SUPPLY CHAIN
A law firm always orders 50 cases of paper from their office supply company. They incur an annual holding cost of $15 per case and have an ordering cost of $25 each time they place an order .If their annual demand is 480 cases, how much could they save annually by switching to their economic order quantity?
$15
A manufacturer replenishes their packaging materials according to the economic order quantity model. They use 25,000 cases of packaging materials per year and order 500 cases at a time. Their cost to carry a case in inventory for a year is $12. How much does it cost them to place an order with their supplier?
$60
A local barbecue joint makes one massive batch of potato salad each day. If they run out of this savory side before the end of the day, their last few customers are less than satisfied, but if they make too much, they sell it to the local hog farmer for feed. Every serving costs an equivalent of $0.23 to make, but can be sold for $1.50 to customers and for $0.08 to the hog farmer. The average daily demand is for 200 servings with a standard deviation of 20 servings. How many servings should be made each day?
225
What is Flinglers' return on assets?
25%
The beef jerky driver shows up every Monday to take orders from his convenience store customers. One fine Monday morning he stops in the Quik-E Mart and notes that there are only three sticks on the shelves. Consulting his route sheet, he discovers that the restock level is 40. The order quantity is therefore
37 Sticks
A hospitals bio medical repair shop uses a 4-week periodic system to maintain the inventory on the blood pressure cuff repair parts. They use an average 40 adult arm cuffs with a standard deviation of 6 cuffs every four weeks. Cuffs aren't the most critical item they carry, but the manager would like to avoid the embarrassment of a stockout at least 95% of the time. What should their restocking level be?
50 cuffs
A university orders all office supplies, including red grading pens, out of a catalog from the same supplier. Conservative estimates of the demand for these red pens are 12,000 pens per year. There is a $25 charge for placing an order and the university has a $10 annual cost for holding these pens. Prices for the pens are based on the quantity purchased, so if less than 100 are ordered, the unit price is $2.50, if 100 to 299 are ordered, the unit price is $2.40, if 300 to 499 are ordered, the unit price is $2.30, and if 500 or more are ordered, the unit price is $2.20. What order quantity will result in the lowest total annual cost to the university?
500
A car wash services 200 customers in a 4 hour span on a lovely Saturday afternoon. The car wash employs 5 washers at $6 per hour. An appropriate measure of productivity is: A) 1.7 cars/$. B) 200 cars/hour. C) 0.6 $/car. D) 8.3 cars/$.
A
A firm that is interested in consistent on-time delivery would probably design their transportation and warehousing system to include: A) air transportation with a spot stock warehouse. B) rail transportation with a consolidation warehouse. C) water transportation with a hub and spoke warehouse. D) pipeline transportation with a postponement warehouse.
A
A firm's demand data from the last two quarters is displayed in the table. Month Demand January 154 February 148 March 214 April 180 May 225 June 246 Use a three period weighted moving average with Wt = 0.7, Wt-1 = 0.2, and Wt-2 = 0.1 to forecast demand for July. A) 235.2 B) 195.6 C) 158.8 D) 180.4
A
A law firm always orders 50 cases of paper from their office supply company. They incur an annual holding cost of $15 per case and have an ordering cost of $25 each time they place an order. If their annual demand is 480 cases, how much could they save annually by switching to their economic order quantity? a. $15 b. $25 c. $40 d. $80
A
A recent survey of executives at Global 1000 companies uncovered what fear? A) the fear of a supply chain disruption B) the fear of the unknown C) the fear of improperly weighting performance dimensions D) the fear of misclassifying direct and indirect costs
A
A revision to a drawing or design released by designers to correct a part is called a(n): A) engineering change. B) part mod. C) tweak. D) lock-in.
A
A set of logically related tasks or activities performed to achieve a defined business outcome is a: A) process. B) primary process. C) support process. D) development process.
A
A typical SRM application is: A) negotiations. B) market analysis. C) order management. D) service center management.
A
An arrow in a process map represents a: A) move activity. B) start or finish point. C) delay. D) creation of a document.
A
An example of a variable cost is: A) a payment to your raw materials supplier. B) a lease payment on a piece of equipment. C) a mortgage payment on buildings. D) a monthly licensing fee for a software package.
A
As potato harvest season approaches, the number of year-round llama wranglers is insufficient to meet the demand, so a few wranglers are hired just for the month it takes to haul the harvest down from the mountains to the anxious potato-festival crowd. This approach to meeting the labor requirements is called: A) a tiered workforce. B) offloading. C) labor management. D) yield management.
A
Before firms can progress to the fourth stage of alignment, they must: A) develop core competencies. B) develop a new mission statement. C) develop order winners. D) abandon order qualifiers.
A
Cargo is loaded and unloaded only once with: A) direct truck shipment. B) less-than-truckload shipment. C) multimodal solutions. D) None of these modes always has only one loading and unloading.
A
Closing the loop in the area of business strategy means that: A) core competencies at the functional level feed back into the business strategy. B) the mission statement is used to develop the business strategy. C) the business strategy is translated into operations and supply chain actions. D) other functional strategies, such as those of the marketing and finance functions are aligned with the operations and supply chain strategy.
A
Customer arrivals at a dry cleaning service occur randomly throughout the day. The distribution that is usually used to model the interval between arrivals is the: A) Poisson distribution. B) uniform distribution. C) random distribution. D) normal distribution.
A
Damron Inc., wants to purchase a shear for their sheet metal shop and chooses dimensions of cost, reliability, and flexibility as critical to their long-term success. They evaluate three different shears and rate their performance on each criterion on a scale from 1 (poor) to 5 (excellent). What is the value index for the shear made by Belsky Manufacturing? Dimension Importance Belsky Mfg. Reber Ind. Floyd Co. Cost 4 1 5 3 Reliability 2 5 2 1 Flexibility 3 3 3 4 A) 23 B) 9 C) 18 D) 81
A
Every morning the married couple waged a war over the available laptop computer. Jeff was always eager to get started on the task at hand but Liza felt the need to first download her podcasts, which infuriated Jeff. He decided to track the time he spent waiting for podcasts to download every day for a month to see whether things were getting worse. The best tool for displaying these results to the divorce court judge would be a: A) run chart. B) swim lane chart. C) flow chart. D) cause and effect diagram.
A
Flexibility is a key performance dimension for information flows in a(n): A) strategic decision-making activity. B) global planning activity. C) routine decision-making activity. D) execution and transaction processing activity.
A
In a single-card kanban system: A) the single card is the production card. B) the empty container serves as the production card. C) the single card is the move signal. D) None of the above is correct in a single-card system.
A
In what way are projects and typical business activities similar? A) The successful completion of projects and business activities is essential to a firm's competitive position. B) Both projects and typical business activities have a defined ending point at which time they are complete. C) Projects and routine business activities require significant levels of cross-functional and inter-organizational coordination. D) For most companies, projects and typical business activities can be described as routine.
A
Jimbo Elrod has obtained fixed and variable cost information for four potential locations for his professional wrestling school and summarized it in tabular form below. All values are in dollars. Site FC VC A 10,000 24 B 12,000 20 C 14,000 18 D 16,000 17 18) What is the break even point for location D if Jimbo decides to charge $21 per student? A) 4,000 students B) 4,250 students C) 4,500 students D) 5,000 students
A
Livermore Industries uses a kanban system to manage production of the KR-9 subassembly. In a ten-hour day they use 1500 units and use containers that can hold 50 units each. It takes 45 minutes to fill and move a container of parts to the right place on the KR-9 line that is currently rated at a 15% safety factor. How many production cards are needed? A) 3 B) 26 C) 82 D) 155
A
On the first day of class at a new university you made judgments about the quality of the class before the professor had entered the room. You noted the comfort of the accommodations, the fine works of art in the halls and on the classroom wall and the soothing music piped in over the sound system. This dimension of quality is: A) aesthetic. B) performance. C) features. D) perceived quality.
A
One form of warehousing that features light manufacturing and packaging duties and allows firms to put off final assembly or packaging until the last possible moment is: A) postponement warehousing. B) assortment warehousing. C) spot stock warehousing. D) pac-man warehousing.
A
One international standard for managing quality across the supply chain is: A) ISO 9000. B) ISO 14000. C) AQL. D) LTPD.
A
Planning numbers needed for effective decision making are typically developed by: A) forecasting. B) capacity planning. C) inventory management. D) process selection.
A
Scrap or rework are examples of the JIT waste recognized as: A) defects. B) inappropriate processing. C) unnecessary motion. D) waiting.
A
Seventy percent of a house painter's business is exterior work and the other thirty percent is interior. The average exterior paint job takes 20 hours of labor and $400 of paint and primer, but the average interior job takes only 6 hours of labor and $75 of paint and primer. If he gets 20 service calls for the coming month, which of the following resource requirements is correct? A) The painter has supply costs of $6050 for next month B) The painter has supply costs of $4750 for next month. C) The painter has a labor demand of 260 hours for next month. D) The painter has a labor demand of 204 hours for next month.
A
Structural elements of a business include: A) computer systems. B) policies. C) people. D) decision rules.
A
Supply chain inventory: a. increases in cost as materials move downstream. b. decreases in value as materials progress downstream. c. increases in flexibility as materials progress upstream. d. is governed by the bullwhip effect, which says a small change downstream can cause a large change upstream.
A
Tata Motors assembles cars from their own parts and subassemblies and also controls the mining and fabrication of the materials used to create those parts. When Anand ordered their luxury sedan with the platinum dashboard he knew he wouldn't be taking delivery of his dream car the next week. Rather, he would be waiting a while thanks to: a. a mismatch between supply chain lead time and customer demand. b. a mismatch between overall demand levels and productive capacity. c. a mismatch between demand and the most efficient production volume. d. a mismatch between demand and the most efficient shipment volume.
A
The Devon Tower graces the Oklahoma City skyline and is officially the tallest building in the state. The manufacturing process used to produce this jewel is most probably: A) a fixed-position layout. B) a batch manufacturing process. C) a hybrid process. D) a job shop.
A
The ability to produce a wide range of products or service is: A) mix flexibility. B) changeover flexibility. C) volume flexibility. D) run flexibility.
A
The analyst turned on his banker's lamp, adjusted his eye shade, and slowly pulled a legal pad from his desk. His weathered hands punched the buttons on his desk calculator deliberately as he divided earnings by total assets in order to calculate: A) return on assets. B) cost of goods sold. C) merchandise inventory. D) profit margin.
A
The development of specifications for the manufacturing equipment needed to make the product is the responsibility of: A) engineering. B) marketing. C) accounting. D) purchasing.
A
The feasibility of a product or service is evaluated during the: A) planning phase. B) evaluation phase. C) launch phase. D) concept development phase.
A
The inventory that companies hold to protect themselves against uncertainties in either demand or replenishment time is called: a. safety stock. b. anticipation inventory. c. hedge inventory. d. smoothing inventory.
A
The most detailed level of logistics information systems is the: A) execution system. B) decision support system. C) planning system. D) material handling system.
A
The planning technique that uses the master production schedule to monitor key resource requirements is: A) rough-cut capacity planning. B) horizon planning. C) resource planning. D) handfield planning.
A
The point where the customer interfaces directly with the service organization is: A) the front room. B) the back room. C) onstage. D) the floor.
A
The procedure of rethinking and radical redesign of business processes to achieve dramatic organizational improvements is called: A) business process re-engineering. B) competitive benchmarking. C) continuous improvement. D) process benchmarking.
A
The transportation mode other than highway with the highest annual tonnage in the United States is: A) rail. B) air. C) water. D) pipeline.
A
The two basic types of purchasing contracts are: A) fixed-price and cost-based. B) bid-rigged and cost-plus. C) cost-zero and fixed-variable. D) fixed-quantity and variable-cost.
A
The use of supply chain partners to provide products or services is called: A) outsourcing. B) insourcing. C) offloading. D) partnering.
A
Wally's Filling Station is manned by one capable attendant that can fill your tank and check your tires, oil, and water in 5 minutes. If four customers arrive each hour, and the service and arrival rates are governed by the Poisson distribution, what is the utilization of the attendant? A) 0.33 B) 0.50 C) 0.66 D) 0.80
A
What is the ending inventory level for April in the production plan shown in the table? All entries in the table are in terms of sales units. Month Forecast Reg Prod Over-t Prod End Inv January 250 250 0 0 February 200 300 0 March 300 325 25 April 500 400 25 A) 75 units B) 150 units C) 125 units D) 100 units
A
What is the latest that activity D can start if A is 5 days, B is 7 days, C is 4 days, D is 5 days, E is 7 days, and F is 6 days long? (Chart) A) 14 B) 15 C) 16 D) 17
A
When compared with single sourcing, multiple sourcing has the advantage of: A) spreading risk. B) volume leveraging. C) lower transportation costs. D) reduced quality variability.
A
When constructing a fishbone diagram, brainstorming takes place during the: A) open phase. B) closed phase. C) narrow phase. D) wide phase.
A
When should a process be an art and not a science? A) when the process is research and development B) when the process is mass customization C) when the process is mass production D) when the process is continuous flow
A
Whether the product was made or service performed to specifications is a question of: A) conformance quality. B) performance quality. C) reliability quality. D) value indices.
A
Which of the following is NOT a core idea of total quality management? A) cost reduction B) leadership involvement C) employee empowerment D) continuous improvement
A
Which of the following is primarily a supply chain management decision? A) from whom to purchase materials B) how many of each item should be produced C) the mix of labor skill and automation D) plant location
A
Which of the following lists is in correct supply chain order? A) first-tier supplier — manufacturer — distributor B) distributor — manufacturer — retailer C) first-tier supplier — second-tier supplier — third-tier supplier D) customer — retailer — distributor
A
Which of the following statements regarding enterprise resource planning systems is NOT correct? A) Most companies using ERP use their system to serve all of the information requirements. B) The primary advantage of ERP systems is that they pull together all of the classic business functions into a single, tightly integrated package. C) All of the business functions running from an ERP system use a common database. D) Making ERP systems integrate with other applications in a business presents a significant technological challenge.
A
Which of these continuous improvement tools would be best suited for showing all of the steps required to change your major to operations management? A) process map B) cause-and-effect diagram C) Pareto chart D) scatter plot
A
Which of these factors typically does NOT impact capacity? A) fixed cost B) conformance quality C) product variations D) actions of supply chain partners
A
Which of these forecasts is the BEST? A) The one with a MAD of zero. B) The one with the tracking signal of +4. C) The one with the tracking signal of -4. D) The one where the tracking signal times the MAD equals zero.
