the greatest
potential for savings for items which have:
A. low cost per unit.
B. low annual cost-volume.
C. high cost per unit.
D. high annual usage.
E. high annual cost-volume.
75. Which of the following is not true of
vendor analysis?
A. It involves an examination of the function
of purchased parts or raw materials.
B. Its purpose is to reduce costs and/or
improve performance of purchased goods or services.
C. It is usually performed only periodically.
D. Representatives from design and operations
may work with purchasing.
E. If improvements are identified, purchasing
implements those that purchasing agrees are justified.
76. Which of the following is not a
performance driver?
A. quality
B. cost
C. stability
D. velocity
E. flexibility
77. Which of the following would not usually
be a main factor in selecting a vendor?
A. location
B. price
C. quality
D. inventory turnover
E. vendor services
78. Which of the following is part of the
purchasing cycle?
(I) Purchasing selects a supplier.
(II) Orders from vendors are received.
(III) Purchasing receives a requisition.
A. II and III
B. I, II, and III
C. I only
D. I and II
E. I and III
79. Which of the following is least likely to
be a key consideration when a company chooses a supplier?
A. lead time and on-time delivery
B. reputation and financial stability
C. value analysis
D. quality and quality assurance
E. flexibility of design change
80. Which of the following is not a benefit
of centralized purchasing?
A. potential for quantity discounts
B. better service from suppliers
C. quick response to local needs
D. potential for use of purchasing
specialists
E. supplier research
81. The purchasing perspective of the
supplier as a partner is characterized by:
A. an emphasis on low prices.
B. one or a few suppliers.
C. low flexibility.
D. 100 percent inspection for quality.
E. low volume.
82. Vendor analysis is the examination of the
_________ of purchased materials.
A. function
B. source
C. quality
D. cycle
E. quantity
83. Last quarter, a retailer sold 8,000
T-shirts, 7,000 of which were sold directly from on-hand inventory. This retailer's
________ was 88 percent.
A. fill rate
B. inventory yield
C. profit margin
D. inventory turnover
E. working yield
84. Which of the following is a principle
required for ethical behavior in purchasing?
(I) loyalty to employer
(II) justice to those you deal with
(III) faith in your profession
A. III only
B. I only
C. II only
D. I, II, and III
E. II and III only
85. The activity which begins with a request
from within the organization is:
A. outsourcing search.
B. purchasing cycle.
C. supplier selection.
D. order receipt.
E. supply chain management.
86. Our organization can obtain visibility to
potential trading partners on the Internet by using:
A. C2C.
B. B2C.
C. B2B.
D. C2B.
E. 2BC.
87. Real-time information about product
movement on store shelves could benefit from the use of:
A. batch processing.
B. economic order quantities.
C. statistical process control.
D. radio frequency identification tags.
E. infrared remote scanners.
88. The website and order fulfillment are
essential features of:
A. delayed differentiation.
B. e-commerce.
C. Internet service providers.
D. inventory balancing.
E. market segmentation.
89. A given inventory item has a per-year
holding cost of $500. One method of shipping this item is three days faster
than the other, but it is $2.50 more per unit. Using the slower method would be
__________ more expensive overall than using the faster method.
A. $1.08
B. $1.16
C. $2.37
D. $2.73
E. $1.61
1. In lean operations, input resources
arrive for processing just as the preceding batch is completed
2. A
functioning MRP system is required prior to adopting lean planning and control
systems.
FALSE
FALSE
3. In
a lean environment, anything not essential to the product or process is viewed
as waste.
TRUE
TRUE
4. The
ultimate goal of lean operations is a system characterized by the smooth, rapid
flow of materials.
TRUE
TRUE
5. Although
inventories are maintained, the goal of lean operations is to minimize safety
stock.
FALSE
FALSE
6. Lean
operations are unable to easily handle changes of output or product mix.
FALSE
FALSE
7. In
the lean philosophy, producing more than two order quantities represents
waste.
FALSE
FALSE
8. The
four building blocks of lean operations are: product design, process design,
personnel/organizational elements, and manufacturing planning and control.
TRUE
TRUE
9. Fast
and simple are two common threads that run through the four building blocks of
lean operations.
TRUE
TRUE
10. Value-stream
mapping is a technique focused on finding new ways of adding value for critical
stakeholders such as customers.
FALSE
FALSE
11. If
a firm's product mix is 60% of product A and 20% each of products B and C, an
optimal mix-model production schedule would be successive sequences of
AAABC.
FALSE
FALSE
12. Quality
and highly capable production systems are requirements for the successful
implementation of lean operations.
TRUE
TRUE
13. The
small lot-sizing policy works well in a situation where both holding costs and
setup costs are high.
FALSE
FALSE
14. The
use of small lot sizes in lean operations is in conflict with the EOQ approach
since setup costs tend to be significantly higher than holding costs.
FALSE
FALSE
15. A
basic requirement for operating with low inventories in lean systems is that
major system problems must already have been solved and new problems will be
solved as they appear.
TRUE
TRUE
16. A
benefit of small lot sizes in lean systems is that each product is produced
less frequently.
FALSE
FALSE
17. In
the lean philosophy, the larger the lot size, the easier it is to
schedule.
