POM TEST 2
The list of 5Ss, although it looks like a housekeeping directive, supports lean production by:
identifying non-value items and removing them, in the "sort/segregate" category.
A major challenge in inventory management is to maintain a balance between inventory investment and customer service. True False
True
In cycle counting, the frequency of item counting and stock verification usually varies from item to item depending upon the item's classification. True False
True
One advantage of cycle counting is that it maintains accurate inventory records. True False
True
Which of the following technologies could enable a cashier to scan the entire contents of a shopping cart in seconds? FMS RFID ASRS AGV CAD/CAM
-RFID
ABC analysis divides on-hand inventory into three classes, generally based upon which of the following? item quality annual demand unit price annual dollar volume the number of units on hand
annual dollar volume
Which of the following is NOT one of the Seven Wastes?
assignment
Kanban is associated with all EXCEPT which of the following?
increased material handling
Which of the following best describes mutual commitment in an organization?
both management and the employees are committed to the same objective
For which corporate strategy(ies) should supply chain inventory be minimized?
low cost and differentiation
Which of the following is characteristic of lean operations?
low space requirements
What tracks both receipts and subtractions from inventory on a continuing basis? periodic system cycle counting ABC analysis shrinkage perpetual inventory
perpetual inventory
The Institute for Supply Management:
publishes the principles and standards for ethical supply management conduct.
Which of the following is generally found in most Lean environments?
pull systems
In most manufacturing industries, which of the following would likely represent the largest cost to the firm?
purchasing
Warehouses sometimes perform certain other functions besides storing goods. Which of the following is NOT typically one of those functions?
purchasing
Which of the following is NOT an attribute of lean operations?
pushing responsibility to the highest level possible through centralized decision making
Designing distribution networks to meet customer expectations suggests what three criteria?
rapid response, product choice, and service
Which of the following is an advantage of the postponement technique?
reduction in inventory investment
Mutual trust is:
reflected in reasonable, documented employment policies that are honestly and equitably implemented to the satisfaction of both management and employee.
Which one of the following is a characteristic of a JIT partnership?
removal of incoming inspection
Which of the following is NOT one of the risk mitigation tactics for the supply chain risk category of suppliers failing to deliver?
require overnight delivery
Among which of the following industries are purchasing costs the LOWEST percentage of sales?
restaurants
Which one is NOT an application of lean principle in services?
securing more inventory to prepare for disruption in production
Which of the following is an illustration of employee empowerment?
"No one knows the job better than those who do it."
Which of the following is TRUE regarding the process capability index C pk? -Positive values of the Cpk index are good; negative values are bad. -The larger the Cpk, the fewer units meet specifications. -A Cpk index value of 1 is the highest possible. -The Cpk index can only be used when the process centerline is also the specification centerline. -Its value will always be less than or equal to the Cp value for the same process.
-A Cpk index value of 1 is the highest possible.
Which one of the following technologies is used ONLY for material handling, NOT actual production or assembly? CAD FMS CNC AGVs robots
-AGVs
Which of the following provides automatic placement and withdrawal of parts and products into and from designated places in a warehouse? -AGV -CIM -FMS -ASRS -CAD/CAM
-ASRS
Plots of sample ranges indicate that the most recent value is below the lower control limit. What course of action would you recommend? -Since there is no obvious pattern in the measurements, variability is in control. -One value outside the control limits is insufficient to warrant any action. -Lower than expected dispersion is a desirable condition; there is no reason to investigate. -Variation is not in control; investigate what created this condition. -The process is out of control; reject the last units produced.
-Variation is not in control; investigate what created this condition.
A Type II error occurs when: -the population is worse than the LTPD. -a bad lot is accepted. -the proportion of defectives is very small. -a good lot is rejected. -none of these
-a bad lot is accepted.
A system using an automated work cell controlled by electronic signals from a common centralized computer facility is called: an automatic guided vehicle (AGV) system. robotics. an adaptive control system. a flexible manufacturing system. a manufacturing cell.
-a flexible manufacturing system.