A
Which of these is NOT a logistics activity? A) inspection B) material handling C) inventory management D) warehousing
A
Which of these is NOT an essential characteristic of the cloud model? A) preservation of metadata B) on-demand self-service C) broad network access D) resource pooling
A
Which of these is an indirect cost associated with in-sourcing? A) maintenance B) purchasing C) receiving D) quality control
A
Which of these quantitative techniques is a causal model? A) linear regression B) last period C) exponential smoothing D) weighted moving average
A
Which of these statements about SCOR level 3 processes is BEST? A) They describe in detail the actual steps required to execute level 2 processes. B) They prescribe how best to achieve the processes defined in level 2. C) They describe an alternative method of achieving processes described in level 2 if a primary system failure occurs. D) They prescribe a communication plan for the people, departments, and organizations that execute level 2 processes.
A
Which of these statements about the zero defects view of the total cost of quality is BEST? A) Failure costs dictate the shape of the total cost curve. B) In general, appraisal costs exceed prevention costs. C) As the defect rate increases, appraisal costs increase. D) As the defect rate increases, prevention costs increase.
A
Which of these steps is NOT part of the Six Sigma process sequence? A) design B) measure C) analyze D) improve
A
Which of these supply chain activities is the most day-to-day, routine activity? A) capacity decision B) warehouse location C) workforce leveling D) control of monetary flows
A
Which step comes first in sales and operations planning? A) master scheduling B) material requirements planning C) production activity control D) vendor order management
A
Willow Trees Inc. makes seven different products, four of which are within their first year of existence. The demands for all products, especially the newest ones, are not well known. The newest products are intended to complement their existing products and take different materials, different processes, and an entirely different set of labor skills for production. Which of these statements regarding their likely sales and operations planning activities is BEST? A) Willow Trees Inc. should use bottom-up planning. B) The planning values for the oldest items in the product line should be used for the new items in the product line. C) Willow Trees Inc. should avoid using sales and operations planning until their product line matures. D) Willow Trees Inc. should use top-down planning.
A
Within the context of the planning cycle, the planning that takes place at the highest levels of the firm is called: A) strategic planning. B) operational planning. C) tactical planning. D) detailed planning and control.
A
Your supplier works closely with you to jointly design a product in: A) gray box design. B) black box design. C) white box design. D) red box design.
A
The cashier waved the can of golden hominy across the holographic bar code reader and it emitted a piercing beep. At the same time the customer's bill was rising, the grocery store's inventory was automatically being reduced by 1 can of golden hominy down to 3 cans. This was the bare minimum amount of hominy the store manager dared carry in inventory, so the computer system automatically sent a message to the hominy man, who loaded a few cases onto his delivery truck for tomorrow morning's trip to replenish the store. This is a classic example of
A continuous review system
The food engineers at Moria Foods have developed a new variety of banana they have named the "mayfly banana" which holds perfect ripeness for exactly one day before becoming a black-skinned sack of putrid mush. Which of these actions will result in a lower order quantity from the many retail establishments clamoring to stock up on this new foodstuff?
A decrease in the salvage value of the mayfly bananas
Tata Motors assembles cars from their own parts and subassemblies and also controls the mining and fabrication of the materials used to create those parts. When Anand ordered their luxury sedan with the platinum dashboard he knew he wouldn't be taking delivery of his dream car the next week. Rather, he would be waiting a while thanks to
A mismatch between supply chain lead time and customer demand
20) Wally's Filling Station is manned by one capable attendant that can fill your tank and check your tires, oil, and water in 5 minutes. If four customers arrive each hour, and the service and arrival rates are governed by the Poisson distribution, what is the utilization of the attendant? A) 0.33 B) 0.50 C) 0.66 D) 0.80
A) 0.33
A car wash services 200 customers in a 4 hour span on a lovely Saturday afternoon. The car wash employs 5 washers at $6 per hour. An appropriate measure of productivity is: A) 1.7 cars/$. B) 200 cars/hour. C) 0.6 $/car. D) 8.3 cars/$.
A) 1.7 cars/$.
Damron Inc., wants to purchase a shear for their sheet metal shop and chooses dimensions of cost, reliability, and flexibility as critical to their long-term success. They evaluate three different shears and rate their performance on each criterion on a scale from 1 (poor) to 5 (excellent). What is the value index for the shear made by Belsky Manufacturing? Dimension Importance Belsky Mfg. Reber Ind. Floyd Co. Cost 4 1 5 3 Reliability 2 5 2 1 Flexibility 3 3 3 4 A) 23 B) 9 C) 18 D) 81
A) 23
Jimbo Elrod has obtained fixed and variable cost information for four potential locations for his professional wrestling school and summarized it in tabular form below. All values are in dollars. Site Fixed Cost Variable Cost A 10,000 24 B 12,000 20 C 14,000 18 D 16,000 17 18) What is the break even point for location D if Jimbo decides to charge $21 per student? A) 4,000 students B) 4,250 students C) 4,500 students D) 5,000 students
A) 4,000 students
Which of these statements about the zero defects view of the total cost of quality is BEST? A) Failure costs dictate the shape of the total cost curve. B) In general, appraisal costs exceed prevention costs. C) As the defect rate increases, appraisal costs increase. D) As the defect rate increases, prevention costs increase.
A) Failure costs dictate the shape of the total cost curve.
One international standard for managing quality across the supply chain is: A) ISO 9000. B) ISO 14000. C) AQL. D) LTPD.
A) ISO 9000.
4) Customer arrivals at a dry cleaning service occur randomly throughout the day. The distribution that is usually used to model the interval between arrivals is the: A) Poisson distribution. B) uniform distribution. C) random distribution. D) normal distribution.
A) Poisson distribution.
The Devon Tower graces the Oklahoma City skyline and is officially the tallest building in the state. The manufacturing process used to produce this jewel is most probably: A) a fixed-position layout. B) a batch manufacturing process. C) a hybrid process. D) a job shop.
A) a fixed-position layout.
An example of a variable cost is: A) a payment to your raw materials supplier. B) a lease payment on a piece of equipment. C) a mortgage payment on buildings. D) a monthly licensing fee for a software package.
A) a payment to your raw materials supplier.
1) On the first day of class at a new university you made judgments about the quality of the class before the professor had entered the room. You noted the comfort of the accommodations, the fine works of art in the halls and on the classroom wall and the soothing music piped in over the sound system. This dimension of quality is: A) aesthetic. B) performance. C) features. D) perceived quality.
A) aesthetic.
Whether the product was made or service performed to specifications is a question of: A) conformance quality. B) performance quality. C) reliability quality. D) value indices.
A) conformance quality.
Closing the loop in the area of business strategy means that: A) core competencies at the functional level feed back into the business strategy. B) the mission statement is used to develop the business strategy. C) the business strategy is translated into operations and supply chain actions. D) other functional strategies, such as those of the marketing and finance functions are aligned with the operations and supply chain strategy.
A) core competencies at the functional level feed back into the business strategy.
Which of these steps is NOT part of the Six Sigma process sequence? A) design B) measure C) analyze D) improve
A) design
Which of the following lists is in correct supply chain order? A) first-tier supplier — manufacturer — distributor B) distributor — manufacturer — retailer C) first-tier supplier — second-tier supplier — third-tier supplier D) customer — retailer — distributor
A) first-tier supplier — manufacturer — distributor
10) Which of these factors typically does NOT impact capacity? A) fixed cost B) conformance quality C) product variations D) actions of supply chain partners
A) fixed cost
The ability to produce a wide range of products or service is: A) mix flexibility. B) changeover flexibility. C) volume flexibility. D) run flexibility.
A) mix flexibility.
An arrow in a process map represents a: A) move activity. B) start or finish point. C) delay. D) creation of a document.
A) move activity.
Every morning the married couple waged a war over the available laptop computer. Jeff was always eager to get started on the task at hand but Liza felt the need to first download her podcasts, which infuriated Jeff. He decided to track the time he spent waiting for podcasts to download every day for a month to see whether things were getting worse. The best tool for displaying these results to the divorce court judge would be a: A) run chart. B) swim lane chart. C) flow chart. D) cause and effect diagram.
A) run chart.
The point where the customer interfaces directly with the service organization is: A) the front room. B) the back room. C) onstage. D) the floor.
A) the front room.
When should a process be an art and not a science? A) when the process is research and development B) when the process is mass customization C) when the process is mass production D) when the process is continuous flow
A) when the process is research and development
Hart's Floral Shop sells bouquets for special occasions. Annual demand is 500 bouquets, the company's cost to place an order with its vendor is $25, and the cost to hold a bouquet in inventory for a year is $15. If Hart orders from its vendor in quantities of 45 bouquets, what is the total annual inventory holding cost? Choose the closest number. A. 338 B. 563 C. 278 D. 300
A. 338
Mertle Mouse sells Swiss cheese gift sets at the airport. She buys the gift sets from a supplier in Wisconsin. The average and standard deviation of demand during replenishment lead time are 45 and 15 units, respectively. What would be the reorder point for a 97% probability of not stocking out during replenishment lead time? (Select the closest number.) A. 73 units B. 28 units C. 85 unis D. 60 units
A. 73 units
_______________ is holding a safety stock in a single location instead of multiple locations. Several locations then share these inventories to lower overall holding costs. A. Inventory pooling B. Inventory separation C. Just in time inventory D. Inventory cycling
A. Inventory pooling
Which of the following is not a component of inventory holding cost? A. Sales expenses on inventory B. Taxes in inventory C. Storage costs D. Capital tied up in inventory
A. Sales expenses on inventory
A men's suit is composed of primary material, lining, thread, buttons, and a zipper. Which of these statements is best? A. Suit zippers are dependent demand items. B. Suit buttons are independent demand items. C. Thread is an independent demand item. D. Suits are dependent demand items.
A. Suit zippers are dependent demand items.
The R&H Mercantile tracks the use of boxes of macaroni and cheese (using a periodic inventory system) and has concluded that demand during lead time is normally distributed with a mean of 60 boxes and a standard deviation of 24 boxes. R&H Mercantile has been using 91 as a reorder point. What is the likelihood that they will run out of inventory before the next shipment arrives? A. about 10% B. about 0% C. about 5% D. about 20%
A. about 10%
Scholastic, the book publisher, has their suppliers, book printers, manufacture millions of Harry Potter books ahead of time so customers can have instant availability on the launch date. This type of inventory is A. anticipation. B. cycle stock. C. safety. D. hedge.
A. anticipation.
A company makes tools, such as hammer and tape measures. One of their primary raw materials is steel and if they run out of steel they cannot make tools. The inventory level for steel is constantly monitored and when the reorder point is reached, an order is released for the economic order quantity. The tool company uses which of the following independent demand inventory systems for steel? A. continuous review system B. periodic review system C. work-in-process (WIP) system D. single period system
A. continuous review system
he owner of a PMEX gas station checks the inventory level of gasoline constantly throughout the day so that he can reorder product when his inventory level falls to 200 gallons. The PMEC station uses what type of inventory systems? A. continuous review system B. Order-up-to system C. dependent demand system D. periodic review system
A. continuous review system
The online tracking systems offered by many package carriers are a form of A. execution system. B. decision support tool. C. point of sale system. D. planning system.
A. execution system.
Any idle resource held for future use dash- those stocks or items used to support production (raw materials), supporting activities (drill bits) and customer service (finished goods, spare parts)" is the definition of A. inventory. B. master production schedule. C. sales and operations planning. D. just in time (JIT).
A. inventory.
"An extreme change in the supply position upstream in a supply chain generated by a small change in demand downstream in the supply chain" is the definition of A. the bullwhip effect. B. the cycle stock effect. C. the inventory pooling effect. D. the hedging effect.
A. the bullwhip effect.
Which of the following illustrates reducing greenhouse emissions by adapting packaging to maximize the cube utilization of the shipment? A. Hewlett-Packard packaged each laptop in a bag made of recycled fabrics. This allowed 31 percent more product to fit on each pallet. B. Amazon increased the size of their shipping boxes so a larger variety of items could be shipped in a given box size. C. putting more pallets on a truck trailer D. Jelly Belly Candy used intermodal transport in order to utilize the larger cube capacity of rail cars.
A. Hewlett-Packard packaged each laptop in a bag made of recycled fabrics. This allowed 31 percent more product to fit on each pallet.
"A system used when demand occurs in only a single point in time" is the definition of A. single-period inventory systems. B. periodic inventory systems. C. mixed inventory systems. D. continuous inventory systems.
A. single-period inventory systems
Structural elements of a business include: A. computer systems. B policies. C people. D decision rules.
A. computer systems.
Which of the following relationships shows dependent demand inventory?
An automaker purchases four tires for each car they produce
The mismatch between timing of customer demand and supply chain lead times is what drives the need for
Anticipation inventory
A bottling machine has a theoretical capacity of 100 bottles per minute. During every ten hour shift it operates continuously but is shut down once for 30 minutes for cleaning, inspection, and lubrication. What is its rated capacity? A) 100 bottles/minute B) 95 bottles/minute C) 90 bottles/minute D) 85 bottles/minute
B
A car wsah service 200 customers in an hour lah blah 5 $6 $50 $5 A 80% B 2.35 C 8 D 0.425
B
A company has a sales forecast for the following five months as shown in the table. If they have a beginning inventory of 100 units, what amount should be produced under a level plan in order for them to have an ending inventory of zero units at the end of the five month period? Month Forecast January 350 February 400 March 300 April 500 May 350 A) 320 units per month B) 360 units per month C) 400 units per month D) 440 units per month
B
A company with fixed costs of $10,000 per month has a target price of $165 for their sole product, a heat shield for masonry fireplaces. What level of output represents their break-even point if their variable cost for producing is $35 per unit? A) between 60 and 70 units B) between 70 and 80 units C) between 80 and 90 units D) between 90 and 100 units
B
A customer enters a business and joins the one line that snakes back and forth through the lobby in order to receive service. The initial part of the service is performed by one customer service representative, after which the customer enters a second, shorter line to complete the service before leaving the establishment. Which description of this waiting line system is appropriate? A) single channel, single phase B) single channel, multiple phase C) multiple channel, single phase D) multiple channel, multiple phase
B
A description method used when a product or service is proprietary or when there is a perceived advantage to using a particular supplier's product or services is: A) Description by market grade. B) Description by brand. C) Description by specification. D) Description by performance characteristics.