FALSE
FALSE
18. Setup
time and its associated cost can often be reduced by the use of group
technology.
TRUE
TRUE
19. Lean
systems often use layouts that are based on group technology product
requirements.
TRUE
TRUE
20. The
goal of lean operations is to produce output using fewer resources than
traditional planning systems.
TRUE
TRUE
21. "Autonomation"
indicates that the firm is attempting to reduce its dependence on automated
equipment.
FALSE
FALSE
22. "Preventive
maintenance" is additional maintenance done immediately after a breakdown
has occurred to help prevent any further breakdowns.
FALSE
FALSE
23. In
the lean approach, inventories are reduced gradually, instead of eliminating
inventories as rapidly as possible.
TRUE
TRUE
24. One
problem with lean operations is that they can lead to much frustration and
disappointment of people on the shop floor due to the need for continuously
monitoring and expediting resource availability.
TRUE
TRUE
25. A
real advantage of the lean philosophy is the reduction of co-ordination effort
required.
FALSE
FALSE
26. The
lean philosophy recognizes that some work-in-process inventories are a
necessary investment to allow for smooth work-flow.
FALSE
FALSE
27. Preventive
maintenance will eliminate the need to carry supplies of spare parts.
FALSE
FALSE
28. A
fundamental tenet of the lean philosophy is that workers are paid based on
seniority.
FALSE
FALSE
29. In
lean operations, a responsibility of the cross-trained worker is to check the
quality of the work of others.
TRUE
TRUE
30. In
lean operations, when work is completed at one work center, it is important to
immediately move the completed work to the next work center to minimize idle
time.
FALSE
FALSE
31. In
a "pull system," a quantity of inventory in front of a workstation
indicates problems at that workstation.
TRUE
TRUE
32. Limited
WIP lowers inventory carrying costs but reduces flexibility.
FALSE
FALSE
33. Engineering
changes can be very disruptive to smooth operations and should not be made in
the six month period following introduction of a new product.
FALSE
FALSE
34. Kanban
is the Japanese term for autonomation.
FALSE
FALSE
35. Increased
setup times equal increased work in process inventories.
TRUE
TRUE
36. Kanban
focuses on specific part numbers; CONWIP does not.
TRUE
TRUE
37. Lean
systems typically require that suppliers be able to provide large lots at
periodic intervals.
FALSE
FALSE
38. Lean
purchasing requires frequent contract bidding by multiple sources to ensure the
buyer of competitive prices.
FALSE
FALSE
39. One
way of reducing the number of suppliers to the organization is to limit
contacts to only one or two tiers of suppliers.
FALSE
FALSE
40. One
major difference between the use of kanban and MRP II in scheduling the
products to be built is that kanban is primarily a manual system while MRP II
uses computers.
TRUE
TRUE
41. A
benefit of the lean philosophy is the flexibility to respond quickly to changing
customer requirements.
TRUE
TRUE
42. A
benefit of lean systems is that lead times are increased allowing more time for
processing.
FALSE
FALSE
43. A
successful conversion to a lean system requires that every vendor use lean
approaches prior to the organization's implementation.
FALSE
FALSE
44. The
single-minute exchange of die is a system for reducing defective product.
FALSE
FALSE
45. In
a balanced system cycle time is equal to Takt time.
TRUE
TRUE
46. It
is important to lower the water (inventory) completely to expose all the rocks
(problems).
FALSE
FALSE
47. Successful
lean implementation requires much more than slogans and idealistic goals such
as zero inventories and zero defects.
TRUE
TRUE
48. Lean
concepts include large lots to take advantage of the economies of scale.
FALSE
FALSE
49. Value-stream
mapping is concerned strictly with the flow of materials through a production
system.
FALSE
FALSE
50. For
a company with a product mix of 40% of product A and 30% each of products B and
C, which of the following mixed-model sequences most reflects the lean
philosophy?
A. AABBCCAABC
B. ABCABCABCA
C. AAAABBBCCC
D. BCABCABCAB
E. BBBAACCCAA
A. AABBCCAABC
B. ABCABCABCA
C. AAAABBBCCC
D. BCABCABCAB
E. BBBAACCCAA
51. The
lean philosophy suggests that workers are ¼
A. Assets
B. Liabilities
C. Interchangeable
D. Replaceable
E. To be phased out
A. Assets
B. Liabilities
C. Interchangeable
D. Replaceable
E. To be phased out
52. The
ultimate goal of lean operations is to have:
A. no in-process inventories
B. cross-trained workers capable of handling every process
C. a smooth, rapid flow of materials through the system
D. no setup times
E. all of the above
A. no in-process inventories
B. cross-trained workers capable of handling every process
C. a smooth, rapid flow of materials through the system
D. no setup times
E. all of the above
53. Which
one of the following is not one of the building blocks that is the foundation
of the lean philosophy?
A. product design
B. process design
C. personnel/organizational elements
D. manufacturing planning and control
E. kanban
A. product design
B. process design
C. personnel/organizational elements
D. manufacturing planning and control
E. kanban
54. Building
up an inventory of standard parts or modules instead of immediately producing
the finished end items is the essence of:
A. delayed differentiation
B. kanban
C. autonomation
D. andon
E. matrix management
A. delayed differentiation
B. kanban
C. autonomation
D. andon
E. matrix management
55. Which
of the following would you not expect to see in a lean environment?
