Ops Exam Conceptual Questions
The efficient frontier is given by the cheapest company in the industry. True False
False
Patients take a drug for severe acne for 2 months and there are 130,000 new patients each month. How many patients are taking this drug on average at any given time? (Round to nearest integer)
260,000 patients Explanation: 2 months (flow time) × 130,000 new patients per month = 260,000 patients
What is the maximum utilization a resource can achieve? A. A value equal to the demand B. A value equal to the capacity C. There is no maximum utilization D. 1.00
D. 1.00
E.The fastest internet in the nation Fit Timing Price Location Performance
Performance
There are four hotels competing with otherwise very similar products on the dimensions of price ($ per night) and amenities (measured by the number of stars (*) awarded by customer reviews). Which of these hotels are on the efficient frontier? Hotel A: price = $200 per night; rating: *** Hotel B: price = $150 per night; rating: **** Hotel C: price = $300 per night; rating ***** Hotel D: price = $80 per night; rating **
Hotels B, C, and D are on the efficient frontier
Which of the following questions is not related to Operations Management? When will the demand be fulfilled? How much do we pay the CEO? Who are the customers? How efficiently are the products or services delivered? Where will the demand be fulfilled? What is the product or service?
How much do we pay the CEO?
Which of the following does not belong to the seven sources of waste? Rework Over time Transportation Inventory
Over Time
C.We match any price in town Fit Timing Price Location Performance
Price
Which car company is most often associated with the term lean operations? General Motors Ford Toyota Honda
Toyota Explanation: Toyota was the birthplace of lean and the Toyota Production System is synonymous with lean operations.
If the batch size is increased, inventory increases, which implies that flow units are likely to spend more time in the process. True False
True
If the flow rate of a process increases, then the utilization of a resource with a setup time must also increase. True False
True
If the takt time is shorter than the cycle time, the process needs to run faster. True False
True
What is the roof in the "house-shaped" representation of the Toyota Production System? Just-in-Time Waste reduction Built in quality Process improvement
Waste Reduction Explanation: The roof is the reduction of waste by better matching supply with demand. This includes the waste of time of the flow units and the waste of resources.
A machine makes 3 different components that are used in a gyroscope. Call these components, A, B, and C. The following repeating schedule is used to make components: make 100 units of A, make 50 units of B, and then make 200 units of C. How many components are made in the production cycle? A. 50 B. 100 C. 200 D. 350
d. 350 Explanation: The production cycle is the repeating sequence of A, B, and C.
It takes a lawyer 120 minutes to serve one customer. Demand is 2 customers per 8 hour day. The lawyer has a wage rate of $200 per hour from a law firm. What is the cost of direct labor for the lawyer expressed in $ per customer? Round to two decimals.
+/-1% $800.00 per customer Explanation: The Direct Labor cost is Total dollar wages/flow rate. We will calculate on a daily basis. The daily wage rate = 8*$200 per hour = $1600 per day. The capacity per minute = 1/120 and thus the daily capacity = 8*60*1/120 = 4.00. The daily flow rate is the lesser of the daily capacity, 4.00, and the daily demand rate, 2. So the flow rate is 2.00 per day. Thus the direct labor cost = $1600/2.00 = $800.00 per customer.
Variability
-Variability corresponds to changes in either demand or supply over time Consider the variability associated with customer demand first. We can distinguish between the following forms of demand variability: -Customer arrivals -Customer requests -Customer Behavior
The batch size is tripled on a resource that has a setup time. What is the likely impact on the resource's capacity? A. Decrease by 1/3 B. Decrease by less than 1/3 C. Increase by less than 300% D. Increase by 300%
. Increase by less than 300%
LaVilla is a village in the Italian Alps. Given its enormous popularity among Swiss, German, Austrian, and Italian skiers, all of its beds are always booked in the winter season and there are on average 1100 skiers in the village. On average, skiers stay in LaVilla for 10 days. How many new skiers are arriving - on average - in LaVilla every day? (Round to nearest integer)
110 skiers Explanation: Use Little's Law: Inventory/Flow Time = Flow Rate = 1100 skiers divided by 10 days = 110 new skiers per day.
