OPMA CH. 8

Using the cut-and-try method for aggregate operations planning we can determine the production requirement in units of product. If the beginning inventory is 500 units, the demand forecast is 1,000, and the necessary safety stock is 10% of the demand forecast, which of the following is the production requirement?

600 Demand = 1,000; 10% of demand = 100; Inventory = 500; produce 1,000 + 100 - 500 = 600

The widespread scientific application of yield management began within what industry?

Airline

Which of the four costs relevant to aggregate production planning is the most difficult to accurately measure?

Backordering cost

In the agriculture industry, migrant workers are commonly employed to pick crops ready for harvest. They are hired as needed and are laid off once the crops are picked. The realities of the industry make this approach necessary. Which production planning strategy best describes this approach?

Chase strategy

The essence of yield management is the ability to manage what?

Demand

Which of the following is a production planning strategy presented in the textbook?

Level

Major operations and supply planning activities can be grouped into categories based on the relevant time range of the activity. Into what time range category does sales and operations planning fit?

Medium-range planning

What category of planning covers a period from a day to six months, with daily or weekly time increments?

Short-range planning

From an operational perspective yield management is least effective under which of the following circumstances?

The product can be kept to be sold when demand is stronger

Under what type of demand is yield management most effective?

highly variable