ISDS 3115 final conceptual
The staff training center at a large regional hospital provides training sessions in CPR to all employees. Assume that the capacity of this training system was designed to be 1200 employees per year. Since the training center was first put into use, the program has become more complex, so that 950 now represents the most employees that can be trained per year. In the past year, 850 employees were trained. The efficiency of this system is approximately ________ and its utilization is approximately ________. A. 89.5 percent; 70.8 percent B. 87.5 percent; 950 employees C. 950 employees; 850 employees D. 90.5 percent; 79.2 percent E. 79.2 percent; 90.5 percent
A. 89.5 percent; 70.8 percent Design = 1200 Effective = 950 Actual = 850 Efficiency = Actual output / Effective capacity = 850 / 950 = .8947368 = 89.5% Utilization = Actual output / Design capacity = 850 / 1200 = .7083333 = 70.8%
Which of the following statements about ABC analysis is FALSE? A. ABC analysis is based on the presumption that all items must be tightly controlled to produce important cost savings. B. In ABC analysis, "A" items should have tighter physical inventory control than "B" or "C" items have. C. ABC analysis is based on the presumption that controlling the few most important items produces the vast majority of inventory savings. D. Criteria other than annual dollar volume, such as high holding cost or delivery problems, can determine item classification in ABC analysis. E. In ABC analysis, forecasting methods for "C" items may be less sophisticated than for "A" items.
A. ABC analysis is based on the presumption that all items must be tightly controlled to produce important cost savings.
Which of the following is FALSE regarding repetitive processes? A. They allow easy switching from one product to the other. B. They are the classic assembly lines. C. They have more structure and less flexibility than a job shop layout. D. They include the assembly of basically all automobiles. E. They use modules.
A. They allow easy switching from one product to the other.
Low-level coding means that: A. a component item is coded at the lowest level at which it appears in the BOM structure. B. a final item has only a few levels in the BOM structure. C. the top level of the BOM is below level zero and that BOMs are not organized around the finished product. D. the code being used is the code for the lowest level in the BOM structure. E. the lowest-paid staff member in the production department performs the coding.
A. a component item is coded at the lowest level at which it appears in the BOM structure.
Which of the following mitigation tactics is NOT designed to reduce the risk of information loss or distortion? A. alternate sourcing B. secure IT systems C. training of supply chain partners on the proper interpretations and use of information D. redundant databases
A. alternate sourcing
What is a long-term purchase commitment to a supplier for items that are to be delivered against short-term releases to ship? A. blanket order B. drop shipping C. advanced shipping notice D. postponement
A. blanket order
In mass service and professional service, the operations manager should focus extensively on: A. human resources. B. sophisticated scheduling. C. equipment maintenance. D. cost-cutting initiatives. E. automation.
A. human resources.
Great Lakes Barge and Baggage Company makes, among other things, battery-operated bilge pumps. Which of the following activities is NOT part of JIT? They: A. produce in long production runs to reduce the impact of setup costs. B. continuously work on reducing setup time. C. produce in small lots. D. use a pull system to move inventory. E. communicate their schedules to suppliers.
A. produce in long production runs to reduce the impact of setup costs.
Which of the following statements is true regarding cross-sourcing? A. Cross-sourcing uses one supplier for a component and a second supplier for another component, where each supplier acts as a backup for the other. B. Cross-sourcing enhances technological skills. C. Cross-sourcing describes suppliers who become part of a company coalition. D. Cross-sourcing develops the ability to produce goods or services previously purchased or actually buying a supplier or distributor.
A. Cross-sourcing uses one supplier for a component and a second supplier for another component, where each supplier acts as a backup for the other.
What is a list of quantities of components, ingredients, and materials required to make a product? A. bill-of-material B. master production schedule C. engineering change notice D. purchase order
A. bill-of-material
What is the term for an approach that seeks efficiency of operations through the integration of all material acquisition, movement, and storage activities? A. E-procurement B. Logistics management C. Third-party logistics D. Distribution management
B. Logistics management
An advantage of the fixed-period inventory system is that: A. safety stock will be lower than it would be under a fixed-quantity inventory system. B. there is no physical count of inventory items when an item is withdrawn. C. orders usually are for smaller order quantities. D. no inventory records are required. E. the average inventory level is reduced.