One of chair lifts at a ski resort unloads 1500 skiers per hour at the top of the slope. The ride from the bottom to the top takes 13 minutes. How many skiers are riding on the lift at any one time? (Round to nearest integer)
325 skiers Use Little's Law: Inventory = Flow Rate x Flow Time = 1500 skiers divided by 60 minutes per hour (flow rate) × 13 minutes (flow time) = 325 skiers
Consider a four-step serial process with processing times given in the list below. There is one machine at each step of the process, and this is a machine-paced process. Step 1: 31 minutes per unit Step 2: 15 minutes per unit Step 3: 31 minutes per unit Step 4: 25 minutes per unit Assuming that the process starts out empty, how long will it take (in hours) to complete a batch of 105 units? (Do not round intermediate calculations. Round your answer to nearest hour)
56 +/-1 hours Explanation: Step 1 is the bottleneck step of the process, so the machine-paced process will be set at a speed of 0.52 hour per unit at each step. The first unit will take 4 ×0.52 = 2.07 hours to complete. The remaining 104.00 units will have a cycle time of 0.52 hour. The total time required to complete a batch of 105 units is 2.07 + 104.00 × 0.52 = 56 hours.
Last year there were 3800000 visitors to a national park and, on average, each visitor spent 15 hours in the park. Instruction: Do not round your intermediate and round final answer to nearest integer. On average, how many visitors were in the park at any particular time last year? (Round to nearest integer)
6,507 visitors Explanation: Flow rate = 3800000 visitors divided by 365 days = 10410.96 visitors per day Flow time = 15 hours/ 24 hours per day = 0.63 days Inventory = 10410.96 (flow rate) × 0.63 (flow time) = 6507 visitors per day
A process has low fixed cost and high variable costs. It is currently capacity constrained. Will the impact of an efficiency improvement be small or large? A. Small B. Large
A. Small
A consulting company must hire 18 new associates per year to replace those who have left the company for other positions or have retired. The company employs 113 associates overall. Instruction: Round your answer to 1 decimal place. How long is the average associate employed at the consulting company?
6.3 years Explanation: 113 associates (Inventory) = 18 new employees per year (Flow rate) × tenure at company (Flow time). Flow time = 6.3
A process is replicated in another country where wages are 50% lower. Staffing and processing times are identical. What would be the effect on the costs of direct labor? A. Costs of direct labor would be 50% lower B. Costs of direct labor would be the same C. Costs of direct labor would be 50% higher D. Cannot determine from the given information
A. Costs of direct labor would be 50% lower
A company is increasing the percentage value add time in the operation. Their value add time and their flow rate remain unchanged. What will happen to their inventory turns (recall from chapter 2 that inventory turns are computed as flow rate divided by inventory)? A. Inventory turns will go up B. Inventory turns will stay constant C. Inventory turns will go down D. Cannot determine from the given information
A. Inventory turns will go up Explanation: If the percentage value add time is going up and their value add time remains constant, their flow time has to go down. And that means, holding flow rate constant, that the inventory turns have to go up (the inventory level goes down).
SmartPhones are made on a 40-step assembly process. All 40 steps are connected through a conveyor belt and all of the 40 steps must work at the same rate even if some of them have more capacity than others. Is this process a machine-paced process or a worker-paced process? A. Machine-paced B. Worker-paced
A. Machine paced
The primary purpose of the "Single minute exchange of die" philosophy is to: A. Reduce the setup time for a resource B. Increase the flow rate of a process C. Decrease the utilization of a process D. Eliminate resources that have setup times
A. Reduce the setup time for a resource
Which of the following statements about takt time and cycle time is true? A. Takt time only depends on demand, not capacity. Cycle time does depend on capacity. B. Takt time only depends on capacity, not demand. Cycle time does depend on demand. C. Takt time and cycle time only depend on capacity. D. Takt time and cycle time only depend on demand.
