Service Systems Final Multiple Choice
11. Which one of the following is not a strategy to manage demand? a. cross-training employees b. offering price incentives c. developing reservation systems d. partitioning demand
A
12. A health club offering a reduced rate membership for students to workout before 4:00 p.m. on weekdays is: a. promoting off-peak demand. b. partitioning demand. c. using yield management. d. offering price incentives.
A
18. A restaurant that features special lunchtime combo meals is providing all but one of the following benefits? a. Promotes off-peak demand b. Increases customer satisfaction c. Decreases service times d. Segment demand
A
25. When yield management is implemented which one of the following does not result: a. consumer surplus increases b. multiple prices are offered c. capacity is more fully utilized d. market for the service is segmented
A
5. The FCFS rule is most often used because: a. analytical models depend upon its use. b. it represents social justice. c. it is viewed as fair. d. most other rules are not as easily applied.
A
The physical goods supply chain contains all but one of the following elements: a. competitor. b. distributor. c. retailer. d. customer.
A
7. The Delphi method is best used when forecasting: a. customer demand. b. technological change. c. correlations between events. d. future economic conditions.
B
14. The symbol ρ is used to denote which one of the following parameters: a. number of customers in the system. b. number of servers. c. traffic intensity. d. finite size of queue.
C
7. The two-way classification for the taxonomy for outsourcing business services contains six cells. Which one of the following is not a descriptive title for one of the cells? a. Facility support b. Professional c. Employee d. Facilitator
C
12. Removing the kitchen from Taco Bell outlets to a central location resulted in all of the following benefits, except: a. Reduction in waste b. Consolidation of demand c. Shorter customer wait times d. Make-to-order customization
D
3. The accuracy of a time-series model is dependent upon: a. the nature of past data. b. the weight given to past data. c. the treatment of seasonality and trend. d. the assumption that the future is a projection of the past.
D
5. In regression models, the variable of interest (being forecast) is called a(an): a. defining variable. b. independent variable. c. basic variable. d. dependent variable.
D
5. The impact of pricing on service chain management was _____ before and _____ after. a. high, low b. passive, active c. static, dynamic d. fixed, variable
D
9. American Express, which offers financial and travel services on a global basis, is an example of a: a. focused service. b. focused network. c. clustered service. d. diversified network.
D
1. The strategy of segmenting demand is feasible only when: a. demand is not from a homogeneous source. b. demand is cyclic and predictable. c. arrivals for service are random. d. making appointments is impossible.
A
1. Which of the following is not one of the major considerations in planning multinational operations? a. Cultural transferability b. Technological compatibility c. Network development d. Host government policy
B
10. The central idea in the retail-discounting model is that: a. money can be made selling below cost. b. turnover of stock generates money for future investment. c. the percent mark-up over cost is discretionary. d. discount pricing generates sales.
B
11. All of the following are forecasting models, except: a. subjective. b. objective. c. causal. d. time series.
B
14. Which of the following service providers likely would be involved in a single-level bi-directional service supply relationship? a. Pharmacy b. Professor c. Garage d. Mortgage company
B
15. Which one of the following is not an example of the differential pricing policy? a. weekend and night rates for long-distance telephone calls b. difference in hospital fees for walk-in and scheduled services c. peak-load pricing by utility companies d. none of the above
B
3. When the number of arrivals per unit time follows a Poisson distribution, the most important implication is that: a. the arrivals are dependent and non-random. b. the time between arrivals is exponentially distributed. c. eventually the queue length will stabilize. d. the rate of completion of service is also Poisson distributed.
B
9. According to Maister's Second Law of Service: a. perceptions minus expectations equal the level of customer satisfaction. b. first impressions can influence the remainder of the service experience. c. quality in the service industry is essentially free. d. a waiting customer cannot be satisfied.
B
9. Making knowledge available to customers at low cost is called: a. embellishment. b. transfer. c. replacement. d. co-production.