B. there is no physical count of inventory items when an item is withdrawn.
A work system has five stations that have process times of 5, 9, 14, 9, and 8. What is the bottleneck time? A. 18 B. 14 C. 35 D. 9 E. 45
B. 14
A work system has five stations that have process times of 5, 9, 4, 6, and 8. What is the throughput time of the system? A. 18 B. 32 C. 9 D. 7 E. 35
B. 32 Throughput is the time it takes to go through production from start to finish sum up the longest path in this case its 5+9+4+6+8 = 32
Consider the following three processes. Which process will have the lowest cost at low volume? Process - Fixed Cost - Variable Cost A - Low - High B - Medium - Medium C - High - Low D - High - High A. B B. A C. D D. C
B. A the differing factor is the fixed cost because it plays a larger role than the variable cost.
A lawnmower assembly plant uses a variety of nuts, bolts, screws, and other fasteners in its operation. Its supplier delivers these items directly to the point of use on the assembly line and ensures that there are always sufficient quantities of fasteners to maintain the production schedule. This is an example of A. postponement. B. e-procurement. C. single stage control of replenishment. D. vendor-managed inventory.
D. vendor-managed inventory.
ABC analysis is based upon the principle that: A. an item is critical if its usage is high. B. as with grade distributions in many MBA courses, there should be more medium-level "B" items than either "A" or "C" items. C. all items in inventory must be monitored very closely. D. more time should be spent on class "C" items because there are many more of them. E. there are usually a few critical items, and many items that are less critical.
E. there are usually a few critical items, and many items that are less critical.
The Academic Computing Center has five trainers available in its computer labs to provide training sessions to students. Assume that the design capacity of the system is 1900 students per semester and that effective capacity equals 90% of design capacity. If the number of students who actually got their orientation session is 1500, what is the utilization of the system? A. 1350 students B. 90% C. 1710 students D. 87.7% E. 78.9%
E. 78.9% Utilization = Actual output / Design capacity = 1900 / 1500 = .7894736... = 78.9%
In MRP, system nervousness is caused by: A. the use of the lot-for-lot approach. B. management's attempt to evaluate alternative plans before making a decision. C. the use of phantom bills of material. D. management's marking part of the master production schedule as "not to be rescheduled". E. management's attempt to continually respond to minor changes in production requirements.
E. management's attempt to continually respond to minor changes in production requirements.
A production order quantity problem has a daily demand rate = 10 and a daily production rate = 50. The production order quantity for this problem is approximately 750 units. What is the average inventory for this problem? A. 375 B. 245 C. 600 D. 61 E. 300
E. 300 d = 10 p = 50 Q = 750 You need "t" t = Q/p t = 750/50 = 15 Then find maximum inventory level = pt - dt = (50*15)-(10*15) = 600 Then find average inventory level = Max inv Level/2 = 600/2 = 300
Kanban is associated with all EXCEPT which of the following? A. signals, such as cards, lights, or flags B. moving inventory only as needed C. increased material handling D. reductions in inventory E. small lot sizes
C. increased material handling
A large quantity and large variety of products are produced in A. repetitive focus. B. process focus. C. mass customization. D. product focus.