A. Takt time only depends on demand, not capacity. Cycle time does depend on capacity.
A worker in charge of assembling a bicycle finds a faster way to mount the pedals. He turns to his supervisor. The supervisor explains that the process had been optimized by the engineering department and so the worker should make sure to stick with the existing procedures. The work of which management scholar does this fit best? A. Taylor B. Ohno C. Womack D. Fujimoto
A. Taylor Explanation: Ohno and other scholars of lean would not be pleased by how the intelligence of the worker is wasted by rejecting improvement ideas.
A non-bottleneck worker currently has an idle time of 20 seconds per unit. Because of the large demand, the company improves the process by adding more capacity to the bottleneck. How does this impact the idle time of the worker? A. The idle time would decrease B. The idle time would stay the same C. The idle time would increase D. Cannot determine from the given information
A. The idle time would decrease
Henry Ford proclaimed "You can have any color you want, as long as it is black". Which of the following best reflects his motivation for this position? He believed that customers didn't actually like other colors, so why go through the hassle of making different color cars? A. With more than one color, the process would have switch over times and that could reduce the overall utilization of the process. B. He wanted to establish "black" cars as part of his company's brand image at that time. C. Assembling non-black cars takes longer than black cars. D. He understood that increasing inventory in a process can lead to a longer flow time through the process.
A. With more than one color, the process would have switch over times and that could reduce the overall utilization of the process.
You observe a long line at the airport security. The process currently is: A. capacity constrained B. demand constrained C. unconstrained D. linearly constrained.
A. capacity constrained
A product requires 4 parts that are made on the same lathe. Call the parts, A, B, C and D. The product requires 1 unit of A, 2 of B, 4 of C and 8 of D. Which of the following production cycle is most appropriate? A:100, B:100, C:100, D:100 A:101, B:102, C:104, D:108 A:100, B:150, C:200, D:400 A:100, B:200, C:400, D:800
A:100, B:200, C:400, D:800 Explanation: The ratios of the quantities among the parts should match the ratios of the parts needed for the product. For example, twice as many B parts should be made as A parts.
Is the capacity of the bottleneck larger than, equal to, or smaller than the capacity of the process? A. Larger than B. Equal to C. Smaller than D. The answer depends on the specific process under consideration
B. Equal to
Which of the following operational decisions correspond to the price component of the consumer utility function? Instructions: You may select more than one answer. A. When will the demand be fulfilled? B. How efficiently will the products or the services be delivered? C. What is the product or service to be delivered? D. Where will the demand be fulfilled?
B. How efficiently will the products or the services be delivered? Explanation: The operational efficiency will affect the price that the firm is able to charge for its product and service to maximize its profitability.
Which of the following questions would be asked in a process analysis of a college admissions office? A. When was the college founded? B. How long does it take the office to process an application? C. How much is the yearly tuition at the college? D. How long does it take the average student to complete a degree program at the college?
B. How long does it take the office to process an application?
Which of the following statements about Kanban are accurate? I. Deploying the Kanban system leads to pulling work through the system instead of pushing work. II. Deploying the Kanban system leads to pushing work through the system instead of pulling work. III. The Kanban system controls the work in process inventory. IV. Kanban will always reduce the amount of inventory in the process V. Kanban requires cross-training all workers. A. I and II B. I and III C. I and IV
B. I and III
Each day QBlitz, a Seattle based startup, offers a single product through its website. The product is available for order only on one day and no other product is available during that day. To add to this odd selling strategy, QBlitz does not post prices for its products. Instead, for each product there is a reserve price. On the day a product is available, customers can submit bids. All of the bids that exceed the reserve price are told at the end of the day that they "won" the product and they pay the price they bid. QBlitz then adds up all of the winning bids and submits an order to a supplier for the needed quantity, which is shipped to customers when the product arrives. The QBlitz system is best described as: A. make-to-stock B. make-to-order C. assemble to order D. mass customization
B. Made to Order
An orthopedic surgeon has read an article about the Toyota Production System and now wants to organize her surgery operation based on lean principles. To eliminate all idle time in the operating room, she decides to call in patients six hours before the scheduled surgery time. Is this a lean process? A. Yes B. No C. Cannot be determined
B. No Explanation: The surgeon emphasizes the reduction of the waste of the resources (doctor and operating room). However, she does this at the expense of the patient who now wastes six hours of the flow time waiting.