B
A hat maker, fresh off a very successful showing at Lidzapalooza is excited about the prospects of providing the finest chapeaus to meet the needs of his energized customer base in the coming year. He and his space designer have identified seven activities that are necessary to expand his small shop. For the sake of simplicity, and to avoid giving away any trade secrets, the activities have been identified by letters A-G. The activities, their time estimates, and the precedence requirements structure are listed in the table immediately below. Activity Predecessors Time (weeks) A -- 7 B A 6 C A 10 D C 12 E B, C 5 F D, E 11 G D, F 8 31) Which of these activities has slack? A) G B) E C) F D) D
B
A local barbecue joint makes one massive batch of potato salad each day. If they run out of this savory side before the end of the day, their last few customers are less than satisfied, but if they make too much, they sell it to the local hog farmer for feed. Every serving costs an equivalent of $0.23 to make, but can be sold for $1.50 to customers and for $0.08 to the hog farmer. The average daily demand is for 200 servings with a standard deviation of 20 servings. How many servings should be made each day? a. 220 b. 225 c. 230 d. 235
B
A logistics manager uses this type of system to select a carrier for an outgoing shipment or to develop a weekly schedule of deliveries. A) decision support B) planning C) execution D) operating
B
A long-term movement up or down in a time series is called: A) seasonality. B) trend. C) randomness. D) cycle.
B
A major retailer has recently deployed self-checkout stands at the front of the store. As long as you don't have items like paint, cold medicine, beer, fruits, or vegetables in your shopping cart, you can check out quickly in one of these lines. This retailer is providing a prime example of: A) a tiered workforce. B) the strategy of offloading. C) the strategy of yield management. D) a constraint.
B
A manufacturer replenishes their packaging materials according to the economic order quantity model. They use 25,000 cases of packaging materials per year and order 500 cases at a time. Their cost to carry a case in inventory for a year is $12. How much does it cost them to place an order with their supplier? a. $12 b. $60 c. $720 d. $5
B
A modular architecture probably improves: A) design for Six Sigma and design for the environment. B) design for manufacturability and design for maintainability. C) design for maintainability and design for the environment. D) design for Six Sigma and design for manufacturability.
B
A sourcing strategy in which two suppliers are used for the same purchased product or service is: A) cross sourcing. B) dual sourcing. C) contingency sourcing. D) multi sourcing.
B
A sporting apparel manufacturer that produces t-shirts to commemorate significant athletic achievements for proud students and alumni probably uses: A) a fixed position layout. B) batch manufacturing. C) a continuous flow process. D) a production line.
B
A supply chain information system that links a company with an entity upstream is called a(n): A) customer relationship management system. B) supplier relationship management system. C) internal supply chain management system. D) business process modeling tool.
B
A typical CRM application is: A) design collaboration. B) sell process. C) sourcing decisions. D) supply collaboration.
B
A video game publishing company needs to predict the total sales in the European market for the next year. This is an example of a(n): A) firm-level demand forecast. B) overall market demand forecast. C) supply forecast. D) price forecast.
B
An electronic commerce system: A) is used to transmit information only upstream. B) can improve the speed and quality of business communication. C) is used to transmit information only downstream. D) links everyone in the supply chain except customers.
B
Competitive bidding, active sourcing, and using industry standards are all actions that are appropriate if the sourcing strategy is to: A) form partnerships with suppliers. B) maximize commercial advantage. C) simplify the acquisition process. D) ensure supply continuity.
B
Costs incurred by defects that occur prior to delivery to the customer are called: A) external failure costs. B) internal failure costs. C) appraisal costs. D) prevention costs.
B
Customers are often brought in to lend their thoughts during the: A) concept development phase. B) planning phase. C) design and development phase. D) commercial preparation phase.
B
Damron Inc., wants to purchase a shear for their sheet metal shop and chooses dimensions of cost, reliability, and flexibility as critical to their long-term success. They evaluate four different shears and rate their performance on each criterion on a scale from 1 (poor) to 5 (excellent). Which shear should be purchased? Importance Belsky Mfg. Reber Ind. Estelle LLC Floyd Co. Cost 4 4 4 3 3 Reliability 2 3 2 3 1 Flexibility 3 2 3 3 4 A) Belsky B) Reber C) Estelle D) Floyd
B
Each outcome of flipping a fair coin is completely independent of the previous flip. This outcome is known as: A) simulation. B) memory less. C) 50/50. D) Monte Carlo.
B
Highly automated batch processes that can reduce the cost of making similar groups of products are: A) functional layouts. B) flexible manufacturing systems. C) make-to-stock. D) adjacent processes.
B
If a manufacturer had no inventory of any kind but had orders for 10 finished units of their sole product, their buyer would know what parts to order if they were supplied with a: A) backward schedule. B) bill of material. C) rough-cut capacity plan. D) planning horizon order sheet.
B
In the water and rocks analogy for JIT: A) water represents problems. B) water represents inventory. C) rocks represent inventory. D) water wears away rocks gradually just like continuous improvement programs improve quality.
B
Inventory that is "in the pipeline" is: a. anticipation inventory. b. transportation inventory. c. smoothing inventory. d. hedge inventory.
B
Jon was a mathematical whiz. He had a flair for developing spreadsheets, using statistics, and creating simulations to show the effects of changes in policy and infrastructure. His skills equipped him well for his operations and supply chain position as: A) a service manager. B) an analyst. C) a commodity manager. D) a sourcing manager.
B
Olivia has had enough of the theoretical equations and rejects the higher math needed to calculate the number of kanbans for her system. One approach that some organizations take in lieu of the kanban equation is to: A) start with one kanban and operate as fast as they can with the one, before adding more kanbans to bring them up to speed. B) start with too many kanbans and gradually reduce them until a problem arises. C) fully load their system with inventory and produce until they cannot build product. D) eliminate all inventory from the system and add material and parts until they can fill a customer order.
B
One advantage of outsourcing is that it: A) gives the company a high degree of control over its operations. B) increases the company's access to state-of-the-art products and processes. C) protects the company's proprietary designs and processes. D) encourages the development of the company's core competencies.
B
Planning numbers are somewhat aggregated (month by month) in: A) strategic planning. B) tactical planning C) operational planning. D) detailed planning and control.
B
Products that are customized only at the very end of the manufacturing process are known as: A)make-to-stock. B) assemble-to-order. C) make-to-order. D) engineer-to-order.
B
Safety stock increases when: a. probability of a stockout increases. b. average demand increases. c. delivery speed increases. d. demand fluctuations decrease.
B
Taguchi defines quality in terms of: A) parts per million. B) losses. C) lot tolerance percent defective. D) acceptable quality levels.
B
The beef jerky driver shows up every Monday to take orders from his convenience store customers. One fine Monday morning he stops in the Quik-E Mart and notes that there are only three sticks on the shelves. Consulting his route sheet, he discovers that the restock level is 40. The order quantity is therefore: a. 3 sticks. b. 37 sticks. c. 40 sticks. d. Cannot be determined with the information given.
B
The collection of people, technology, and systems within an organization that has primary responsibility for providing the organizations products or services is called: A) the supply chain. B) the operations function. C) the evoked set. D) relationship management.
B
The ease with which parts can be replaced or evaluated is: A) repeatability. B) serviceability. C) testability. D) functionality.
B
The greater the emphasis on intangible activities, the more management's attention will be directed to: A) buildings and property. B) training employees. C) truck fleets. D) material costs.
B
The mismatch between timing of customer demand and supply chain lead times is what drives the need for: a. safety stock. b. anticipation inventory. c. cycle stock. d. hedge inventory.
B
The mode of transportation that is highly cost effective for bulky items but has relatively poor delivery reliability and speed is: A) highway. B) water. C) rail. D) air.
B
The organization that provides national and institutional leadership in purchasing and materials management is: A) APICS. B) ISM. C) CLM. D) ASQ.
B
The percentage of value of shipments that come from materials for the average manufacturer is: A) greater than or equal to 40 and less than or equal to 49 percent. B) greater than or equal to 50 and less than or equal to 59 percent. C) greater than or equal to 60 and less than or equal to 69 percent. D) greater than or equal to 70 percent.
B
The process of preapproving suppliers for specific commodities or parts is known as: A) screening. B) pre sourcing. C) presaging. D) certifying.
B
W. Edwards Deming's Fourteen Points for Management include: A) use statistical methods to determine the workers responsible for poor quality. B) break down barriers between departments. C) the customer is always right, so design your system to please them. D) plan your work and work your plan.
B
What is the latest that activity B can start if A is 35 days, B is 5 days, C is 6 days, and D is 7 days long? (Chart) A) 35 B) 36 C) 40 D) 41
B
When the operations and supply chain areas are not linked with the overall business strategy, but instead follow industry practices, the firm is in this stage of alignment. A) internally neutral B) externally neutral C) internally supportive D) externally supportive
B
Which job title would most likely be responsible for supervising production in a manufacturing setting? A) supply chain manager B) production manager C) supplier development manager D) purchasing manager
B
Which of the following is NOT an element of Lean production? A) to have only the required inventory when needed B) to increase queue lengths C) to improve quality to zero defects D) to reduce setup times
B
Which of the following statements about simulation is BEST? A) Tools like linear programming and regression analysis work best when they are simulated. B) Simulation permits managers to test the effects of new policies and procedures without disrupting customer service. C) As computers have increased in power, simulation results have become less accurate. D) Computer-based simulation is the only "true" simulation.
B
Which of the following statements about theoretical capacity is BEST? A) Theoretical capacity allows adjustments for preventive maintenance. B) Running a factory at this level for a short time is often better than permanently raising resource levels. C) Theoretical capacity levels are usually lower than rated capacity levels. D) Theoretical capacity levels take into account that machines occasionally break and that workers occasionally call in sick.
B
Which of the following statements regarding collaborative planning, forecasting, and replenishment (CPFR) systems is BEST? A) In CPFR, each business develops a sales and operations plan and the mainframe system reconciles these plans to find a middle ground that all businesses work towards. B) CPFR is a set of business processes. C) CPFR has the Project Management Body of Knowledge (PMBOK©) as its basis. D) Recent studies have demonstrated that manual, paper-based CPFR systems are more responsive and more accurate than computer-based CPFR systems.
B
Which of the following statements regarding supply chain synchronization using kanbans is BEST? A) An interruption in the flow of goods within a supplier's assembly operations will have no effect on final assembly downstream in the supply chain. B) For the system to work properly, demand rates must be relatively stable and interruptions must be minimized. C) If final assembly demand doubles, there is no need to change kanban counts at each of the suppliers. D) Final assembly demand may rise or fall, but the sum of the kanbans among all suppliers in the supply chain will remain constant.
B
Which of these SCOR model flows moves in the opposite direction from the others? A) plan B) return C) source D) make
B
Which of these actions would tend to make an MRP system less nervous? A) using the same component, such as a fastener, at multiple levels throughout the product structure tree B) eliminating lot size requirements wherever possible C) increasing the number of levels in a product structure tree D) increasing the minimum order quantities only at the highest level of a bill or materials
B
Which of these conditions is likely to cause a decrease in the probability of a stockout? a. higher lead time variance b. lower lead time c. higher demand level variance d. lower service level
B
Which of these factors is most likely to increase the risk of a missed shipment, communication problem, or human error? A) supply base reduction B) global outsourcing C) multi criteria decision models D) electronic data interchange
B
Which of these statements about time performance is BEST? A) A supplier with high delivery speed must have high delivery reliability. B) A customer with a narrow delivery window should have a supplier with high delivery reliability. C) A supplier with low delivery reliability must have low delivery speed. D) A customer with a wide delivery window should have a supplier with low delivery reliability.
B
Which of these supply chain activities is the most strategic? A) inventory level B) new markets entry C) supplier evaluation systems D) job scheduling
B
Which tool should be used to track the movement of a customer's complaint from one department to the next until it is resolved? A) process map B) swim lane map C) entity map D) data flow map
B
Which two continuous improvement tools are most similar in appearance? A) scatter plot and check sheet B) Pareto chart and histogram C) histogram and fishbone diagram D) check sheet and fishbone diagram
B
________ is an example of an infrastructural element. A) A building B) An organizational structure C) Office equipment D) A fleet of delivery trucks
B
A car wash services 200 customers in an hour on a lovely Saturday afternoon. The car wash employs 5 washers at $6 per hour and uses $50 of water and $5 of electricity per hour. An appropriate measure of productivity is: A) 80%. B) 2.35 cars/$. C) 8 cars/$. D) 0.425 $/car.
B) 2.35 cars/$.
9). A bottling machine has a theoretical capacity of 100 bottles per minute. During every ten hour shift it operates continuously but is shut down once for 30 minutes for cleaning, inspection, and lubrication. What is its rated capacity? A) 100 bottles/minute B) 95 bottles/minute C) 90 bottles/minute D) 85 bottles/minute
B) 95 bottles/minute
Which of these statements about time performance is BEST? A) A supplier with high delivery speed must have high delivery reliability. B) A customer with a narrow delivery window should have a supplier with high delivery reliability. C) A supplier with low delivery reliability must have low delivery speed. D) A customer with a wide delivery window should have a supplier with low delivery reliability.
B) A customer with a narrow delivery window should have a supplier with high delivery reliability.
______ is an example of an infrastructural element. A) A building B) An organizational structure C) Office equipment D) A fleet of delivery trucks
B) An organizational structure
Damron Inc., wants to purchase a shear for their sheet metal shop and chooses dimensions of cost, reliability, and flexibility as critical to their long-term success. They evaluate four different shears and rate their performance on each criterion on a scale from 1 (poor) to 5 (excellent). Which shear should be purchased? A) Belsky B) Reber C) Estelle D) Floyd
B) Reber
8) Which of the following statements about theoretical capacity is BEST? A) Theoretical capacity allows adjustments for preventive maintenance. B) Running a factory at this level for a short time is often better than permanently raising resource levels. C) Theoretical capacity levels are usually lower than rated capacity levels. D) Theoretical capacity levels take into account that machines occasionally break and that workers occasionally call in sick.
B) Running a factory at this level for a short time is often better than permanently raising resource levels.
5) Which of the following statements about simulation is BEST? A) Tools like linear programming and regression analysis work best when they are simulated. B) Simulation permits managers to test the effects of new policies and procedures without disrupting customer service. C) As computers have increased in power, simulation results have become less accurate. D) Computer-based simulation is the only "true" simulation.
B) Simulation permits managers to test the effects of new policies and procedures without disrupting customer service.
Products that are customized only at the very end of the manufacturing process are known as: A) make-to-stock. B) assemble-to-order. C) make-to-order. D) engineer-to-order.
B) assemble-to-order.
A sporting apparel manufacturer that produces t-shirts to commemorate significant athletic achievements for proud students and alumni probably uses: A) a fixed position layout. B) batch manufacturing. C) a continuous flow process. D) a production line.
B) batch manufacturing.