C. mass customization.
Capacity decisions are based on technological concerns, not demand forecasts. True False
False
MRP can be effective only if very accurate lot sizes are calculated in advance. True False
False
Utilization is the number of units a facility can hold, receive, store, or produce in a period of time. True False
False (capacity)
Christopher's Cranks uses a machine that can produce 100 cranks per hour. The firm operates 12 hours per day, five days per week. Due to regularly scheduled preventive maintenance, the firm expects the machine to be running during approximately 95% of the available time. Based on experience with other products, the firm expects to achieve an efficiency level for the cranks of 75%. What is the expected weekly output of cranks for this company? A. 5700 B. 4845 C. 8421 D. 4275 E. 5100
D. 4275 (100 * 12 * 5) <---- how many it can make a week, 6000 v (6000 * .95)<---- runs 95% of the time, 5700 v (5700 * .75)<---- effective 75% of the time, 4275
The use of effective contracts with penalties could reduce which form of supply chain risk? A. Supplier failure to deliver B. Logistic delays or damages C. Distribution D. All of the above
D. All of the above
Toyota attempts to have at least two suppliers, each in a different geographical region, for each component to mitigate which type of supply chain risk? A. Political B. Distribution C. Economic D. Natural catastrophes
D. Natural catastrophes
Which one of the following statements is TRUE about the kanban system? A. It is useful to smooth operations when numerous quality problems occur. B. It is associated with a push system. C. The quantities in the containers are usually large to reduce setup costs. D. The customer workstation signals to the supplier workstation when production is needed. E. The supplier workstation signals the customer workstation as soon as a batch is completed.
D. The customer workstation signals to the supplier workstation when production is needed.
Which of the following mitigation tactics could reduce economic risk? A. franchising and licensing B. multiple transportation modes and warehouses C. subcontractors on retainer D. purchasing contracts that address price fluctuations
D. purchasing contracts that address price fluctuations
Which one of the following is a characteristic of a JIT partnership? A. third-party logistics never used B. active pursuit of vertical integration C. maximal product specifications imposed on supplier D. removal of incoming inspection E. frequent deliveries in large lot quantities
D. removal of incoming inspection
Which one is NOT an application of lean principle in services? A. improving kitchen layout at McDonald's to drive seconds out of the production process B. inventory sharing among members of the pharmaceutical network C. scheduling personnel availability at 15 minute increments to meet demand fluctuations D. securing more inventory to prepare for disruption in production E. JIT in food supply management
D. securing more inventory to prepare for disruption in production
Adding a complementary product to what is currently being produced is a demand management strategy used when: A. efficiency exceeds 100 percent. B. demand exceeds capacity. C. capacity exceeds demand for a product that has stable demand. D. the existing product has seasonal or cyclical demand. E. price increases have failed to bring about demand management.
D. the existing product has seasonal or cyclical demand.
Which of the following would NOT generally be a motive for a firm to hold inventories? A. to provide a selection of goods for anticipated customer demand and to separate the firm from fluctuations in that demand B. to decouple various parts of the production process C. to hedge against inflation D. to minimize holding costs E. to take advantage of quantity discounts
D. to minimize holding costs
Harley Davidson: A. uses product focused manufacturing. B. uses a large number of modules to build a small number of different bikes. C. utilizes job shops to make each of its modules. D. uses work cells to feed its assembly line. E. All of the above are true.
D. uses work cells to feed its assembly line.
An assembly line has 10 stations with times of 1, 2, 3, 4, ..., 10, respectively. What is the bottleneck time? A. 550% of the throughput time B. 50% of the throughput time C. 1.82% of the throughput time D. 18.18% of the throughput time E. 100% of the throughput time
D. 18.18% of the throughput time Bottleneck = Highest time/through point time Through point time = Sum of all times 1+2+3+4+5+6+7+8+9+10 = 55 10/55 = .1818181818 = 18.18%
Demand for dishwasher water pumps is 8 per day. The standard deviation of demand is 3 per day, and the order lead time is four days. The service level is 95%. What should the reorder point be? A. about 32 B. about 18 C. more than 40 D. about 24 E. about 38
c. more than 40
An assembly line is an example of a: A. line process. B. repetitive process. C. process-focused process. D. product-focused process. E. specialized process.
