Production & OPs. (FINAL EXAM)

What is the primary lever to reduce cycle​ inventory?

A. ****CORRECT**** reduce the lot sizes B. use flexible automation C. place orders closer to the time when they must be received D. improve demand forecasts

Input measures of capacity are preferred when there

. are​ high-volume processes. B. are service processes. C. is low customization. D.***CORRECT*** are flexible flow processes.

An enterprise process is a companywide process that cuts across

. functional areas. B. suppliers and customers. C. business units and geographic regions. D.***CORRECT**** All of the above.

_________ is a rule that allows a customer of higher priority to interrupt the service of another customer.

A scheduling discipline B. ​First-come-first-serve C.****CORRECT**** A preemptive discipline D. An emergency policy

For class C​ SKUs, why is much looser inventory control​ appropriate?

A stockout of a class C SKU is not as crucial as for a class A SKU. B. *****CORRECT**** The inventory holding cost of class C SKUs tends to be low. C. Class C SKUs tend to have very low demand. D. All of the above.

Which of the following elements are NOT common to​ waiting-line problems?

A. A service facility B. A waiting line of customers C. A priority rule D.***CORRECT**** A​ random-number generator

Which of the following is NOT a benefit of an MRP​ system?

A. Improvement in customer service B. Better utilization of labor and facilities C.***CORRECT**** Forecasting of​ finished-goods demand D. Reduction of inventory levels

An MRP system provides which of the following​ advantages?

A. Increased vertical integration. B.***CORRECT**** Automatic update of the dependent demand and replenishment schedules of components when parent schedules change. C. Smoothing of lumpy demand. D. Statistical forecast of component demand.

Which of the following is an example of dependent demand for manufactured​ goods?

A. Refrigerators B. Hotel rooms sold C.***CORRECT*** Hospital bed sheets D. ​Pick-up truck

Which of these statements is NOT required in order for the EOQ model to be a reasonable​ approach?

A. The demand rate is known and constant. B.***CORRECT**** The​ setup/ordering cost must exceed the annual holding cost of one unit. C. The lead time is known and constant. D. No constraints are placed on the size of each lot.

The Mickey and Mouse Cat Food Factory runs an aggressive marketing campaign and much to the​ delight, orders surge to twice their previous level. If their operations manager uses an EOQ​ policy, what is the impact on the order​ quantity?

A. The order quantity will be​ 70% higher. B.***CORRECT**** The order quantity will be​ 40% higher. C. The order quantity will double. D. The order quantity will be​ 50% lower.

Which of the following statements is true regarding master production​ scheduling?

A. The production quantities should be allocated efficiently over time. B. Capacity limitations and bottlenecks may determine the timing and size of MPS quantities. C. The sums of the quantities in the MPS must equal those in the sales and operations plan. D.***CORRECT**** All of the above are true.

Which statement about capacity requirements planning​ (CRP) is NOT​ true?

A. The purpose of CRP is to match the material requirements plan with the​ plant's production capacity. B.***CORRECT*** CRP systems adjust the order release time to prevent a workstation from exceeding its capacity. C. CRP systems enable the identification of​ "critical" workstations. D. CRP systems access inventory records to determine when planned orders or scheduled receipts will reach a workstation.

A component that has one or more parents and no components is most likely to be

A. a subassembly. B. an end item. C. an intermediate item. D.****CORRECT**** a purchased item.

A P system has an advantage over the Q system

A. because fixed lot​ sizes, if large​ enough, can result in quantity discounts. B. because the review frequency of each item may be individualized. C.****CORRECT**** because orders from multiple items from one supplier can be combined into a single purchase order. D. because lower safety stocks result in savings.

The service analogy to the bill of materials is the

A. bill of process. B. bill of sale. C. bill of service. D.***CORRECT*** bill of resources.

When evaluating alternative capacity​ decisions, qualitative concerns exclude

A. competitive reaction. B.***CORRECT*** cash flow. C. technology change. D. uncertainties about demand.

Waiting-line problems that cannot be studied with​ waiting-line models must be analyzed with which analytical​ tool?

A. decision trees B.***CORRECT*** simulation C. forecasting tools D. regression analysis

A form of shrinkage called​ ________ occurs when inventory cannot be used or sold at full​ value, owing to model​ changes, engineering​ modifications, or unexpectedly low demand.

A. deterioration B. ​life-cycle shrink C.****CORRECT**** obsolescence D. pilferage

The key inputs to an MRP include

A. engineering drawing of the product. B.****CORRECT**** inventory record database. C. process chart. D. personnel records.

Which of the following can put pressure on a company to carry small levels of​ inventory?

