Operations Management Quiz #1, Operations Management - Chapter 2 test bank, 17 osc, Operations MGMT exam 1
The fictional Taj Mahal Indian grocery store had sales of US$50,000 in August and US$62,000 in September. There are 10 full-time workers in the store, each of whom worked 40 hours a week. In August, the store also employed four part-time workers, each of whom worked 15 hours a week. In September, eight part-time workers were employed, each for 10 hours a week. Assuming there are four weeks in each month, and sales dollars are the output measure, what was the change in productivity from August to September? 30.46% 18.83% 26.58% 32.09%
18.83%
You run a medium-sized farming equipment repair firm in North Dakota. Your busiest season is the late fall through winter months when area farmers need repairs done to their equipment. Because you have limited cash flow, keeping extra people on your payroll is expensive and undesirable. You have determined that each worker must work 120 hours per month and you can repair an average of 42 machines each month. If their labor productivity rate is 0.175, how many workers can you employ at your company? 1.46 2.00 1.17 1.75
2.00
The following data were collected by Orion Industries Inc. (Auburn, WA) to compile the monthly productivity report to be presented to its board of directors. By using these data, compute partial machine productivity. Number of units produced 150000 Labor hours used 12000 Machine hours used 5000 Materials cost 50000 Energy cost 18000 30 27 32 25
30
110. Which of the following leads to simulation being a useful tool with uncertain activity times? A. paths that are not independent B. networks with each activity on only one path C. activity times that cannot be crashed D. noncritical paths that have no variability E. critical paths with activities with deterministic time estimates
A
47. A sequence of activities that leads from the starting node to the finishing node is called a: A. path. B. sequel. C. trail. D. critical sequence. E. time line.
A
49. A hierarchical listing of what must be done in a project is called a: A. work breakdown structure (WBS). B. PERT. C. planning matrix. D. crashing plan. E. critical path.
A
50. A method used for establishing a logical framework for identifying the required activities for the project is called: A. work breakdown structure. B. PERT. C. planning matrix. D. crashing. E. critical path analysis.
A
53. Concerning PERT and CPM: A. These are two different names for essentially the same technique. B. CPM tends to focus more on the critical path; PERT focuses on the parallel paths. C. PERT gives a clearer indication of activity slack, while CPM gives a better picture of path slack. D. Because of its recent discovery, much less is known about CPM than PERT. E. CPM is useful for project manager selection; PERT is useful for project team selection.
A
54. The advantage a precedence diagram has over a Gantt chart is: A. its ability to reveal relationships among activities. B. its difficulty in depicting networks. C. its complexity. D. its simplicity. E. its lack of riskiness
A
54. The advantage a precedence diagram has over a Gantt chart is: A. its ability to reveal relationships among activities. B. its difficulty in depicting networks. C. its complexity. D. its simplicity. E. its lack of riskiness.
A
60. Which of the following is determined as a direct result of computing the earliest starting and finishing times for the activities of a project network? A. expected project duration B. activity slack time C. which activities are on the critical path D. variance in project duration E. maximum project duration
A
68. When developing probabilistic estimates of project duration, it is necessary to know which of the following? A. the mean and variance of every activity B. the mean and variance of activities on the critical path C. the standard deviation of activities on the critical path D. each activity's probability of completion E. the distribution of activity times
A
77. Which of the following are limitations of PERT and CPM? (I) Time estimates may include a fudge factor. (II) Important activities may be overlooked. (III) It is an after-the-fact analysis. A. I and II B. I, II, and III C. I and III D. II and III E. I only
A
78. Which of the following is not a limitation of PERT and similar project-scheduling techniques? A. They force the manager to organize and quantify information. B. One or more important activities may be omitted from the network. C. Precedence relationships may not all be correct as shown. D. Time estimates may contain a "fudge factor." E. The use of a computer is essential for large projects
A
The manager of a carpet store is trying to determine the best installation crew size. He has tried various crew sizes with the results shown below. Based on productivity, what crew size do you recommend? 2 - 716 4 - 1298 3 - 1017 3 - 1002 4 - 1278 2 - 702 A. 2 B. 3 C. 4 A. 2
A. 2 Crews of two workers are most productive.
Gourmet Pretzels bakes soft pretzels on an assembly line. It currently bakes 800 pretzels each eight-hour shift. If the production is increased to 1,200 pretzels each shift, then productivity will have increased by: A. 50 percent. B. 33 percent. C. 25 percent. D. 67 percent.
