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Break-even analysis for the single-product case requires an estimation of fixed costs, variable costs, and: A. revenue. B. the percent of total dollar sales for each product. C. price. D. price, along with the percent of total dollar sales for each product.
A revenue
The person who introduced standardized, interchangeable parts was A. Eli Whitney. B. W. Edwards Deming. C. Frederick W. Taylor. D. Henry Ford.
A. Eli Whitney
The person who believed that management must do more to improve the work environment and processes so that quality can be improved was A. W. Edwards Deming. B. Walter Shewhart. C. Henry Ford. D. Eli Whitney.
A. W. Edwards Deming
Which of the following statements is NOT true? A. Adding flexibility to the production process can be a major competitive advantage. Building flexibility into a production process is usually inexpensive, but difficult. B. Selection of a particular process strategy requires decisions about equipment and technology. C. Selecting the best equipment requires understanding the specific industry and available processes and technology. D. The selection of equipment requires considering cost, cash flow, market stability, quality, capacity, and flexibility.
A. adding flexibility to the production process can be a major competitive advantage. building flexibility into a production process is usually inexpensive but difficult
The service sector constitutes what percentage of employment in the United States? A. between 80% to 90% B. between 60% to 70% C. between 50% to 60% D. between 70% to 80%
A. between 80-90%
The difference between selling price and variable cost is called: A. contribution. B. the bottleneck. C. fixed cost. D. the break-even point.
A. contribution
In manufacturing, excess capacity can be used to: A. do more setups, shorten production runs, and drive down inventory costs. B. do fewer setups, lengthen production runs, and drive down inventory costs. C. do fewer setups, shorten production runs, and drive down inventory costs. D. do more setups, lengthen production runs, and drive down inventory costs.
A. do more setups, shorten production runs, and drive down inventory costs
When making investment decisions using the net present value method, managers need to choose the investments with: A. higher net present values. B. higher revenues. C. lower costs. D. lower net present values.
A. higher net present values
Which of the following DOES NOT increase profit by improving quality? A. higher warranty costs B. improved reputation C. flexible pricing D. increased productivity
A. higher warranty costs
The capital investment each year in the United States usually: A. increases. B. remains constant. C. decreases unless favorably taxed. D. decreases.
A. increases
Productivity increases when: A. inputs decrease while outputs remain the same. B. outputs decrease while inputs remain the same. C. inputs increase while outputs remain the same. D. inputs and outputs increase proportionately.
A. inputs decrease while outputs remain the same
Which of the following approaches may use subcontracting to accommodate excess demand? A. lagging demand with incremental expansion B. Subcontracting should never be used to accommodate excess demand. C. leading demand with a one-step expansion D. leading demand with incremental expansion
A. lagging demand with incremental expansion
Which of the following approaches may use subcontracting to accommodate excess demand? Part 2 A. lagging demand with incremental expansion B. Subcontracting should never be used to accommodate excess demand. C. leading demand with a one-step expansion D. leading demand with incremental expansion
A. lagging demand with incremental expansion
Taguchi's quality loss function is based on a: A. quadratic equation. B. negative exponential distribution. C. binomial distribution. D. linear equation.
A. quadratic equation
Which of these statements accurately captures a current trend in operations? A. Rapid product development. B. Jobs are increasingly specialized as workers focus on basic assembly tasks. C. There is increased focus on local market and local competition. D. Mass production at the expense of product variety.
A. rapid product development
Which of the following costs is NOT a cost of quality? A. research and development B. lost goodwill C. scrap D. rework
A. research and development
Which of the following activities at an airline is NOT an operations activity? A. sales B. flying C. crew scheduling D. catering
A. sales
In general, the supply chain starts with: A. the provider of basic raw materials. B. research and development. C. a distributor. D. final customers at the retail store.
A. the provider of basic raw materials
Which of the following is NOT one of the four reasons that we study OM? A. We want to understand what marketing managers do. B. It is such a costly part of an organization. C. It is one of the three major functions of any organization. D. We want to know how goods and services are produced.
