Business Logistics Final Exam
Service capacity is the number of customers per day the firm's service delivery systems are designed to serve.
True
If λ = 6 CUSTOMERS/HOUR and μ = 9 CUSTOMERS/HOUR, in a single server model, find the probability that there will be exactly 2 people in line.
0.148
Customer lifetime value is calculated as the net present value of an annuity.
True
Deming, Crosby, and Juran are all prominent quality professionals whose ideas were vital to the development of Six Sigma.
True
Departmental layouts that reduce distances traveled are designed to reduce the travel times of customers and servers when moving from one area to another.
True
In most services, customers are not involved in the production of the service itself.
False
Lean production is an operating philosophy or mindset that essentially attempts to minimize the impact of system variability and flaws in forecasting through the use of high safety stock inventories.
False
Calculate the score for the layout below. Do not count the departments with just corners touching. The desirability ratings are based on a (-1 to 3) scale, where -1=undesirable, 0=unimportant, 1=slightly important, 2=moderately important and 3=very important. Existing Office Layout Reception Area(A)Copy Room(B)Conference Room(C)Managers Offices(D)President Office(E)Accounting Office(F) Desirability Ratings BCDEFA301-12B 2103C 321D 22E 2
11
Foreign-trade zones (FTZs) are secure sites within the European Union under the supervision of the EU Customs and Tarriffs.
False
Limitations of air carrier transport include cost and airport accessibility.
True
Con-way Multimodal and BNSF Logistics are both considered third-party logistics providers.
True
Capacity utilization =
Actual customers served per period / Capacity
Examples of regional trade agreements include all of the following EXCEPT:
Association of Indian Markets (AIM)
Milan, Wall Street, and Detroit are examples of ____________.
Business clusters
A company sells eggs in boxes with 12 cartons and 12 eggs in each carton, thus there are 144 eggs in each box. The organization wants to construct a P-chart to track the proportion of broken eggs in each sample (shown below). If the company used one box of eggs in each sample in the dataset below, what would be the centerline, upper control limit (UCL), and lower control limit (LCL) for the appropriate P-chart? (Use z = 3.) Choose the closest answer.
Centerline = 0.025, UCL = 0.64, LCL = 0
se the breakeven model to determine which of the statements below is TRUE according to the information provided in the table relating to three different locations considered for a new manufacturing facility. LOCATION ANNUAL UNIT FIXED VARIABLE COSTS COSTS Site A $35,000 $15 Site B $30,000 $21 Site C $20,000 $25
Choose site C if you are producing 1000 units per year
Which of the following would be considered a quality of life factor?
Community safety
A firm offers group discount for orders exceeding 15. Two firms are taking advantage of this offer. Sales to Company A averages $15, 000 of annual sales, has a 22% profit margin and an expected lifetime of 8 years. Company B averages $11, 000 of annual sales, has a 25% profit margin and an expected lifetime of 9 years. Which is the more important customer based on the higher expected lifetime value? Assume a 7% discount rate.
Company A because its' NPV = $19705
The online retailer Ecatalog.com has decided to send consumers of the new John Grisham book an e-mail with suggestions for books with similar themes and has also offered them a 20% discount if those suggested books were purchased. This type of marketing/promotion is an example of:
Cross-selling
Which of the following is a factor in choosing a location?
Currency stability
In a 2016 survey of 3PL usage, 70 percent of shippers and 85 percent of 3PL services said the use of 3PLs contributed to higher logistics costs.
False
All of the following are considerations used in designing service layouts EXCEPT:
Ease of access to parking lot
Which of the following is NOT one of the Seven Wastes?
Environmental waste
A firm is comparing two potential service layouts using the Closeness Desirability Rating. Option 1's closeness desirability score is 18. Option 2's closeness desirability score is 22. It can be concluded that Option 1 layout is better.
False
A lean system is also known as a push system.
False
A list of quality-of-life factors would most likely include proximity to customers, proximity to suppliers, tariff rates, and currency stability.
False
A primary advantage for motor carriers is the weather.
False
A retailer with two checkout stands is an example of a single-channel, multiple-phase queuing system.
False
A weakness of lean systems is that none of its practices are related to the environment or sustainability.
False
Continuous connectivity is desired by many users of CRM applications, however this is still something the systems can't deliver yet.
False
Customers of companies that use CRM applications, should not be concerned with their personal information becoming compromised or being shared with other companies, because of the law.
False
Due to the advances in technology, less business clusters are being created globally.