You observe a vehicle registration department at your local township. Assume that all employees are ready to work at 9 a.m. You arrive at 9 a.m. sharp and are the first customer. Is your time through the empty process longer or shorter than flow time averaged across all customers that arrive over the course of the day? A. Longer than the average flow time B. Shorter than the average flow time
B. Shorter
You and three of your friends run a car wash for a fundraiser. Between interior and exterior cleaning, you spend about 40 minutes per vehicle. You are so successful that the next day, you invite four more friends to help. How does this impact the labor content? A. The labor content goes up B. The labor content stays the same C. The labor content goes down D. Cannot determine from the given information
B. The labor content stays the same
What happens to the target manpower if the labor content is doubled? A. The target manpower increases by 50%. b. The target manpower doubles. C. The target manpower decreases by 50%. D. The target manpower decreases by a factor of 2.
B. The target manpower doubles.
What is the relationship between the number of Kanban cards in a process and the inventory level? A. There is no relationship between the two B. There never can be more inventory in the process than what was authorized via Kanban cards C. The inventory of the process grows with the square root of the number of Kanban cards D. The inventory of the process can be reduced by adding more Kanban cards
B. There never can be more inventory in the process than what was authorized via Kanban cards
What is the relationship between the processing time at a resource and its capacity? A. They are the same B. They are reciprocals of each other C. They are multiples of each other D. They are not related
B. They are reciprocals of each other
Over the course of a day, fans pour into a NASCAR venue at the rate of 8,000 people per hour. The rate at which fans leave the venue A. must be less than 8,000 people per hour. B. must be exactly 8,000 people per hour. C. must be more than 8,000 people per hour. D. could be more or less than 8,000 people per hour.
B. must be exactly 8,000 people per hour. Explanation: The flow rate into a process must equal the flow rate out of a process.
A chemical process involves adding various agents to a vat and then waiting for the agents to react to make a final compound. The vat holds up to 1000 gallons. Chemical agents are added to the vat at a rate of 4.5 gallons per minute. Once the agents have been added to the vat, the reaction takes 85 minutes no matter the actual number of gallons in the batch. After the batch is complete, the vat must be cleaned. Cleaning always takes 15 minutes. What is the setup time of this process? A. 15 minutes B. 85 minutes C. 100 minutes D. 222.22 minutes
C. 100 minutes Explanation: It might seem that pouring the chemical agents into the vat is the "setup process," but that process actually depends on the amount of agent added to the vat. The reaction time of 85 minutes is independent of the volume in the batch, so it is the setup time. In addition, the 15 minutes of cleaning is also required and is independent of the amount added to the vat. Hence, the total setup time for each production cycle is 85 + 15 = 100.
A manager is concerned that there isn't enough time spent on production and too much time spent on setups. The manager decides to double all production batch sizes. This change has no impact on demand. What impact will this likely have on the average inventory in the process? A. Average inventory will decrease because the capacity of the resources will increase. B. Average inventory will remain the same because demand has not changed. C. Average inventory will increase because larger batches require more time to be completed. D. Cannot determine from the given information.
C. Average inventory will increase because larger batches require more time to be completed
Which of the following is most likely to be a concern if batches are very large? A. The flow rate will be too high. b. Utilization will be too high. C. Inventory will be too high. D. Too much time will be spent on product change overs.
C. Inventory will be too high.
What are the subcomponents of inconvenience in a customer utility function? A. Location and Price B. Price and Volume C. Location and Time D. Time and Performance
C. Location and Time
From the perspective of process analysis, which of the following could be appropriate flow units for a hardware store? A. Number of workers B. Number of cash registers C. Number of customers D. Number of suppliers
C. Number of customers Explanation: The number of workers, cash registers, and suppliers are unlikely to change much over the course of a month and do not "flow" through the process of the hardware store.
