BUAD 452: Exam 1, CH 1.2.9.10

Measurements taken at various points in the transformation process for control purposes are called: A. plans B. directions C. controls D. feedback E. budgets

D. feedback

Budgeting, analysis of investment proposals, and provision of funds are activities associated with the _______ function. A. operation B. marketing C. purchasing D. finance E. internal audit

D. finance

The weekly output of a production process is shown below, together with data for labor and material inputs. The standard inventory value of the output is $125 per unit. Overhead is charged weekly at the rate of $1500 plus .5 times direct labor cost. Assume a 40-hour week and an hourly wage of $16. Material cost is $10 per running foot. What is the average multi-factor productivity for this process? (Chart on page 46 of PDF, #72)

wk1: 1.444 wk2: 1.431 wk3: 1.463 wk4: 1.451 avg: 1.447 (Calculate weekly multifactor, then average)

Product design and choice of location are examples of _______ decisions. A. strategic B. tactical C. operational D. customer focused E. design

A. strategic

In the past, a significant reason why U.S. productivity was the highest in the world was high: A. agricultural productivity B. manufacturing productivity C. labor productivity D. savings productivity E. governmental productivity

A. agricultural productivity

The manager of a carpet store is trying to determine the best installation crew size. He has tried various crew sizes with the results shown below. Based on productivity, what crew size do you recommend? (Chart on page 43 of PDF, #59) A. 2 B. 3 C. 4

A. 2 (Crews of 2 are most productive)

Gourmet Pretzels bakes soft pretzels on an assembly line. It currently bakes 800 pretzels each 8-hour shift. If the production is increased to 1,200 pretzels each shift, then productivity will have increased by: A. 50% B. 33% C. 25% D. 67%

A. 50%

Suppose a country's productivity last year was 84. If this country's productivity growth rate of 5% is to be maintained, this means that this year's productivity will have to be _______. A. 88.2 B. 79.8 C. 82.8 D. 78.9 E. 4.2

A. 88.2 (multiply 84 by 1.05 and then subtract 84 from this product)

_______ variation is a variation whose cause can be identified. A. Assignable B. Controllable C. Random D. Statistical E. Theoretical

A. assignable

Which is not a significant difference between manufacturing and service operations? A. cost per unit B. uniformity of output C. labor content of jobs D. customer contact E. measurement of productivity

A. cost per unit

Two widely used metrics of variation are the __________ and the _________. A. mean; standard deviation B. productivity ratio; correlation C. standardized mean; assignable deviation D. randomized mean; standardized deviation E. normal distribution; random variation

A. mean; standard deviation

Modern firms increasingly rely on other firms to supply goods and services instead of doing these tasks themselves. This increased level of _____________ is leading to increased emphasis on ____________ management. A. outsourcing; supply chain B. offshoring; lean C. downsizing; total quality D. optimizing; inventory E. internationalization; intercultural

A. outsourcing; supply chain

A control chart used to monitor the fraction of defectives generated by a process is the: A. p-chart B. R-chart C. x-bar chart D. c-chart E. Gantt chart

A. p-chart

Business organizations consist of three major functions which, ideally: A. support one another B. are mutually exclusive C. exist independently of each other D. function independently of each other E. do not interface with each other

A. support one another

A firm pursuing a strategy based on customization and variety will tend to structure and manage its supply chain to accommodate more _____________ than a firm pursuing a strategy based on low-cost and high-volume. A. Variation B. Streamlined flow C. Quality D. Capacity E. Productivity

A. variation

A productivity increase in one operation that doesn't improve overall productivity of the business isn't A. worthwhile B. trivial C. competence-destroying D. an order winner E. an order qualifier

A. worthwhile

Chapter 9 questions with charts (in PDF): Page 670: #77-114

Answers starting on page 709

A process that makes chocolate candy bars has an output that is normally distributed with a mean of 6 oz. and a standard deviation of .01 oz. A job is to be run that requires 200 candy bars. Determine three sigma control limits for an x-bar chart assuming a sample size of 10. If specifications are 5.98 to 6.02, what run size should be used for this job so that the expected number of good candy bars is 200, assuming the process is in control?

Approximately 210 (Feedback: The specifications are at ± 2 process standard deviations, which would include 95.44% of the output. Thus, .9544Q = 200, so Q = 209.6 or 210.)