A. 50 percent. Divide the difference in productivity by the original productivity.
Suppose a country's productivity last year was 84. If this country's productivity growth rate of 5% is to be maintained, this means that this year's productivity will have to be _______.
A. 88.2 Multiply 84 by 1.05 and then subtract 84 from this product
Which of the following would be least important in the pursuit of a time-based strategy? A. cost minimization B. quick changeover times C. operational agility D. reduced complaint resolution times E. flexible technology
A. cost minimization Many means for minimizing cost would have the effect of making a time-based strategy less feasible.
With regard to operations strategy, organization strategy should, ideally, take into account: A. Remove communications barriers within organizations. B. Minimize attention to the operations function. C. Put less emphasis on short-term financial results. D. Recognize labor as a valuable asset and act to develop it. E. Improve quality.
A. operations' strengths and weaknesses. Formulation of organization strategy should take into account the realities of operations' strengths and weaknesses, capitalizing on strengths and dealing with weaknesses.
Which of the following is least likely to affect the cost an organization incurs in producing its products or services? A. price B. productivity C. location D. quality E. inventory management
A. price Relative to the other choices, price is least likely to affect cost.
Product design and choice of location are examples of _______ decisions. A. strategic B. tactical C. operational D. customer-focused E. design
A. strategic These decisions are made high in the hierarchy.
Business organizations consist of three major functions which, ideally: A. support one another B. are mutually exclusive C. exist independently of each other D. function independently of each other E. do not interface with each other
A. support one another
A firm pursuing a strategy based on customization and variety will tend to structure and manage its supply chain to accommodate more _____________ than a firm pursuing a strategy based on low cost and high volume. A. variation B. streamlined flow C. quality D. capacity E. productivity
A. variation Customization and variety lead to variation that must be accommodated.
A productivity increase in one operation that does not improve overall productivity of the business is not A. worthwhile. B. trivial. C. competence-destroying. D. an order winner. E. an order qualifier.
A. worthwhile. Only system-wide productivity improvement makes the organization more productive.
Udupi, a fictional catering service, prepares and serves meals at wedding receptions, anniversary celebrations, and birthday parties. The data in the following table provide the company's labor and material usage for the past four weeks for various events. The labor cost is US$10 per hour. Based on multifactor productivity which event is the least productive service? Wedding reception Graduation party Birthday Party Anniversary Celebration
Anniversary Celebration
109. Which of the following is not characteristic of good risk management? A. estimating the likelihood of chance events occurring B. planning to eliminate chance events C. identifying potential chance events D. formulating contingency plans for chance events E. analyzing the consequences of chance events
B
38. In the execution phase of a project's life cycle, activities are guided by decisions that were made in the __________ phase. A. initiating B. planning C. monitoring/controlling D. closing E. assessment
B
39. Which of the following is not one of the six key decisions in project management? (I) Selecting the project team (II) Deciding on the project manager's title (III) Managing and controlling project resources (IV) Deciding which projects to implement (V) Selecting the project manager A. I B. II C. III D. IV E. V
B
57. Shortening activity durations is called: A. expediting. B. crashing. C. vendor management. D. null nodes. E. trade-off analysis.
B
67. The basis for use of the beta distribution in PERT is: A. essentially theoretical. B. its features that make it attractive in practice. C. its symmetry. D. It is bimodal. E. It can easily be converted to a normal distribution.
B
69. A PERT/CPM activity has an optimistic time estimate of three days, a most likely time estimate of eight days, and a pessimistic time estimate of 10 days. The expected time (in days) of this activity is: A. 7.0. B. 7.5. C. 8.0. D. 8.5. E. 10.0.