A Type I error occurs when: -a good lot is rejected. -a bad lot is accepted. -the population is worse than the AQL. -the number of defectives is very large. -none of these
-a good lot is rejected.
Consumer's risk is the probability of: -accepting a bad lot. -accepting a good lot. -rejecting a bad lot. -rejecting a good lot. -none of these
-accepting a bad lot.
Consumer's risk is the probability of: -accepting a good lot. -rejecting a good lot. -accepting a bad lot. -rejecting a bad lot. -none of these.
-accepting a bad lot.
Process redesign: often focuses on activities that cross functional lines. is sometimes called process reengineering. tries to bring about dramatic improvements in performance. is the fundamental rethinking of business processes. all of these
-all of these
The Central Limit Theorem: -states that the average of assignable variations is zero. -states that the average range can be used as a proxy for the standard deviation. -is the theoretical foundation of the c-chart. -controls the steepness of an operating characteristic curve. -allows managers to use the normal distribution as the basis for building some control charts.
-allows managers to use the normal distribution as the basis for building some control charts.
Which of the following products is likely to be assembled on a repetitive process line? steel beer automobiles custom personal computers custom cakes
-automobiles
To set x-bar chart upper and lower control limits, one must know the process central line, which is the: -total number of defects in the population. -average range. -average of the sample means. -percent defects in the population. -size of the population.
-average of the sample means.
Control charts for variables are based on data that come from: -averages of large samples. -the entire lot. -averages of small samples. -individual items. -acceptance sampling.
-averages of small samples.
Jars of pickles are sampled and weighed. Sample measures are plotted on control charts. The ideal weight should be precisely 11 oz. Which type of chart(s) would you recommend? -both an x-bar chart and an R-chart -an x-bar chart, but not an R-chart -c-chart -p-chart -both a p-chart and a c-chart
-both an x-bar chart and an R-chart
A nationwide parcel delivery service keeps track of the number of late deliveries (more than 30 minutes past the time promised to clients) per day. They plan on using a control chart to plot their results. Which type of control chart(s) would you recommend? -both p-chart and c-chart -p-chart -x-bar chart -both x-bar chart and R-chart -c-chart
-c-chart
The local newspaper receives several complaints per day about typographic errors. Over a seven-day period, the publisher has received calls from readers reporting the following total daily number of errors: 4, 3, 2, 6, 7, 3, and 9. Based on these data alone, what type of control chart(s) should the publisher use? -c-chart -x-bar chart -x-bar chart and R-chart -p-chart -R-chart
-c-chart
The number of defects after a hotel room cleaning (sheets not straight, smears on mirror, missed debris on carpet, etc.) should be measured using what type of control chart? -c-chart -p-chart -either x-bar chart or R chart -x-bar chart -R-chart
-c-chart
What is the statistical process chart used to control the number of defects per unit of output? -c-chart -R-chart -p-chart -AOQ chart -x-bar chart
-c-chart
The purpose of an x-bar chart is to determine whether there has been a: -change in the AOQ. -change in the dispersion of the process output. -change in the percent defective in a sample. -change in the number of defects in a sample. -change in the central tendency of the process output.
-change in the central tendency of the process output.
The c-chart signals whether there has been a: -change in the central tendency of the process output. -gain or loss in uniformity. -change in the number of defects per unit. -change in the AOQ. -change in the percent defective in a sample.
-change in the number of defects per unit.
Computer-integrated manufacturing (CIM) includes manufacturing systems that have: all of their computers integrated with the marketing department. transaction processing, management information systems, and decision support systems integrated. computer-aided design, a flexible manufacturing system, inventory control, warehousing and shipping integrated. automated guided vehicles, robots, and process control integrated. robots, automated guided vehicles, and transfer equipment integrated.
-computer-aided design, a flexible manufacturing system, inventory control, warehousing and shipping integrated
Which one of the following products is most likely made in a job shop environment? -custom furniture -cigarettes -rolls of newsprint -canned vegetables -television sets
-custom furniture
In the mass service and service factory quadrants of the service process matrix, the operations manager could focus on all of the following EXCEPT: -removing some services. -automation. -tight quality control. -standardization. -customization.