A. we want to understand what marketing managers do
What is an electronically guided and controlled cart used to move materials? A. AIS B. AGV C. RFID D. CNC
B. AGV
Which of the following organizations does NOT belong to the service sector? A. Costco B. Ford Motor Company C. San Diego Zoo D. Southwest Airlines
B. Ford Motor Company
The father of scientific management is A. Eli Whitney. B. Frederick W. Taylor. C. Henry L. Gantt. D. Henry Ford.
B. Fredrick W. Taylor
A process focus is: A. organized around products. B. a production facility organized around specific activities. C. a rapid, low-cost production system that caters to constantly changing unique customer desires. D. based on the classical assembly line.
B. a production facility organized around specific activities
Efficiency is given by: A. actual output divided by design capacity. B. actual output divided by effective capacity. C. design capacity divided by utilization. D. effective capacity divided by actual output.
B. actual output dividend by effective capacity
An investment that generates a series of uniform and equal cash amounts is referred as: A. future value. B. an annuity. C. net present value. D. cash flow.
B. an annuity
A successful quality strategy begins with: A. engaging employees in the necessary activities to implement quality. B. an organizational culture that fosters quality. C. an understanding of the principles of quality. D. satisfying customers and obtaining a competitive advantage.
B. an organizational culture that fosters quality
What is the time of the slowest workstation in a production system? A. effective capacity B. bottleneck time C. utilization D. throughput time
B. bottleneck time
What is a means of determining throughput capacity of workstations or an entire production system? A. throughput analysis B. capacity analysis C. theory of constraints D. effective capacity
B. capacity analysis
What is a drawing of the movement of material, product or people? A. RFID B. flowchart C. AIS D. process chart
B. flowchart
Which of the following is NOT a valid principle of bottleneck management? A. Release work orders to the system at the pace set by the bottleneck's capacity. B. Increasing the capacity of a non-bottleneck station increases the capacity for the whole system. C. Lost time at the bottleneck represents lost capacity for the whole system. D. Increasing the capacity of a non-bottleneck station is a mirage.
B. increasing the capacity of a non-bottleneck station increases the capacity of the whole system
Which of the following is NOT one of the factors that fosters specialization and worldwide supply chains? A. specialized expert knowledge B. marketing. C. instant communication D. cheaper transportation
B. marketing
What is a means of determining the discounted value of a series of future cash receipts? A. future value B. net present value C. cash flow D. variable cost
B. net present value
Which of the following is NOT a limitation of the net present value approach? A. Investments with the same net present value may have significantly different projected lives and different salvage values. B. Payments are assumed to be made at the beginning of the period, which is not always the case. C. The assumption is that we know future interest rates, which we do not. D. Investments with the same net present value may have different cash flows.
B. payments are assumed to be made at the beginning of the period, which is not always the case
What is a flowchart with time added on the horizontal axis? A. process chart B. process mapping C. CNC D. service blueprinting
B. process mapping
Which of the following is NOT an external failure cost? A. returned goods B. scrap C. lost goodwill D. costs to society
B. scrap
The economic activities that typically produce an intangible product are referred to as A. phantoms. B. services. C. products. D. goods.
B. services
The multiproduct case of determining the break-even point in dollars weights what by each product's proportion of sales? A. the fixed cost attributable to each product B. the contribution of each product C. the selling price of each product D. the variable cost of each product
B. the contribution of each product
The American Society for Quality defines quality as: A. how well a product fits patterns of consumer preferences. B. the totality of features and characteristics of a product or service that bears on its ability to satisfy stated or implied needs. C. the degree of excellence at an acceptable price and the control of variability at an acceptable cost. D. even though it cannot be defined, you know what it is.
B. the totality of features and characteristics of a product or service that bears on its ability to satisfy stated or implied needs
which of the following is an example of a "hidden" production function? A. assembling a motorcycle B. transplanting a liver C. producing a computer D. manufacturing a television
B. transplanting a liver
In many applications, human quality inspectors can be replaced effectively by: A. RFID tags. B. vision systems. C. automated storage and retrieval systems. D. FMS.
