Upgrade to remove ads
Only $35.99/year

BU225 Midterm Study

Terms in this set (61)

The role of operations includes all of the following except
- convert inputs into outputs.
- create demand.
- serve as a technical core.
- create value.
Create Demand
The scientific management era involves all the following concepts except
- moving assembly line.
- time and motion studies.
- interchangeable parts.
- standardized work methods.
Interchangeable Parts
The balanced scorecard examines a firm's performance in all the following critical areas except
- customers.
- finances.
- processes.
- competitors.
Competitors
What are key elements of the division of labour?
- The production process is broken down into a series of small tasks.
- Small tasks are performed by different workers.
- The specialization of the workers on limited, repetitive tasks allows them to become very proficient at those tasks.
- All of the above.
All of the above
The _________________ distribution is most often associated with the arrival rate.
- Beta
- Poisson
- negative exponential
- normal
Poisson
Given an arrival rate of 20 and a mean service rate of 25 customers per hour, what is the probability that a customer will not have to wait to be served?
- 20%
- 25%
- 75%
- 80%
20%

p= 1 - (20/25) = 20%
Given an arrival rate of 20 and a mean service rate of 25 customers per hour, what is the average number of customers in the waiting line?
(#)
3.2

Lq = 20*20/[25(25-20)] = 3.2
Given an arrival rate of 20 and a mean service rate of 25 customers per hour, what is the average number of customers in the system?
(#)
4

L = 20/(25-20) = 4
Prevention costs include
- Quality Planning Costs
- Product Design Costs
- Information Costs
- All answers are correct
All of the above
The cost of poor quality can be categorized as
- not important as it is part of doing business.
- external failure costs and loss of profitability.
- appraisal and prevention costs.
- internal failure costs and external failure costs.
Internal failure costs and external failure costs
Recording the number of defects resulting from different causes is known as a
- Pareto analysis.
- check sheet.
- histogram.
- cause-and effect diagram.
Check Sheet
All of the following improve the QPR (quality-productivity ratio) except
- increasing the production rate.
- increasing product yield.
- reducing rework costs.
- reducing processing costs.
Increasing the production rate
Pluto Inc. manufactures low-cost water features at a processing cost of $70 per unit. The company produces 100 units per day and averages 80% good quality resulting in 20% defective items. Fifty percent of the defective units are reworked prior to shipment to Pluto's distribution center. What is the product yield?
- 90
- 95
- 85
- 80
90

Yield = 1000.80 + 200.50 = 90
Pluto Inc. manufactures low-cost water features at a processing cost of $70 per unit. The company produces 100 units per day and averages 80% good quality resulting in 20% defective items. Fifty percent of the defective units are reworked prior to shipment to Pluto's distribution center. The rework cost is $20 per unit. The quality productivity ratio (QPR) is
- approximately 2.00.
- approximately 1.75.
- approximately 1.50.
- approximately 1.25.
1.25

QPR = 90/($7000 + $200)*100 = 1.25
A relationship between a firm and its supplier where the supplier agrees to meet the firms' quality standards and the firm enters into a long-term purchasing agreement with the supplier is known as
- partnering.
- outsourcing.
- vertical integration.
- conformance.
Partnering
Which of the following quality tools displays major causes of poor quality on a graph?
- Histogram
- Process flow chart
- Fishbone diagram
- Scatter diagram
Fishbone diagram
Which of the following quality tools displays the frequency of data related to a quality problem?
- Process flow chart
- Fishbone diagram
- Histogram
- Scatter diagram
Histogram
Which of the following statements about the voice of the customer is not correct?
- Customers who "like" Walmart on Facebook are four times more likely to buy there than the average person.

- Over four out of five of consumers consult online reviews prior to their holiday purchases.

- The vast majority of consumers trusts peer recommendations, but only a small minority trusts advertisements.

- On average, satisfied customers will tell more people on social media about their experiences than an unsatisfied customer will tell.
- On average, satisfied customers will tell more people on social media about their experiences than an unsatisfied customer will tell.
A process is generally said to be in control if
- there are no sample points outside the control limits.
- most points are near the process average.
- approximately equal numbers of sample points occur above and below the centre line.
- all of these answer choices are correct.
All of the above
Consider a production process that produces computers. A technician has taken 10 samples each containing 200 computers. The total number of defective units observed over the 10 samples is 100. The UCL for the control chart constructed using 2-sigma is
- 0.050.
- 0.006.
- 0.094.
- 0.150.
0.094

UCL = 0.05 + 2 SQRT(.05 .95 / 100)*2 = .094
Consider a production process that produces computers. A technician has taken 10 samples each containing 200 computers. The total number of defective units observed over the 10 samples is 100. The LCL for the control chart constructed using 2-sigma is
- 0.094.
- 0.150.
- 0.006.
- 0.050.
0.006

LCL = 0.05 - 2SQRT(.05.95/100)*2 = .006
Consider a production process producing cars. A quality manager has taken 25 samples each containing one observation. The total number of defects reported across the 25 samples is 200. The UCL for a control chart constructed using 3-sigma is
- 16.49.
- 10.83.
- 13.66.
- 8.00.
16.49

UCL = 8 + 3*SQRT(8) = 16.49
In constructing a p-chart where the average proportion defective rate is 8 percent and the sample size is 50, what is the standard deviation?
- 3.84
- 1.6
- 0.0384
- 0.0732
0.0384