-customization.
Acceptance sampling's primary purpose is to: -identify processes that are out of control. -determine whether defective items found in sampling should be replaced. -decide if a lot meets predetermined standards. -detect and eliminate defectives. -estimate process quality.
-decide if a lot meets predetermined standards.
Statistical process control charts: -indicate to the operator the true quality of material leaving the process. -are a graphic way of classifying problems by their level of importance, often referred to as the 80-20 rule. -display the measurements on every item being produced. -display upper and lower limits for process variables or attributes and signal when a process is no longer in control. -indicate to the process operator the average outgoing quality of each lot.
-display upper and lower limits for process variables or attributes and signal when a process is no longer in control.
"Operators simply load new programs, as necessary, to produce different products" describes: -process control. -automated guided vehicles. -CAD. -vision systems. -flexible manufacturing systems.
-flexible manufacturing systems.
What is a drawing of the movement of material, product, or people? vision system flowchart service blueprint process map process chart
-flowchart
Service blueprinting: determines the best time for each step in the process. uses the schematic of a house to diagram a service process. provides the basis to negotiate prices with suppliers. focuses on the provider's interaction with the customer. mimics the way people communicate.
-focuses on the provider's interaction with the customer.
The usual purpose of an R-chart is to signal whether there has been a: -change in the central tendency of the process output. -change in the number of defects in a sample. -change in the percent defective in a sample. -gain or loss in dispersion. -change in the consumer's risk.
-gain or loss in dispersion.
Advances in technology: have impacted the manufacturing sector only. have failed to change the level of customer interaction with an organization. have dramatically changed health care, but have not changed retailing. have had a dramatic impact on customer interaction with services and with products. have had only a limited impact on services.
-have had a dramatic impact on customer interaction with services and with products.
Which of the following phrases best describes product focus? high fixed costs, low variable costs low volume, high variety high inventory Processes are designed to perform a wide variety of activities. Finished goods are usually made to order.
-high fixed costs, low variable costs
A product-focused process is commonly used to produce: high-volume, high-variety products. high-volume, low-variety products. low-volume, high-variety products. low-variety products at either high- or low-volume. high-volume products of either high- or low-variety.
-high-volume, low-variety products.
In mass service and professional service, the operations manager should focus extensively on: sophisticated scheduling. human resources. equipment maintenance. automation. cost-cutting initiatives.
-human resources.
Acceptance sampling is usually used to control: -the quality of work-in-process inventory. -the number of units of output from one stage of a process that are -then sent to the next stage. -incoming lots of purchased products. -the number of units delivered to the customer. -all of these.
-incoming lots of purchased products.
The advantage of additive manufacturing includes supporting: flexible manufacturing systems (FMS). innovative product design. ASRS and AGVs. information numeric control. all of these.
-innovative product design.
A job shop is an example of a(n): intermittent process. continuous process. repetitive process. specialized process. line process.
-intermittent process.
Assignable variation: -is a sign that a process is under control. -is the same as random variation. -is variation that cannot be traced to a specific cause. -leads to a steep OC curve. -is to be identified and investigated.
-is to be identified and investigated.
Acceptance sampling: -is used to determine whether to accept or reject a lot of material based on the evaluation of a sample. -was developed by Walter Shewhart of Bell Laboratories. -is another name for 100% inspection. -separates the natural and assignable causes of variation. -is the application of statistical techniques to the control of processes.
-is used to determine whether to accept or reject a lot of material based on the evaluation of a sample.
Natural variations: -are variations that can be traced to a specific cause. -are variations that are to be identified and investigated. -lead to occasional false findings that processes are out of control. -are the same as assignable variations. -play no role in statistical process control.
-lead to occasional false findings that processes are out of control.
If a sample of items is taken and the mean of the sample is outside the control limits, the process is: -monitored closely to see if the next sample mean will also fall outside the control limits. -in control, but not capable of producing within the established control limits. -within the established control limits with only natural causes of variation. -producing high quality products. -likely out of control and the cause should be investigated.
