Multiple Choice Questions Per Exam (Pre/Post)

What process capability index (Cp) value implies that the process "exceeds minimal capability?" 0 1 = 1 > 1 6σ

> 1

Which of the following is not a typical result of the bullwhip effect? Absenteeism Lost revenues Ineffective transportation use Poor customer service levels Misused manufacturing capacity

Absenteeism

If the EOQ is ordered, which of the following is true? Annual ordering cost exceeds annual holding cost. Annual holding cost exceeds annual ordering cost. Annual ordering cost is equal to annual holding cost. The sum of annual ordering cost plus annual holding cost is maximized. The annual holding cost curve is decreasing.

Annual ordering cost is equal to annual holding cost.

Causes of variation that can be identified and eliminated are called what? Random Assignable Identifiable Stochastic Common

Assignable

Which of the following is not a remedy for the bullwhip effect? Allocate units based on past demand Price stabilization Base forecasts on demand coming from the immediate downstream customer Eliminate order batching Information sharing

Base forecasts on demand coming from the immediate downstream customer

Which term refers to inaccurate or distorted demand information created in the supply chain? Battle axe effect Cobra effect Bullwhip effect Lasso effect Whirlpool effect

Bullwhip effect

_______________ MRP is an MRP system that includes production planning, master production scheduling, and capacity requirements planning. Fully-integrated Closed-loop Open-loop Wide-range Enterprise

Closed-loop

Quality is defined by the Quality Control department Marketing department Board of directors Customer Auditors

Customer

When do rationing and shortage gaming occur? Supply exceeds demand. Demand exceeds supply. Government contracts are awarded. Transportation workers go on strike. Marginal revenue exceeds marginal cost.

Demand exceeds supply.

What does EDI stand for? Easy data interchange Electronic door interface Electronic detachable interface Elementary data integration Electronic data interchange

Electronic data interchange

Which of the following typically represents the beginning of a supply chain? Wholesalers Retailers Manufacturers External suppliers Inspectors

External suppliers

Being able to keep costs low while changing the volume of production is an example of Simplicity Flexibility Visibility Continuous improvement Total quality management

Flexibility

What type of warehouse is used for long-term storage? Customized Strategic General Distribution Tactical

General

To address ethics in SCM, which of the following organizations created a set of principles and standards to guide purchasing employees? ISO 9000 PMI ISM TQM ISO 14000

ISM

What does the textbook define as the three most critical factors in successful partnering? Impact, mission, vision Impact, intimacy, vision Contracting, mission, vision Contracting, intimacy, mission Contracting, impact, intimacy

Impact, intimacy, vision

Which of the following is not one of the six ways to use inventory? seasonal inventory JIT inventory pipeline inventory hedge inventory MRO inventory

JIT inventory

Which of the following is an objective of MRP? Keep priorities updated and valid. Keep track of material movements on the shop floor. Provide information for expediting orders. Allocate scarce parts to products. Provide information for activity based costing.

Keep priorities updated and valid.

Hand tools, lubricants, and cleaning supplies are usually examples of what? WIP inventory finished goods inventory raw materials inventory distribution inventory MRO inventory

MRO inventory

_________________ crossdocking is the receiving and consolidating of inbound supplies to support just-in-time manufacturing. Distributor Transportation Warehouse Manufacturing Retail

Manufacturing

_____________________ is the probability that demand during lead time will not exceed on-hand inventory. EOQ service level Fill rate Stock out risk Order-cycle service level Lead time service level

Order-cycle service level

Which of the following is an assumption of the basic EOQ model? Lead time is unknown. Demand may be seasonal. Orders arrive at once (in one lot). Quantity discounts are considered. Lost sales are allowed, but not back orders.

Orders arrive at once (in one lot).

Which basic EOQ assumption does the EPQ model relax? Lead time is known and constant. Demand is known and constant. Quantity discounts are not considered. Orders arrive at once. Back orders are not allowed.

Orders arrive at once.

What is the common term for a process of developing a long-term relationship with a supplier based on mutual trust, shared vision, shared information, and shared risks? Marrying Cohabitating Sharing Partnering Diversifying

Partnering

Which of the following statements is true? Periodic counting and cycle counting generally both count every item in stock. Periodic counting and cycle counting generally both do not count every item in stock. Periodic counting generally counts every item in stock, whereas annually cycle counting generally does not daily. Cycle counting generally counts every item in stock, whereas periodic counting generally does not. Periodic counting generally occurs more frequently than cycle counting.

Periodic counting generally counts every item in stock, whereas annually cycle counting generally does not daily.