B. vision systems
What is the theoretical maximum output of a system in a given period under ideal conditions? A. effective capacity B. utilization C. design capacity D. efficiency
C design capacity
Stacked Restaurants lets customers choose ingredients for their sandwhiches using: A. playing cards. B. a moving conveyor belt. C. an iPad menu. D. a telephone at the table.
C. an iPad menu
Which of the following activities at a commercial bank is NOT an operations activity? A. check clearing B. maintenance C. auditing D. security
C. auditing
Which of the following is NOT considered to be a stakeholder? A. distributors B. community members C. competitors D. customers
C. competitors
Managing quality helps build successful strategies of: A. differentiation, time and response. B. differentiation, low cost and service. C. differentiation, low cost and response. D. differentiation, time and service.
C. differentiation, low cost and response
What does EMV stand for? A. expected machine valuation B. expected maintenance volume C. expected monetary value D. enterprise management valuation
C. expected monetary value
which of the following tasks would NOT typically represent an operations management activity at Hard Rock Cafe? A. designing an efficient layout B. receiving a shipment of incoming food ingredients C. filing a tax return D. preparing an employee schedule
C. filing a tax return
What is the ability to respond with little penalty in time, cost, or customer value? A. repetitive process B. mass customization C. flexibility D. postponement
C. flexibility
Which of the following statements is NOT true regarding production technologies? A. Robots are mechanical devices that use electronic impulses to activate motors and switches. B. Vision systems combine video cameras and computer technology and are often used in inspection roles. C. Flexible manufacturing systems and computer-integrated manufacturing are increasing the distinction between low-volume/high-variety and high-volume/low-variety production. D. CNC is machinery with its own computer and memory
C. flexible manufacturing systems and computer-integrated manufacturing are increasing the distinction between low-volume/high-variety and high-volume/low-variety production
When using EMV for capacity planning situations, the state of nature usually is: A. level of inflation or interest rates. B. average temperature or average rainfall. C. future demand or market favorability. D. wage rates or equipment costs.
C. future demand or market favorability
Which of the following could reduce costs and increase profit? A. improved response B. flexible pricing C. increased productivity D. improved reputation
C. increased productivity
Which operations function at a manufacturing facility strives for the efficient use of machines, space, and personnel? A. production and inventory control B. process analysis C. industrial engineering D. design
C. industrial design
Which of these is NOT one of the basic functions of the management process? A. controlling B. staffing C. inspecting D. leading
C. inspecting
Which of the following is NOT one of the reasons operations managers want to work with their supply chains to viciously cut inventories at every level? A. Inventory constrains response to ever-shorter product life cycles. B. Inventory hides quality issues. C. Inventory provides safety against higher-than expected demand. D. Inventory requires financial resources.
C. inventory provides safety against higher-than expected demand
Which of the following is the Japanese term used to describe continuous improvement efforts? A. kanban B. six sigma C. kaizen D. poka-yoke
C. kaizen
Which of the following approaches makes new capacity a larger increase at the beginning of the period? A. lagging demand with incremental expansion B. leading demand with incremental expansion C. leading demand with a one-step expansion D. attempts to have an average capacity that straddles demand with incremental expansion
C. leading demand with incremental expansion
The most aggressive and risky approach to capacity planning is: A. attempts to have an average capacity that straddles demand with incremental expansion. B. lagging demand with incremental expansion. C. leading demand with one-step expansion. D. leading demand with incremental expansion.