-likely out of control and the cause should be investigated.
Which of the following phrases best describes process focus? high fixed costs, low variable costs Operators are less broadly skilled. low inventory Finished goods are usually made to a forecast and stored. low volume, high variety
-low volume, high variety
The causes of variation in statistical process control are: -producer's causes and consumer's causes. -natural causes and assignable causes. -Type I and Type II. -mean and range. -cycles, trends, seasonality, and random variations.
-natural causes and assignable causes.
The number of late insurance claim payouts per 100 should be measured with what type of control chart? -either p-chart or c-chart -x-bar chart -c-chart -p-chart -R-chart
-p-chart
The normal application of a p-chart is in: -acceptance sampling by variables. -process sampling by attributes. -process capability ratio computations. -acceptance sampling by attributes. -process sampling by variables.
-process sampling by attributes.
Goods made to order are typical of ________ and ________ approaches while goods made to forecast are typical of ________ and ________ approaches. process, mass customization; repetitive, product product, process; repetitive, mass customization repetitive, process; mass customization, product repetitive, product; mass customization, process product, mass customization; repetitive, process
-process, mass customization; repetitive, product
An assembly line is an example of a: -line process. -repetitive process. -specialized process. -process-focused process. -product-focused process.
-repetitive process.
Which of the following industries is most likely to have low equipment utilization? steel manufacturing auto manufacturing restaurants television manufacturing commercial baking
-restaurants
Mechanical devices that use electronic impulses to activate motors and switches are called: additive manufacturing. automated storage and retrieval systems. automated guided vehicles. robots. flexible manufacturing systems.
-robots
Which of the following is NOT one of the four main types of inventory? maintenance/repair/operating supply inventory work-in-process inventory raw material inventory finished-goods inventory safety stock inventory
-safety stock inventory
In most banks, customers need to go to different service areas for opening accounts, applying for loans, and making deposits. This service strategy is an example of: separation. modules. automation. focus. self-service.
-separation.
Product-focused processes: are profitable because customers demand flexibility, not specialization. allow more customization, but are not very efficient. tend to have long, continuous production runs. apply only to service firms, not to manufacturers. are processes that accommodate a variety of products or customer groups.
-tend to have long, continuous production runs.
One fundamental difference between a process chart and a flowchart is that: the process chart focuses on the customer and on the provider's interaction with the customer, while the flowchart does not deal directly with the customer. the process chart adds a time dimension to the horizontal axis, while a flowchart is not time-oriented. the process chart is more like a table, while the flowchart is more like a schematic diagram. the process chart includes the supply chain, while the flowchart stays within an organization. None of these is true, because a process chart and a flowchart are the same thing.
-the process chart is more like a table, while the flowchart is more like a schematic diagram.
One of the similarities between product focus and mass-customization is: the variety of outputs. the volume of outputs. the use of modules. many departments and many routings. All of these are similarities.
-the volume of outputs.
A run test is used: -to examine points in a control chart to check for nonrandom variability. -to examine points in a control chart to check for natural variability. -in acceptance sampling to establish control. -to examine variability in acceptance sampling plans. -to test the validity of the Central Limit Theorem.
-to examine points in a control chart to check for nonrandom variability.
Extended periods of exposure to decibel levels above ________ has been judged to be permanently damaging.
85 dB
Which one of the following scenarios represents the use of a kanban to reduce inventories?
A "customer" work center signals to the "supplier" workstation that more parts are needed.
Which of the following statements about ABC analysis is FALSE? Criteria other than annual dollar volume, such as high holding cost or delivery problems, can determine item classification in ABC analysis. In ABC analysis, forecasting methods for "C" items may be less sophisticated than for "A" items. In ABC analysis, "A" items should have tighter physical inventory control than "B" or "C" items have. ABC analysis is based on the presumption that controlling the few most important items produces the vast majority of inventory savings. ABC analysis is based on the presumption that all items must be tightly controlled to produce important cost savings.