B. repetitive process.
What is a dependent demand technique that uses a bill-of-material, inventory, expected receipts, and a master production schedule to determine material requirements? A. Material requirements planning (MRP) B. Economic order method (EOM) C. Material requirements method (MRM) D. Periodic order planning (POP)
A. Material requirements planning (MRP)
Which of the following statements is TRUE about the MRP plan when using lot-for-lot ordering? A. The quantity of gross requirements for a child item is equal to the quantity of planned order release(s) multiplied by the number of child items used in the parent assembly. B. The quantity of gross requirements for a child item is always equal to the quantity of planned order releases for its parent. C. The quantity of gross requirements for a child item is always equal to the quantity of gross requirements for its parent. D. The quantity and gross requirements for a child item is always equal to the quantity of net requirements for its parent. E. All of the above are true.
A. The quantity of gross requirements for a child item is equal to the quantity of planned order release(s) multiplied by the number of child items used in the parent assembly.
Which of the following is specifically characterized by a focus on continuous improvement, respect for people, and standard work practices? A. kanban B. Toyota Production System (TPS) C. Just-in-time (JIT) D. Lean operations E. Material requirements planning (MRP)
B. Toyota Production System (TPS)
Which of the following products is likely to be assembled on a repetitive process line? A. steel B. automobiles C. custom personal computers D. beer E. custom cakes
B. automobiles
Supply chain managers outsource logistics to meet three goals: A. drive down inventory investment, lower delivery costs, and provide better market response. B. drive down inventory investment, lower delivery costs, and improve delivery reliability and speed. C. lower delivery costs, improve delivery reliability and speed, and provide better market response. D. drive down inventory investment, improve delivery reliability and speed, and provide better market response.
B. drive down inventory investment, lower delivery costs, and improve delivery reliability and speed.
The advantage of having few suppliers is to A. pursue low cost. B. form a long-term relationship. C. look for short-term attributes. D. take advantage of diseconomies of scale.
B. form a long-term relationship.
Which of the following is not a goal of JIT partnerships? A. removal of in-transit inventory B. inspect all incoming shipments to ensure zero defects C. removal of in-plant inventory D. removal of unnecessary activities E. All of the above are goals of JIT partnerships
B. inspect all incoming shipments to ensure zero defects
Characteristics of just-in-time partnerships do NOT include: A. produce with zero defects. B. large lot sizes to save on setup costs and to gain quantity discounts. C. focus on core competencies. D. long-term contracts. E. removal of in-transit inventory.
B. large lot sizes to save on setup costs and to gain quantity discounts
Low-volume, high-variety production is best suited for which of the following process strategies? A. product focus B. process focus C. mass customization D. repetitive focus
B. process focus
What is the term of shipping directly from the supplier to the end consumer rather than from the seller, saving both time and reshipping costs? A. Postponement B. Direct shipping C. Drop shipping D. Vendor-managed inventory
C. Drop shipping
Which of the following would NOT reduce the bullwhip effect? A. Share point-of-sales data with all members of the supply chain B. Implement single-stage control of replenishment C. Increase end-of-quarter sales bonuses D. Reduce lot sizes
C. Increase end-of-quarter sales bonuses
Which of the following is specifically characterized by the elimination of waste through a focus on exactly what the customer wants? A. Material requirements planning (MRP) B. Just-in-time (JIT) C. Lean operations D. kanban E. Toyota Production System (TPS)
C. Lean operations
Which of the following statements regarding a pull system is TRUE? A. Large lots are pulled from upstream stations. B. Manufacturing cycle time is increased. C. Problems become more obvious. D. Work is pulled to the downstream stations before it is actually needed. E. None of the above is true of a pull system.
C. Problems become more obvious.
Which of the following best represents the relationship between the master production schedule (MPS) and the aggregate plan? A. The MPS precedes the aggregate plan in the planning process. B. The MPS is the same as the aggregate plan. C. The MPS disaggregates the aggregate plan. D. There is no relationship between the MPS and the aggregate plan.