False
Sales force automation products manage a sales person's accounts, business opportunities, and communications.
False
Segmenting customers on the basis of things like products purchased, sales history, demographic information, and desired product features can dilute the results of a CRM program.
False
The objectives of any CRM initiative should be focused on what the company can reasonably achieve.
False
The optimal capacity utilization for an organization would be 100%.
False
The weighted-factor rating model, is a useful location analysis technique when fixed and variable costs can be determined for each potential location.
False
Transportation, warehousing, marketing, and customer service play very significant roles in the logistics function.
False
Two models that utilize quantitative data, which can help determine the attractiveness of one location versus another, are the Break-Even Model and the Extrapolated Average Cost Model.
False
Until recently, CRM was not very effective for most companies because it didn't focus on building customers' trust and loyalty, or building strong relationships with customers.
False
Efficient Consumer Response was initially developed in the 1990's for the following industry:
Grocery
Using the weighted-factor rating model, the location with the lowest total weighted score is the recommended location.
False
Volatile currency exchange rates do not have an impact on location decisions.
False
When designing a manufacturing or service process, a Pareto chart would be an essential tool for evaluating the process in terms of its action elements, waiting periods, and process flow.
False
While a well-planned and organized CRM initiative can be extremely useful in developing effective and efficient marketing programs for retailers, they are not particularly helpful for manufacturing companies like GM since their touches with the customer are few.
False
A customer's lifetime value is calculated by:
Finding the NPV of a customer's projected lifetime profits for the firm
According to the text, which of the following is a service strategy characterized by the idea that a service can serve a narrow target market better than a broad market?
Focus strategy
The difference between customer expectations and customer perceptions of what was actually received during the service encounter is referred to as service quality ________.
Gaps
The first step in the weighted-factor rating technique is to:
Identify all factors considered important to the facility location decision
The Quick Response program, developed in the 1980's, was an offshoot of the following supply chain concept:
Just-in-Time
Japanese manufacturing firms sometimes create cooperative coalitions with their suppliers in order to provide the suppliers with a certain degree of financial support. What are these cooperative coalitions called?
Keiretsu Networks
Your top sales executive leaves your company to work for a competitor. Fortunately, all of her notes regarding prior dealings with customers have been captured in a:
Knowledge management system
Lean production emphasizes all of the following EXCEPT:
Long production runs
Regional trade agreements assist with which of the following?
Monitor national trade policies Provide technical assistance for developing countries Handle trade disputes ***All of the above
In the text, Table 9.1 shows that for-hire logistics expenditures in the U.S., have _____________ in the past thirty-one years.
More than quadrupled
Waste in Japan is also referred to as:
Muda
Service provided by multiple servers acting in parallel is referred to as:
Multiple-channel queuing system
Which tool is useful for presenting data in an organized fashion, indicating process problems from most to least severe:
Pareto Charts
You are a manager at Sunnydale Appliances. A customer who recently purchased a dishwasher contacts you with a problem and requests warranty information. According to the text, this is an example of:
Posttransaction customer service
___________________ are for-profit organizations that contract out or lease a wide range of light manufacturing, warehousing, and distribution services to other companies.
Public warehouses
Reverse logistics can have a positive impact on the environment through activities such as?
Recycling
A customer who enters the waiting line but leaves the system prior to receiving service is said to have:
Reneged
Foreign-trade zones are:
Secure sites within the U.S. where goods and materials can be assembled and exported without being levied domestic duties or excise taxes
Which of the following can aggregate cargo and arrange for the domestic or international shipment of members' cargo at favorable volume rates?
Shippers' Associations
A certain organization trying to decide where to locate their future factory is considering three locations. They are taking into account three factors: labor costs, currency stability, and proximity to market. Using the weights for each factor listed below and the scores achieved by each of the three considered locations, determine which location should be chosen for the new facility based on the weighted factory location model. SCORES (Maximum 100) FACTORWEIGHTSITE ASITE B SITE C Labor Cost0.25928284Currency Stability0.35758588Proximity to Market0.30805060Taxes0.10698891
Site A
Which of the following is NOT a reason for locating in a business cluster?
Sophisticated retailers
Which of the following legislative acts is NOT in support of transportation deregulation?
Staggers Rail Act
You work for a company that segments customers by demographic information, and then markets specifically to those customers who are located in the Los Angeles area. This is an example of:
Target marketing
Which of the following marked the end of the initial push by Congress to deregulate the entire U.S. transportation industry?
The Shipping Act of 1984
Which of the following is a U.S. law which requires compliance by all firms engaged in handling customer information?