A company with fixed costs of $10,000 per month has a target price of $165 for their sole product, a heat shield for masonry fireplaces. What level of output represents their break-even point if their variable cost for producing is $35 per unit? A) between 60 and 70 units B) between 70 and 80 units C) between 80 and 90 units D) between 90 and 100 units
B) between 70 and 80 units
W. Edwards Deming's Fourteen Points for Management include: A) use statistical methods to determine the workers responsible for poor quality. B) break down barriers between departments. C) the customer is always right, so design your system to please them. D) plan your work and work your plan.
B) break down barriers between departments.
An electronic commerce system: A) is used to transmit information only upstream. B) can improve the speed and quality of business communication. C) is used to transmit information only downstream. D) links everyone in the supply chain except customers.
B) can improve the speed and quality of business communication.
Highly automated batch processes that can reduce the cost of making similar groups of products are: A) functional layouts. B) flexible manufacturing systems. C) make-to-stock. D) adjacent processes.
B) flexible manufacturing systems.
7) Each outcome of flipping a fair coin is completely independent of the previous flip. This outcome is known as: A) simulation. B) memory less. C) 50/50. D) Monte Carlo
B) memory less.
Which job title would most likely be responsible for supervising production in a manufacturing setting? A) supply chain manager B) production manager C) supplier development manager D) purchasing manager
B) production manager
3) A customer enters a business and joins the one line that snakes back and forth through the lobby in order to receive service. The initial part of the service is performed by one customer service representative, after which the customer enters a second, shorter line to complete the service before leaving the establishment. Which description of this waiting line system is appropriate? A) single channel, single phase B) single channel, multiple phase C) multiple channel, single phase D) multiple channel, multiple phase
B) single channel, multiple phase
The greater the emphasis on intangible activities, the more management's attention will be directed to: A) buildings and property. B) training employees. C) truck fleets. D) material costs.
B) training employees.
Franklin BBQ operates 50 weeks per year. Weekly demand averages 30 beef briskets per week with a standard deviation of 6 briskets. Ordering costs are $25 and annual inventory holding cost is $4 per brisket. Delivery lead time from the vendor is 4 weeks. What is the standard deviation of demand during lead time? (Select the nearest number) A. 6 briskets B. 12 briskets C. 24 briskets D. 120 briskets
B. 12 briskets
Which logistics activity accounts for the largest percentage of logistics-related greenhouse gas emissions? A. Rail freight B. Highway freight C. Ocean freight D. Buildings
B. Highway freight
Guadalupe sells imported watches from Germany on his e-commerce website. He wants to determine the Economic Order Quantity for his best selling watch. Which of the factors below is not relevant to this decision? A. The average demand per period. B. Replenishment lead time. C. The cost for placing an order. D. The annual inventory holding cost per watch.
B. Replenishment lead time.
Which of these is NOT an assumption of the basic continuous review model? A. The lead time to receive a new shipment is constant. B. The order quantity is constant, regardless of the demand. C. The price of each item is constant, regardless of how many are ordered at a time. D. Demand for the item is constant.
B. The order quantity is constant, regardless of the demand.
The type of demand which comes from outside the organization, is unpredictable, and usually forecasted is A. periodic. B. independent. C. continuous. D. dependent.
B. independent.
"A complete supply chain dedicated to the reverse flow of products and materials for the purpose of returns, repair, remanufacture, and/or recycling" is the definition of A. hub-and-spoke systems. B. reverse logistics systems. C. packaging systems. D. material handling systems.
B. reverse logistics systems.
Companies hold hedge inventory due to: A. mismatch between timing of customer demand and supply chain lead times. B. uncertainty in supply or demand. C. mismatch between downstream partner's demand and most efficient production or shipment volumes for upstream partner. D. mismatch between downstream demand levels and upstream production capacity.
B. uncertainty in supply or demand.
Silly Sally sells sea shells at the Sea Shore Store. The average and standard deviation of demand during replenishment lead time is 60 and 10 units, respectively. Sally sipped Sangria at the Silver Spoon Saloon and forgot to place a replenishment order. If Sally places an order at the end today when she has 65 units on hand, what is the probability she doesn't run out of sea shells before the replenishment arrives? A. 50% B. 69% C. 31% D. 84%
B. 69%
If Z is set at 1.28 in a safety stock calculation, what will be the service level? A. 84% B. 90% C. 128% D. 95%
B. 90%
**An automobile windshield manufacturer wants to verify that their process is producing windshields of an appropriate thickness. The BEST tool to determine this information is a(n): A) process capability ratio. B) process capability index. C) chart. D) operating characteristics curve.
C
A box of cake mix can be the basis for a tasty cake even if the novice baker adds olive oil instead of vegetable oil and forgets to set a timer. The cake recipe has probably been developed using: A) value analysis. B) the development funnel. C) robust design. D) DFE.
C
A hospital's biomedical repair shop uses a 4-week periodic system to maintain the inventory on the blood pressure cuff repair parts. They use an average 40 adult arm cuffs with a standard deviation of 6 cuffs every four weeks. Cuffs aren't the most critical item they carry, but the manager would like to avoid the embarrassment of a stockout at least 95% of the time. What should their restocking level be? a. 40 cuffs b. 46 cuffs c. 50 cuffs d. 52 cuffs
C
A lead capacity strategy has the advantage of: A) a reduced risk of overbuilding. B) greater productivity due to high utilization levels. C) assuring adequate capacity during all types of growth. D) the ability to put off large investments as long as possible.
C
A legal service in a corporate acquisition probably scores: A) low on customization and high on physical activities. B) high on customer contact and low on intangible activities. C) high on customization and high on intangible activities. D) low on customer contact and low on intangible activities.
C
A man in midlife crisis places his order for a custom chopper from OC Choppers on September 1, but the work on the bike doesn't actually begin until October 1. The actual work on the bike, from design, through fabrication and assembly takes the entire month of October. The entire month of November is spent learning to ride a trainer bike, adding another garage bay to the house, and updating his will. Finally on November 30, the customer takes possession of his dream chopper and happily smokes his tires out of the lot and rides back to Oklahoma. This period of 91 days, besides being labeled "the longest three months of his life" would be more accurately labeled: A) efficiency. B) value-added time. C) cycle time. D) productivity.
C
A process that involves examining all elements of a component, assembly, end product, or service to make sure it fulfills its intended function at the lowest total cost is: A) target costing. B) design to cost. C) value analysis. D) examination costing.
C
A project is comprised of 6 activities that have durations and precedence requirements shown in the table. Which of these activities is not on the critical path? Activity Length Predecessor A 5 -- B 7 A C 4 A D 7 B, C E 7 B F 6 D, E A) A B) B C) C D) D
C
A qualitative forecasting technique well-suited for demand forecasts of a new product or service is the: A) Delphi method. B) build-up forecast. C) life cycle analogy method. D) market survey.
C
A quality perspective that focuses on whether or not a product was made or a service was performed as intended is the: A) performance perspective. B) value perspective. C) conformance perspective. D) intention perspective.
C
A supplier that has previously demonstrated its performance capabilities through purchase contracts may well receive: A) maverick status. B) a request for description. C) preferred supplier status. D) a request for proposal.
C
A technique used to translate customer requirements into technical requirements is: A) quality assurance. B) statistical quality control. C) quality function deployment. D) continuous improvement.
C
An advantage of a production line process is: A) the volume of output needed to justify the investment. B) the degree of flexibility of the process. C) the per unit cost of items produced on the line. D) the range of output typically produced on such a process.
C
An expectation that a new building's foundation would be poured and cured by the end of the year is an example of a(n): A) activity. B) scope. C) milestone. D) precedence.
C
Efforts to improve cooperation among firms in the supply chain can be characterized as: A) globalization. B) domestic focus. C) relationship management. D) electronic commerce.
C
Flingers Inc. reveals the following information in their annual report for FY 2004. Earnings and Expenses Sales $10,000,000 Cost of goods sold $5,000,000 Pre-tax earnings $500,000 Selected Balance Sheet Items Merchandise inventory $80,000 Total assets $2,000,000 What is Flingers' return on assets? A) 16% B) 20% C) 25% D) 40%
C
If a firm cannot make a profit regardless of output volume, then: A) FC > VC. B) VC > FC. C) VC > R. D) BEP > VC.
C
In a two-card kanban system: A) each box of finished goods has a move card so it can be sent to the next step. B) each box of raw material has a production card so it can be made into finished goods. C) a downstream station pulls finished material out of a production area. D) demand for more raw materials pushes finished goods to the finished goods area.
C
In statistical terms, a process that achieves Six Sigma quality will generate about: A) zero defects per million opportunities. B) six defects per million opportunities. C) three defects per million opportunities. D) thirty-four defects per million opportunities.
C
Inflexible or unreliable processes that cause organizations to produce goods before they are required are called: A) excess motion. B) inappropriate processes. C) overproduction. D) defects.
C
Last year the Perfection Logistics Company delivered 3.1 million packages and damaged 45,000 deliveries, sent 28,000 to the wrong address, and was late 20,000 times. Their percent perfect order is: A) 93000 B) 3007000 C) 97% D) 93.7%
C
Liversuch Industries uses a kanban system to manage production of the J-15 subassembly. They have an hourly demand for 250 units and use containers that can hold 50 units each. It takes 90 minutes to fill and move a container of parts to the right place on the J-15 line that is currently rated at a 20% safety factor. How many production cards are needed? A) 540 B) 100 C) 9 D) 1.5
C
Mapping does NOT: A) create a common understanding of the content of a process. B) define the boundaries of a process. C) provide a detailed view of all elements external to the process. D) provide a baseline against which to measure the impact of improvement efforts.
C
One advantage of simulation modeling is: A) the fact that an optimal solution is reached. B) the many simplifying assumptions that are often made when using it. C) it allows the user to conduct a "what if" analysis. D) the time and cost required to make a perfectly realistic simulation.
C
PERT is an acronym meaning: A) Project Evaluation and Review Technique. B) Project Execution and Review Technique. C) Program Evaluation and Review Technique. D) Plan Estimation and Review Technique.
C
Parts standardization typically does NOT: A) reduce the time to develop a new product. B) reduce the cost of final products. C) reduce the profit of a new product. D) reduce the cost of developing new products.
C
Products that use standard components but the final configuration of those components is customer-specific are known as: A) make-to-stock. B) assemble-to-order. C) make-to-order. D) engineer-to-order.
C
Project planners develop a broad definition of what the project is and what its scope will be during the: A) planning phase. B) project definition phase. C) concept phase. D) performance phase.
C
The cashier waved the can of golden hominy across the holographic bar code reader and it emitted a piercing beep. At the same time the customer's bill was rising, the grocery store's inventory was automatically being reduced by 1 can of golden hominy down to 3 cans. This was the bare minimum amount of hominy the store manager dared carry in inventory, so the computer system automatically sent a message to the hominy man, who loaded a few cases onto his delivery truck for tomorrow morning's trip to replenish the store. This is a classic example of: a. a periodic review system. b. safety stock. c. a continuous review system. d. cycle stock.
C
The fireworks that were produced year-round in South Africa were sent to warehouses around the United States during the months of May and June in anticipation of large demand for the July 4th holiday. The warehousing system that is BEST suited to handle this situation is the: A) assortment warehouse. B) postponement warehouse. C) spot stock warehouse. D) break-bulk warehouse.
C
The food engineers at Moria Foods have developed a new variety of banana they have named the "mayfly banana" which holds perfect ripeness for exactly one day before becoming a black-skinned sack of putrid mush. Which of these actions will result in a lower order quantity from the many retail establishments clamoring to stock up on this new foodstuff? a. an increase in the price consumers are willing to pay for the mayfly banana b. an increase in the standard deviation of the number of mayfly bananas demanded by consumers c. a decrease in the salvage value of the mayfly bananas d. a decrease in the disposal cost of the mayfly bananas
C
The latex division of Vandelay Industries provided support after the sale that could not be matched by any of the other players in the latex industry. This unique attribute was responsible for perhaps 60% of their sales volume and could be described as: A) a trade-off. B) a core competency. C) an order winner. D) externally neutral.
C
The left side of the quality function deployment house of quality contains: A) product characteristics. B) relationships between product characteristics. C) customer requirements. D) product specifications.
C
The manufacturing process used to make a wide variety of highly customized products in quantities as small as one is a: A) production line. B) continuous flow process. C) job shop. D) fixed position.
C
The operations and supply chain functions develop detailed process maps of the operations and supply chain flows and test new processes in the: A) concept development phase. B) planning phase. C) design and development phase. D) commercial preparation phase.
C
The purchasing team examined all of their purchasing patterns in order to identify any irregularities or possible areas of cost savings in a little scheme they liked to call: A) internal auditing. B) purchase consolidation. C) spend analysis. D) cooking the books.
C
The ratio of earnings to sales for a given time period is the: A) cost of goods sold. B) merchandise inventory. C) profit margin. D) return on assets.
C
Universal Exports has several crates it needs to send from the United Kingdom to North Korea. They have located a firm that specializes in transferring cargo to the actual carrier that will bring the crates into North Korea. This firm could be described as: A) an interlocuter. B) a customs broker. C) a freight forwarder. D) a mercenary.
C
Which department is least likely to interact with the purchasing function? A) engineering B) finance C) human resources D) operations
C
Which of the following approaches to process improvement could be described as competitive benchmarking? A) Employees at XEROX ignore the way they have always processed customer orders and design an entirely new way to do so. B) Employees at XEROX visit GM to pick up ideas on processing customer orders. C) Employees at XEROX purchase a Canon copier and take it apart to get design ideas for their next generation of copiers. D) Employees at XEROX take classes in quality improvement and make small, incremental changes to their order filling processes.
C
Which of the following is an example of consolidation warehousing? A) Large shipments from multiple suppliers are re-sorted into customized shipments to individual stores. B) A single manufacturer takes output directly from a single manufacturing plant and sends it directly to a single customer. C) A single manufacturer takes output from several of its manufacturing plants and combines them into one shipment to a major customer. D) A single manufacturer holds a wide array of goods close to the source of demand.
C
Which of the following is characteristic of Monte Carlo simulation? A) Results are usually not valid, but provide managers with an approximation. B) Time compression is not possible using this technique. C) Statistical sampling is used to create outcomes for many trials. D) Computer packages such as Simquick and Arena can show on-screen graphics of customers moving through the system or inventory accumulation.
C
Which of the following is required in order to execute a successful spend analysis? A) graphics capabilities found in charting packages and Visio B) a sophisticated statistical software package such as SPSS or SAS C) ability to analyze large quantities of data D) a minimum of six months uninterrupted work time
C
Which of the following relationships shows dependent demand inventory? a. A business purchases a new car when the old one wears out. b. A tire maker buys cleaning supplies. c. An automaker purchases four tires for each car they produce. d. A winemaker buys grapes from farmers in the Columbia Valley.