Studies on a machine that molds plastic water pipe indicate that when it is injecting 1-inch diameter pipe, the process standard deviation is 0.05 inches. The one-inch pipe has a specification of 1-inch plus or minus 0.10 inch. What is the process capability index (Cpk) if the long-run process mean is 1 inch? A. 0.50 B. 0.67 C. 1.00 D. 2.00 E. none of the above

B. 0.67 (Cpk formula)

The weekly output of a fabrication process is shown below together with data for labor and material inputs. Standard selling price is $125 per unit. Overhead is charged weekly at the rate of $1,500 plus .5 times direct labor cost. Assume a 40-hour week and an hourly wage of $16. Material cost is $10 per foot. What is the average multifactor productivity? (Chart on page 44 of PDF, #62) A. 1.463 B. 1.457 C. 1.431

B. 1.457 (Calculate multifactor productivity for each week, then average the two)

The specifications for a product are 6 mm ± 0.1 mm. The process is known to operate at a mean of 6.05 with a standard deviation of 0.01 mm. What is the Cpk for this process? A. 3.33 B. 1.67 C. 5.00 D. 2.50 E. none of the above

B. 1.67 (Cpk used since process mean isn't centered)

The Balanced Scorecard is a useful tool for helping managers translate their strategy into action in the following areas: A. Sustainability; Flexibility; Efficiency; Technology B. Customers; Financial; Internal Business Processes; Learning and Growth C. Customization; Standardization; Efficiency; Effectiveness D. The Environment; The Community; Suppliers; Other Stakeholders E. Strategy; Tactics; Productivity; Profitability

B. Customers; financial; internal business processes; learning and growth

The fact that a few improvements in a few key areas of operations will have more impact than many improvements in many other areas is consistent with the: A. Irwin phenomenon B. Pareto phenomenon C. Stevenson phenomenon D. Tellier phenomenon E. Adam Smith phenomenon

B. Pareto phenomenon

A process results in a few defects occurring in each unit of output. Long-run, these defects should be monitored with ___________. A. p-charts B. c-charts C. x-bar charts D. r-charts E. o-charts

B. c-charts

For firms competing in worldwide markets, conducting __________________ is more complex, since what works in one country or region might not work in another. A. Productivity analysis B. Environmental analysis C. Strategy implementation D. Sustainability analysis E. Growth forecasting

B. environmental analysis

Marketing depends on operations for information regarding ___________. A. productivity B. lead time C. cash flow D. budgeting E. corporate intelligence

B. lead time

Which of the following is not typically considered a cure for poor competitiveness? A. remove communications barriers within organizations B. minimize attention to the operations function C. put less emphasis on short-term financial results D. recognize labor as a valuable asset and act to develop it E. improve quality

B. minimize attention to the operations function

Scheduling personnel is an example of an operations management: A. mission implementation B. operational decision C. organizational strategy D. functional strategy E. tactical decision

B. operational decision

Manufacturing work sent to other countries is called: A. downsized B. outsourced C. internationalization D. vertical integration E. entrepreneurial ship

B. outsourced

The responsibilities of the operations manager are: A. planning, organizing, staffing, procuring, and reviewing B. planning, organizing, staffing, directing, and controlling C. forecasting, designing, planning, organizing, and controlling D. forecasting, designing, operating, procuring, and reviewing E. designing and operating

B. planning, organizing, staffing directing, and controlling

The ratio of good output to quantity of raw material input is called A. non-defective productivity B. process yield C. worker quality measurement D. total quality productivity E. quantity/quality ratio

B. process yield

A shift in the process mean for a measured characteristic would most likely be detected by a: A. p-chart B. x-bar chart C. c-chart D. R-chart E. s-chart

B. x-bar chart

The specification limit for a product is 8 cm and 10 cm. A process that produces the product has a mean of 9.5 cm and a standard deviation of 0.2 cm. What is the process capability, Cpk? A. 3.33 B. 1.67 C. 0.83 D. 2.50 E. none of the above

C. 0.83 (Cpk used since process mean is not centered)

In an assembly operation at a furniture factory, six employees assembled an average of 450 standard dining chairs per 5-day week. What is the labor productivity of this operation? A. 90 chairs/worker/day B. 20 chairs/worker/day C. 15 chairs/worker/day D. 75 chairs/worker/day E. none of the above

C. 15 chairs/worker/day (divide the output of 450 chairs by the input of 30 worker days)

Which of the following is not true about systems approach? A. A systems viewpoint is almost always beneficial in decision making. B. A systems approach emphasizes interrelationships among subsystems. C. A systems approach concentrates on efficiency within subsystems. D. A systems approach is essential whenever something is being redesigned or improved. E. All of the above are true.