Which of the following is not important for evaluating a current situation? Point of departure Magnitude of change Permanent change Duration of change Point of sale

Point of sale

Which of the following is not an argument in favor of having a single supplier? Quantity discounts may be achieved. Partnering becomes more possible. Consistency of input materials is achieved. Probability of assured supply is better. Deliveries can be scheduled more easily.

Probability of assured supply is better.

Which of the following is a tool for evaluating an operation in terms of the sequence of steps from inputs to outputs with the goal of improving its design? process flow analysis sequencing analysis operations sequencing operations analysis input/output analysis

Process flow analysis

Product tolerances are often called SPC Product drawings Product descriptions Process capability Product specifications

Product specifications

The system of Kanbans used to coordinate delivery of goods by suppliers can include all of the following except Filled containers delivered by the supplier Purchase approvals by the production manager Mail boxes for each supplier Empty containers with a Kanban Bar-coded Kanbans

Purchase approvals by the production manager

Three basic elements work together to complete a JIT system: just-in-time manufacturing, total quality management, and Quality circles Pull production Minimizing inventory Respect for people Full utilization of capacity

Respect for people

Which of the following are examples of traditional measures of SC performance? ROI, Market share, size of trucks Profitability, weeks of supply, customer calls ROI, Inventory surplus, absenteeism Revenue growth, market share, ROI Costs, expenses, earned value

Revenue growth, market share, ROI

JIT manufacturing cannot succeed if __________costs are too high. Variable Fixed Set-up Depreciation Marginal

Set-up

What is the term used for the adjustment of a machine after making one product type so that production can begin for another product type? Level assembly schedule Group technology Setup Cycle time Automation

Setup

In a periodic review inventory system, how many units are ordered? Target inventory level Target inventory level - on hand balance Max inventory level - min inventory level The EOQ Average demand during review period + average demand during lead time

Target inventory level - on hand balance

Which of the following is the term for "arranging the method of shipment for both incoming and outgoing products or material"? TQM Employee management Distribution management Traffic management Logistics management

Traffic management

Consider a packaged milk products supply chain. A lumber company provides wood to a paper mill, who supplies cardboard to a container manufacturer, who supplies containers to the milk products manufacturer. The lumber company is: a tier one supplier. a tier two supplier. a tier three supplier. a tier four supplier. not in the supply chain.

a tier three supplier.

Percentage of orders shipped on schedule is a good measure of finished goods customer service if: all orders and customers have similar cost impacts. all orders and customers have similar value. all orders and customers have similar backorder requirements. later deliveries are not considered. late deliveries contribute to the overall demand.

all orders and customers have similar value.

Which inventory function specifically is designed to allow the company to maintain a level production strategy? anticipation inventory fluctuation inventory lot-size inventory transportation inventory speculative inventory

anticipation inventory

Local wage rates, presence of local unions, and attitudes of local workers would be major factors for location decisions for businesses that ________________________. are labor intensive have perishable products have high transportation costs have need for specific raw materials provide in-home services

are labor intensive

JIT is applies to only the manufacturing organization only the service organization both the manufacturing and service organizations only the production portion of manufacturing and service organizations all of the organization except the marketing division

both the manufacturing and service organizations

Net marketplaces are designed to: bring together only internal resources. bring together limited external resources. bring together significant number of purchasing firms. limit the number of daily transactions. limit cyber security risks.

bring together significant number of purchasing firms.

What type of aggregate plan sets labor and equipment capacity to satisfy demand each period? uniform level chase mixed steady

chase

If inventory records fail to accurately reflect the quantity of materials available, all except which of the following may occur? poor customer service continuous operations lower productivity poor material planning excessive expediting

continuous operations

What is the process whereby shipments are transferred directly from inbound trailers to outbound trailers? crossdocking directdocking nodocking simuldocking transferdocking

crossdocking

Due to globalization, which of the following are not some commonly shared ocean shipping logistical characteristics? goods arrive in larger quantities greater break-bulk activity is required crossdocking is required typically have higher inventories longer port times occur

crossdocking is required

What are the three areas for Inventory objectives? customer service, cost-efficient operations, minimum inventory investment customer service, cost-prohibitive operations, minimum inventory investment customer service, cost-efficient operations, minimum inventory withdrawal marketing, cost-efficient operations, minimum inventory investment customer service, cost-efficient operations, maximum inventory investment

customer service, cost-efficient operations, minimum inventory investment

Sales and operations planning enables: disciplined and formalized scheduling. disciplined and formalized communications. disciplined and formalized inventory control. disciplined and formalized strategic planning. disciplined and formalized marketing.

disciplined and formalized communications.