B
The calling population is termed finite when: a. there is restriction on the maximum number in the queue. b. only a limited number of people may use the facility in any given period. c. the interarrival time is not very large. d. there is no queue discipline specified.
B
1. A queuing system is said to be in a transient condition when: a. its parameters change with time. b. its parameters remain constant. c. it is still under the influence of the initial state. d. it grows beyond bound.
C
13. _______ is not part of the service chain concept. a. Conversion b. Distribution c. Inventory management d. Knowledge management
C
17. Travel booking is a service that falls in the _________ category of outsourcing business service. a. facility support b. employee development c. facilitator d. professional
C
18. All but one of the following is a caution when considering outsourcing services: a. Loss of direct control over quality. b. Jeopardize employee loyalty because of job-loss fears. c. Costs might increase. d. In-house capability to perform service will atrophy.
C
18. Spatial distribution of demand is important to consider in which of the following services? a. Restaurants b. Banking c. Emergency ambulance services d. Motels
C
19. All but one of the following are characteristics of the moving-average model: a. very low relative cost. b. short term forecast horizon. c. uses all past data in forecast. d. used for demand forecasting.
C
20. The total inventory for a retailer is comprised of in-transit inventory, safety stock, and __________ inventory. a. decoupling b. seasonal c. cyclical d. speculative
C
11. Global service strategies include all but one of the following: a. Exporting services b. Following your customers c. Beating-the-clock d. Service offshoring
A
20. McDonald's includes beer on its menu for German franchises. This is an example of _______ a. cultural transferability. b. network development. c. host government policy. d. labor norms.
A
20. Supermarkets can be described by which of the following facility arrangement? a. Self-serve followed by service in parallel b. Many service centers in parallel and series c. Servers in parallel
A
3. Inventory management costs include all but one of the following: a. ordering. b. purchase. c. receiving. d. shortage.
B
8. In the ABC inventory classification, C items can best be described as: a. expensive. b. among the most numerous. c. having a high stockout cost. d. requiring close attention.
B
6. According to Maister, one of the following statements is not true of waits. a. Unoccupied time feels longer than occupied time. b. Anxiety makes waits feel longer. c. In-process waits feel longer than preprocess waits. d. Unfair waits feel longer than fair waits.
C
6. Which of the following strategies is inappropriate for managing capacity and demand? a. Smooth customer demand by offering price incentives. b. Scheduling staff to meet variations in forecasted customer demand. c. Decrease customer participation in the service process. d. Promoting off-peak use of facilities.
C
8. In the long run, if service capacity is inadequate for the arrival rate, one of the following will likely occur: a. servers will slow down. b. customers will demand less. c. reneging will occur. d. prices will be increased.
C
9. Exponential smoothing uses a feedback control mechanism because: a. is less than 1. b. calculations are based on modifying the previous smooth value. c. the calculation contains the forecast error. d. the weights given to past data are exponentially distributed.
C
19. Which one of the following is most affected by the bullwhip effect? a. customer. b. retailer. c. distributor. d. wholesaler.
D
3. Which of the following is not a benefit to the franchisee of a franchise? a. Brand name b. National advertising c. Economics of scale d. Autonomy
D
4. Bars that offer happy hours in the afternoon are using the strategy of: a. creating adjustable capacity. b. developing complementary services. c. increasing customer participation. d. promoting off-peak demand.
D
8. All of the following are benefits of a multisite type of expansion except: a. ability to reach a mass market quickly. b. reduced financial risk from local economic downturn. c. preemption of competitors by capturing premium locations. d. retention of control.
D
8. The following are all advantages of the single queue system, except: a. the arrangement guarantees fairness by ensuring that the FCFS rule applies. b. the anxiety of "Am I in the fastest line?" is eliminated. c. the problem of line cutting is reduced. d. the customer has the option of selecting a particular server of preference.
D
10. The cost of service capacity is determined by a. the number of customers waiting. b. the total number of customers. c. waiting time. d. the number of servers on duty.