C
Which of the following statements about functional strategy is BEST? A) Functional strategies are not impacted by the mission statement; instead they are impacted by the overall business strategy. B) Functional strategies determine the overall business strategy. C) Many functional-level strategies could readily be described as cross-functional. D) A firm's operations and supply chain strategy is more important than their marketing, finance and engineering strategies.
C
Which of the following statements about learning curves is BEST? A) Learning improvements always follow a constant pattern. B) Frequent design changes and reengineering have no effect on learning rates. C) Underestimated learning effects may cause overestimation of capacity needs. D) An eighty percent learning curve means that each unit takes twenty percent less time to produce than its immediate predecessor.
C
Which of the following statements about the operations function is NOT correct? A) Inputs to operations can take many different forms. B) Nearly all operations activities require coordination with other business functions. C) The outputs of an operations function are always tangible. D) Operations management activities are information intensive.
C
Which of the following statements regarding the supply chain is TRUE? A) A second-tier supplier is downstream from a first-tier supplier. B) A first-tier supplier is upstream from a second-tier supplier. C) A first-tier supplier is downstream from a second-tier supplier. D) A customer is upstream from a first-tier supplier.
C
Which of these matrix combinations is a correct pairing for quality function deployment? A) customer requirements and process specifications B) product characteristics and process characteristics C) product specifications and process characteristics D) process specifications and product specifications
C
Which of these statements about recent trends in operations and supply chain management is BEST? A) A lower level of competition exists thanks to an increased level of globalization. B) The rate of change in markets is actually lower than 10-15 years ago once inflation is factored in. C) More companies are putting an emphasis on relationship management. D) Customers demand increased standardization in goods and services.
C
________ is an example of an output of the transformation process. A) Material B) Information C) Satisfied customers D) Intangible needs
C
Which of the following statements regarding the supply chain is TRUE? A) A second-tier supplier is downstream from a first-tier supplier. B) A first-tier supplier is upstream from a second-tier supplier. C) A first-tier supplier is downstream from a second-tier supplier. D) A customer is upstream from a first-tier supplier.
C) A first-tier supplier is downstream from a second-tier supplier.
1) Which of the following approaches to process improvement could be described as competitive benchmarking? A) Employees at XEROX ignore the way they have always processed customer orders and design an entirely new way to do so. B) Employees at XEROX visit GM to pick up ideas on processing customer orders. C) Employees at XEROX purchase a Canon copier and take it apart to get design ideas for their next generation of copiers. D) Employees at XEROX take classes in quality improvement and make small, incremental changes to their order filling processes.
C) Employees at XEROX purchase a Canon copier and take it apart to get design ideas for their next generation of copiers.
Which of the following statements about functional strategy is BEST? A) Functional strategies are not impacted by the mission statement; instead they are impacted by the overall business strategy. B) Functional strategies determine the overall business strategy. C) Many functional-level strategies could readily be described as cross-functional. D) A firm's operations and supply chain strategy is more important than their marketing, finance and engineering strategies.
C) Many functional-level strategies could readily be described as cross-functional.
________ is an example of an output of the transformation process. A) Material B) Information C) Satisfied customers D) Intangible needs
C) Satisfied customers
6) Which of the following is characteristic of Monte Carlo simulation? A) Results are usually not valid, but provide managers with an approximation. B) Time compression is not possible using this technique. C) Statistical sampling is used to create outcomes for many trials. D) Computer packages such as Simquick and Arena can show on-screen graphics of customers moving through the system or inventory accumulation.
C) Statistical sampling is used to create outcomes for many trials.
1) Which of the following statements about learning curves is BEST? A) Learning improvements always follow a constant pattern. B) Frequent design changes and reengineering have no effect on learning rates. C) Underestimated learning effects may cause overestimation of capacity needs. D) An eighty percent learning curve means that each unit takes twenty percent less time to produce than its immediate predecessor.
C) Underestimated learning effects may cause overestimation of capacity needs.
If a firm cannot make a profit regardless of output volume, then: A) FC > VC. B) VC > FC. C) VC > R. D) BEP > VC.
C) VC > R.
The latex division of Vandelay Industries provided support after the sale that could not be matched by any of the other players in the latex industry. This unique attribute was responsible for perhaps 60% of their sales volume and could be described as: A) a trade-off. B) a core competency. C) an order winner. D) externally neutral.
C) an order winner.
11). A lead capacity strategy has the advantage of: A) a reduced risk of overbuilding. B) greater productivity due to high utilization levels. C) assuring adequate capacity during all types of growth. D) the ability to put off large investments as long as possible.
C) assuring adequate capacity during all types of growth.
A legal service in a corporate acquisition probably scores: A) low on customization and high on physical activities. B) high on customer contact and low on intangible activities. C) high on customization and high on intangible activities. D) low on customer contact and low on intangible activities.
C) high on customization and high on intangible activities.
Which department is least likely to interact with the purchasing function? A) engineering B) finance C) human resources D) operations
C) human resources
One advantage of simulation modeling is: A) the fact that an optimal solution is reached. B) the many simplifying assumptions that are often made when using it. C) it allows the user to conduct a "what if" analysis. D) the time and cost required to make a perfectly realistic simulation.
C) it allows the user to conduct a "what if" analysis.
Products that use standard components but the final configuration of those components is customer-specific are known as: A) make-to-stock. B) assemble-to-order. C) make-to-order. D) engineer-to-order.
C) make-to-order.
An advantage of a production line process is: A) the volume of output needed to justify the investment. B) the degree of flexibility of the process. C) the per unit cost of items produced on the line. D) the range of output typically produced on such a process.
C) the per unit cost of items produced on the line.
On December 31, 2014 Wal-Mart Stores reported total 2014 revenues of $476,294,000,000. On hand inventory was $43,858,000,000 and total assets were $204,751,000,000. What was the inventory turnover for 2014? (Pick the closest number) A. 2.3 turns B. 4.7 turns C. 10.9 turns D. 21.4 turns
C. 10.9 turns
Assume the standard deviation of demand per week is 8 units and replenishment lead time is 4 weeks. What is the standard deviation of demand during lead time? A. 8 units B. 12 units C. 16 units D. 32 units
C. 16 units
Franklin BBQ is open 7 days per week. Joe Bob reorders pickles every Monday for delivery on Wednesday. Average daily demand is 10 gallons with a standard deviation of 2 gallons per day. What is the standard deviation of demand for pickles during the review period plus the lead time (e.g., uncertainty period)? (Select the nearest number) A. 4 gallons B. 18 gallons C. 6 gallons D. 2 gallons
C. 6 gallons
Mr. Drucker uses a periodic review system to manage the inventory in his dry goods store. He likes to maintain 15 sacks of sugar on his shelves based on the annual demand figure of 225 sacks. It costs $2 to place an order for sugar and costs $1 to hold a sack in inventory for a year. Mr. Drucker checks inventory one day and notes that he is down to 9 sacks; how much should he order? A. 9 sacks B. 30 sacks C. 6 sacks D. 15 sacks
C. 6 sacks
Which of these statements about inventory management is BEST? A. Cross-docking facilities don't need to match incoming and outgoing demand since they typically retain much of their inventory for a week or longer. B. A system using air transportation experiences higher costs due to higher levels of inventory. C. A system using water and rail transportation tends to have higher levels of inventory. D. Spot stock warehouses are more useful with less inventory in the system.
C. A system using water and rail transportation tends to have higher levels of inventory.
_______________ pulls together shipments from a number of sources (often plants) in the same geographic area and combines them into largerlong dash—and hence more economicallong dash—shipping loads. A. Break-bulk warehousing B. Hub-and-spoke systems C. Consolidation warehousing D. Postponement warehousing
C. Consolidation warehousing
Which of the following is not associated with diesel particulate matter (DPM) emissions? A. DPM is associated with respiratory illness and cardiovascular disease B. DPM is anticipated to be a human carcinogen C. DPM is caused by newer equipment that is imported from Europe D. DPM emissions have heavy economic and health-related costs for people living near major poprts or rail yards
C. DPM is caused by newer equipment that is imported from Europe
_______________ is holding a safety stock in a single location instead of multiple locations. Several locations then share these inventories to lower overall holding costs. A. Inventory separation B. Just in time inventory C. Inventory pooling D. Inventory cycling
C. Inventory pooling
_______________ include the equipment and procedures needed to move goods within a facility, between a facility and transportation mode, and between different transportation modes. A. Hub-and-spoke systems B. Break-bulk systems C. Material handling systems D. Packaging systems
C. Material handling systems
Which of the following is not a characteristic of the Periodic Review Model for inventory management? A. The time interval between inventory reviews is fixed B. Order quantity may vary on different orders C. Will have less safety stock inventory than a continuous review model D. Has a longer uncertainty period than the continuous review model
C. Will have less safety stock inventory than a continuous review model
The type of demand which is tied to the production of another item (table legs are an example) is A. independent. B. continuous. C. dependent. D. periodic.
C. dependent.
The transportation mode other than highway with the highest annual tonnage in the United States is A. pipeline. B. air. C. rail. D. water.
C. rail.
The bullwhip effect says that A. the greater the effect of a disturbance upstream, the farther downstream the supply chain. B. the greater the effect of a disturbance downstream, the farther upstream the supply chain. C. the farther upstream the supply chain, the greater the impact of a small disturbance downstream. D. the farther downstream the supply chain, the greater the impact of a small disturbance upstream
C. the farther upstream the supply chain, the greater the impact of a small disturbance downstream.
Last year the Monroe Logistics Company reported 40,000 damaged deliveries, 18,000 deliveries to the wrong address, 15,000 late deliveries, 1,200 deliveries billed incorrectly, and 127,000 deliveries handled properly. Assuming no delivery had more than one error, Monroe's percent perfect order is A. 58% B. 37% C. 63% D. 42%
C. 63%
Using the freight emission factors in the table below, how many grams are of CO2 are released in the atmosphere for a truck load movement in a dry-van that travels 800 miles with 20 short tons of cargo ( a short ton is 2,000 pounds)? Mode Category Unit Emissions Greenhouse gas Rail All Grams per ton-mile 22.9 CO2 Truck Truck Load Dry-van Grams per ton-mile 161.8 CO2 A. 3,236 grams B. 3,236,000 grams C. 2,588,800 grams D. 129,440 grrams
C. 2,588,800 161.8 x 20 x 800
Which of the following is NOT a core idea of total quality management?
Cost reduction
A company that makes the rocket widget has one machine capable of producing this unique item. The machine requires an attendant, who works 40 hours a week for $12 per hour and has made himself available for a maximum of 8 hours of overtime. It costs $20 per hour to run the machine and it is capable of producing 10,000 rocket widgets per hour. The widgets sell for $10 per hundred and cost $1 per hundred in materials. If the production manager wishes to develop a sales and operations plans using an optimization model, which of the following statements is valid? A) The objective function should limit overtime to less than 8 hours per week. B) The objective function should maximize the amount of rocket widgets produced. C) The objective function must be to minimize costs. D) None of these statements will help plan production using optimization modeling.
D
A company using portfolio analysis correctly decides to streamline the purchasing process for a few items by use of EDI and automated requisitions to the greatest extent possible. The quadrant that these items fall in is most probably the: A) bottleneck quadrant. B) critical quadrant. C) leverage quadrant. D) routine quadrant.
D
A consideration to create products and services that are easy to make is: A) DFE. B) CAM. C) QFD. D) DFM.
D
A firm's demand data from the last two quarters is displayed in the table. Month Demand January 154 February 148 March 214 April 180 May 225 June 246 What is the three-period moving average for July's demand? A) 172 B) 181 C) 206 D) 217
D
A hat maker, fresh off a very successful showing at Lidzapalooza is excited about the prospects of providing the finest chapeaus to meet the needs of his energized customer base in the coming year. He and his space designer have identified seven activities that are necessary to expand his small shop. For the sake of simplicity, and to avoid giving away any trade secrets, the activities have been identified by letters A-G. The activities, their time estimates, and the precedence requirements structure are listed in the table immediately below. Activity Predecessors Time (weeks) A -- 7 B A 6 C A 10 D C 12 E B, C 5 F D, E 11 G D, F 8 30) Which of these statements is BEST? A) Only four of these activities have zero slack. B) The late finish of D minus the late finish of C is less than the slack of B. C) B's late start plus its slack equals F's late finish. D) The sum of the late start values for activities A through E is less than the sum of the late start values for F and G.
D
A kanban can be: A) a container. B) a card. C) a visual cue. D) All of these can be kanbans.
D
A key performance measure for an execution and transaction processing system would be: A) flexibility. B) form. C) function. D) accuracy.
D
A manufacturing process decision affects: A) the type of workforce needed. B) the type of equipment needed. C) the type of products that can be made. D) All of the above are correct.
D
A qualitative forecasting technique in which individuals familiar with specific market segments estimate the demands within these sectors that are then summed to get an overall forecast is called a: A) market survey. B) life cycle analogy. C) panel consensus. D) build-up method.
D
A service firm that takes care of all of the logistics requirements for other companies is a: A) common carrier. B) contract carrier. C) freight forwarder. D) third party logistics provider.
D
A set of tasks or activities that addresses the main value-added activities of an organization is a: A) process. B) support process. C) development process. D) primary process.
D
A university orders all office supplies, including red grading pens, out of a catalog from the same supplier. Conservative estimates of the demand for these red pens are 12,000 pens per year. There is a $25 charge for placing an order and the university has a $10 annual cost for holding these pens. Prices for the pens are based on the quantity purchased, so if less than 100 are ordered, the unit price is $2.50, if 100 to 299 are ordered, the unit price is $2.40, if 300 to 499 are ordered, the unit price is $2.30, and if 500 or more are ordered, the unit price is $2.20. What order quantity will result in the lowest total annual cost to the university? a. 100 b. 245 c. 300 d. 500
D
An MRP system cannot answer the question: A) "how much?" B) "when?" C) "what?" D) "why?"
D
An organization has developed three alternate sales and operations plans for the coming six months and now must choose between them. They should consider: A) how their plan will impact supply chain partners. B) what the cash flows are like. C) how flexible the plan is. D) All of these are admirable criteria for a sales and operation plan.
D
Assemble-to-order occurs upstream from: A) design. B) material sourcing. C) fabrication. D) finishing.
D
Business process modeling tools allow the user to: A) connect to the cloud without using the internet. B) manage internal supply chain relationships. C) manage external supply chain relationships. D) simulate the performance of a new process.