ABC analysis is based on the presumption that all items must be tightly controlled to produce important cost savings.
Which of the following statements regarding work-in-process (WIP) inventory is FALSE? Actual "run" time is usually a significant portion of the material flow time. WIP exists because of flow time. WIP inventory describes products or components that are no longer raw materials but have yet to become finished products. Reducing flow time reduces WIP inventory. During most of the time a product is "being made," it is in fact sitting idle.
Actual "run" time is usually a significant portion of the material flow time.
Lean operations are known for their:
All of these are attributes of lean operations.
The bullwhip effect:
All of these are true.
Which of the following statements regarding the reorder point is TRUE? The reorder point is larger than d × L if safety stock is present. There is a reorder point even if lead time and demand during lead time are constant. The reorder point is that quantity that triggers an action to restock an item. A shorter lead time implies a smaller reorder point. All of these are true.
All of these are true.
Which of the following statements regarding control of service inventories is TRUE? Service inventory needs no safety stock, because there's no such thing as a service stockout. Service inventory has carrying costs but no setup costs. Good personnel selection, training, and discipline are easy. Effective control of all goods leaving the facility is one applicable technique. Service inventory is a fictional concept, because services are intangible.
Effective control of all goods leaving the facility is one applicable technique.
Which of the following is NOT a source of variability?
Employees, machines, and suppliers produce units that conform to standards.
ABC analysis is based on the presumption that carefully controlling all items is necessary to produce important inventory savings. True False
False
In ABC analysis, "A" items are the least tightly controlled. True False
False
Insurance and taxes on inventory are part of the costs known as setup or ordering costs. True False
False
Outsourcing refers to transferring a firm's activities that have traditionally been external to internal suppliers.
False
Which item to order and with which supplier the order should be placed are the two fundamental issues in inventory management. True False
False
Work-in-process inventory is devoted to maintenance, repair, and operating materials. True False
False
Which of the following statements about the basic EOQ model is FALSE? If the holding cost were to increase, the EOQ would decrease. If annual demand were to double, the EOQ would rise. If the setup cost were to decrease, the EOQ would fall. If annual demand were to double, the number of orders per year would increase by 73%. None. All of these statements are true.
If annual demand were to double, the EOQ would rise. (wrong)
If the goals of JIT partnerships are met, which of the following is a result?
In-transit inventory falls as suppliers are located closer to facilities.
Which of the following statements regarding the production order quantity model is TRUE? It relaxes the assumption that all the order quantity is received at one time. It minimizes inventory. It applies only to items produced in the firm's own production departments. It relaxes the assumption that the demand rate is constant. It minimizes the total production costs.
It relaxes the assumption that all the order quantity is received at one time.
Which of the following is specifically characterized by continuous and forced problem solving via a focus on throughput and reduced inventory?
Just-in-time (JIT)
Which of the following is specifically characterized by the elimination of waste through a focus on exactly what the customer wants?
Lean operations
Which of the following statements regarding a pull system is TRUE?
Problems become more obvious.
If a factory wants to cut its current lot size in half, by what proportion must setup cost change?
Setup cost must be cut to one fourth its current value.
Who is credited with coining the phrase, "Inventory is evil"?
Shigeo Shingo
Which of the following is NOT true about reverse logistics as compared to forward logistics?
Speed is often not a priority. (WRONG)
Which of the following is often added to the 5Ss by U.S. managers?
Support/maintenance
Which one of the following statements is TRUE about the kanban system?
The customer workstation signals to the supplier workstation when production is needed.
Which of the following statements describes job rotation?
The operator is allowed to move, for example, from one type of CNC machine to another.
What does TPS stand for?
Toyota Production System
Which of the following is specifically characterized by a focus on continuous improvement, respect for people, and standard work practices?
Toyota Production System (TPS)
Vertical integration appears particularly advantageous when the organization has:
a large market share.
If demand is not uniform and constant, then stockout risks can be controlled by: increasing the EOQ. reducing the reorder point. spreading annual demand over more frequent, but smaller, orders. raising the selling price to reduce demand. adding safety stock.
adding safety stock.