A. a flexible system
B. minimum inventory
C. little waste
D. reduced setup times
E. a significant number of daily schedule changes
A. a flexible system
B. minimum inventory
C. little waste
D. reduced setup times
E. a significant number of daily schedule changes
56. The
comprehensive approach used in lean systems to deal with quality
includes:
A. designing quality into products and processes
B. insisting vendors provide high quality materials
C. making workers responsible for producing high quality
D. A, B and C
E. 100% inspection of raw materials, work-in-process and finished goods
A. designing quality into products and processes
B. insisting vendors provide high quality materials
C. making workers responsible for producing high quality
D. A, B and C
E. 100% inspection of raw materials, work-in-process and finished goods
57. Which
of the following is not a benefit of small lot sizes in lean systems?
A. In-process inventory is considerably less.
B. Each product is produced less frequently.
C. Carrying costs are reduced.
D. There is less clutter in the workplace.
E. Inspection and rework costs are less.
A. In-process inventory is considerably less.
B. Each product is produced less frequently.
C. Carrying costs are reduced.
D. There is less clutter in the workplace.
E. Inspection and rework costs are less.
58. In
the lean philosophy, the ideal lot size is:
A. the economic order quantity
B. the economic run size
C. one unit
D. the capacity of the standard container
E. N=(DT(1+X))/C
A. the economic order quantity
B. the economic run size
C. one unit
D. the capacity of the standard container
E. N=(DT(1+X))/C
59. Which
of the following does not contribute to reduced setup time and cost?
A. standardized setup tools
B. standardized setup equipment
C. custom setup procedures for each product
D. use of multipurpose equipment or attachments
E. use of group technology
A. standardized setup tools
B. standardized setup equipment
C. custom setup procedures for each product
D. use of multipurpose equipment or attachments
E. use of group technology
60. A
conveyance __________ signals parts movement.
A. Request
B. Routing
C. Bar code
D. Kanban
E. Kazian
A. Request
B. Routing
C. Bar code
D. Kanban
E. Kazian
61. The
term that refers to the automatic detection of defects is:
A. kaizen
B. kanban
C. autonomation
D. automation
E. 100% inspection
A. kaizen
B. kanban
C. autonomation
D. automation
E. 100% inspection
62. A
basic requirement for operating with the low inventories present in lean
systems is:
A. Inventory space must be increased.
B. Inventory investment must be increased.
C. Major problems must be identified.
D. Major problems must have been solved.
E. Inventories must be reduced rapidly.
A. Inventory space must be increased.
B. Inventory investment must be increased.
C. Major problems must be identified.
D. Major problems must have been solved.
E. Inventories must be reduced rapidly.
63. Which
of the following is not characteristic of preventive maintenance in lean
systems?
A. maintaining equipment in good operating condition
B. replacing parts when they are worn but before they fail
C. workers maintaining their own equipment
D. eliminating supplies of spare parts to reduce capital investment
E. perceiving breakdowns as an opportunity for improvement
A. maintaining equipment in good operating condition
B. replacing parts when they are worn but before they fail
C. workers maintaining their own equipment
D. eliminating supplies of spare parts to reduce capital investment
E. perceiving breakdowns as an opportunity for improvement
64. The
Five S's don't include ¼
A. Sort
B. Straighten
C. Sanitize
D. Sweep
E. Standardize
A. Sort
B. Straighten
C. Sanitize
D. Sweep
E. Standardize
65. The
Kaizen philosophy applies to ¼
A. Employee development
B. Safety stock
C. Waste
D. Supply Chain Management
E. MRP III
A. Employee development
B. Safety stock
C. Waste
D. Supply Chain Management
E. MRP III
66. A
kanban card is used to signal that:
A. work is needed at the work center
B. work is ready to be moved to the next station
C. a worker has run out of parts needed for further processing
D. a machine has broken down and needs immediate attention
E. a machine is ready for preventive maintenance
A. work is needed at the work center
B. work is ready to be moved to the next station
C. a worker has run out of parts needed for further processing
D. a machine has broken down and needs immediate attention
E. a machine is ready for preventive maintenance
67. With
regard to suppliers, lean systems typically require:
A. delivery of large lots at regular intervals
B. buyer inspection of goods and materials
C. multiple sources from which to purchase
D. long-term relationships and commitments
E. the lowest price possible
A. delivery of large lots at regular intervals
B. buyer inspection of goods and materials
C. multiple sources from which to purchase
D. long-term relationships and commitments
E. the lowest price possible
68. Which
of the following is characteristic of the lean philosophy?