C. A systems approach concentrates on efficiency within subsystems

If a process is performing as it should, it is still possible to obtain observations which are outside of which limits? (I) tolerances (II) control limits (III) process variability A. I B. II C. I and II D. II and III E. I, II, and III

C. I and II

A plot below the lower control limit on the range chart: (I) should be ignored since lower variation is desirable (II) may be an indication that process variation has decreased (III) should be investigated for assignable cause A. I and II B. I and III C. II and III D. II only E. I, II, and III

C. II and III

Operations management involves continuous decision-making; hopefully most decisions made will be: A. redundant B. minor in nature C. informed D. quantitative E. none of the above

C. Informed

Which of the following relationships must always be incorrect? A. Tolerances > process variability > control limits B. Process variability > tolerances > control limits C. Tolerances > control limits > process variability D. Process variability > control limits > tolerances E. Process variability <Tolerances<control limits

C. Tolerances > control limits > process variability

A 'product package' consists of: A. the exterior wrapping B. the shipping container C. a combination of goods and services D. goods if a manufacturing organization E. customer relations if a service organization

C. a combination of goods and services

Knowledge skills usually don't include: A. process knowledge B. accounting skills C. communication skills D. global knowledge E. all of the above

C. communication skills

A time-ordered plot of sample statistics is called a(n) ______ chart. A. Statistical B. Inspection C. Control D. SIMO E. Limit

C. control

A time-ordered plot of representative sample statistics is called a: A. Gantt chart B. SIMO-chart C. Control Chart D. Up-Down Matrix E. Standard deviation table

C. control chart

The process of comparing outputs to previously established standards to determine if corrective action is needed is called: A. planning B. directing C. controlling D. budgeting E. disciplining

C. controlling

Which of the following is not a step in the quality control process? A. define what is to be controlled B. compare measurements to a standard C. eliminate each of the defects as they are identified D. take corrective action if necessary E. evaluate corrective action

C. eliminate each of the defects as they are identified

For an organization to grow its market share, it must: A. advertise using multimedia B. lower prices C. exceed minimum standards of acceptability for its products or services D. establish an internet website E. broaden its mission statement

C. exceed minimum standards of acceptability for its products or services

Which of the following is true? A. Corporate strategy is shaped by functional strategies. B. Corporate mission is shaped by corporate strategy. C. Functional strategies are shaped by corporate strategy. D. External conditions are shaped by corporate mission. E. Corporate mission is shaped by functional strategies.

C. functional strategies are shaped by corporate strategy

Which of the following does not relate to system design? A. altering the system capacity B. location of facilities C. inventory management D. selection and acquisition of equipment E. physical arrangement of departments

C. inventory management

In the 1970's and 1980's in the USA, organizations concentrated on: A. operations strategies B. improving quality C. marketing and financial strategies D. revising mission statements E. environmental issues

C. marketing and financial strategies

Which of the following factors would tend to reduce productivity? A. improvements in workplace safety B. reductions in labor turnover C. more inexperienced workers D. reductions in the scrap rate E. none of the above

C. more inexperienced workers

Farming is an example of: A. an obsolete activity B. a virtual organization C. non-manufactured goods D. a growth industry E. customized manufacturing

C. non-manufactured goods

The external elements of SWOT analysis are: A. strengths and weaknesses B. strengths and threats C. opportunities and threats D. weaknesses and opportunities E. strengths and opportunities

C. opportunities and threats

Years ago in the overnight delivery business, providing package tracking capability gave some firms a competitive advantage. Now, all firms must offer this capability simply to be in this line of business. This is an example of ______________ becoming ____________ over time. A. Tactical implications; strategic B. Strategic implications; tactical C. Order winners; order qualifiers D. Profitability factors; productivity factors E. Order qualifiers; order winners

C. order winners; order qualifiers

Competitiveness doesn't include: A. Productivity B. Effectiveness C. Profitability D. Operations Strategy E. Operations Management

C. profitability

Dealing with the fact that certain aspects of any management situation are more important than others is called: A. analysis of trade-offs B. sensitivity analysis C. recognition of priorities D. analysis of variance E. decision table analysis

C. recognition of priorities

A point which is outside of the lower control limit on an R-chart: A. is an indication that no cause of variation is present B. should be ignored because it signifies better than average quality C. should be investigated because an assignable cause of variation might be present D. should be ignored unless another point is outside that limit E. is impossible since the lower limit is always zero