C. leading demand with one-step expansion
Which of the following trends is NOT part of the exciting OM challenges currently facing operations managers? A. sustainability B. rapid product development C. local focus D. supply chain partnering
C. local focus
Which of the following OM decisions determines how a good or service is produced and commits management to specific technology, quality, human resources, and capital investment? A. design of goods and services B. managing quality C. process and capacity design D. human resources and job design
C. process and capacity design
Low-volume, high-variety production is best suited for which of the following process strategies? A. mass customization B. product focus C. process focus D. repetitive focus
C. process focus
High-volume, low-variety production is best suited for which of the following process strategies? A. process focus B. repetitive focus C. product focus D. mass customization
C. product focus
the creation of goods and services is referred to as: A. transformation B. design C. production D. formation
C. production
Which of the following is NOT considered to be one of the three primary functions that all organizations perform? A. production/operations B. finance/accounting C. research and development D. marketing
C. research and development
Which of the following is a possible option to employ when demand exceeds capacity? A. temporarily lay-off workers B. increase advertising expenditures C. schedule long lead times D. lower prices
C. schedule long lead times
Which of the following does NOT contribute to OM? A. other disciplines including industrial engineering, statistics, management, and economics B. innovations from physical sciences C. unsystematic processing of data D. information technology
C. unsystematic processing of data
Which of the following is an award for quality achievement in Japan? A. Tokyo Medal for Excellence in Quality B. Malcolm Baldrige National Quality Award C. ISO 9000 D. Deming Prize
D. Deming Prize
Which of the following is NOT a tool for process analysis and design? A. process mapping B. process chart C. flowchart D. Pareto chart
D. Pareto chart
Which of the following is NOT an example of technology's impact on the financial services industry? A. Internet stock trading B. debit cards C. electronic funds transfer D. RFID
D. RFID
A global network of organizations and activities that supply a firm with goods and services is referred to as: A. production. B. operations management. C. business functions. D. a supply chain
D. a supply chain
The production process at Hard Rock Cafe does NOT include which of the following activities? A. placing raw materials in cold storage B. cooking C. receiving D. advertising
D. advertising
Which of the following is true regarding the concept of flexibility? A. It is the ability to respond with little penalty in time, cost, or customer value. B. It may be accomplished with digitally controlled equipment. C. It may involve modular or movable equipment. D. All of the above are true. E. None of the above is true.
D. all the above are true
Which of the following is an example of technology's impact on wholesale/retail trade industry? A. automatic toll booths B. interactive TV C. automatic teller machines D. bar-coded data
D. bar-coded data
What is a means of finding the point, in dollars and units, at which costs equal revenues? A. zero-sum analysis B. bottleneck analysis C. capacity analysis D. break-even analysis
D. break-even analysis
Which of the following best defines scheduling? A. Determines and implements long- and short-term schedules that effectively and efficiently utilize both personnel and facilities while meeting customer demands. B. Determines and implements intermediate- and short-term schedules that effectively and efficiently utilize personnel while meeting customer demands. C. Determines and implements long- and short-term schedules that effectively and efficiently utilize personnel while meeting customer demands. D. Determines and implements intermediate- and short-term schedules that effectively and efficiently utilize both personnel and facilities while meeting customer demands.
D. determines and implements intermediate- and short-term schedules that effectively and efficiently utilize both personnel and facilities while meeting customer demands
To develop a standard or benchmark, firms need to start with: A. forming a benchmark team. B. collecting benchmarking information. C. identifying benchmarking partners. D. determining what to benchmark.
D. determining what to benchmark
Which of the following is NOT one of the techniques for building employee empowerment? A. Build high-morale organizations. B. Develop open, supportive supervisors. C. Build communication networks that include employees. D. Eliminate formal organization structures such as teams and quality circles.
D. eliminate formal organization structures such as teams and quality circles
Which of the following is NOT among the ethical and social challenges facing operations managers? A. training, retaining, and motivating employees B. providing a safe workplace C. efficiently developing and producing safe high-quality green products D. increasing executive pay E. honoring stakeholder commitments
D. increasing executive pay
Which of these is NOT one of the 10 strategic OM decisions? A. scheduling B. layout strategies C. managing quality D. marketing
D. marketing
A large quantity and large variety of products are produced in: A. repetitive focus. B. product focus. C. process focus. D. mass customization.
D. mass customization
What is the typical goal of applying EMV to capacity decisions? A. Identify the most likely state of nature. B. Identify the least risky alternative. C. Identify the alternative with the highest potential payoff. D. Maximize the expected value of the alternatives.