D
Consider the product structure tree shown below: With a beginning inventory of zero for all components and finished items, how many assembly As are needed to produce 25 product Xs? A) 125 B) 250 C) 400 D) 325
D
Consider the system composed of four processes linked by a conveyor belt. There is no storage between these processes pictured below. Which statement is BEST (chart) A) The overall system output is 220 units/hr. B) The process that determines the system's capacity is process 4. C) If only process 3 experiences 5 minutes of unplanned downtime, the system's overall output is diminished. D) Overall system improvement efforts should focus on process 1.
D
Fed up with her working conditions at the call center, Lisa decides to invest in a state-of-the-art sewing machine and produce limited quantities of her own clothing designs. After a few months of operation, she decides to apply some of the forecasting techniques she mastered in school. Which of these statements about her forecasts is correct? A) Her forecasts will probably be 100% accurate. B) Her demand forecasts for a year from now will probably be more accurate than her demand forecasts for three months from now. C) Her demand forecasts for each style of skirt will be less accurate than her demand forecasts for all skirts. D) The best way for her to determine the amount of fabric she needs is to forecast it based on her customer orders for each type of skirt.
D
Firms do not compete only against global competitors, but against: A) their suppliers. B) themselves. C) the customers of their competitors. D) their competitors' supply chains.
D
Forecasts in a company using a distribution requirements planning system are typically based on: A) historical data from upstream supply partners. B) historical data from downstream supply partners. C) upstream supply partners' requirements. D) downstream supply partners' requirements.
D
Forty percent of a house painter's business is exterior work and the other sixty percent is interior. The average exterior paint job takes 30 hours of labor and $500 of paint and primer, but the average interior job takes only 6 hours of labor and $80 of paint and primer. If he gets 25 service calls for the coming month and 30 calls for the month after that, which of the following resource requirements is correct? A) The painter has supply costs of greater than $13,500 but less than $13,600 for the next two months. B) The painter has a labor demand of greater than 800 hours but less than 850 hours for the next two months. C) The painter has supply costs of greater than $13,400 but less than $13,500 for the next two months. D) The painter has a labor demand of greater than 850 hours but less than 900 hours for the next two months.
D
Hub and spoke systems are characterized by: A) "spokes" that are represented by the sites that receive the goods. B) "hubs" that hold inventory until the appropriate season or upswing in demand. C) inventory locations that are close to producers, not customers. D) warehouses that are purely sorting facilities.
D
If demand increases by 100%, the average inventory held in a system governed by the EOQ model: a. is increased 100%. b. is decreased by 100%. c. is decreased by 50%. d. is increased by 40%.
D
In a two-card kanban system: A) the production card signals when a move card should be moved to the next process step. B) the move card signals when a container of parts should be produced. C) the production card signals when a container that held parts should be returned to inventory. D) the move card signals when a container of parts should move to the next process step.
D
Individual links in the supply chain can stabilize their production at the most efficient level by using: a. safety stock. b. anticipation inventory. c. linkage inventory d. smoothing inventory.
D
It takes one day for Peter Gibbons to complete a TPS report and attach the cover sheet. During that day, Peter spends about 15 minutes a day performing actual work and the other 7 hours and 45 minutes spacing out. Which of the following statements is correct? A) Peter's cycle time is 7 hours and 30 minutes. B) Peter's efficiency is 25%. C) Peter's productivity is 8 hours per TPS report. D) Peter's percent value-added time is just over 3%.
D
JIT can be used in: A) repetitive production. B) job shop production. C) many service industries. D) All of these settings are appropriate for JIT.
D
Lean supply chain management focuses on eliminating waste: A) in a firm's sourcing and logistics activities. B) within a firm's internal operations. C) in flows of information and money among supply chain partners. D) in all of the above areas.
D
Livernonions Industries uses a kanban system to manage production of the BR-549 subassembly. In an eight-hour day they use 900 units and use containers that can hold 30 units each. It takes 120 minutes to fill and move a container of parts to the right place on the BR-549 line that is currently rated at a 15% safety factor. How many production hours of inventory are needed? A) 18.4 B) 7.6 C) 4.3 D) 2.4
D
Logistics information systems that support tactical planning efforts by allocating fixed logistics capacity in the best possible way given business requirements are known as: A) decision support systems. B) network design applications. C) warehouse management and transportation execution systems. D) warehouse and transportation planning systems.
D
MRP is NOT capable of: A) lowering inventory levels. B) helping a firm meet their master schedule commitments. C) telling a firm's suppliers what needs to be made and by when. D) sequencing jobs at a machining center.
D
Mutt's Amazing Dogs offers a hot dog with mustard and a hot dog with relish and mustard. The difference between the two (the relish) is achieved by flipping a single lever, which changes the dispenser from mustard, to a perfectly proportioned mix of relish and mustard. This lever responds instantly to the feathery touch of Mutt, who has achieved a high level of: A) mix flexibility. B) volume flexibility. C) delivery flexibility. D) changeover flexibility.
D
No one could turn around a failing restaurant as expertly as Gordon, whose experience and cadre of trained professionals was available at a moment's notice should his services be needed. This ability, some might call it a gift, was developed to such a level that other restaurant consultants were unable to match his results. This ability is best described as his: A) business strategy. B) mission statement. C) operations and supply chain strategy. D) core competency.
D
Performance dimensions on which customers expect a minimum level of performance are called: A) order winners. B) minimum performers. C) recommended daily allowances. D) order qualifiers.
D
Sales and operations planning must consider: A) customer demand. B) capabilities of suppliers. C) capabilities of logistics service providers. D) All of these must be considered when performing SOP.
D
Single sourcing is a better choice than multiple sourcing from the perspective of: A) increased competition. B) ensuring that a supplier will not become complacent. C) spreading risk. D) access to the supplier's design and engineering capabilities.
D
Terms and conditions for a purchased service that indicate what services will be performed and how the service provider will be evaluated are called a: A) request for quotation. B) bid specification. C) preferred supplier contract. D) statement of work.
D
The Super Bowl is right around the corner and Gowgem Hotels is aquiver with anticipation. They'd like to price their rooms at their three city locations, next to the stadium, near the airport, and in the suburbs, as high as possible but still achieve 100% occupancy. The approach they should take to this opportunity is: A) a tiered workforce. B) a load profile. C) beagling. D) yield management.
D
The ________ dimension of quality asks how long a product can go between failures or the need for maintenance. A) warranty B) lifetime C) serviceability D) reliability
D
The bank manager of a busy downtown location found herself unable to find good teller help so she invested in an ATM to handle the routine withdrawals that tended to occupy an inordinate amount of the teller's time. Before she installed the ATM she found that customers were arriving on average every 2 minutes (Poisson distributed) and it took a teller 30 seconds (exponentially distributed) to process their request. The ATM is able to maintain a constant 30 second service time. What is the impact on system utilization? A) Utilization has dropped by 45%. B) Utilization has dropped by 15%. C) Utilization has dropped by 30%. D) There is no change.
D
The budget estimates made during the concept phase are usually accurate to within: A) 20 percent. B) 50 percent. C) 40 percent. D) 30 percent.
D
The drought of 2011 devastated hay crops in the plains states and horse owners ranged far and wide to purchase hay for their horses when winter arrived. Hay can be purchased "up north" for $4 a bale and a few entrepreneurs with large trailers were more than willing to pick up a few hundred bales and haul them south where demand was high. The transportation cost was $6 per bale and a packing and loading cost of $1 was typical. The landed cost of a bale of hay this winter was: A) $4. B) $6. C) $10. D) $11.
D
The factory produces product and ships it to the distributor. The distributor sends it to the wholesaler when they receive an order. The wholesaler ships the product to the retailer as the retailer requests replenishment. The customer visits the retailer's bricks and mortar store to purchase the product when they run out. Which of these supply chain members is most likely subjected to the greatest variability in customer demand? a. retailer b. wholesaler c. distributor d. factory
D
The firm's targeted customers, time frames, and performance objectives are identified by their: A) mission statement. B) core competencies. C) functional strategy. D) core competency.
D
The majority of the total operating budget for most organizations is: A) engineering costs. B) advertising costs. C) equipment maintenance costs. D) supply chain costs.
D
The phenomenon that a dollar in cost savings increases pretax profits by a dollar, while a dollar increase in sales increases pretax profits only by the dollar multiplied by the pretax profit margin is known as the: A) profit margin. B) return on assets. C) saving to spending ratio. D) profit leverage effect.
D
The probability of rejecting a lot with quality better than the acceptable quality level is: A) the lot tolerance percent defective. B) the lot tolerance percent acceptable. C) the consumer's risk. D) the producer's risk.
D
The standard equation used by Gigi Enterprises for production planning is Production = Demand. The sales and operations planner is probably using: A) a mixed production approach. B) a level production approach. C) a bottom-up planning approach. D) a chase production approach.
D
The transportation mode with the highest dollar value of freight in the United States is: A) water. B) rail. C) pipeline. D) highway.
D
There are few, if any, options for adjusting capacity levels for managers involved in: A) strategic planning. B) operational planning. C) tactical planning. D) detailed planning and control.
D
This Gantt chart can be used to show: (Chart) A)activity D must come before activity C. B) activity F can be done at the same time as D. C) activity E can begin as soon as activity A is complete. D) activities D and B can be done simultaneously.
D
This graph of expected sales level and expected output shows (graph): A) a chase production plan is being used. B) a mixed production plan is being used. C) planning levels have been computed. D) a level production plan is being used.
D
This table contains the performance criteria and scores for four potential suppliers to Kramerica Industries. Evaluate the data and identify the BEST source for Kramerica. Perform Dim A B C D Quality (W=0.4) 3 4 2 5 Cost (W=0.3) 4 3 5 3 Flexibility (W=0.2) 5 3 4 2 Speed (W=0.1) 2 5 5 4 A) Company A B) Company B C) Company C D) Company D
D
This transportation mode is often the most expensive on a per pound basis. A) rail B) water C) highway D) air
D
What is the fastest completion time of the project with activity lengths (in days) and precedence requirements as shown in the table? Activity Length Predecessor A 15 -- B 7 A C 4 A D 8 B,C A) 22 B) 25 C) 27 D) 30
D
What percent of North American gross domestic product is accounted for by logistics? A) almost 12 percent B) almost 16 percent C) almost 20 percent D) almost 8 percent
D
When using MRP and kanban together: A) the control capabilities of MRP are used instead of those from kanban. B) the planning capabilities of kanban are used instead of those from MRP. C) the demand rate should be variable in order to derive the greatest benefit from the MRP portion of the system. D) the number of kanbans is recalculated from the MRP system's order changes throughout the horizon.
D
Which of the activities in this project has the greatest amount of slack? Activity Length Predecessor A 7 -- B 4 A C 8 A D 3 B, C E 2 B F 8 D, E A) B B) C C) D D) E
D
Which of the following functions is NOT typically involved in a cross-functional product development effort? A) marketing B) operations C) finance D) All of these functions are involved.
D
Which of the following is NOT a flow typically found in a supply chain? A) physical B) information C) monetary D) risk
D
Which of the following is NOT a generic performance dimension of operations and supply chain activities? A) quality B) time C) flexibility D) social responsibility
D
Which of the following is NOT a trend in operations management? A) increased use of electronic commerce B) increased globalization C) decreased delivery times D) decreased customization
D
Which of the following is NOT an appropriate measure of capacity? A) square yards of carpet installed per hour B) number of cars assembled per month C) printed pages per minute D) thickness of laminate on a desktop
D
Which of the following is a type of material handling equipment? A) 3PL B) LTL C) RFID D) ASRS
D
Which of the following occurs during a sequential development process? A) Activities in different development stages overlap with one another. B) Constant communication is required between participants at various stages in the development effort. C) Prototypes can begin before product characteristics are finalized. D) The development funnel process takes place.
D
Which of the following statements BEST describes current thinking regarding processes? A) If companies concentrate on how functional areas like marketing, finance, and operations are organized, then everything will be fine. B) Managing functional areas like marketing, finance, and operations is essentially the same thing as managing what a business does. C) If the individual functional strategies of marketing, finance, and accounting are aligned with the overall business strategy, then everything will be fine. D) Developing superior business processes requires a cross-functional and cross-organizational perspective.
D
Which of the following statements about capacity strategies is NOT correct? A) Lead capacity strategy can be used to preempt competitors who might be planning to expand their own capacity. B) A lag capacity strategy tends to have greater productivity due to higher utilization levels. C) A match capacity strategy tends to avoid periods of high under- or overutilization. D) A lag capacity strategy would be well-suited for a period of high growth.
D
Which of these conditions is NOT necessary for the economic order quantity model to be valid? a. The item has a constant demand. b. The item has a constant lead time. c. The item has a constant price. d. The item has a constant safety stock.
D
Which of these is NOT an advantage of linking sales and operations planning throughout the supply chain as mentioned in the book? A) greater coordination B) improved productivity C) fewer disruptions in the flow of goods and services D) increased sales revenue
D
Which of these is NOT one of the primary objectives of an operations and supply chain strategy? A) to help management choose the right mix of structural and infrastructural elements, based on a clear understanding of the performance dimensions valued by customers and the trade-offs involved B) to ensure that the firm's structural and infrastructural choices are strategically aligned with the firm's business strategy C) to support the development of core competencies in the firm's operations and supply chains D) to align structural and infrastructural elements to convert order winners into order qualifiers as determined by the mission statement
D
Which of these is a direct cost associated with outsourcing? A) direct material B) direct labor C) variable overhead D) price from invoice
D
Which of these manufacturing processes is most likely dictated by the physical characteristics of the product being produced? A) job shop B) batch C) production line D) continuous flow
D
Which of these statements about inventory management is BEST? A) Spot stock warehouses are more useful with less inventory in the system. B) A system using air transportation experiences higher costs due to higher levels of inventory. C) Cross-docking facilities don't need to match incoming and outgoing demand since they typically retain much of their inventory for a week or longer. D) A system using water and rail transportation tends to have higher levels of inventory.
D
Which of these statements about reverse logistics is BEST? A) Reverse logistics systems are usually designed to be less flexible than forward-based systems. B) Reverse logistics systems usually play no role in customer satisfaction. C) Reverse logistics systems usually use the same processes and players that comprise the forward-based system. D) Reverse logistics systems are usually less cost-efficient than forward-based systems.
D
Which of these statements about the SCOR model is BEST? A) The SCOR model consists of four levels that describe supply chain processes in increasing detail. B) The core management processes of the model are Source, Collaborate, Operations, and Return. C) The process types detailed in level one are Planning, Execution, and Enable. D) The model makes provisions for different levels of customization.