A. Inventories are an asset.
B. Lot sizes are optimized by formula.
C. Vendors are co-workers, essentially other departments of our organization.
D. Queues are a necessary investment.
E. all of the above
A. Inventories are an asset.
B. Lot sizes are optimized by formula.
C. Vendors are co-workers, essentially other departments of our organization.
D. Queues are a necessary investment.
E. all of the above
69. The
activities controlled in the same way by kanban and MRP II is the determination
of:
A. rates of output
B. products to be built
C. materials required
D. capacity required
E. feedback information
A. rates of output
B. products to be built
C. materials required
D. capacity required
E. feedback information
70. Process
design supporting lean doesn't include ¼
A. Production flexibility.
B. Duplicate facilities.
C. Setup time reduction.
D. Minimal inventory storage.
E. Small lot sizes
A. Production flexibility.
B. Duplicate facilities.
C. Setup time reduction.
D. Minimal inventory storage.
E. Small lot sizes
71. Which
of the following questions is not answered by value stream mapping?
A. Where does waste occur?
B. Which processes or sub-processes exhibit the most variability?
C. Where are the best opportunities to extract more value from customers?
D. Where are process bottlenecks?
E. Where do errors occur?
A. Where does waste occur?
B. Which processes or sub-processes exhibit the most variability?
C. Where are the best opportunities to extract more value from customers?
D. Where are process bottlenecks?
E. Where do errors occur?
72. A
successful conversion to a lean system requires that the conversion:
A. be done as quickly as possible
B. begin at the start of the process and work forward
C. convert vendors to lean as one of the last steps
D. reduce setup times as one of the last steps
E. all of the above
A. be done as quickly as possible
B. begin at the start of the process and work forward
C. convert vendors to lean as one of the last steps
D. reduce setup times as one of the last steps
E. all of the above
73. A
potential obstacle to conversion to a lean system is:
A. lack of management commitment
B. lack of worker cooperation
C. supplier resistance
D. all of the above
E. insufficient space to store the increased inventories
A. lack of management commitment
B. lack of worker cooperation
C. supplier resistance
D. all of the above
E. insufficient space to store the increased inventories
74. A
system of lights used at each workstation to signal problems or slowdowns
is:
A. command and control center
B. automation
C. andon
D. pull system
E. kanban
A. command and control center
B. automation
C. andon
D. pull system
E. kanban
75. Which
of the following contributes to the competitive advantage enjoyed by firms
using lean production?
A. Backup employees to cover for absenteeism
B. 100% inspection to remove defects
C. Dedicated equipment to reduce unit costs
D. Safety stocks to prevent stock-outs
E. Greater flexibility to cope with change
A. Backup employees to cover for absenteeism
B. 100% inspection to remove defects
C. Dedicated equipment to reduce unit costs
D. Safety stocks to prevent stock-outs
E. Greater flexibility to cope with change
76. An
operations strategy reflecting the lean philosophy of production should
recognize that lean:
A. is most suited for non-repetitive manufacturing
B. cannot be implemented sequentially
C. requires a wholesale commitment from the outset
D. may provide a competitive advantage
E. all of the above
A. is most suited for non-repetitive manufacturing
B. cannot be implemented sequentially
C. requires a wholesale commitment from the outset
D. may provide a competitive advantage
E. all of the above
77. With
regard to suppliers, lean systems typically involve:
A. delivery of large lots on short notice
B. the highest quality at the lowest price
C. long-term relationships
D. multiple suppliers to assure continuous availability
E. dedicated staging areas for material
A. delivery of large lots on short notice
B. the highest quality at the lowest price
C. long-term relationships
D. multiple suppliers to assure continuous availability
E. dedicated staging areas for material
78. A
common objective of both MRP and the lean philosophy is to:
A. smooth production
B. minimize inventory
C. obtain high quality
D. reduce overhead
E. eliminate inventory
A. smooth production
B. minimize inventory
C. obtain high quality
D. reduce overhead
E. eliminate inventory
79. The
ultimate objective in a lean system is:
A. low to moderate levels of inventory
B. high quality, zero defects
C. minimal waste (less than 6%)
D. balanced and rapid flow
E. all of the above
A. low to moderate levels of inventory
B. high quality, zero defects
C. minimal waste (less than 6%)
D. balanced and rapid flow
E. all of the above
1. Flow-shop scheduling is used in
high-volume systems.
True False
2. Line balancing is a major factor in the
design and scheduling of low-volume systems because of batch processing.
True False
3. Scheduling in intermediate-volume systems
has three basic issues: run size, timing, and sequence.
True False
4. When operations are often bottlenecked, additional
planned idle time will improve the throughput in those areas.
True False
5. When orders exceed our capacity, priority
rules are used to select which orders will be accepted.
True False
6. The term loading, as used in
scheduling, refers to choosing the order in which jobs will be processed in
low-volume systems.
True False
7. Loading is the determination of which work
centers should perform which jobs.
True False
8. A Gantt chart is a basic scheduling tool
that works best for high-volume systems.
True False
9. A Gantt chart is a basic scheduling tool
that is most useful in low-volume systems.
True False
10. A schedule chart depicts the loading and
idle times for a group of machines or departments.
True False
11. The output of the system cannot exceed
the output of the bottleneck operation(s).
True False
12. The elimination of idle time on both
bottleneck and non-bottleneck operations must be accomplished to optimize
output.
True False
13. As long as the bottleneck operations are
used effectively, idle time in non-bottleneck operations will not affect the
overall productivity of the system.
