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

Airline

Which of the following circumstances would make a level aggregate planning approach more attractive than a chase aggregate planning approach?

An increase in the time required to train new employees

What term is used to identify the difference between the number of units of an item listed on the master schedule and the number of firm customer orders?

Available to promise

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

Backordering costs

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

Chase strategy

Almost certainly you have seen vending machines being serviced on your campus and elsewhere. On a predetermined schedule the vending company checks each machine and fills it with various products. This is an example of which category of inventory model?

Fixed-time period model

Under what type of demand is yield management most effective?

Highly variable

What is the term used to refer to inventory while in distribution—that is, being moved within the supply chain?

In-transit inventory

What is the process used to ensure that all of the needs for a particular item are calculated at the same time in the MRP process?

Low-level coding

What are the three primary data sources used by the MRP system?

Master production schedule, bill-of-materials, inventory records file

Which scheduling process drives requirements in the MRP process?

Master production scheduling

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

Medium-range planning

What is the term for a more complex production strategy that combines approaches from more than one basic strategy?

Mixed strategy

What is another common name for the bill-of-materials?

Product structure tree

In a yield management system, pricing differences must appear logical and justified to the customer. What is the basis for this justification commonly called?

Rate fences

A process that helps firms provide better customer service, lower inventory, shorten customer lead times, stabilize production rates, and give top management a handle on the business.

Sales and operations planning

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

Short-range planning

What is the MRP term for the time periods used in planning?

Time buckets

In a typical inventory reordering scenario, if the lead time for delivery of the item increases, the __________ will need to be increased if stockout risk is to remain unchanged.

safety stock

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

Demand

MRP is based on what type of demand?

Dependent demand

To support the manufacture of desktop computers for their customers, Dell needs to order all the parts that go into the computer, such as hard drives, motherboards, and memory modules. Obviously the demand for these items is driven by the production schedule for the computers. What is the term used to describe demand for these parts?

Dependent demand

Firm A typically sees a learning percentage of 85 percent in their processes. Firm B has a learning percentage of 80 percent. Which firm has the faster learning rate?

Firm B

Owners of a local restaurant are concerned about their ability to provide quality service as they continue to grow and attract more customers. They have collected data from Friday and Saturday nights, their busiest times of the week. During these time periods about 75 customers arrive per hour for service. Given number of tables and chairs, and the typical time it takes to serve a customer, they the owners estimate they can serve on average about 100 customers per hour. Use Exhibit 5.6. During these nights, are they in the zone of service, the critical zone, or the zone of nonservice?

Critical zone