A. high ordering cost B.***CORRECT*** high cost of capital C. the potential for stockouts and backorders D. the need to increase workforce productivity

Which of the following inventory classifications is one of the four forms that represent how the inventory was​ created?

A. independent demand inventory B. raw material inventory C. service support inventory D.***CORRECT**** pipeline inventory

A perpetual inventory system requires that

A. inventory is constantly being produced. B. inventory is always in stock. C.*****CORRECT***** inventory records are always current. D. inventory is always on order.

Which of the following costs is NOT considered an inventory holding​ (or carrying)​ cost?

A. inventory storage costs B.****CORRECT**** inventory transportation costs C. inventory shrinkage costs D. inventory handling costs

The goal of determining the timing and size of MPS quantities is to

A. maximize​ on-hand inventory. B. minimize total inventory cost. C.***CORRECT*** maintain a nonnegative projected​ on-hand inventory balance. D. maintain positive available to promise.

The concept of dependent demand is

A. not applicable to service firms. B. not applicable to manufacturing firms. C.***CORRECT**** that demand for an item is a function of the production plans for some other item the company produces. D. that demand for an item is independent of the demand for all other items the company produces.

Matching the demand rate with the production rate is a primary lever to reduce

A. pipeline inventory. B. cycle inventory. C.****CORRECT**** anticipation inventory. D. ​work-in-process inventory.

Studies show that companies reap the greatest rewards with ERP when they

A. spend as little money on ERP training as possible. B. extensively customize their systems to fit their specific needs. C. work with a large number of software vendors. D. ****CORRECT**** keep their ERP implementations simple.

Which of the following is NOT considered a pressure to hold large​ inventories?

A. the cost of placing an order B. the potential to reduce stockouts C. the need to increase machine utilization D.****CORRECT**** the cost of insurance

A reorder point will fall if

A. the setup cost rises. B.***CORRECT**** the lead time falls. C. the chance of a stockout falls. D. the variance of demand rises.

The Bill of Resources​ (BOR) can be used to determine which of the​ following?

A. what resources a firm will need B. when resources will be needed by a firm C. how much of a resource a firm will need D.****CORRECT**** All of the above.

A visual version of the Q system

A. ****CORRECT**** is the​ two-bin system. B. is the P system. C. is the R system. D. is the ABC system.

In master production​ scheduling, what does projected​ on-hand inventory​ represent?

A. ***CORRECT**** an estimate of the amount of inventory available each week after demand has been satisfied B. the actual level of inventory that will be available at the beginning of each week C. an estimate of the amount of inventory available each week before booked orders have been satisfied D. None of the above.

Which of the following are NOT advantages of a periodic review​ system?

A.****CORRECT**** Lower safety stock B. Can permit combining orders to common suppliers C. Convenient administration of inventory control D. All of the above.

A​ _______ customer is one who enters the system and remains there until being served.

A.****CORRECT**** patient B. normal priority C. focused D. transactional

Which of the following is NOT a feature of an ERP​ system?

A.***CORRECT*** Identifying the actions planners must take to stay on schedule B. Updating of information in all modules C. Information entered as transactions D. Single database

Chang and Chang observe that the competition is increasing the size of its warehouses. They have decided to do the same. They are following​ _______ strategy.

A.***CORRECT*** a follow the leader B. a Theory of Constraints C. an expansionist D. a​ wait-and-see

Service providers must plan their resources just as manufacturers do.​ However, unlike finished​ goods, services cannot be

A.***CORRECT*** inventoried. B. provided on demand. C. resourced to serve all customers. D. All of the above.

In master production​ scheduling, what does​ available-to-promise (ATP) inventory​ represent?

A.***CORRECT*** the difference between the customer orders already booked and the quantity that operations is planning to produce B. the​ company's commitment to always hold finished goods in inventory C. inventory currently being shipped to all customers D. the difference between forecasted customer orders and the quantity that operations is planning to produce

Anna's landscaping business has a capacity​ gap; which alternative can best be described as​ "simply to do​ nothing"?

A.***CORRECT*** ​Base-case strategy B. ​Follow-the leader strategy C. ​Wait-and-see strategy D. Expansionist strategy

When is the customer population of a waiting line problem said to be​ infinite?

A.***CORRECT**** when the number of customers in the system does not affect the rate at which the population generates new customers B. ​never, since every population of potential customers is finite in number C. when the waiting line system can accommodate a very large number of customers in the queue D. when the number of potential customers is greater than 10

ERP revolves around a single comprehensive​ _________ that can be made available across the entire organization.

A.***CORRECT***A database B. set of policies C. set of modular applications D. All of the above.