True False
14. The quantity sent to a bottleneck
operation could be split into two or more process batches to better utilize a
bottleneck resource rather than process the entire batch.
True False
15. Splitting a large lot after one operation
beyond a bottleneck operation would reduce the overall waiting time of the
bottleneck operation.
True False
16. Input/output (I/O) control refers to
monitoring the productivity changes since productivity is determined by the
ratio of output to input.
True False
17. Infinite loading and finite loading are
two major approaches used to load work centers.
True False
18. A schedule chart can be used to monitor
job progress.
True False
19. The assignment model seeks an optimum
matching of tasks and resources.
True False
20. Sequencing is concerned with the order in
which jobs are done, while loading is concerned with assigning jobs to work
centers or workstations.
True False
21. Priority rules are widely used to
sequence jobs in high-volume systems.
True False
22. The assignment method is limited to a
maximum of two jobs per resource.
True False
23. Priority rules generally assume that job
setup cost is independent of processing sequence of jobs.
True False
24. In a single work center, makespan
improvement can be accomplished by selecting the optimal sequencing rule.
True False
25. Priority rules are used in low-volume
systems to identify an optimal processing sequence.
True False
26. The SPT priority rule always results in
the lowest average completion time.
True False
27. Bottlenecks may shift with the passage of
time, so that different operations become bottleneck operations at different
times.
True False
28. If optimal sequencing through three work
centers is desired, Johnson's rule II is used rather than Johnson's rule.
True False
29. In the decision-making hierarchy,
scheduling decisions are the final step in the transformation process before
actual output occurs.
True False
30. Makespan is the total time needed to
complete a group of jobs.
True False
31. The theory of constraints has a goal of
maximizing flow through the entire system.
True False
32. Similar to that in manufacturing, the
service scheduling hierarchy begins with __________ and ends with _________.
A. aggregate planning; detailed daily
scheduling
B. aggregate planning; master scheduling
C. master scheduling; detailed material
planning
D. aggregate planning; detailed material
planning
E. quarterly planning; monthly planning
33. Which of the following is present in the
manufacturing scheduling hierarchy but is absent in the service scheduling
hierarchy?
A. aggregate planning
B. materials planning
C. master scheduling
D. detailed, short-term scheduling
E. detailed, short-term planning
34. In theory of constraints scheduling, the
__________ refers to the schedule and the __________ refers to inventory used
to ensure that the bottleneck is never idle.
A. rope; drum
B. drum; rope
C. drum; buffer
D. buffer; drum
E. buffer; rope
35. In theory of constraints scheduling, the
synchronization of the sequence of operations is referred to as the:
A. buffer.
B. bottleneck.
C. constraint.
D. rope.
E. drum.
36. To facilitate utilization of bottleneck
operations, in theory of constraints scheduling ________ can be split into
__________ to reduce waiting times.
A. bottleneck lots; nonbottleneck lots
B. transfer batches; process lots
C. sized lots; constrained lots
D. process batches; transfer batches
E. buffer lots; transfer lots
37. Ensuring that the constraining resource
is used to its maximum is an example of constraint:
A. elevation.
B. subordination.
C. identification.
D. elimination.
E. exploitation.
38. Scheduling pertains to:
A. hiring workers.
B. process selection.
C. buying machinery.
D. timing the use of specific resources.
E. determining the lowest cost.
39. Which of the following is the last step
in the capacity/scheduling chain?
A. product planning
B. process planning
C. capacity planning
D. aggregate planning
E. scheduling
40. Which of the following is not an example
of a high-volume system?
A. aircraft manufacturing
B. magazine printing
C. petroleum refining
D. waste treatment
E. commercial donut baking
41. Which of the following is not usually a
characteristic of successful high-volume systems?
A. smooth workflow through the system
B. customized output
C. rapid repair of breakdowns
D. minimal quality problems
E. reliable supply schedules
42. Primary considerations in scheduling
high-volume systems involve:
(I) coordinating the flow of inputs.
(II) overcoming the disruptions to planned
outputs.
(III) assigning workers to work centers.
A. I and III
B. I and II
C. II and III
D. I, II, and III
E. II only
43. Organizations with fixed, perishable
capacity can benefit from:
A. yield management.
B. price increases.
C. constraints.
D. suboptimization.
E. waiting lines.
44. A work center can be a:
(I) machine.
(II) group of machines.
(III) department.
(IV) facility.
A. I, II, and III only
B. II and IV only
C. II and III only
D. I and III only
E. I, II, III, and IV
45. The EDD priority rule usually does well
with regard to:
A. cost.
B. lateness.
C. overtime.
D. waste.
E. makespan.
46. Which of the following is not an
assumption of priority rules?
A. The set of jobs is known: no new jobs
arrive after processing begins.
B. Setup time is independent of processing
sequence.