The U.S. Patriot Act
CRM systems today require less training because:
They are designed to be more user-friendly
Which of the following would be considered an act of deregulation?
Trucking Industry Regulatory Reform Act − Motor carriers freed from filing rates with the Interstate Commerce Commission
A very popular fast food restaurant is presently staffed with three cash register attendants that are taking orders. Upon entering the restaurant, customers must choose from three separate lines, each of which leads to one of the three registers. Immediately upon placing their order with the register attendant, customers are given their food and drinks by the register attendant. To analyze this situation you would use the queuing model for an infinite demand source, multiple servers, and multiple channels.
True
Acceptance sampling is a statistical technique that enables a shipment reject or accept decision to be made based on information obtained from a representative sample drawn from the population.
True
According to the text, poor planning is typically the cause of most unsuccessful CRM initiatives.
True
Amazon.com is an example of a firm which uses the Pure Internet Distribution Strategy.
True
An office setting could be an example of a departmental layout that maximizes closeness desirability.
True
Global location decisions are made to optimize the performance of supply chains and to be consistent with the firm's competitive strategy.
True
Lean thinking and Six Sigma quality are both concerned with achieving low cost and high quality throughout the supply chain.
True
Locating research and development, component manufacturing, assembly operations, marketing, and other associated businesses in one area can improve the supply chain, technology sharing, and information sharing.
True
Private warehouses refer to warehouses that are owned by the firm storing the goods.
True
Reverse logistics refers to the movement and storage of returned goods.
True
Statistical process control (SPC) allows firms to compare process performance to desired levels or required standards.
True
The Malcolm Baldrige National Quality Award recognizes firms for their quality achievements but is only given to U.S. firms.
True
The primary design objective with lean layouts is to reduce wasted movements of workers, customers, and/or work-in-process.
True
Through the use of permission marketing programs, customers are allowed to select the type of communications that companies can make with them. Actually, customers can even choose to be completely eliminated from both e-mail and traditional mailing lists.
True
When a level demand strategy is used for managing capacity, the firm is required to use a demand management or queue management tactic to deal with excess customers.
True
When mistakes occur in deliveries along the supply chain, more safety stocks must be held, adversely impacting both customer service levels and costs.
True
While many developing countries are attractive to companies seeking out low labor costs, there are other factors such as productivity levels, employee skill and education levels, turnover rates, and employment trends that certain industries find just as important, if not more important, in determining facility locations.
True
All of the following are required elements for the development of an effective CRM initiative EXCEPT:
Utilization of MRP
Which of the following are among the MOST important elements of the lean production philosophy?
Waste reduction and continuous improvement
Which of the following modes of cargo transport can be characterized as being the most inexpensive and very slow, yet good for transporting very heavy goods a long-distance?
Water Carriers
The average transaction at a single channel, single phase automatic teller can be completed in 7.5 minutes and customers arrive at the average rate of one every ten minutes. On average, what is the server utilization? (Choose the closest answer.)
0.75
The average transaction at an automatic teller can be completed in six minutes and customers arrive at the average rate of one every ten minutes. On average, how many customers are there in the queue?
0.900 Customers
Calculate the defects per million opportunities (DPMO) given the following:Blake, owner of Blakester's T-shirt Shoppe, keeps track of customer complaints. For each T-shirt sold, there are four possible complaints: T-shirt shrinks, poor quality, design wears off, and doesn't fit right. Each week, Blake calculates the rate of T-shirt "defects" per total T-shirts sold, and then uses this information to determine his company's DPMO. During the past week, his company sold 1200 T-shirts. His company received 22 customer shrinkage complaints, 16 poor quality complaints, 12 design wears off complaints, 8 doesn't fit right complaints.Calculate his firm's DPMO.
69,600 0.193 5.8 x 10−6 Correct! (12,083)
_______________ carry the majority of the world's water-transported manufactured goods.
Containerships
When CRM applications are available 24/7 on smartphones, tablets, and desktops, this is referred to as:
Continuous connectivity
Once a decision on locating a facility is made, it is ________ to move or shut down that facility.
Costly
Efficient supply chain management distribution requires that modern warehouses concentrate their efforts on a wide array of warehousing and distribution functions like storing purchases, work in progress inventories, and finished goods inventories, receiving shipments, breaking down shipments, repackaging, and the distribution of components.
True
In the U.S. there is a trend to locate manufacturing facilities in the sunny, incentive-friendly, nonunionized South.
True