B
71. There are four activities on the critical path, and they have standard deviations of 1, 2, 4, and 2 days. The standard deviation of the critical path is: A. 3. B. 5. C. 9. D. 16. E. 25.
B
79. Gantt charts are most closely associated with A. JIT. B. PERT. C. MRP. D. MRPII. E. Six Sigma.
B
The weekly output of a fabrication process is shown below, together with data for labor and material inputs. Standard selling price is $125 per unit. Overhead is charged weekly at the rate of $1,500 plus .5 times direct labor cost. Assume a 40-hour week and an hourly wage of $16. Material cost is $10 per foot. What is the average multifactor productivity? A. 1.463 B. 1.457 C. 1.431
B. 1.457 Calculate multifactor productivity for each week, then average the two.
The Balanced Scorecard is a useful tool for helping managers translate their strategy into action in the following areas: A. Sustainability; Flexibility; Efficiency; Technology B. Customers; Financial; Internal Business Processes; Learning and Growth C. Customization; Standardization; Efficiency; Effectiveness D. The Environment; The Community; Suppliers; Other Stakeholders E. Strategy; Tactics; Productivity; Profitability
B. Customers; Financial; Internal Business Processes; Learning and Growth These are the four core areas addressed by the Balanced Scorecard.
Which of the following is not typically considered a cure for poor competitiveness? A. Remove communications barriers within organizations. B. Minimize attention to the operations function. C. Put less emphasis on short-term financial results. D. Recognize labor as a valuable asset and act to develop it. E. Improve quality.
B. Minimize attention to the operations function. Operations is a prime area for improving competitiveness.
Which of the following is not among the chief reasons organizations fail? A. overemphasis on short-term financial performance B. emphasizing labor productivity in labor-intensive environments C. poor internal communications D. not investing in capital and human resources E. overemphasis on product (or service) design
B. emphasizing labor productivity in labor-intensive environments In labor-intensive environments, emphasizing labor productivity is a good idea.
For firms competing in worldwide markets, conducting ______________ is more complex, since what works in one country or region might not work in another. A. productivity analysis B. environmental analysis C. strategy implementation D. sustainability analysis E. growth forecasting
B. environmental analysis Environmental analysis takes into account the relevant factors in the environment; there are more of these if there are more markets to consider.
Scheduling personnel is an example of an operations management: A. mission implementation. B. operational decision. C. organizational strategy. D. functional strategy. E. tactical decision.
B. operational decision. Staffing-level decisions are made low in the hierarchy.
Manufacturing work sent to other countries is called: A. downsized B. outsourced C. internationalization D. vertical integration E. entrepreneurial ship
B. outsourced
The ratio of good output to quantity of raw material input is called A. nondefective productivity. B. process yield. C. worker quality measurement. D. total quality productivity. E. quantity/quality ratio.
B. process yield. This is sometimes a useful productivity measure in service industries.
111. Which of the following is not an element of the project management triangle? A. cost B. schedule C. resources D. quality E. performance objectives
C
41. Project risk events tend to be unlikely __________ a project, but that's also when they tend to be the __________. A. early in; most costly B. late in; least costly C. late in; most costly D. before the beginning of; most complex E. at the conclusion of; least complex
C
43. Project management differs from management of more traditional activities mainly because of: (I) its limited time frame. (II) its unique, defined set of activities. (III) the requirement for use of the appropriate resources. (IV) the need for planning and execution. A. I B. II C. I and II D. I and III E. I, II, and IV
C
48. Which of the following is not typically treated as part of a project life cycle? A. feasibility assessment B. planning C. maturity D. release resources E. project staffing
C
51. A popular visual tool for planning and scheduling simple projects, and for monitoring progress, is the: A. activity-on-arrows network. B. activity-on-nodes network. C. Gantt chart. D. critical path method. E. program evaluation and review technique.
C
52. To _____ an activity means to shorten the time it will take. A. smash B. fund C. crash D. aggregate E. matrix
C
66. In the probabilistic approach to project network analysis, the time estimate annotated tm for any activity is the: A. mean time. B. median time. C. most likely time. D. mode time. E. marginal time.