C. Finite loading is assumed.
D. Processing times are deterministic.
E. No machine breakdowns are assumed.
47. The two different approaches to load work
centers in job-shop scheduling are:
A. load charts and schedule charts.
B. Gantt charts and assignment method.
C. infinite loading and finite loading.
D. linear programming and makespan.
E. infinite charting and finite charting.
48. The priority rule which will sequence
jobs in the order they are received is:
A. EDD.
B. LIFO.
C. SPT.
D. CR.
E. FCFS.
49. A scheduling technique used to achieve an
optimum, one-to-one matching of tasks and resources is:
A. the assignment method.
B. Johnson's rule.
C. the optimum production technology method.
D. the appointment method.
E. the reservation method.
50. In a task assignment situation, in how
many different ways can five jobs be assigned to five machines?
A. 1
B. 5
C. 25
D. 120
E. 3,125
51. In an assignment method problem, if it
takes Abe 3 hours to build a birdhouse and 4 hours for a doghouse, while Betty
takes 4 hours for a birdhouse and 3 hours for a doghouse, what is the reduced
cost (in hours) of assigning Abe to build the doghouse?
A. 0 hours
B. 1 hour
C. 2 hours
D. 3 hours
E. 4 hours
52. The following matrix shows relative costs
for various job-machine combinations. Which set of pairs constitutes the
minimum-cost solution using the assignment method?
A. 1-B, 2-C, 3-A
B. 1-B, 2-A, 3-C
C. 1-A, 2-C, 3-B
D. 1-A, 2-B, 3-C
E. 1-C, 2-A, 3-B
53. Based on the cost information given in
the following table, which set of job-machine pairs reflects the minimum-cost
solution using the Assignment method?
A. 1-B, 2-A, 3-C
B. 1-A, 2-B, 3-C
C. 1-C, 2-A, 3-B
D. 1-B, 2-C, 3-A
E. 1-C, 2-B, 3-A
54. Effective scheduling cannot:
A. yield cost savings and improved
productivity.
B. reduce the need for expansion of
facilities.
C. improve customer service.
D. eliminate the need to train employees.
E. improve patient care in medical settings.
55. The priority rule where jobs are
processed according to the smallest ratio of due date to processing time is:
A. CR.
B. EEDD.
C. FCFS.
D. S/O.
E. SPT.
56. Scheduled due dates are the result of:
A. promises to customers.
B. MRP processing.
C. managerial decisions.
D. all of the choices.
E. our competitor's promises.
57. Which of the following is not a measure
for judging the effectiveness of a schedule sequence?
A. average number of jobs at the work center
B. total number of jobs at the work center
C. average completion (flow) time
D. average job tardiness
E. total number of work centers per job
58. The purpose of cyclical scheduling is to:
A. eliminate weekends and holidays.
B. rotate schedules.
C. add flexible hours.
D. incorporate overtime.
E. observe work patterns.
59. Average completion (flow) time for a
schedule sequence at a work center is:
A. the sum of processing time divided by the
number of jobs.
B. the sum of jobs' flow times divided by the
number of jobs.
C. overall flow time divided by total processing
time.
D. total processing time plus total late time
divided by number of jobs.
E. the sum of flow time plus total late time
divided by number of jobs.
60. The scheduling sequencing rule which
always results in the lowest average completion (flow) time is the:
A. first come, first served (FCFS) rule.
B. shortest processing time first (SPT) rule.
C. earliest due date first (EDD) rule.
D. least slack per operation first (S/O)
rule.
E. run until slack happens (RUSH) rule.
61. Which sequencing rule is designed
specifically to minimize job tardiness?
A. S/O
B. EDD
C. FCFS
D. SPT
E. LPT
62. A scheduling rule used for sequencing
jobs through two work centers is:
A. critical ratio rule.
B. Johnson's rule.
C. slack per operation rule.
D. shortest processing time rule.
E. Pareto rule.
63. For the jobs listed below, which
processing sequence would result using Johnson's rule?
A. c-a-d-b
B. b-d-a-c
C. a-b-c-d
D. d-c-b-a
E. c-a-b-d
64. What is the optimum job sequence for the
jobs listed below using Johnson's rule?
A. e-g-f-d
B. d-g-f-e
C. d-f-g-e
D. e-d-f-g
E. f-e-d-g
65. A major difference between manufacturing
and service systems in terms of scheduling is:
A. variability in arrival and service rates.
B. processing cost per unit.
C. the number of units to be processed.
D. length of processing time.
E. output rate.
66. Scheduling in service systems often takes
the form of:
(I) appointment systems.
(II) reservation systems.
(III) makespan systems.
A. I only
B. II only
C. I and II only
D. III only
E. I, II, and III
67. Scheduling in service systems may involve
scheduling:
(I) the workforce.
(II) the equipment.
(III) customers.
A. II only
B. I and II only
C. II and III only
D. I and III only
E. I, II, and III
68. One disadvantage of appointment systems
is:
A. Capacity can be adjusted by varying hours.
B. The customer's desired time may be already
taken.
C. People generally accept it as fair.
D. It can reduce customer waiting time.
E. Appointments do not have to be all the
same length.
69. In an assignment model where there are
fewer jobs than resources:
A. dummy jobs are needed to solve the
problem.
B. dummy resources are needed to solve the
problem.
C. the problem cannot be solved using an
assignment model.
D. the problem will have multiple optimum
solutions.
E. the simplex method must be used to solve
the problem.
70. The following table contains information
about five jobs waiting to be processed at work center number three.