Which one of the following distribution systems offers speed and reliability when emergency supplies are needed overseas?
airfreight
Outsourcing
all of the above
Ethical work environment decisions by managers may be guided by ALL EXCEPT which of the following?
all of these
Labor standards are defined as the:
amount of time required to perform a job or part of a job.
One of the elements of ergonomics is:
analyzing human motions and efforts.
Which of the following is a visual signal at a machine that notifies support personnel about the machine's status?
andon
A fried chicken fast-food chain that acquired feed mills and poultry farms has performed which of the following?
backward integration
Therbligs are:
basic physical elements of motion as used in methods time measurement exercises.
What does the Japanese word "kanban" mean?
card
Concerning relationships with suppliers, which of the following combinations is critical to the success of JIT?
close relationships with trust
What term describes a supply chain that is designed to optimize both forward and reverse flows?
closed-loop supply chain
The purpose of safety stock is to: eliminate the possibility of a stockout. protect the firm from a sudden decrease in demand. control the likelihood of a stockout due to variable demand and/or lead time. replace failed units with good ones. eliminate the likelihood of a stockout due to erroneous inventory tally.
control the likelihood of a stockout due to variable demand and/or lead time.
Which of the following is NOT a primary supplier selection criterion for a firm pursuing a response strategy?
cost
What type of negotiating strategy requires the supplier to open its books to the purchasers?
cost-based price model
Which of the following describes using one supplier for a component and a second supplier for another component, where each supplier acts as a backup for the other?
cross-sourcing
In JIT partnerships, suppliers have several concerns. Which of the following is NOT such a concern?
customers' infrequent engineering changes
Cycle counting: assumes that the most frequently used items must be counted more frequently. provides a measure of inventory turnover. assumes that all inventory records must be verified with the same frequency. eliminates annual inventory adjustments. is a process by which inventory records are verified once a year.
eliminates annual inventory adjustments.
The difference between job enrichment and job enlargement is that:
enriched jobs involve vertical expansion, while enlarged jobs involve horizontal expansion
When a worker obtains clear and timely information about his/her performance, his/her job includes which of the following characteristics?
feedback
Which one of the following is NOT a layout tactic in a JIT environment?
fixed equipment
Working four shifts of ten hours each instead of five shifts of eight hours each is known as which of the following?
flexible workweek
A manufacturing plant allows its engineers to come in at 7 A.M. plus or minus an hour but still requires them to work 8-hour days. Which of the following scheduling techniques is the firm employing?
flextime
The two most basic policies associated with employment stability are:
follow demand exactly and hold employment constant.
A rice mill in south Louisiana purchases the trucking firm that transports packaged rice to distributors. This is an example of which of the following?
forward integration
Which one of the following is a concern expressed by suppliers in JIT partnerships?
having limited ability to respond to changes in product and quality
Excess bags of basic commodities such as flour and sugar that are stored in a restaurant's kitchen represent which of the following wastes?
inventory
What three logistics-related costs are relevant when analyzing the choice of number of facilities in a distribution network?
inventory costs, transportation costs, and facility costs
E-procurement:
is purchasing facilitated through the Internet.
Methods analysis focuses on:
issues such as the movement of individuals or material.
A disadvantage of work sampling is that:
it tends to be less accurate, particularly when task times are short.
What is the behavioral approach to job design that involves giving the worker more tasks requiring similar skills?
job enlargement
Which of the following terms implies an increase in responsibility and control in the vertical direction?
job enrichment
Which of Hackman and Oldham's five job characteristics refers to providing a sense that the job has an impact on the organization and society?
job significance
Four of the components of job design are:
job specialization, job expansion, psychological components, and self-directed teams.
When Daimler and BMW pooled resources to develop standardized auto components, the sourcing strategy could best be described by which of the following?
joint venture
Japanese manufacturers often pursue a strategy that is part collaboration, part purchasing from a few suppliers, and part vertical integration. What is this approach called?
keiretsu
Characteristics of just-in-time partnerships do NOT include:
large lot sizes to save on setup costs and to gain quantity discounts.
