## 90 terms

### All organizations including service firms such as banks, and hospitals, have a production function

TRUE

### OM is the set of activities that creates value in the form of goods and services by transforming inputs into outputs

TRUE

### Primary functions of all organizations

marketing, production/operations, and finance/accounting

### operations functions in commercial bank

teller scheduling, check clearing, maintenance, collection

### operations manager is involved in -

work scheduling to meet due dates, design of goods + services to satisfy customers, the quality of goods + services to satisfy customers, maintenance schedules

### On a specific project...

there can be multiple critical paths, all with exactly the same duration

### CPM networks

If a specific project has multiple critical paths, all of them will have the same duration

### Expected time calculated in PERT is

weighted average of a, m, b with m weighted 4x as heavily as a and b

### In a PERT network, non-critical activities that have little slack need to be monitored closely, why?

Because near critical paths could become critical paths with small delays in these activities

### c) Mean absolute deivation for the forecast developed using the 3 year moving ave is 2.59 and for the 3 year weighted moving ave is 2.79. based on this info the better forecast is achieved using which one?

3 year moving average approach.

### based on the comparison of MAD, the best forecast is achieved using the...?

Trend project method

### forecasts are usually classified by time horizon into three categories

short range, medium range, and long range

### a forecast with a time horizon of about 3 months to 3 years is typically called a

medium range forecast

### forecasts used for new product planning, capital expenditures, facility location or expansion, and R&D typically utilize a

long range time horizon

### forecasts are based on...

the assumption that the analysis of past demand helps predict future demand

### naïve approach

time series that assumes that demand in the next period will be equal to the most recent periods demand

### this time series model uses past forecasts and past demand data to generate a new forecast

exponential smoothing

### the following smoothing constants would make an exponential smoothing forecast equivalent to a naïve forecast

1

### the primary purpose of the mean absolute deviation (MAD) in forecasting is to

measure frequency accuracy

### for a given product demand, the time series trend equation is 53-4x. The negative sign on the slope of the equation is an indication that...

product demand is declining

### A fundamental distinction between trend projection and linear regression is that

in trend projection the independent variable is time, in linear regression the independent variable need not be time, but can be any varaible with explanatory power

### The last 4 weekly values of sales were 80, 100, 105, and 90 units. The last four forecasts were 60, 80, 95 and 75 units.

these forecasts illustrate BIAS

### This expresses the error as a percent of the actual values, undistorted by a single large value

MAPE

### trend analysis

regression with time as the independent variable, slope of the line is the trend, can forecast more then one period into the future

### expected value of perfect info

maximum increase in expected value if outcome is known in advance

### an occurrence or situation over which the decision maker has no control is called a(n)...

state of nature

### A tabular presentation that shows the outcome for each decision alternative under the various possible states of nature is called a...

payoff table

### The decision criterion that would be used by an optimistic decision maker solving a problem under conditions of uncertainty would be the...

maximax critertion

### A decision maker who uses the maximin criterion when solving a problem under conditions of uncertainty is...

a pessimist

### The difference between the expected payoff under perfect information and the maximum expected payoff under risk is...

expected value of perfect info

### The number of defects after a hotel room cleaning (sheets not straight, smears on mirror, missed debris on carpet) should be measured using a(n)

c chart

### An x bar control chart was examined and no data points fell outside of the limits. Can this process be considered

no there could be a pattern, and the R chart must be checked

### Statistical process control charts display...

upper and lower limits for process variables or attributes, and signal when a process is no longer in control

### Jars of pickles are sampled and weighed. Sample measures are plotted on control charts. The ideal weight should be...

x bar and r charts

### The usual purpose of an R chart is to signal whether there has been a ...

gain or loss in dispersion

### According to the text, the most common choice of limits for control charts is usually...

+ or - std dev

### The statistical process chart used to control the number of defects per unit of output is the

c chart

### A manufacturer uses statistical process control to control the quality of the firms products. Samples of 50 of product A

P chart for A, C chart for B

### A nationwide parcel delivery service keeps track of the number of late deliveries (more than 30 minutes past the time promised to clients) per day. WHAT CHART

C CHART

### acceptance sampling...

is used to determine whether to accept or reject a lot of material based on the evaluation of a sample

### An acceptance sampling plans ability to discriminate between low quality lots and high quality lots is described by

an operating characteristics curve

### An operating characteristics curve shows

how the probability of accepting a lot varies with the population percent defective

### An acceptance sampling plan is to be designed to meet the organizations targets for product quality and risk levels. Which of the following is true?

AQL, LTPD, α and β collectively determine n and c

### Utilization will always be lower than efficiency because

effective capacity is less then design capacity

### Adding a complementary product to what is currently being produced is a demand management strategy used when

The existing product has seasonal or cyclical demand

### While fixed costs are ordinarily constant with respect to volume

they can "step" upward if volume increases result in additional fixed costs

### Manufacturers may want to locate close to their customers, if the transportation of finished goods is expensive or difficult

TRUE

### The graphic approach to location break-even analysis displays the range of volume over which each location is preferable

TRUE

### this is not one of the top considerations in choosing a country for a facility location -

zoning regulations

### factor rating method

community attitudes, zoning restrictions, and quality of labor force are likely to be considered in this location decision methods

### factor rating analysis

This method considers intangible costs related to a location decision -

### On the crossover chart, where the costs of 2 or more location alternatives have been plotted, the quantity at which 2 cost curves cross is the quantity at which

total costs are equal to two alternative locations

### a regional bookstore chain is about to build a distribution center that is centrally located for its eight retail outlets. It will most likely employ this following tool analysis -

center of gravity model

### this is a location analysis technique typically employed by a manufacturing organization -

transportation method