D
Work on a project's constituent activities begins in the project's: A) planning phase. B) concept phase. C) post-completion phase. D) performance phase.
D
Your new Garden Weasel fails to "completely satisfy" you so you decide to return it for a full refund. What is the name for the system that will carry your weasel back to the manufacturer? A) upstream logistics B) reverse ordering C) upstream ordering D) reverse logistics
D
12) Which of the following statements about capacity strategies is NOT correct? A) Lead capacity strategy can be used to preempt competitors who might be planning to expand their own capacity. B) A lag capacity strategy tends to have greater productivity due to higher utilization levels. C) A match capacity strategy tends to avoid periods of high under- or overutilization. D) A lag capacity strategy would be well-suited for a period of high growth.
D) A lag capacity strategy would be well-suited for a period of high growth.
A manufacturing process decision affects: A) the type of workforce needed. B) the type of equipment needed. C) the type of products that can be made. D) All of the above are correct.
D) All of the above are correct.
Which of the following statements BEST describes current thinking regarding processes? A) If companies concentrate on how functional areas like marketing, finance, and operations are organized, then everything will be fine. B) Managing functional areas like marketing, finance, and operations is essentially the same thing as managing what a business does. C) If the individual functional strategies of marketing, finance, and accounting are aligned with the overall business strategy, then everything will be fine. D) Developing superior business processes requires a cross-functional and cross-organizational perspective.
D) Developing superior business processes requires a cross-functional and cross-organizational perspective.
2) Consider the system composed of four processes linked by a conveyor belt. There is no storage between these processes pictured below. Which statement is BEST A) The overall system output is 220 units/hr. B) The process that determines the system's capacity is process 4. C) If only process 3 experiences 5 minutes of unplanned downtime, the system's overall output is diminished. D) Overall system improvement efforts should focus on process 1.
D) Overall system improvement efforts should focus on process 1.
It takes one day for Peter Gibbons to complete a TPS report and attach the cover sheet. During that day, Peter spends about 15 minutes a day performing actual work and the other 7 hours and 45 minutes spacing out. Which of the following statements is correct? A) Peter's cycle time is 7 hours and 30 minutes. B) Peter's efficiency is 25%. C) Peter's productivity is 8 hours per TPS report. D) Peter's percent value-added time is just over 3%.
D) Peter's percent value-added time is just over 3%.
Which of these statements about the SCOR model is BEST? A) The SCOR model consists of four levels that describe supply chain processes in increasing detail. B) The core management processes of the model are Source, Collaborate, Operations, and Return. C) The process types detailed in level one are Planning, Execution, and Enable. D) The model makes provisions for different levels of customization.
D) The model makes provisions for different levels of customization.
15) The bank manager of a busy downtown location found herself unable to find good teller help so she invested in an ATM to handle the routine withdrawals that tended to occupy an inordinate amount of the teller's time. Before she installed the ATM she found that customers were arriving on average every 2 minutes (Poisson distributed) and it took a teller 30 seconds (exponentially distributed) to process their request. The ATM is able to maintain a constant 30 second service time. What is the impact on system utilization? A) Utilization has dropped by 45%. B) Utilization has dropped by 15%. C) Utilization has dropped by 30%. D) There is no change.
D) There is no change.
Which of these manufacturing processes is most likely dictated by the physical characteristics of the product being produced? A) job shop B) batch C) production line D) continuous flow
D) continuous flow
No one could turn around a failing restaurant as expertly as Gordon, whose experience and cadre of trained professionals was available at a moment's notice should his services be needed. This ability, some might call it a gift, was developed to such a level that other restaurant consultants were unable to match his results. This ability is best described as his: A) business strategy. B) mission statement. C) operations and supply chain strategy. D) core competency.
D) core competency.
Which of the following is NOT a trend in operations management? A) increased use of electronic commerce B) increased globalization C) decreased delivery times D) decreased customization
D) decreased customization
21) Assemble-to-order occurs upstream from: A) design. B) material sourcing. C) fabrication. D) finishing.
D) finishing.
A set of tasks or activities that addresses the main value-added activities of an organization is a: A) process. B) support process. C) development process. D) primary process.
D) primary process.
The ________ dimension of quality asks how long a product can go between failures or the need for maintenance. A) warranty B) lifetime C) serviceability D) reliability
D) reliability
Which of the following is NOT a flow typically found in a supply chain? A) physical B) information C) monetary D) risk
D) risk
Which of the following is NOT a generic performance dimension of operations and supply chain activities? A) quality B) time C) flexibility D) social responsibility
D) social responsibility
The probability of rejecting a lot with quality better than the acceptable quality level is: A) the lot tolerance percent defective. B) the lot tolerance percent acceptable. C) the consumer's risk. D) the producer's risk.
D) the producer's risk.
Which of the following is NOT an appropriate measure of capacity? A) square yards of carpet installed per hour B) number of cars assembled per month C) printed pages per minute D) thickness of laminate on a desktop
D) thickness of laminate on a desktop
Which of these is NOT one of the primary objectives of an operations and supply chain strategy? A) to help management choose the right mix of structural and infrastructural elements, based on a clear understanding of the performance dimensions valued by customers and the trade-offs involved B) to ensure that the firm's structural and infrastructural choices are strategically aligned with the firm's business strategy C) to support the development of core competencies in the firm's operations and supply chains D) to align structural and infrastructural elements to convert order winners into order qualifiers as determined by the mission statement
D) to align structural and infrastructural elements to convert order winners into order qualifiers as determined by the mission statement
Diamond Hardware Store sells picture-hanging kits. Annual demand is 4,000 kits. The cost to place an order from Diamond's vendor is $50 and the holding cost is $10 per kit per year. Product price varies by order quantity, Q. If Q < 150 units, each kit costs $2.00. If 150 less than or equals≤Q < 250, each kit costs $1.75. If 250 less than or equals≤ Q, the price is $1.50 per kit. How many kits should Diamond order to minimize costs? A. 200 B. 150 C. 500 D. 250
D. 250
Firms often redesign their supply chain networks due to mergers and acquisitions. Which of the following is the desired outcome of the network redesign? A. Reduced costs B. Improved customer service C. Lower greenhouse gas emissions D. All of the listed outcomes
D. All of the listed outcomes
Which of the following performance dimensions are included in the Strategic Triple Bottom Line A. Economic performance B. Environmental stewardship C. Social responsibility D. All of the listed performance dimensions
D. All of the listed performance dimensions
The Times-Picayune is searching for an ideal spotting station for the morning paper. Neighborhoods, their location on an XY grid of the city, and morning volume are shown in the table. What is the location that will minimize the transportation costs for the newspaper? Customer Annual Volume X-Coordinate Y-Coordinate Florida 7 3 7 Desire 39 7 5 Lafitte 245 1 3 Iberville 116 2 5 Guste 55 1 6 CJ Peete 284 1 4 A. Near (3.0, 4.5) B. Near (2.5, 2.5) C. Near (4.5, 5.0) D. Near (1.5, 4.0)
D. Near (1.5, 4.0)
Scholastic, the book publisher, has their suppliers, book printers, manufacture millions of Harry Potter books ahead of time so customers can have instant availability on the launch date. This type of inventory is A. hedge. B. safety. C. cycle stock. D. anticipation
D. anticipation
You order a box of pencils from an office supply store and use them one-by-one until they are all gone. The pencils in your possession are A. safety stock. B. hedge inventory. C. anticipation inventory. D. cycle stock.
D. cycle stock.
"An agent who serves as an intermediary between the organization shipping the product and the actual carrier, typically on international shipments" is the definition of a A. customs broker. B. logistics agent. C. free agent. D. freight forwarder.
D. freight forwarder.
The cost and value of inventory increase as materials move down the supply chain. One way operations and supply chain managers counteract the negative aspect of this fact is by A. advertising to increase demand. B. using a periodic inventory system. C. using a continuous inventory system. D. inventory pooling
D. inventory pooling
The _______________ represents the timely, error-free provision of a product or service in good condition. A. first order B. landed cost C. order total D. perfect order
D. perfect order
"Which of the following is not a cause of the bullwhip effect? A. transportation discounts to encourage larger volume shipments. B. marketing promotions that encourage distributors to buy in larger quantities. C. increasing order quantity sizes in order to get purchase discounts. D. sharing retailer point-of-sale data with suppliers.
D. sharing retailer point-of-sale data with suppliers.
Some companies want their supply chain partners (suppliers) to co-locate, i.e., move as close as possible to them. This would reduce A. hedge inventory. B. smoothing inventory. C. anticipation inventory. D. transportation inventory.
D. transportation inventory.
A company which sources raw materials and components from overseas will hold extra inventory of these items due to a mismatch between the timing of customer demand and supply chain lead times. This type of inventory is A. cycle stock. B. hedging. C. smoothing. D. transportation.
D. transportation.
"An operation that stores, repackages, stages, sorts, or centralizes goods or materials" is the definition of A. efficiency. B. sustainability. C. transportation. D. warehousing.
D. warehousing.
In 2014 Wal-Mart Stores held $43,858 million dollars of inventory. Annual inventory holding costs are approximately 25% of item value. Assume that during your summer internship, you invented an improved forecasting model that reduced Wal-Mart's inventory level by 1% without lowering the service level. How much would this save Wal-Mart each year? (Pick the closest number) A. $43,858 million B. $4,385.8 million C. 10.9 percent D. $109.645 million
D. $109.645 million
The goal of a _______________ is to establish a stocking level that strikes the best balance between expected shortage costs and expected excess costs. A. mixed inventory system B. periodic inventory system C. continuous inventory system D. single-period inventory system
D. single-period inventory system
A description method used when a product or service is proprietary or when there is a perceived advantage to using a particular suppliers product or service is
Description by brand
The factory produces product and ships it to the distributor. The distributor sends it to the wholesaler when they receive an order. The wholesaler ships the product to the retailer as the retailer requests replenishment. The customer visits the retailer's bricks and mortar store to purchase the product when they run out. Which of these supply chain members is most likely subjected to the greatest variability in customer demand?
Factory
Which of these statements about the zero defects view of the total cost of quality is BEST?
Failure costs dictate the shape of the total cost curve
23) Building rental and depreciation on capital equipment are examples of variable costs.
False
24) The Greek letter lambda (λ) is used to represent the service rate of a waiting line system.
False
25) In general, higher conformance quality reduces capacity since the extra care taken during production slows the output rate.
False
26) A firm's capacity cannot be limited by members of its supply chain.
False
28) Virtual supply chains have the advantage of efficiency, but this advantage is gained in a trade-off with decreased flexibility.
False
31) A traditional university classroom has room for 30 students and is scheduled for use during 12 consecutive one hour periods from 8:00 a.m. to 8:00 p.m. in the spring semester. Its theoretical capacity is therefore half of its rated capacity.
False
32) For a given fixed cost and revenue, as the variable cost rises, the break-even point also rises.
False
33) A waiting line cannot be both multiple-channel and multiple-phase.
False
34) In a decision tree, outcome points are under direct control of the decision maker and show the results of choices.
False
37) A ninety percent learning curve is steeper than an eighty percent learning curve.
False
39) A busy toll highway that has four toll collectors for northbound traffic is an example of a single-channel, single-phase system.
False
42) In most waiting line models, customers are assumed to arrive at random intervals, based on a normal distribution.
False
45) The term time compression refers to the phenomenon that a server tends to speed up the service process if the waiting line exceeds some critical number of customers.
False
47) In most cases, simulation models provide optimal solutions to problems just like most of the equations presented in your textbook.
False
A company that uses portfolio analysis would probably classify things like office supplies in the Bottleneck quadrant
False
A manufacturer seeking to reduce the variability of quality should use multiple sourcing
False
A recent trend in supply management is a move towards a more sustainable supply chain
False
As the average demand rises, the standard deviation of demand falls
False
Assortment warehousing is a form of warehousing that combines classic operations with light manufacturing and packaging duties in order to assure short customer lead times.
False
Between any two locations, a less-than-truckload shipment probably experiences fewer stops and handling than a direct truck shipment.
False
Buying advance tickets for the Giraffe Massacre concert on New Years Eve saves the buyer one-tenth of one percent on the face value of the tickets. It would be wise to buy tickets well in advance of the concert date.
False
Company A spends $250 million purchasing materials and sub-assemblies that it processes and sells for a total of $350 million. The COGS buy company A is $350 million
False
Cross sourcing is a strategy in which two suppliers are used for the same purchases product or service
False
Dependent demand inventory never needs hedge inventory
False
ISO 9001:2000 cannot be used by both manufacturing and service companies.
False
In a cost-based contract, the stated price does not change, regardless of fluctuations in the general overall economic conditions
False
In order for the assignment problem method to yield an optimal solution all of the transportation costs in the area must be identical.
False
In the description activity of the purchasing process, the product should be described by only one brand or specification
False
Inventory pooling occurs when a warehouse operator fails to complete shipments and is left with inventory that should be elsewhere.
False
Maverick spending is often promoted by top management as a way to improve the bottom line and break out of a purchasing cycle.
False
Order quantity decisions are typically made in isolation from considerations of transportation, packaging, and material handling
False
Outsourcing can be risky because it decreases the firms strategic ability
False
The excess cost on an item is the profit you would have made on it
False
The first step of the purchasing process is to select the supplier
False
The flexibility of inventory increases as materials move down the supply chain
False
The landed cost is the sum of all of the logistics activities from packaging at the producer's site through transportation, handling, customs, and any other logistics fees to the point of sale.
False
The net result of the renaissance in logistics is that logistics costs are expected to decline.
False
The recorder point increases as the service level falls
False
The request for quotation is a formal request for suppliers to deliver a product of service that includes key terms and condition, such as price, delivery, and quality requirements
False
The value of goods on a "per unit" basis far upstream in a supply chain is greater than the value of those same goods far downstream in a supply chain
False
The weighted point evaluation system allows for a completely objective decision to be made
False
Which of these factors is most likely to increase the risk of a missed shipment, communication problem, or human error?
Global Outsourcing
The percentage value of shipments that come form materials for the average manufacturer is
Greater than or equal to 50 and less than or equal to 59 percent
One international standard for managing quality across the supply chain is:
ISO 9000
Supply chain inventory
Increases in cost as materials move downstrem
Costs incurred by defects that occur prior to delivery to the customer are called
Internal Failure Costs
Which of these conditions is likely to cause a decrease in the probability of a stockout?