C. should be investigated because an assignable cause of variation might be present

Which one of the following would not generally be classified under the heading of transformation? A. assembling B. teaching C. staffing D. farming E. consulting

C. staffing

Which of the following is a recent trend in business? A. pollution control B. total quality management C. supply chain management D. competition from foreign manufacturers E. technological change

C. supply chain management

Taking a systems viewpoint with regard to operations in today's environment increasingly leads decision-makers to consider ______________ in response to the ___________. A. flexibility; pressure to be more efficient B. offshoring; need to promote domestic production C. sustainability; threat of global warming D. technology; impact of random variation E. forecasting; stabilization of demand

C. sustainability; threat of global warming

Product design and process selection are examples of _______ decisions. A. financial B. tactical C. system design D. system operation E. forecasting

C. system design

A p-chart would be used to monitor _______. A. average shrinkage B. dispersion in sample data C. the fraction defective D. the number of defects per unit E. the range of values

C. the fraction defective

Technology choices seldom affect: A. costs. B. productivity. C. union activity. D. quality. E. flexibility.

C. union activity

A control chart used to monitor the process mean is the: A. p-chart B. R-chart C. x-bar chart D. c-chart E. Gantt chart

C. x-bar chart

When a process is in control, it results in there being, on average, 16 defects per unit of output. C-chart limits of 4 and 28 would lead to a _______ chance of a Type I error. A. 67% B. 92% C. 33% D. 0.3% E. 5%

D. 0.3%

Studies on a bottle-filling machine indicates it fills bottles to a mean of 16 ounces with a standard deviation of 0.10 ounces. What is the process specification, assuming the Cpk index of 1? A. 0.10 ounces B. 0.20 ounces C. 0.30 ounces D. 16.0 ounces plus or minus 0.30 ounces E. none of the above

D. 16 ounces plus or minus 0.30 ounces (Cpk formula)

Which of the following is not a benefit of using models in decision making? A. They provide a standardized format for analyzing a problem. B. They serve as a consistent tool for evaluation. C. They are easy to use and less expensive than dealing with the actual situation. D. All of the above are benefits. E. None of the above is a benefit.

D. All of the above are benefits.

Which of the following statements about variation is FALSE? A. Variation prevents a production process from being as efficient as it can be. B. Some variation can be prevented. C. Variation can either be assignable or random. D. Any variation makes a production process less productive. E. Random variation generally cannot be influenced by managers.

D. Any variation makes a production process less productive.

Unique attributes of firms that give them a competitive edge are called ______________. A. Functional strategies B. Balanced scorecards C. Supply chains D. Core competencies E. Sustainable initiatives

D. Core competencies

The probability of concluding that assignable variation exists when only random variation is present is: (I) the probability of a Type I error (II) known as the alpha risk (III) highly unlikely (IV) the sum of probabilities in the two tails of the normal distribution A. I and II B. I and IV C. II and III D. I, II, and IV E. I, III, and IV

D. I, II, and IV

What is credited with gains in industrial productivity, increased standards of living and affordable products? A. personal computers B. the internet C. mass transportation D. assembly lines E. multi-level marketing

D. assembly lines

A control chart used to monitor the number of defects per unit is the: A. p-chart B. R-chart C. x-bar chart D. c-chart E. Gantt chart

D. c-chart

The purpose of control charts is to: A. estimate the proportion of output that is acceptable B. weed out defective items C. determine if the output is within tolerances/specifications D. distinguish between random variation and assignable variation in the process E. provide meaningful work for quality inspectors

D. distinguish between random variation and assignable variation in the process

Which of the following is not a characteristic of service operations? A. intangible output B. high customer contact C. high labor content D. easy measurement of productivity E. low uniformity of output

D. easy measurement of productivity

Which of the following is not an ongoing trend in manufacturing? A. globalization B. quality improvement C. flexibility and agility D. mass production for greater economies of scale E. technological advances

D. mass production for greater economies of scale

The fundamental purpose for the existence of any organization is described by its: A. policies B. procedures C. corporate charter D. mission statement E. bylaws

D. mission statement

Productivity is expressed as: A. output plus input B. output minus input C. output times input D. output divided by input E. input divided by output

D. output divided by input

Increasing the service offered to the customer makes it more difficult to compete on the basis of ______. A. order qualifiers B. customization C. quality D. price E. flexibility

D. price

Some companies attempt to maximize the revenue they receive from fixed operating capacity by influencing demands through price manipulation. This is an example of __________________: A. Illegal price discrimination B. Collusion C. Volume analysis D. Revenue management E. Outsourcing