The sequence that would result using the SPT
rule is:
A. e-b-c-d-a.
B. c-a-b-e-d.
C. a-d-c-e-b.
D. d-e-b-a-c.
E. e-d-b-a-c.
71. The following table contains information
about five jobs waiting to be processed at work center number three. Using the
EDD rule, the sequence of jobs would be:
A. d-e-b-a-c.
B. a-d-c-b-e.
C. e-d-b-a-c.
D. a-d-c-e-d.
E. e-b-c-d-a.
72. There are four resources and four jobs to
be done. The time required for each resource to do each job is as follows:
After the row reduction, what is the reduced time for assigning resource 4 to
Job D?
A. 0 hours
B. 2 hours
C. 3 hours
D. 6 hours
E. 9 hours
73. There are four resources and four jobs to
be done. The time required for each resource to do each job is as follows:
After the row and column reductions, what is the reduced time for assigning
resource 4 to job D?
A. 0 hours
B. 2 hours
C. 3 hours
D. 6 hours
E. 9 hours
74. There are four resources and four jobs to
be done. The time required for each resource to do each job is as follows:
After the row and column reductions, what is the minimum number of lines needed
to cover all of the zeroes?
A. 0 lines
B. 1 line
C. 2 lines
D. 3 lines
E. 4 lines
75. There are four resources and four jobs to
be done. The time required for each resource to do each job is as follows: What
is the optimal assignment of resources to jobs?
A. 1 to A; 2 to C; 3 to B; 4 to D
B. 1 to B; 2 to D; 3 to C; 4 to A
C. 1 to C; 2 to B; 3 to A; 4 to D
D. 1 to D; 2 to B; 3 to C; 4 to A
E. 1 to A; 2 to C; 3 to D; 4 to B
76. There are four resources and four jobs to
be done. The time required for each resource to do each job is as follows: For
the optimal schedule, what is the total number of hours required to complete
these jobs?
A. 23 hours
B. 22 hours
C. 21 hours
D. 20 hours
E. 19 hours
77. The president of a consulting firm wants
to minimize the total number of hours it will take to complete four projects
for a new client. Accordingly, she has estimated the time it should take for
each of her top consultants—Charlie, Betty, Johnny, and Rick—to complete any of
the four projects, as follows: In how many different ways can she assign these
consultants to these projects?
A. 4
B. 8
C. 16
D. 24
E. 256
78. The president of a consulting firm wants
to minimize the total number of hours it will take to complete four projects
for a new client. Accordingly, she has estimated the time it should take for
each of her top consultants—Charlie, Betty, Johnny, and Rick—to complete any of
the four projects, as follows: After the row and column reductions, what is the
reduced time for assigning Rick to project D?
A. 0 hours
B. 8 hours
C. 10 hours
D. 9 hours
E. 22 hours
79. The president of a consulting firm wants
to minimize the total number of hours it will take to complete four projects
for a new client. Accordingly, she has estimated the time it should take for
each of her top consultants—Charlie, Betty, Johnny, and Rick—to complete any of
the four projects, as follows: What is the optimal assignment of consultants to
projects?
A. Charlie to A; Betty to B; Johnny to C;
Rick to D
B. Charlie to D; Betty to C; Johnny to B;
Rick to A
C. Charlie to C; Betty to A; Johnny to D;
Rick to B
D. Charlie to D; Betty to B; Johnny to C;
Rick to A
E. Charlie to D; Betty to A; Johnny to C;
Rick to B
80. The president of a consulting firm wants
to minimize the total number of hours it will take to complete four projects
for a new client. Accordingly, she has estimated the time it should take for
each of her top consultants—Charlie, Betty, Johnny, and Rick—to complete any of
the four projects, as follows: For the optimal schedule, what is the total
number of hours it will take these consultants to complete these projects?
A. 53 hours
B. 46 hours
C. 50 hours
D. 61 hours
E. 54 hours
81. The owner/operator of the local franchise
of Handyman, Inc., has four jobs to do today, shown in the order they were
received: If he uses the first come, first served priority rule to schedule
these jobs, what will be the average completion time?
A. 7.5 hours
B. 5 hours
C. 3 hours
D. 2.5 hours
E. 2 hours
82. The owner/operator of the local franchise
of Handyman, Inc., has four jobs to do today, shown in the order they were
received: If he uses the earliest due date first priority rule to schedule
these jobs, what will be the average job tardiness?
A. 0 hours
B. 1.5 hours
C. 1.75 hours
D. 2 hours
E. 2.25 hours
83. The owner/operator of the local franchise
of Handyman, Inc., has four jobs to do today, shown in the order they were
received: If he uses the shortest processing time first priority rule to
schedule these jobs, what will be the average completion time?
A. 7.5 hours
B. 5 hours
C. 3 hours
D. 2.5 hours
E. 2 hours
84. The owner/operator of the local franchise
of Handyman, Inc., has four jobs to do today, shown in the order they were
received: If he uses the shortest processing time first priority rule to
schedule these jobs, what will be the average job tardiness?