Finished goods in transit to the customer are called what? WIP inventory components inventory raw materials inventory distribution inventory MRO inventory

distribution inventory

etting up control charts to monitor whether a process is in control guarantees process capability guarantees process specifications does not guarantee process capability does not guarantee product specification guarantees meeting client needs

does not guarantee process capability

The maximum output rate that can be sustained under normal conditions is _______________________. utilization design capacity effective capacity ultimate capacity temporary capacity

effective capacity

A difficulty with back orders, even when the customer waits, can be ________________. finding space to store the product extra administrative costs added inventory holding costs possible deterioration of the product that other customers will want back orders also

extra administrative costs

What is an extension of an intranet to include suppliers and customers called? supply chain net supernet supranet extranet intranet++

extranet

The comparison of aggregate plans is difficult when they produce different quantities and thus _________. have different ending inventories have different staffing levels have different amounts of overtime have different amounts of subcontracting have different revenues

have different ending inventories

The first step in making a capacity planning decision is ______________________. evaluate capacity alternative implementation identify capacity requirements develop capacity alternatives weight capacity objectives

identify capacity requirements

The first step managers need to take when making facility location decisions is ___________________. begin negotiations with governments for several potential locations identify specific location possibilities gather information on location alternatives evaluate specific sites identify the location factors that are dominant for the business

identify the location factors that are dominant for the business

JIT can be traced back to the early 1900's but no one can argue that the philosophy gained worldwide prominence at the close of WWII in the 1950s in the 1960s in the 1970s in the 1980s

in the 1970s

According to the textbook, the way to reduce the ppm defective is to change product specifications increase process capability increase the number of inspection points. employ more inspectors increase process throughput

increase process capability

Which of the following is not a "greening" requirement for both suppliers and distributors? carbon emission footprint reduction increased transportation costs use of sustainable farming agreeing not to use specified materials use or nonuse of specific technologies

increased transportation costs

One outcome of a U-shaped cell manufacturing layouts is increased labor per hour cost for higher skilled workers decreased labor per hour cost for lower skilled workers improved external supplier response times increased worker satisfaction decreased worker satisfaction

increased worker satisfaction

Which type of operation is used to produce many different products with varying process requirements in lower volumes? intermittent downstream continuous repetitive gateway

intermittent

Companies can achieve cost-efficient operations by using which of the following inventory approaches? work-in-process to buffer operations inventory building to leverage reduced setup costs JIT inventory to reduce overall cost level work force maintenance through speculative selling

inventory building to leverage reduced setup costs

Capacity decisions at the strategic level include ____________________. investment in new facilities and equipment size of workforce inventory buffers day-to-day use of machines composition of the workforce

investment in new facilities and equipment

An improvement tool that utilizes cross-functional teams to plan and deliver improvements to specific processes during two- or three-day marathon sessions is called a ___________________. kanban blitz cross-functional blitz short-term blitz JIT blitz kaizen blitz

kaizen blitz

The most critical factors for successful EPR implementation are ______ and _________ ______. leadership, top management commitment leadership, technological transfer management management, technological transfer management funding, top management commitment leadership, detailed technical specifications

leadership, top management commitment

he broad view of JIT is now often termed __________________________. vendor-managed inventory business process reengineering lean production cycle time management e-distribution

lean production

What type of aggregate plan maintains a constant workforce and produces the same amount of product in each time period? uniform level chase mixed steady

level

According to the textbook, the larger cargo ships created the negative result of? increased per pound shipping charges increased CO2 emissions decreased operating costs longer port times increased in transition times

longer port times

Companies want a supply chain that makes it possible to: manage all suppliers' development costs. manage and adapt to all of the business dynamics. manage distribution display. manage distribution outlet retail prices. manage customer demands.

manage and adapt to all of the business dynamics.

The next level down in the planning process after development of the aggregate plan is the _____________. materials requirements plan engineering plan rough-cut capacity plan master production schedule purchasing plan

master production schedule

What are the two primary objectives of aggregate planning? material availability and supplier size output rate and workforce size input rate and training for employees total cost and production rate transportation rate and workforce size

material availability and supplier size

Which of the following is not a fixed cost? land rent materials overhead taxes insurance

materials

The center of gravity approach identifies the precise location for the new distribution site identifies where the trucking firm should be located may identify a location that may not be feasible to locate to relies on GPS coordinates for all calculations relies on which transportation method is selected

may identify a location that may not be feasible to locate to

Which of the following is not a primary objective of the master production schedule? minimize shipping costs achieve the desired customer service level. make the best use of the company's resources: material, labor, and equipment. ensure that the inventory investment is at the appropriate level none of the answer choices are correct

minimize shipping costs

Which of the following is not an objective of the master production schedule? minimize shipping costs achieve the desired customer service level make the best use of the company's resources: material, labor, and equipment ensure that the inventory investment is at the appropriate level identify the specific products or services planned for a given time period

minimize shipping costs

The Production Plan is usually updated and reevaluated: weekly monthly quarterly semi-annually annually

monthly

Percentage of Line Items Shipped on Schedule recognizes that: not all orders are equal but fails to take into account the dollar value of orders. not all orders are equal but this can be compensated for. there are differences in orders in terms of both line items and dollar value. an absolute measure of manufacturing or service time lost because material or parts are not available. all orders and customers should be treated equally.

not all orders are equal but fails to take into account the dollar value of orders.