D. revenue management

Which of the following is not a reason for poor performance of our organization in the marketplace? A. placing too much emphasis on product/service design and too little on process design B. failing to take into account customer wants and needs C. putting too much emphasis on short-term financial performance D. taking advantage of strengths/opportunities, and recognizing competitive threats E. none of the above

D. taking advantage of strengths/opportunities, and recognizing competitive threats

The optimum level of inspection is where the: A. cost of inspection is minimum B. cost of passing defectives is minimum C. total cost of inspection and defectives is maximum D. total cost of inspection and defectives is minimum E. difference between inspection and defectives costs is minimum

D. total cost of inspection and defectives is minimum

Organizations should work to improve process capability so that quality control efforts can become more ________. A. effective B. efficient C. necessary D. unnecessary E. widespread

D. unnecessary

The range chart (R-chart) is most likely to detect a change in: A. proportion B. mean C. number defective D. variability E. sample size

D. variability

When a process is in control, it results in there being, on average, 16 defects per unit of output. C-chart limits of 8 and 24 would lead to a _______ chance of a Type I error. A. 67% B. 92% C. 33% D. .03% E. 5%

E. 5%

The process capability index (Cpk) may mislead if: (I) the process is not stable. (II) the process output is not normally distributed. (III) the process is not centered. A. I and II B. I and III C. II and III D. II only E. I, II and III

E. I, II, and III

Core competencies in organizations generally relate to: A. cost B. quality C. time D. flexibility E. all of the above

E. all of the above

Which of the following is considered to be a cause of poor U.S. global competitiveness? A. the tendency to view labor as a cost factor to be minimized B. decision-making based on short-term horizons C. weaknesses in technological practice D. powerful trading partners E. all of the above

E. all of the above

Which of the following is essential to consider with respect to managing a process to meet demand? A. strategy B. demand forecasts C. capacity D. random variability E. all of the above

E. all of the above

Which of these factors affects productivity? A. methods and technology B. workers C. management D. a and b only E. all of the above

E. all of the above

Which of the following is not a type of operations? A. goods production B. storage/transportation C. entertainment D. communication E. all the above involve operations

E. all the above involve operations

Which of the following is not a key step toward improving productivity? A. developing productivity measures for all operations B. improving the bottleneck operations C. establishing reasonable goals for improvement D. considering incentives to reward workers E. converting bond debt to stock ownership

E. converting bond debt to stock ownership

Time-based approaches of business organizations focus on reducing the time to accomplish certain necessary activities. Time reductions seldom apply to: A. product/service design time B. processing time C. delivery time D. response time for complaints E. internal audits

E. internal audits

Operations and sales are the two ________ functions in businesses. A. strategic B. tactical C. support D. value-adding E. line

E. line

___________ is generally used to facilitate an organization strategy that emphasizes low cost. A. Speed to market B. Flexibility C. Customization D. Sustainability E. None of the above

E. none of the above

A c-chart is used for: A. means B. ranges C. percent defective D. fraction defective per unit E. number of defects per unit

E. number of defects per unit

Value added can be calculated by: A. average productivity gains over time B. inputs divided by the outputs C. outputs divided by the inputs D. input plus output divided by two E. outputs minus inputs

E. outputs minus inputs

Which of the following quality control sample statistics indicates a quality characteristic that is an attribute? A. mean B. variance C. standard deviation D. range E. proportion

E. proportion

Which of the following is not a key factor of competitiveness? A. price B. product differentiation C. flexibility D. after-sale service E. size of organization

E. size of organization

Production systems with customized outputs typically have relatively: A. high volumes of output B. low unit costs C. high amount of specialized equipment D. fast work movement E. skilled workers

E. skilled workers

Which of the following is not a factor that affects productivity? A. computer viruses B. design of the workspace C. use of the Internet D. standardizing processes E. wireless cellular phones

E. wireless cellular phones

A company has introduced a process improvement that reduces processing time for each unit, so that output is increased by 25% with less material, but one additional worker required. Under the old process, five workers could produce 60 units per hour. Labor costs are $12/hour, and material input was previously $16/unit. For the new process, material is now $10/unit. Overhead is charged at 1.6 times direct labor cost. Finished units sell for $31 each. What increase in productivity is associated with the process improvement? (full explained answer on pg 70 of PDF, #73)

before: 1.667 after: 2.481 productivity increase: 48.83% (divide the improvement in productivity by the productivity before the change. multiply this ratio for the percent increase).