You are sitting in a restaurant and the waiter brings you the food that you ordered a while ago. If you think about you being the flow unit in the process of the restaurant - which step of this process will be downstream relative to your current position in the process? A. Waiting to order B. being seated at a table C. Paying the bill D. Reviewing the menu
C. Paying the bill
The information turnaround time is driven primarily by: A. The number of workers B. The IT system C. The inventory in the process D. The amount of waste in the process
C. The inventory in the process
How does the takt time change as the demand rate increases? A. The takt time increases B. The takt time stays the same C. The takt time decreases D. Cannot determine from the given information
C. The takt time decreases
Which of the following operational decisions correspond to the consumption utility component of the consumer utility function? Instructions: You may select more than one answer. A. When will the demand be fulfilled? B. How efficiently will the products or the services be delivered? C. What is the product or service to be delivered? D. Where will the demand be fulfilled?
C. What is the product or service to be delivered? Explanation: The product or service characteristics will affect how much each consumer will like the overall product or service, which is measured by consumption utility.
You observe a bank and notice that a customer leaves the bank about every five minutes. These five minutes between customers are: A. the capacity of the process. B. the processing time of the last resource. C. the cycle time. D. the lead time.
C. the cycle time
Which of the following is not a dimension or sub-dimension in a customer's utility function? Convenience Price Location Customer Satisfaction Performance
Customer Satisfaction
Which of the following inefficiencies in a bank's operations results from variability? A. Customers directed to the wrong associate for a particular service B. Associates read the terms and conditions of each -account to the customer C. Customers incorrectly list information on forms D. Employee work schedules set a week in advance
Customers incorrectly list information on forms
Which of the following items would be considered resources in a restaurant? A. Recipes B. Food C. Brand image D. Chefs
D. Chefs
Which of the following inefficiencies in a grocery store's operations results from inflexibility? A. Leftover fruits and vegetables B. Delivery delays from the warehouse C. A surge in customer arrivals at one time D. Employee work schedules set a week in advance
D. Employee work schedules set a week in advance Explanation: Mismatch costs for green shirts include the mark-down (discount) that is now necessary to get rid of the green shirts. Mismatch costs for red shirts include the lost sales that were not made because the store ran out of red shirts.
Over the course of a month, which of the following is most likely to describe an appropriate flow unit for a process analysis of a hospital? The number of physicians The number of beds The square footage of the building The number of patients
D. Number of patients Explanation: Physicians, beds, and square footage are unlikely to change much over the course of a month and do not "flow" through the process of a hospital.
If the demand rate increases, the takt time: Increases Decreases
Decreases
A campus deli serves 275 customers over its busy lunch period from 11:30 am to 1:30 pm. A quick count of the number of customers waiting in line and being served by the sandwich makers shows that an average of 11 customers are in process at any point in time. What is the average amount of time that a customer spends in process? Instruction: Round your intermediate and final answer to 1 decimal place. Average amount of time (Round to one decimal) +/-1%4.8 minutes
Explanation: To solve this problem, use Little's Law. Inventory = Flow rate × Flow time. 11 people in line (average inventory) = 2.3 flow rate × flow time Flow time = 4.8 minutes The flow rate is 275 customers divided by 120 minutes = 2.3
A single inspection system with experts testing the output of the process will help reduce the information turnaround time. True False
False
Increasing the batch size on a resource with setups always increases the capacity of the process. True False
False
Specialization increases the costs of labor as specialists will command a higher wage rate. True False
False
Taiichi Ohno built the Toyota Production System with the metaphor of a tiger in mind. Rapid and decisive movements were in his view the best way to match supply with demand. True False
False
There can be no more than two firms on the efficient frontier. True False
False
A computer server experiences large fluctuations in the amount of data requests it receives throughout the day. Because of this variation, Little's Law does not apply. True False
False Little's Law applies even if there are fluctuations in inventory, flow rates, and flow times.