Lower lead time
The phenomenon that a dollar in cost savings increases pretax profits by a dollar, while a dollar increase in sales increases pretax profits only by the dollar multiplied by the pretax profit margin is known as the:
Profit leverage effect
The analyst turned on his bankers lamp, adjusted his eye shade, and slowly pulled a legal pad from his desk. His weathered hands punched the buttons on his desk calculator deliberately as he divided his earnings by total assets in order to calculate
Return on Assets
The inventory that companies hold to protect themselves against uncertainties in either demand or replenishment time is called
Safety Stock
Individual links in the supply chain can stabilize their production at the most efficient level by using
Smoothing Inventory
A recent survey of executives at Global 1000 companies uncovered what fear?
The fear of supply chain distruption
Which of these conditions is NOT necessary for the economic order quantity model to be valid?
The item has a constant safety stock
Firms do not compete only against global competitors but against:
Their competitors supply chain
21) Customers enter the stadium and purchase refreshments before they are shown to their seats by experienced ushers. The customers are considered objects in the simulation model.
True
22) Customers enter the stadium and purchase refreshments before they are shown to their seats by experienced ushers. The concession stand lines are considered elements in the simulation model.
True
29) Capacity is the capability of a worker, machine, work center, plant, or organization to produce output per time period.
True
30) All waiting line formulas assume that customers are served on a first-come first-served (FCFS) basis.
True
35) The break-even formula does not include a provision for a price break if a customer purchases a large quantity.
True
36) Learning curve theory suggests that productivity will increase as people and systems learn to perform tasks more efficiently.
True
38) The Theory of Constraints would support the statement that a chain is only as strong as its weakest link.
True
40) In operations and supply chain environments that must deal with random demand, it is virtually impossible to achieve very high capacity utilization levels and still provide acceptable customer service.
True
41) In waiting line theory, the number of channels refers to the number of customer waiting lines in the system.
True
43) With only a half hour for lunch I screamed into the parking lot of the nearest Golden Arches Supper Club at 40 miles an hour. When I saw the drive through line was 15 cars deep I didn't bother getting in line; I was off to visit the Colonel. This behavior might be described as balking.
True
44) Everything about two different waiting line systems is the same except one system has a constant service time and the other has a Poisson distributed service time. Customers using the system with the constant service time will have half the waiting time of the customers using the system with Poisson distributed service times.
True
46) It is more costly to create a more realistic simulation than one that is less realistic.
True
48) Monte Carlo simulation uses statistical sampling to create outcomes for a large number of trials.
True
A company interested in consistently achieving a high level of on-time delivery would be best served by the highway or air modalities of transportation.
True
A company that orders at their economic order quantity has an annual ordering cost that is half of their total cost
True
A firm is able to meet current demand. If it adopts a lead capacity strategy, then it is probably making the assumption that demand will increase in the future.
True
A manufacturer that wants to make sure that suppliers do not become complacent should use multiple sourcing
True
A material handling system includes equipment and procedures that are needed to move items within a facility, between a facility and a transportation mode, and between different transportation modes.
True
A reverse logistics system handles repairs, recycling and goods that require redeployment elsewhere.
True
A target service level is the point where the expected cost of a shortage equals the expected cost of having excess units
True
A third party logistics provider is a company that provides services when another firm decides to completely outsource the logistics function.
True
Companies do NOT plan to use safety stock
True
Cross-docking is essentially the reverse procedure from consolidation warehousing.
True
Cycle stock can occur at more than one point in a supply chain
True
Decreases in the standard deviation of demand reduce the amount of safety stock that should be held
True
For the average manufacturer, over 50% of the value of shipments comes from materials
True
In order for the economic order quantity model to work, demand must be known and constant
True
In order for the weighted center of gravity method to yield an optimal solution all of the transportation costs in the area must be identical.
True
In order to find the lowest cost ordering policy in a quantity discount model, you must compare the holding cost, ordering cost, and the cost of goods for various order quantities.
True
In the United States, the value of goods transported via highway is greater than the value of goods transported by all other transportation modes.
True
Money is automatically drawn from the buyer's account and deposited into the supplier's account in an electronic funds transfer
True
Packaging is a logistics activity.
True
Portfolio Analysis begins with assignment to a quadrant before a sourcing strategy is formulated
True
Roadrailers are considered a multimodal solution when all of their capabilities are utilized.
True
The bullwhip effect says that a small change in the demand downstream in the supply chain causes a large chain in demand upstream
True
The difference between a contract carrier and a common carrier is that the common carrier handles shipments on a case-by-case basis while the contract carrier handles shipments based on long-term contracts.
True
The most detailed level of a logistics information system is the execution system.
True
The order quantity in a periodic review system rises as the on-hand inventory falls
True
The perfect order measures how effectively logistics serves the customer but the landed cost measures how efficiently logistics provides that service.
True
The perfect order measures how effectively logistics serves the customer while the landed cost measures how efficiently logistics provides that service. True False
True
The ratio of earning to sales for a given time period is a firms profit margin
True
The solution obtained from an assignment problem is an optimal answer to the problem of shipping goods from multiple sources to multiple destinations.
True
Total cost analysis divides cost into direct (costs that are tied to the level of operations and supply chain activities) and indirect ( costs that are not tied to the level of operations or supply chain activity)
True
Use of EDI in the supply chain has led to shorter lead times and lower inventory
True
When a preferred supplier does not exist, competitive bidding and negotiation are two methods commonly used for final supplier selection
True
A firm that is interested in consistent on-time delivery would probably design their transportation and warehousing system to include: A) air transportation with a spot stock warehouse. B) rail transportation with a consolidation warehouse. C) water transportation with a hub and spoke warehouse. D) pipeline transportation with a postponement warehouse.
a
Cargo is loaded and unloaded only once with: A) direct truck shipment. B) less-than-truckload shipment. C) multimodal solutions. D) None of these modes always has only one loading and unloading.
a
What percent of North American gross domestic product is accounted for by logistics? A) almost 8 percent B) almost 12 percent C) almost 16 percent D) almost 20 percent
a
Which of these statements about reverse logistics is BEST? A) Reverse logistics systems are usually less cost-efficient than forward-based systems. B) Reverse logistics systems are usually designed to be less flexible than forward-based systems. C) Reverse logistics systems usually play no role in customer satisfaction. D) Reverse logistics systems usually use the same processes and players that comprise the forward-based system.
a
This transportation mode is often the most expensive on a per pound basis. A) air B) rail C) water D) highway
a.
Which of the following is required in order to execute a successful spend analysis?
ability to analyze large quantities of data
Single sourcing is a better choice than multiple sourcing from the perspective of
access to the suppliers design and engineering capabilities
On the first day of class at a new university you made judgments about the quality of the class before the professor had entered the room. You noted the comfort of the accommodations, the fine works of art in the halls and on the classroom wall and the soothing music piped in over the sound system. This dimension of quality is:
aesthetic
Safety stock increases when
average demand increases
4) Using the map and annual volumes shown next to each location, what is the BEST location for a central warehouse that can be used to service all of the locations? A) Near (2,3) B) Near (3,2) C) Near (3,4) D) Near (4,3)
b
42 Acme wants to locate a warehouse to serve their major customers that are shown in the table. What is the location that will minimize the transportation costs for their family of products? A) Near (3,4) B) Near (4,5) C) Near (5,6) D) Near (6,5)
b
A logistics manager uses this type of system to select a carrier for an outgoing shipment or to develop a weekly schedule of deliveries. A) decision support B) planning C) execution D) operating
b
The mode of transportation that is highly cost effective for bulky items but has relatively poor delivery reliability and speed is: A) highway. B) water. C) rail. D) air.
b
Which of the following is a type of material handling equipment? A) 3PL B) ASRS C) LTL D) RFID
b
W. Edwards Deming's Fourteen Points for Management include:
break down barriers between departments.
A service firm that takes care of all of the logistics requirements for other companies is a: A) common carrier. B) contract carrier. C) third party logistics provider. D) freight forwarder.
c
Last year the Perfection Logistics Company delivered 3.1 million packages and damaged 45,000 deliveries, sent 28,000 to the wrong address, and was late 20,000 times. Their percent perfect order is: A) 93000 B) 3007000 C) 97% D) 93.7%
c
One form of warehousing that features light manufacturing and packaging duties and allows firms to put off final assembly or packaging until the last possible moment is: A) assortment warehousing. B) spot stock warehousing. C) postponement warehousing. D) pac-man warehousing.
c
The fireworks that were produced year-round in South Africa were sent to warehouses around the United States during the months of May and June in anticipation of large demand for the July 4th holiday. The warehousing system that is BEST suited to handle this situation is the: A) assortment warehouse. B) postponement warehouse. C) spot stock warehouse. D) break-bulk warehouse.
c
The transportation mode other than highway with the highest annual tonnage in the United States is: A) air. B) water. C) rail. D) pipeline.
c
The transportation mode with the highest dollar value of freight in the United States is: A) water. B) rail. C) highway. D) pipeline.
c
Universal Exports has several crates it needs to send from the United Kingdom to North Korea. They have located a firm that specializes in transferring cargo to the actual carrier that will bring the crates into North Korea. This firm could be described as: A) an interlocuter. B) a customs broker. C) a freight forwarder. D) a mercenary.
c
Which of the following is an example of consolidation warehousing? A) Large shipments from multiple suppliers are re-sorted into customized shipments to individual stores. B) A single manufacturer takes output directly from a single manufacturing plant and sends it directly to a single customer. C) A single manufacturer takes output from several of its manufacturing plants and combines them into one shipment to a major customer. D) A single manufacturer holds a wide array of goods close to the source of demand.
c
A quality perspective that focuses on whether or not a product was made or a service was performed as intended is the:
conformance perspective
Hub and spoke systems are characterized by: A) "spokes" that are represented by the sites that receive the goods. B) "hubs" that hold inventory until the appropriate season or upswing in demand. C) inventory locations that are close to producers, not customers. D) warehouses that are purely sorting facilities.
d
The drought of 2011 devastated hay crops in the plains states and horse owners ranged far and wide to purchase hay for their horses when winter arrived. Hay can be purchased "up north" for $4 a bale and a few entrepreneurs with large trailers were more than willing to pick up a few hundred bales and haul them south where demand was high. The transportation cost was $6 per bale and a packing and loading cost of $1 was typical. The landed cost of a bale of hay this winter was: A) $4. B) $6. C) $10. D) $11.
d
The most detailed level of logistics information systems is the: A) decision support system. B) planning system. C) material handling system. D) execution system.
d
Which of these is NOT a logistics activity? A) material handling B) inventory management C) warehousing D) inspection
d
Which of these statements about inventory management is BEST? A) Spot stock warehouses are more useful with less inventory in the system. B) A system using air transportation experiences higher costs due to higher levels of inventory. C) Cross-docking facilities don't need to match incoming and outgoing demand since they typically retain much of their inventory for a week or longer. D) A system using water and rail transportation tends to have higher levels of inventory.
d
Your new Garden Weasel fails to "completely satisfy" you so you decide to return it for a full refund. What is the name for the system that will carry your weasel back to the manufacturer? A) upstream logistics B) reverse ordering C) upstream ordering D) reverse logistics
d
A sourcing strategy in which two suppliers are used for the same purchased product or service is
dual sourcing
Appraisal costs cannot occur when a company has NOT produced any defective items.
false
Based on W. Edwards Deming's Fourteen Points for Management, we can safely conclude he would have been a strong advocate for a Zero Defects promotion.
false
For a perfectly centered process with normally distributed output, Six Sigma process quality translates to around 2 defects per trillion units produced.
false
If a contact lens has a scratch on it, the manufacturer classifies it as defective. This is an example of a continuous variable.
false
In the Zero Defects view of the total cost of quality, the minimum value of the total cost curve is closer to the y axis (the cost axis) than it is in the traditional view.
false
Inventory pooling occurs when a warehouse operator fails to complete shipments and is left with inventory that should be elsewhere. True False
false
Money spent training an employee how to do the job mistake-free is an example of an appraisal cost.
false
Producer's risk rises as consumer's risk rises
false
Six Sigma quality means that the difference between the upper and lower tolerance levels is six standard deviations wide
false
Statistical quality control is not an element of quality assurance.
false
The upper and lower limits of a control chart should be wider than the upper and lower tolerance limits.
false
With everything else held constant, a sampling plan with c=1 will have a lower producer's risk than a sampling plan with c=2
false
The two basic types of purchasing contracts are
fixed-price and cost-based
One advantage of outsourcing is that it:
increases the company's access to state-of-the-art products and processes
If demand increases by 100%, the average inventory held in a system governed by the EOQ model
is increased by 40%
Taguchi defines quality in terms of:
losses
Which of these is an indirect cost associated with in-sourcing?
maintenance
Competitive bidding, active sourcing, and using industry standards are all actions that are appropriate if the sourcing strategy is to
maximize commercial advantage
The use of supply chain partners to provide products or services is called:
outsourcing
A supplier that has previously demonstrated its performance capabilities through purchase contracts may well receive
preferred supplier status
Which of these is a direct cost associated with outsourcing?
price from invoice
The ratio of earnings to sales for a given time period is the
profit margin
A technique used to translate customer requirements into technical requirements is:
quality function deployment.
The ________ dimension of quality asks how long a product can go between failures or the need for maintenance.
reliability
A company using portfolio analysis correctly decides to streamline the purchasing process for a few items by use of EDI and automated requisitions to the greatest extent possible. The quadrant that these items fall in is most probably the:
routine quadrant
The purchasing team examined all of their purchasing patterns in order to identify any irregularities or possible areas of cost savings in a little scheme they liked to call:
spend analysis
When compared with single sourcing, multiple sourcing has the advantage of
spreading risk
Terms and conditions for a purchased service that indicates what service will be performed and how the service provider will be evaluated are called a
statement of work
The probability of rejecting a lot with quality better than the acceptable quality level is:
the producer's risk.
Inventory that is "in the pipeline" is
transportation inventory
An R chart is used to track how much the individual observations within a sample vary.
true
Joseph Juran's definition of quality as "fitness for use" is an example of the value perspective of quality.
true
Reductions in process variance result in higher process capability.
true
Taguchi's quality loss function runs counter to the notion that a product falling within tolerance limits is acceptable
true
The Dodo Corporation plans to launch two new products for this year, a blank eight track tape and a 5 floppy diskette. If both items are produced precisely to the specifications provided by the design engineers, then Dodo Corporation's operations function will achieve a high level of conformance quality.
true
Total Quality Management is the management of an entire organization so that it excels in all quality dimensions that are important to customers.
true
company interested in consistently achieving a high level of on-time delivery would be best served by the highway or air modalities of transportation. True False
true
An automobile windshield manufacturer wants to verify that their process is producing windshields of an appropriate thickness. The BEST tool to determine this information is a(n):
x chart