Which of the following is not typically indicated as part of the resources authorized in an aggregate plan? number of machines to be used size of the workforce authorized level of overtime and undertime number of units to be subcontracted level of inventory held

number of machines to be used

What type of machine is controlled by a computer and can do a variety of tasks, such as drilling, boring, or turning parts of different sizes and shapes? numerically controlled variable turning flexible driven non-calculating next component

numerically controlled

A(n) _________________ inventory record provides an up-to-date inventory balance by recording all inventory transactions as they happen. infinite everlasting constant permanent perpetual

perpetual

In evaluating the current situation, the ____________ is the percentage of normal capacity at which the company is currently operating. point of departure amount of subcontracting needed magnitude of the change duration of the change rated capacity

point of departure

A demand-based option in which the marketing tries to shift demand patterns to minimize demand fluctuations is called hyperactive inactive proactive reactive retroactive

proactive

Which of the following is not typically contained in the marketing plan? product design target markets new products profit margin competitive focus

product design

Which type of process would be least likely to produce goods for inventory rather than for a specific customer request? remanufacturing project continuous batch line

project

Which of the following is not a factor in capacity planning? approach used to measure capacity economies of scale prepare to deal with capacity in "chunks" proximity to suppliers identify the best operating level

proximity to suppliers

The goal of developing an aggregate plan using composite product information is: group like things together reduce the number of calculations keep it simple for senior management help marketing plan provide detail reports

reduce the number of calculations

Vertical integration decisions is a better strategic decision for service organizations quasi-manufacturing organizations intermittent processes project processes repetitive operations

repetitive operations

According to JIT, workers should perform system specification development as directed by the supervisor routine preventive maintenance activities poka-yoke designs quality program development

routine preventive maintenance activities

Single setup means performing only one setup at a time restricting setup to one machine at a time extend external setup to include one supplier setup times are in single digits of minutes external and internal setup times are the same

setup times are in single digits of minutes

From the textbook, leveraging core competencies is about sharing knowledge employing the highest knowledge worker correctly outsourcing a function developing new educational opportunities installing new IT systems

sharing knowledge

Service organization supply chains are: similar to manufacturing organizations. not similar to service organizations. very unique. not a consideration when planning a service organization. universally government regulated.

similar to manufacturing organizations.

In evaluating your new production plan, cost comparisons are not required simple if you are comparing different ending positions simple if you are using the same units simple if you are comparing similar ending positions simple to analyze

simple if you are comparing similar ending positions

Concurrent engineering is relying on marketing to determine specifications while product is in engineering designing several new products at the same time simultaneously design the product and the process simultaneously design the product and develop the marketing sales brochure is not used in operations management processes

simultaneously design the product and the process

What is the formula for the process capability index Cp? specification width / 99.74% process width / specification width b specification width × process width specification width / Type I error specification width / process width

specification width / process width

Which inventory function provides a cushion against unexpected supply shortage? anticipation inventory fluctuation inventory lot-size inventory transportation inventory speculative inventory

speculative inventory

Which of the following is not considered to be a key element of JIT supplier relationships? suppliers viewed as internal factory use of single-source suppliers long-term supplier relationships developed suppliers locate near customer cost and information sharing

suppliers viewed as internal factory

JIT was based on the need for a new management fad new consulting revenue stream a need for shorter supply lines survival a new vision

survival

Managers become more of a supportive function in the JIT environment. Aside from being a coach, motivator, assisting with teamwork and problem solving, what is the most important thing managers can give to employees to help facilitate implementing JIT? money food free access to the gym time high appraisal

time

The ratio of actual output rate to capacity is ____________________________. effectiveness cycle time throughput utilization productivity

utilization

Companies that use backorders are asking their customers to _________________________________. wait for delivery of the product resubmit their orders check back to see what their last order was receive the product immediately and pay for it later send back their last order

wait for delivery of the product

The master production schedule is reviewed: annually semi-annually quarterly monthly weekly

weekly