D
11. Which of the following is not a source of uncertainty in managing a supply chain? a. Supplier delivery performance b. Manufacturing reliability c. Customer demand d. Quality control
D
13. Several approaches to demand management exist, but only _______ seeks to maximize revenue. a. promoting off-peak demand b. reservation systems c. offering price incentives d. yield management
D
17. For seasonal items a ______ system could be used to manage inventory. a. continuous review b. periodic review c. retail discounting d. single-period model
D
18. Survey results are used in: a. regression. b. cross-impact analysis. c. econometric models. d. Delphi method.
D
20. _________ variability is not one of the five sources of customer-induced variability. a. Arrival b. Capability c. Effort d. Demand
D
22. ________ is not a strategy for accommodating of customer-induced variability. e. Provide generous staffing f. Cross-train employees g. Reward increased effort h. Do work for customers
G
11. Which queue configuration permits opportunities for division of labor and service differentiation? a. multiple queue b. single queue c. take a number d. self serve
A
12. In the A/B/C analytical queuing model classification, M is used to denote: a. exponential inter-arrival time distribution. b. deterministic inter-arrival time distribution. c. general distribution with mean and variance. d. Erlang distribution.
A
12. Service level influences _______ and ________. a. reorder point, safety stock b. reorder point, backorder quantity c. safety stock, backorder quantity d. backorder quantity, lead-time demand
A
13. After selecting a line in a multiple queue system, a customer is ________ when she or he switches to a different line perceive it to be moving faster. a. jockeying b. balking c. reneging d. weaving
A
14. When franchising which one of the following is not a benefit to the franchiser? a. Proven business b. Rapid expansion c. Right to dictate conditions d. Fees from the franchisee
A
14. _____________ is used best to forecast demand. a. Exponential smoothing b. Historical analogy c. Dephi method d. Econometrics
A
17. The usual range of the smoothing constant for a simple exponential smoothing forecast is: a. 0.1-0.5 b. 0.3-0.7 c. 0.5-0.7 d. 0.5-1.0
A
19. When franchising, which of the following is not an issue for the franchisee? a. Establishing a brand b. Franchise contract c. Degree of discretion d. Conflict resolution
A
2. For the exponential distribution we have: a. the mean equal to its standard deviation. b. the variance equal to the standard deviation. c. no specific relationship between mean and variance. d. the mean equal to the reciprocal of the variance.
A
2. Multinational expansion by a service firm is: a. often driven by customer demand. b. vital for growth. c. not recommended for labor intensive operations. d. primarily a defense strategy.
A
7. A queuing system is described by all but one of the following: a. balking behavior b. calling population c. arrival process d. queue configuration
A
7. Which of the following is not an effective way to manage the psychology of waiting? a. Prominently display time with a large analog clock. b. Inform customers when long waits are anticipated. c. Use diversions to occupy customer waiting times. d. Employ a take-a-number system to ensure fairness.
A
2. Subjective forecasting models are best characterized by: a. the use of experts. b. the use of opinion as a basis for a forecast. c. the absence of data manipulation. d. the use of simultaneous equations.
B
2. The purpose of differential pricing is to: a. make peak period usage unattractive. b. make off-peak usage attractive. c. charge customers according to their ability to pay. d. adjust capacity to demand.
B
4. Which of the following is not one of Kenichi Ohmae's five "Cs" of strategic planning in a borderless world economy? a. Competitors b. Creativity c. Company d. Country
B
5. Which of the following is not a strategy for managing capacity? a. Developing complementary services b. Using part-time employees c. Forecasting demand d. Scheduling shifts
A
8. Regression models require all but one of the following: a. numerical data. b. subjective data. c. independent variables. d. dependent variable.
B
15. All but one of the following are techniques to lessen the boredom of waiting customers: a. placement of mirrors in elevators. b. telling customers how long the wait is at different points in the queue. c. installing a television tuned to CNN. d. displaying time with a large analog clock.