Which of the following is NOT an advantage of the "few suppliers" sourcing strategy?
less vulnerable trade secrets
The objective of a human resource strategy is to:
manage labor and design jobs so people are effectively and efficiently utilized.
Which sourcing strategy is particularly common when the products being sourced are commodities?
many suppliers
Drop shipping:
means the supplier will ship directly to the end consumer, rather than to the seller.
If a business adopts a low-cost strategy, it should build a supply chain with ________.
minimized inventory
When quantity discounts are allowed, the cost-minimizing order quantity: minimizes the sum of holding and ordering costs. may be a quantity below that at which one qualifies for that price. is always an EOQ quantity. minimizes the sum of holding, ordering, and product costs. minimizes the unit purchase price.
minimizes the sum of holding, ordering, and product costs.
Flow diagrams are used to analyze:
movement of people or material.
Which of the following is used by methods analysis in analyzing body movement at the workstation level?
operations chart
Local optimization is a supply-chain complication best described as:
optimizing one's local area without full knowledge of supply chain needs.
The transfer of some of what are traditional internal activities and resources of a firm to outside vendors is:
outsourcing
Which category of inventory holding costs has a much higher percentage than average for rapid-change industries such as tablets and smart phones? labor cost material handling costs investment costs pilferage, scrap, and obsolescence housing costs
pilferage, scrap, and obsolescence
What is the practice of keeping a product generic as long as possible before customizing?
postponement
The use of information technology to monitor and control a physical process is known as: -numeric information control. -IT oversight. -numeric control. -computer-aided design. -process control.
process control.
Which of the following best describes backward integration?
produce goods or services previously purchased
Which of the following is a primary supplier selection criterion for a firm pursuing a differentiation strategy?
product development skills
One function of inventory is to take advantage of quantity discounts. True False
true
The proper quantity of safety stock is typically determined by: minimizing total costs. setting the level of safety stock so that a given stockout risk is not exceeded. using a single-period model. multiplying the EOQ by the desired service level. carrying sufficient safety stock so as to eliminate all stockouts.
setting the level of safety stock so that a given stockout risk is not exceeded.
In the consumer packaged goods industry, the benchmark firms tend to have ________.
short cash-to-cash cycle time
Which of the following is NOT a condition that favors the success of vertical integration?
small market share
While freight rates are often based on very complicated pricing systems, in general, the primary freight price factor is based on which of the following attributes?
speed of shipment
Which of the following is NOT characteristic of a TPS employee?
strict job classifications
What are the four stages of supplier selection?
supplier evaluation, supplier development, negotiations, and contracting
How can a reduction of in-transit inventory be encouraged?
supplier location near plants
A disadvantage of the "few suppliers" sourcing strategy is:
the high cost of changing partners.
Distribution management focuses on which of the following?
the outbound flow of products
An advantage of work sampling is that:
the time spent observing the employee is relatively short.
ABC analysis is based upon the principle that: as with grade distributions in many MBA courses, there should be more medium-level "B" items than either "A" or "C" items. more time should be spent on class "C" items because there are many more of them. all items in inventory must be monitored very closely. there are usually a few critical items, and many items that are less critical. an item is critical if its usage is high.
there are usually a few critical items, and many items that are less critical.
What term is used to describe the outsourcing of logistics?
third-party logistics (3PL)
Timing a sample of a worker's performance and using it as a basis for setting a standard time describes which of the following?
time studies
Which of the following would NOT generally be a motive for a firm to hold inventories? to take advantage of quantity discounts to minimize holding costs to provide a selection of goods for anticipated customer demand and to separate the firm from fluctuations in that demand to hedge against inflation to decouple various parts of the production process
to minimize holding costs
Activity charts help analyze:
utilization of an operator and machine.
Which one of the following is NOT a benefit of JIT implementation?
variability increase
Which of the following best describes Vizio's sourcing strategy?
virtual company
What is a technique for estimating the percent of time a worker spends on various tasks?
work sampling