C
70. Activity 4-5 in a network diagram has an optimistic time estimate of five days, a most likely time estimate of seven days, and a pessimistic time estimate of 10 days. Its expected time (in days) is approximately: A. 5. B. 6. C. 7. D. 8. E. 9.
C
72. There are four activities on the critical path. Coincidentally, their standard deviations are all equal to 4. The standard deviation of the critical path is therefore equal to: A. 2. B. 4. C. 8. D. 16. E. 64.
C
75. At which point does crashing of a project cease? A. when the project is completed B. when no additional crashing is possible C. when the cost to crash equals or exceeds the benefit of crashing D. when the project is one-half completed E. when the team has been disbanded
C
In an assembly operation at a furniture factory, six employees assembled an average of 450 standard dining chairs per five-day week. What is the labor productivity of this operation? A. 90 chairs/worker/day B. 20 chairs/worker/day C. 15 chairs/worker/day D. 75 chairs/worker/day E. 60 chairs/worker/day
C. 15 chairs/worker/day Divide the output of 450 chairs by the inputs of 30 worker-days.
Which of the following is true? A. Corporate strategy is shaped by functional strategies. B. Corporate mission is shaped by corporate strategy. C. Functional strategies are shaped by corporate strategy. D. External conditions are shaped by corporate mission. E. Corporate mission is shaped by functional strategies.
C. Functional strategies are shaped by corporate strategy. Corporate strategy shapes strategies at lower levels.
A 'product package' consists of: A. the exterior wrapping B. the shipping container C. a combination of goods and services D. goods if a manufacturing organization E. customer relations if a service organization
C. a combination of goods and services
For an organization to grow its market share, it must: A. advertise using multimedia. B. reduce prices. C. exceed minimum standards of acceptability for its products or services. D. establish an Internet Web site. E. broaden its mission statement.
C. exceed minimum standards of acceptability for its products or services. Only by exceeding standards can an organization grow its market share.
The key to successfully competing is understanding what customers want and then __________ satisfy those wants. A. training production workers to B. finding suppliers who can C. finding the best way to D. designing products and services that E. hiring enough workers to
C. finding the best way to To successfully compete, two basic issues must be addressed: What do the customers want? What is the best way to satisfy those wants?
Operations management involves continuous decision-making; hopefully most decisions made will be: A. redundant B. minor in nature C. informed D. quantitative E. none of the above
C. informed
In the 1970s and early 1980s in the United States, organizations concentrated on: A. operations strategies. B. improving quality. C. marketing and financial strategies. D. revising mission statements. E. environmental issues.
C. marketing and financial strategies. This led to U.S. firms being not very competitive with regard to their operations.
Which of the following factors would tend to reduce productivity? A. improvements in workplace safety B. reductions in labor turnover C. more inexperienced workers D. reductions in the scrap rate E. less variety in the product mix
C. more inexperienced workers More inexperienced workers tend to be less productive.
The external elements of SWOT analysis are: A. strengths and weaknesses. B. strengths and threats. C. opportunities and threats. D. weaknesses and opportunities. E. strengths and opportunities.
C. opportunities and threats. Opportunities and threats relate to the organization and its external environment.
Years ago in the overnight delivery business, providing package tracking capability gave some firms a competitive advantage. Now, all firms must offer this capability simply to be in this line of business. This is an example of ______________ becoming ____________ over time. A. tactical implications; strategic B. strategic implications; tactical C. order winners; order qualifiers D. profitability factors; productivity factors E. order qualifiers; order winners
C. order winners; order qualifiers What is an order qualifier and what is an order winner changes over time.
Competitiveness doesn't include: A. productivity. B. effectiveness. C. profitability. D. operations strategy. E. operations management.
C. profitability. A company can be competitive relative to similar companies and still be unprofitable if the competitive environment is inherently unprofitable.