C. The MPS disaggregates the aggregate plan.
A process focused facility is A. a rapid, low-cost production facility that caters to constantly changing unique customer desires. B. based on the classical assembly line. C. a production facility organized around specific activities. D. a production facility organized around products
C. a production facility organized around specific activities.
The do-it-yourselfer plucked a gallon can of base paint from the shelf of the local hardware store and handed it to Keith, the cheerful clerk at the paint counter. Their eyes met briefly and the do-it-yourselfer silently handed over sample 150C-1, Musical Mist, to the clerk. It was impractical to keep several gallons of every possible color on the shelves at the hardware store, so the paint manufacturer had created clever workaround. The workaround was a computer-based system that added predetermined quantities of pigments to a gallon can of base paint depending on the desired shade, in this case, Musical Mist. The hardware store now needed to stock only the base paint, this machine, and a small supply of paint pigments in order to create the thousands of colors in its catalog. This scenario is a prime example of A. the bullwhip effect. B. drop shipping. C. postponement. D. vendor-managed inventory.
C. postponement.
The two most basic inventory questions answered by the typical inventory model are: A. order quantity and service level. B. order quantity and cost of orders. C. timing of orders and order quantity. D. ordering cost and carrying cost. E. timing of orders and cost of orders.
C. timing of orders and order quantity.
The crossover point is that production quantity where: A. variable costs of one process equal the variable costs of another process. B. the process no longer loses money. C. total costs for one process equal total costs for another process. D. total costs equal total revenues for a process. E. fixed costs of a process are equal to its variable costs.
C. total costs for one process equal total costs for another process.
What is developing the ability to produce goods or services previously purchased or actually buying a supplier or a distributor? A. horizontal integration B. virtual companies C. vertical integration D. outsourcing
C. vertical integration
Which of the following lot-sizing techniques results in the lowest holding costs? A. EOQ B. POQ C. lot-for-lot D. the quantity discount model E. Wagner-Whitin algorithm
C. lot-for-lot
The purpose of safety stock is to: A. protect the firm from a sudden decrease in demand. B. eliminate the likelihood of a stockout due to erroneous inventory tally. C. eliminate the possibility of a stockout. D. control the likelihood of a stockout due to variable demand and/or lead time. E. replace failed units with good ones.
D. control the likelihood of a stockout due to variable demand and/or lead time.
Which of the following statements is NOT one of the response strategy decisions? A. fast transportation B. low setup time C. use buffer stocks to ensure speedy supply D. gather and communicate market research data
D. gather and communicate market research data
Which of the following strategies is part collaboration, part purchasing from few suppliers, and part vertical integration? A. horizontal integration B. joint ventures C. virtual companies D. keiretsu networks
D. keiretsu networks
Which of the following phrases best describes process focus? A. Operators are less broadly skilled. B. high fixed costs, low variable costs C. low inventory D. low volume, high variety E. Finished goods are usually made to a forecast and stored.
D. low volume, high variety
Which of the following is not one of the strategies for improving service productivity? A. scheduling B. separation C. automation D. mass customization E. self-service
D. mass customization
Which of the following is NOT a goal of JIT partnerships? A. removal of unnecessary activities B. removal of in-plant inventory C. obtain improved quality and reliability D. removal of in-transit inventory E. All of the above are goals of JIT partnerships.
E. All of the above are goals of JIT partnerships.
If a factory wants to cut its current lot size in half, by what proportion must setup cost change? A. Setup cost must also be cut in half from its current value. B. Setup cost must double from its current value. C. Cannot be determined. D. Setup cost must quadruple from its current value. E. Setup cost must be cut to one fourth its current value.
E. Setup cost must be cut to one fourth its current value.
ABC analysis divides on-hand inventory into three classes, generally based upon which of the following? A. item quality B. unit price C. annual demand D. the number of units on hand E. annual dollar volume
E. annual dollar volume
What is Just-in-Time (JIT)?
Just-in-time, or JIT, is an inventory management method in which goods are received from suppliers only as they are needed.
A useful tactic for increasing capacity is to redesign a product in order to facilitate more throughput. True False
True