A. 0 hours
B. 1.5 hours
C. 1.75 hours
D. 2 hours
E. 2.25 hours
85. The owner/operator of the local franchise
of Handyman, Inc., has four jobs to do today, shown in the order they were
received: If he uses the shortest processing time first priority rule to
schedule these jobs, what will be the average number of jobs in his shop today?
A. 0
B. 1
C. 2
D. 3
E. 4
86. Eva, the owner of Eva's Second Time
Around Wedding Dresses, currently has five dresses to be altered, shown in the
order in which they arrived: If Eva uses the first come, first served priority
rule to schedule these jobs, what will be the average completion time?
A. 3 hours
B. 5 hours
C. 7 hours
D. 7.2 hours
E. 8 hours
87. Eva, the owner of Eva's Second Time Around
Wedding Dresses, currently has five dresses to be altered, shown in the order
in which they arrived: If Eva uses the earliest due date first (EDD) priority
rule to schedule these jobs, what will be the average job tardiness?
A. 2 hours
B. 2.2 hours
C. 2.33 hours
D. 2.4 hours
E. 3 hours
88. Eva, the owner of Eva's Second Time
Around Wedding Dresses, currently has five dresses to be altered, shown in the
order in which they arrived: If Eva uses the shortest processing time first
(SPT) priority rule to schedule these jobs, what will be the average completion
time?
A. 3 hours
B. 5 hours
C. 7 hours
D. 7.2 hours
E. 8 hours
89. Eva, the owner of Eva's Second Time
Around Wedding Dresses, currently has five dresses to be altered, shown in the
order in which they arrived: If Eva uses the shortest processing time first
priority rule to schedule these jobs, what will be the average job tardiness?
A. 2 hours
B. 2.2 hours
C. 2.33 hours
D. 2.4 hours
E. 3 hours
90. Eva, the owner of Eva's Second Time
Around Wedding Dresses, currently has five dresses to be altered, shown in the
order in which they arrived: If Eva uses the shortest processing time first
priority rule to schedule these jobs, what will be the average number of jobs
in her shop today?
A. 2 jobs
B. 2.33 jobs
C. 2.4 jobs
D. 2.67 jobs
E. 3 jobs
91. The operations manager of a body and
paint shop has five cars to schedule for repair. He would like to minimize the
throughput time to complete all work on these cars. Each car requires body work
prior to painting. The estimates of the times required to do the body paint
work on each are as follows: Where in the optimum sequence should car E be
scheduled?
A. first
B. second
C. third
D. fourth
E. fifth
92. The operations manager of a body and
paint shop has five cars to schedule for repair. He would like to minimize the
throughput time to complete all work on these cars. Each car requires body work
prior to painting. The estimates of the times required to do the body paint
work on each are as follows: Where in the optimum sequence should car A be
scheduled?
A. first
B. second
C. third
D. fourth
E. fifth
93. The operations manager of a body and
paint shop has five cars to schedule for repair. He would like to minimize the
throughput time to complete all work on these cars. Each car requires body work
prior to painting. The estimates of the times required to do the body paint
work on each are as follows: What is the optimum sequence (first car to last)?
A. A; B; C; D; E
B. E; D; C; B; A
C. E; B; D; C; A
D. E; D; B; C; A
E. E; B; D; A; C
94. The operations manager of a body and
paint shop has five cars to schedule for repair. He would like to minimize the
throughput time to complete all work on these cars. Each car requires body work
prior to painting. The estimates of the times required to do the body paint
work on each are as follows: What is the throughput time for the optimal
schedule?
A. 24 hours
B. 25 hours
C. 26 hours
D. 28 hours
E. 50 hours
95. The operations manager of a body and
paint shop has five cars to schedule for repair. He would like to minimize the
throughput time to complete all work on these cars. Each car requires body work
prior to painting. The estimates of the times required to do the body paint
work on each are as follows: What is the idle time at the paint work center for
the optimal schedule?
A. 1 hour
B. 2 hours
C. 4 hours
D. 7 hours
E. 10 hours
96. Job X, which has a duration of four days,
is due by the close of business on Friday, December 23. Without looking at the
work already scheduled on X's required resource, the scheduler schedules X to
be begun on the morning of Tuesday, December 20. This is an example of:
A. infinite scheduling.
B. finite scheduling.
C. forward scheduling.
D. backward scheduling.
E. prioritization.
97. Job X, which has a duration of four days,
is due by the close of business on Friday, December 23. Without looking at the
work already at X's required resource, the scheduler schedules X to be begun
immediately and assumes that X will be done four days from now. This is an
example of:
A. infinite scheduling.
B. finite scheduling.
C. forward scheduling.
D. backward scheduling.
E. prioritization.
98. Job X arrived at work center Q at noon.
At 2 p.m. that same day X was begun. X left work center Q at 3:15 p.m. that
same day. X's flow time, in minutes, was:
A. 195.
B. 120.
C. 75.
D. 60.
E. Cannot be determined.
99. Which of the following is critical to
effective yield management?
A. one-price pricing
B. forecasting
C. capacity flexibility
D. constant demand
E. trained service personnel
100.Which of the following is least likely to
be a consideration when scheduling a high-volume system?
A. equipment failures
B. material shortages
C. accidents
D. worker absences
E. demand variability
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