Which one of the following would not generally be classified under the heading of transformation? A. assembling B. teaching C. staffing D. farming E. consulting
C. staffing
Technology choices seldom affect: A. costs. B. productivity. C. union activity. D. quality. E. flexibility.
C. union activity.
113. Activity J has a duration of 7 and an earliest finish time of 21. If J's latest start time is 16, this must mean that J's slack is: A. 7. B. 4. C. 3. D. 2. E. 1.
D
40. One upside to terminating a project that is not going as well as planned is that: A. poorly performing project team members will be kept from causing trouble elsewhere. B. no additional costs will be incurred. C. poor project managers will be weeded out. D. resources can perhaps be put to better use elsewhere. E. project completion will be hastened
D
44. Which of the following would probably not involve the use of PERT? A. planning and constructing a new city hall B. developing an advertising campaign for a new product C. designing and constructing a subway system D. writing a poem E. preparing for the visit of a foreign dignitary
D
46. Which of the following is not a form of risk reduction in project management? A. backup system B. outsourcing C. risk sharing D. scenario analysis E. frequent monitoring of critical project dimensions in order to catch and eliminate problems earl
D
55. In a project network, the critical path is the sequence of activities which has the: A. most activities. B. most nodes. C. most events. D. longest duration. E. greatest variance.
D
64. Activity C has an early start time of 8, an early finish time of 12, a latest start time of 13, and a latest finish time of 17. Its slack is: A. 0. B. 1. C. 4. D. 5. E. 9.
D
65. Given this information about activity 3-4: ES = 10, EF = 15, LS = 16, and LF = 21, we can determine that the amount of slack associated with the activity is: A. 0. B. 1. C. 5. D. 6. E. 11.
D
73. The project management strategy of injecting additional resources in order to reduce the length of the project is called: A. expediting. B. rushing. C. panicking. D. crashing. E. loading.
D
74. In "crashing" a project, a manager will generally focus on activities which: A. are not on the critical path. B. are the least costly to crash. C. are costly to crash and are on the critical path. D. are on the critical path and are the least costly to crash. E. are the easiest to crash.
D
76. Which of the following are advantages of PERT and CPM? (I) It is visual. (II) It is automatically updated. (III) Activities that need to be watched closely can be identified. A. I and II B. II and III C. III only D. I and III E. I, II, and III
D
Unique attributes of firms that give them a competitive edge are called: A. functional strategies. B. Balanced Scorecards. C. supply chains. D. core competencies. E. sustainable initiatives.
D. core competencies. Core competencies can be translated into competitive advantage.
Measurements taken at various points in the transformation process for control purposes are called: A. plans B. directions C. controls D. feedback E. budgets
D. feedback
. Budgeting, analysis of investment proposals, and provision of funds are activities associated with the _______ function. A. operation B. marketing C. purchasing D. finance E. internal audit
D. finance
The fundamental purpose for the existence of any organization is described by its: A. policies. B. procedures. C. corporate charter. D. mission statement. E. bylaws.
D. mission statement. A mission statement is the organization's attempt to justify its existence.
Productivity is expressed as: .A. output plus input. B. output minus input. C. output times input. D. output divided by input. E. input divided by output.
D. output divided by input. Productivity is the ratio of outputs to inputs.
Increasing the service offered to the customer makes it more difficult to compete on the basis of: A. order qualifiers. B. customization. C. quality. D. price. E. flexibility.
D. price. More extensive service can be more costly, and more costly outputs make price-based strategies more difficult.
Where a firm locates would typically not affect that firm's: A. costs. B. convenience for customers. C. delivery times. D. strategy. E. transportation costs.
D. strategy. Typically, strategy dictates where firms will locate, rather than location dictating strategy.
Which of the following is not a reason for poor performance of our organization in the marketplace? A. placing too much emphasis on product/service design and too little on process design B. failing to take into account customer wants and needs C. putting too much emphasis on short-term financial performance D. taking advantage of strengths/opportunities, and recognizing competitive threats E. failing to monitor the external environment
D. taking advantage of strengths/opportunities, and recognizing competitive threats Taking advantage of strengths/opportunities and recognizing competitive threats would enable good performance.