D
21. ________ is not a strategy for reduction of customer-induced variability. a. Adapt to customer skill levels b. Require reservations c. Limit service breadth d. Target customers based on capability
A
24. A ________ project is not project category for a professional firm. a. routine b. brains c. grey hair d. procedure
A
3. For the system to operate satisfactorily over the long run, a. the capacity to serve must be greater than the average demand. b. the expected waiting time for each customer must not exceed average service time. c. the arrival rate must be less than the service rate. d. the number of servers must equal the average number of arrivals per unit time.
A
6. All but one of the following is a reason for outsourcing services. a. Avoids coordination expenses and delays b. Allows the firm to focus on its core competence. c. Provides access to latest technology. d. Leverages benefits from supplier economies of scale.
A
6. Little's Law states that a relationship exists between a. line length and waiting time. b. multiple and single queues. c. waiting in queue and waiting in system. d. exponential time between arrivals and Poisson arrival rate.
A
9. Service capacity decisions have all but one of the following strategic characteristics: a. the decision to invest in capacity will attract competitors. b. financial investment in capacity must be balanced against the costs of lost sales. c. inadequate short-term capacity needs can generate customers for the competition. d. hostile customers can result from inadequate capacity following a marketing campaign.
A
17. Empirical studies have suggested that the distribution of inter-arrival times is: a. Poisson b. Exponential c. Uniform d. FCFS
B
24. ________ is not a characteristic appropriate for a yield management strategy. a. Relatively fixed capacity b. Steady demand c. Ability to segment markets d. Products sold in advance
B
3. A good overbooking strategy should: a. minimize the expected opportunity cost of idle service capacity. b. balance the expected opportunity cost of idle service capacity and expected cost of turning away customers who have reservations. c. minimize the expected cost of turning away reservations. d. none of the above; services should try to avoid overbooking.
B
4. In forecasting, the term "cycle" refers to repetition of data: a. once a year, if seasonal. b. once in a period. c. within a week. d. during a day.
B
5. In general, for infinite queues, the expected number of people in the system is equal to: a. the average arrival rate minus the average service rate. b. the expected number in the queue plus the expected number in service. c. the expected arrival rate times the expected waiting time. d. alternatives (a) and (b) above.
B
6. A relatively recent concept that refers to the movement of new products through existing distribution channels is called: a. economies of scale. b. economies of scope. c. diversification. d. micromarketing.
B
6. Characteristics of forecasting models include all but one of the following: a. data required. b. economic conditions. c. relative cost. d. forecast horizon.
B
7. What is the principal reason that service trade receives low priority at WTO meetings? a. Controlling service trade is difficult. b. Governments are more concerned with trade in manufactured products. c. Service trade is an insignificant factor in international trade. d. Tariffs cannot be applied to services.
B
8. What one of the following is not a characteristic of yield management? a. Capacity is relatively fixed. b. There is one homogeneous customer class. c. The service is considered a perishable inventory. d. Demand fluctuates yet is somewhat predictable.
B
10. In what cell of the matrix below would you place the fast food chain McDonald's? A. Single Service,Single Location B. Single Service, Multi Location C. Single Service, Multi Location D. Multi Service, Multi Location
C
13. Taxes and insurance would fall under _____ costs. a. ordering b. receiving and inspection c. holding or carrying d. shortage
C
14. Which one of the following is not a characteristic of firms using yield management? a. ability to segment their market b. perishable inventory c. variable capacity d. product sold in advance
C
17. In the equation LS = LQ + ρ, ρ refers to: a. number of servers. b. traffic density. c. mean number of customers being served. d. number of customer that have been served.
C
7. A cruise ship has available a certain number of rooms in each of 10 categories of appointments ranging from a two-bunk inside cabin to a suite with an outside patio and indoor sitting area. If a passenger requests a sailing date in which the desired cabin is sold out, which of the following actions would be considered the least viable alternative for the cruise line? a. Offer an upgraded cabin at a reduced price. b. Attempt to steer the passenger to an available date. c. Overbook the cabin. d. Offer a downgraded cabin with special privileges such as a $100 certificate for use in the casino.