Which of the following is not one of the three system inhibitors? Waste Variability Fatigue Inflexibility
Fatigue
Below are a number of slogans used for advertisement. Which dimensions of customer utility do the slogans emphasize? A.We build lenses uniquely to the needs of your eyes Fit Timing Price Location Performance
Fit
D.Our dealership network provides service, wherever in the country you may be Fit Timing Price Location
Location
Which dimensions of customer utility do the slogans emphasize? B. Get your burger in 1 minute or less - otherwise, you eat free Fit Timing Price Location
Timing
Two retailers compete on costs and ambience of the retail store. They are identical on all other dimensions of customer utility. Retailer A is cheaper than retailer B. Retailer A also has the better ambience. Does this mean that retailer A is on the efficient frontier? Yes No
Yes
A community health system's nurse team consists of 17 nurses working in the local community. It takes a nurse 1.5 hours to complete one patient visit (including travel times and breaks). Round "Utilization" to a whole percent, and "Cycle Time" to 1 decimal. a. What is the capacity of the nurse team over the course of a 9 hour work day? b. Assuming the demand for the nurses is 60 patients per day, what is the utilization of the nurse team? c. Assuming the demand for the nurses is 60 patients per day, what is the cycle time?
a. 102 per 9 hour work day b. +/-1% 59% c. +/-0.5% 9.0 minutes per patient Explanation: a. Hourly capacity with 17 nurses is 17/1.5 hours per patient = 11.33 patients per hour. In a 9 hour day, capacity is 11.33 * 9 = 102.0 patients per day. b. Utilization = flow rate/capacity. Utilization = 60 patients per day/102.0 patients per day = .59 or 59%. c. Cycle time in minutes = 1/flow rate in minutes. Capacity per minute = 17/(1.5*60) = 0.19 patients per minute. Demand per minute = 60/(9 *60) = 0.11 patients per minute. Flow rate in minutes = min(0.19, 0.11) = 0.1111 patients per minute. Cycle time in minutes = 1/0.1111 = 9.0
It takes a barber 5 minutes to serve one customer. Round your answers to two decimal places. a. What is the capacity of the barber expressed in customers per hour? b. Assuming the demand for the barber is 12 customers per hour, what is the flow rate? c. Assuming the demand for the barber is 12 customers per hour, what is the utilization? d. Assuming the demand for the barber is 12 customers per hour, what is the cycle time?
a. 12.00 customers per hour b. 12.00 customers per hour c. 100.00 percent d. 5.00 minutes per customer Explanation: a. 60 minutes / 5 minutes = 12 customers per hour b. Flow rate is the lesser of demand and capacity = min(12 customers per hour, 12 customers per hour) = 12 customers per hour c. Utilization = flow rate /capacity = 12 customers per hour / 12 customers per hour = 100.00% d. Cycle time (in minutes) = 60* 1 / flow rate in customers per hour, 60*(1/12) = 5.00 minutes per customer
The local driver's license center processes applications for driver's license renewals through the following three steps. First, the customer registers with one of 3 receptionist(s), who updates the customer's information in the database. This first step takes 4 minutes per customer. Then the customer visits one of 2 cashiers to pay the associated fees for the license renewal. This takes 8 minutes per customer because several forms must be printed from the computer and signed by the customer. Finally, the customer visits one of 4 license processing stations where the customer's picture is taken and the license is printed. This final step takes 6 minutes per customer. a. Assuming unlimited demand, what is the flow rate of the process in customers per hour? (Round to nearest integer) b. Assuming unlimited demand, what would the new flow rate be if the center added one server to the bottleneck resource? (Round to nearest integer)
a. 15 per hour b. 23 per hour Explanation: a. The bottleneck resource is the cashier with capacity 60*2/8=15.00 customers per hour. All of the other steps have higher capacities. b. The current bottleneck is the cashier. Adding one more resource to this setp would increase the capacity of this station to 22.50 customers per hour. With this new capacity, the flow rate of the process is 22.50 customers per hour.