112. If an activity is determined to be on the critical path, that means that unlike activities that are not on the critical path, it will affect project: A. direct costs. B. performance. C. quality. D. conflict. E. duration.
E
37. Which of the following stages is that one in which the project's expected costs, benefits, and risks are assessed? A. executing B. monitoring/controlling C. assessment D. planning E. initiating
E
45. Once a project is underway, the project manager usually is not responsible for effectively managing: A. the people. B. costs. C. resources. D. time. E. project priority.
E
56. Which of the following is not true about the use of dummy activities in project networking? A. They preserve the separate identities of activities. B. They clarify precedence relationships among activities. C. They have an activity time equal to zero. D. They have an activity time variance equal to zero. E. They are used in activities-on-nodes (AON) network diagrams
E
63. In project network analysis, "slack" refers to the difference between: A. observed and predicted times. B. optimistic and pessimistic times. C. mean and modal times. D. finish and start times. E. latest and earliest times.
E
__________ is generally used to facilitate an organization strategy that emphasizes low cost. A. Speed to market B. Flexibility C. Customization D. Sustainability E. Standardization
E. Standardization Standardization is a powerful means of achieving low-cost production.
Which of these factors would be least likely to affect productivity? A. methods and technology B. workers C. management D. product mix E. advertising
E. advertising Advertising could increase the value of the outputs, but it is less likely to affect productivity than these other factors.
Which of the following is not a type of operations? A. goods production B. storage/transportation C. entertainment D. communication E. all the above involve operations
E. all the above involve operations
Which of the following is not a key step toward improving productivity? A. developing productivity measures for all operations B. improving the bottleneck operations C. establishing reasonable goals for improvement D. considering incentives to reward workers E. converting bond debt to stock ownership
E. converting bond debt to stock ownership A firm's productivity is independent of its capital structure.
Time-based approaches of business organizations focus on reducing the time to accomplish certain necessary activities. Time reductions seldom apply to: A. product/service design time. B. processing time. C. delivery time. D. response time for complaints. E. internal audits.
E. internal audits. Internal audits have little to do with core value-adding efforts.
An organization's mission statement serves as the basis for: A. environmental scanning. B. core competencies. C. operating procedures. D. distinctiveness. E. organizational goals.
E. organizational goals. Organizations' missions serve as the broad underpinning for their goals.
Value added can be calculated by: A. average productivity gains over time. B. inputs divided by the outputs. C. outputs divided by the inputs. D. input plus output divided by two. E. outputs minus inputs.
E. outputs minus inputs. Value added represents the change in value of the original inputs.
Which of the following is not a factor that affects productivity? A. computer viruses B. design of the workspace C. use of the Internet D. standardizing processes E. product price
E. product price These don't lead to fundamental changes in operations.
Core competencies in organizations generally do not relate to: A. cost. B. quality. C. time. D. flexibility. E. sales price.
E. sales price. What a firm charges for its outputs is not a core competency. What it can charge, however, is potentially related to a core competency.
Which of the following is not a key factor of competitiveness? A. price B. product differentiation C. flexibility D. after-sale service E. size of organization
E. size of organization Competitiveness often has nothing to do with organization size.
A Swiss manufacturing company that operates two manufacturing plants—one in the United States and the other in India—shows the following results (all figures are in U.S. dollars). Compute the multifactor productivity measure using all inputs. Which country has the higher productivity?US IndiaSales 2500000 1800000Labor 450000 350000Raw material 170000 120000Capital equipment 360000 200000
India
Orion Tile & Marble Inc. (Anaheim, CA) supplies and installs ceramic tiles. The company tracks its workers' output over the past several weeks, and the data are as follows. In which week was labor productivity the highest? Week Number of Workers Tiles Installed 1 5 120 2 4 4 112 3 4 3 88 4 3 2 69 5 2 2 44 6 5 5 115 7 2 2 54 A. Week 2 B. Week 6 C. Week 1 D. Week 7
Week 2