D. maximize the expected value of the alternatives
A large percentage of the revenue of most firms is spent on which function? A. finance B. marketing C. research and development D. operations
D. operations
What is the fundamental rethinking of business processes to bring about dramatic improvements in performance? A. process strategy B. process analysis C. process design D. process redesign
D. process redesign
Which of the following statements is NOT true regarding process redesign? A. Effective process redesign works only if the basic process and its objectives are reexamined. B. Process redesign is also called process reengineering. C. Process redesign also focuses on those activities that cross functional lines. D. Process redesign is also called process reinvention.
D. process redesign is also called process reinvention
Which of the following is the fourth step in the theory of constraints? A. Develop a plan for overcoming the identified constraints. B. Focus resources on accomplishing the plan. C. When one set of constraints is overcome, go back and identify new constraints. D. Reduce the effects of the constraints by offloading work or by expanding capability.
D. reduce the effects of the constraints by offloading work or by expanding capability
Which of the following is NOT a production technology that enhances production and productivity? A. automatic identification systems B. process control C. vision systems D. service blueprinting
D. service blueprinting
Which of the following is NOT a characteristic of services? A. intangible B. produced and consumed simultaneously C. unique D. standardized product
D. standardized product
Which of the following capacity adjustment options applies to intermediate-range planning? A. add long lead time equipment B. schedule personnel C. allocate machinery D. subcontract
D. subcontract
Competition in the 21st century is no longer between companies; it is between: A. countries. B. individuals. C. technologies. D. supply chains.
D. supply chains
What is the goal for mass customization? A. The goal is to let operations managers work with their supply chain to viciously cut inventories at every level. B. The goal is to seek creative designs, efficient production, and high-quality goods via international collaboration. C. The goal is to enrich jobs and move more decision making to the individual contributor. D. The goal is to produce customized products, whenever and wherever needed.
D. the goal is to produce customized products, whenever and wherever needed
Which of the following is a requirement to be able to compute expected monetary value? A. each decision alternative needs at least two states of nature B. each state of nature is equally likely to occur C. the probability of each decision alternative is known D. the probability of each state of nature is known
D. the probability of each state of nature is known
Which of the following statements is NOT true regarding the process analysis tools? A. Service blueprinting is designed to help focus on the customer interaction part of the process. B. Process mapping is another name for time-function mapping. C. A process chart is different than a flowchart. D. Time-function mapping extends value-stream mapping to include suppliers.
D. time-function mapping extends value-stream mapping to include suppliers
A business's stakeholders, whose conflicting perspectives cause ethical and social dilemmas, include: A. employees. B. suppliers. C. owners. D. lenders. E. All of the above.
E. all the above
Process redesign: A. is the fundamental rethinking of business processes. B. is sometimes called process reengineering. C. often focuses on activities that cross functional lines. D. tries to bring about dramatic improvements in performance. E. All of the above.
E. all the above
Advances in technology: A. have failed to change the level of customer interaction with an organization. B. have had only a limited impact on services. C. have impacted the manufacturing sector only. D. have dramatically changed health care, but have not changed retailing. E. have had a dramatic impact on customer interaction with services and with products.
E. have had a dramatic impact on customer interaction with services and with products
Successful process redesign focuses on departmental areas where small, continuous improvements can be made. True/False
False
Ethical and social dilemmas arise because stakeholders of a business have conflicting perspectives. True/False
T
Optical checkout scanners and ATMs are examples of technology's impact on services. True/False
T
What term is given to those individuals with a vested interest in an organization, including customers, distributors, suppliers, owners, lenders, employees, and community members? A. investors B. stakeholders C. alumni D. stockholders E. vestors
b. stakeholders
Production technology has had a major impact on services, but as yet there has been little reduction in service labor requirements. true/false
false
When selecting new equipment and technology, decision makers look for flexibility—the ability to respond with little penalty in time, cost, or customer value. True/False
t