C
8. When outsourcing facilitator services, which one of the following is not a consideration? a. Knowledge of alternate vendors is important. b. Involvement of end user in vendor identification. c. Experience with particular industry is important. d. Detailed specification written by user.
C
. A single-server food cart competes with several nearby food carts and experiences arrival of customers during an 8-hour period as shown: Customers would probably exhibit a high incidence of ________ during the 11 a.m.-1 p.m. and 4 p.m.-5 p.m. periods; to avoid this opportunity cost, the cart owner should __________ a. balking; offer "2 for 1" specials during slow periods. b. reneging; expand the menu. c. jockeying; offer price discounts between 2 p.m. and 4 p.m. d. balking; add another server during peak periods.
D
10. Faced with variable demand and a perishable capacity, a service manager can smooth demand by: a. using part-time help during peak hours. b. scheduling workshifts to vary workforce needs according to demand. c. increasing the customer self-service content of the service. d. using reservations and appointments.
D
11. Queuing models can help explain all but one of the following: a. predicting results of adding servers to a multiple server system. b. effect of reducing service time variation on waiting time. c. determining the size of a parking lot. d. mean arrival rate.
D
12. One advantage of the multiple queue compared to a single queue is that multiple queues a. minimize wait times. b. reduce the average service time. c. lead to a perceived shorter service time. d. lead to a perceived shorter wait time.
D
13. Which one of the following is an example of a causal model? a. Delphi method b. Moving average c. Cross-impact analysis d. Regression
D
13. Which one of the following is not part of the queuing system features? a. calling population b. queue configuration c. queue discipline d. departure process
D
14. An inventory model with quantity discounts has all of the following features, except: a. savings in manufacture. b. savings in transportation. c. increased holding costs. d. increased ordering costs.
D
15. All but one of the following are advantages of using one large computer system to serve an entire university community: a. short turnaround time. b. large memory. c. economics of scale in services. d. short wait in queue.
D
15. Which one of the following is not an advantage of the Simple Exponential Smoothing model over the N-period Moving Average model? a. Old data are never dropped. b. Older data are given progressively less weight. c. Calculation is simple. d. None of the above.
D
16. In using the critical fractile criterion P(d<x) = Cu/(Cu + Co) for overbooking, the 'd' refers to: a. cost of overestimating demand. b. cost of underestimating demand. c. number of rooms overbooked. d. number of no-shows based on past experience.
D
16. Which of the following is not an essential feature of a queuing system? a. Calling population b. Queue configuration c. Service process d. Customer
D
17. A community hospital is an example of a: a. diversified network. b. focused network. c. focused service. d. clustered service.
D
18. In the annual cost curve for the EOQ model, the ordering cost _________ with the order quantity a. increases linearly b. decreases linearly c. increases negative exponentially d. decreases negative exponentially
D
19. All but one of the following depicts the impact of service chain management: a. Proactive demand management. b. Variable pricing. c. Real-time tracking. d. Pull system for flow of information.
D
2. The A/B/C notation classifies queuing systems on the basis of: a. arrival rates and queue discipline. b. queue discipline alone. c. arrival rates and service rates. d. arrival rates, service rates, and number of servers.
D
21. _________ is not a reason for outsourcing services. a. Leveraging benefits from a supplier b. Allowing the firm to focus on core competence c. Providing access to latest technology d. None of the above
D
23. A medical clinic has two doctors and each can treat 25 patients a day. The doctors see walk-in patients whose arrival times cannot be controlled, and also patients who have made appointments. Knowing the expected number of walk-ins per day, appointments are scheduled to utilize the doctors fully. The following table gives the expected number of walk-ins for a particular week: Day: Mon. Tue. Wed. Th. Fri. Expected Walk-ins: 45 35 40 45 40 What is the total number of appointments that can be scheduled during this week? a. 30 b. 35 c. 40 d. 45
D