Standard deviation = SQRT(.08*.92/50) = 0.0384
A company produces a product which is designed to weigh 5 oz., with a tolerance of + 0.04 oz. The process produces products with an average weight of 5.02 oz. and a standard deviation of 0.010 oz. The process capability ratio for this process is
- 1.17.
- 1.33.
- 1.00.
- 1.50.
1.33

Process capability ratio = 0.8/.6 = 1.33
A company produces a product which is designed to weigh 5 oz., with a tolerance of + 0.04 oz. The process produces products with an average weight of 5.02 oz. and a standard deviation of 0.010 oz. The process capability index for this process is
- 2.00.
- 0.67.
- 0.00.
- 1.50.
0.67

Process capability index
= MIN{((5.04 - 5.02)/.03),((5.02 - 4.96)/.03)}
= MIN{0.67,2.0}
= .67
Elon Corporation manufactures parts for an aircraft company. It uses a computerized numerical controlled (CNC) machining centre to produce a specific part that has a design (nominal) target of 3.244 cm with tolerances of ± 0.061 cm. The CNC process that manufactures these parts has a mean of 3.259 cm and a standard deviation of 0.020 cm.
Which of the following statements is true concerning the process capability ratio and process capability index?

- The process is off center and incapable.
- The process is capable, but off center.
- The process is centered, but incapable.
- The process is capable and centered.
The process is capable, but off center.
Outsourcing and offshoring have impacted which era of operations management?
- quality revolution
- globalization
- internet revolution
- operations research
globalization
All of the following are responsibilities of operations managers except
- acquiring financial resources.
- scheduling production.
- planning production.
- managing inventories.
acquiring financial resources.
Pluto Inc. manufactures low-cost water features at a processing cost of $70 per unit. The company produces 100 units per day and averages 80% good quality resulting in 20% defective items. Fifty percent of the defective units are reworked prior to shipment to Pluto's distribution center. The rework cost is $20 per unit. If production is increased to 200 units per day the quality productivity ratio (QPR) is
- approximately 2.00.
- approximately 1.25.
- approximately 1.50.
- approximately 1.75.
approximately 1.25

QPR = 180/($14000 + $400)*100 = 1.25
The probability that a product will operate properly within an expected time frame is the dimension of quality known as
- reliability.
- serviceability.
- durability.
- performance.
Reliability
Which of the following process choices is characterized by one-at-a-time production of a unique product?
- batches
- continuous
- mass
- projects
Projects
______________ production is used for producing very high volumes of commodity products.
- Mass
- Continuous
- Craft
- Batch
Continuous
Which of the following is not one of the factors managers consider in their outsourcing decision?
- capacity
- quality
- quantity
- cost
Quantity
Blitz is a small company that manufactures skateboards. They are introducing a new skateboard that they anticipate selling for $120. The estimated fixed cost for equipment is $3,000 and the estimated material and labour cost is $60. What volume of demand is needed for Blitz to breakeven?
- 70
- 60
- 80
- 50
50

BE = 3000/(120 - 60) = 50 skateboards
Blitz is a small company that manufactures skateboards. They are introducing a new skateboard that they anticipate selling for $120. The estimated fixed cost for equipment is $3,000 and the estimated material and labour cost is $60. The owner of the company predicts strong sales and is interested in upgrading the proposed equipment. The fixed cost for the proposed equipment is $6,000 and the estimated material and labour cost is $30. Determine the point of indifference.
- 400
- 200
- 300
- 100
100

3000 + 60v = 6000 + 30v; v = 100 skateboards
A process flowchart
- includes only productive activities.
- shows the parent-component relationship in a product.
- is derived from a floor plan of the facility.
- traces the path of a product through a production process.
traces the path of a product through a production process.
A print shop is an example of which of the following process choices?
- mass production
- continuous production
- batch production
- project
batch production
Steel, paper, paints, and chemicals are examples of products that use
- batch production.
- continuous production.
- mass production.
- repetitive production.
continuous production.
A company is evaluating which of two alternatives should be used to produce a product that will sell for $35.00 per unit. The following cost information describes the two alternatives:

PROCESS A
Fixed Costs ___________________________________$500,000
Variable Cost per Unit ____________________$25.00

PROCESS B
Fixed Costs ___________________________________$750,000
Variable Cost per Unit ____________________$23.00

What is the breakeven volume for PROCESS A (In units)
50,000 Units

= (500,000)/(35-25)
=50,000
All the following are factors influencing the outsourcing decision except
- capacity.
- quality.
- expertise.
- product variety.
product variety.
Expanding capacity to coincide with average expected demand is known as a(n)
- coincidental strategy.
- average capacity strategy.
- capacity lead strategy.
- capacity lag strategy.
average capacity strategy.
A(n) ______________ strategy expands capacity in anticipation of demand growth.
- capacity lag
- incremental capacity
- capacity lead
- average capacity
capacity lead
Which of the following is not true regarding economies of scale?
- Operating efficiency increases as the number of units increases.
- Operating efficiency decreases as the number of units increases.
- Quantity discounts become available as the number of units increases.
- Fixed costs can be spread over a larger number of units.
Operating efficiency decreases as the number of units increases
Increasing capacity in response to an increase in demand reflects a _________ strategy.
- capacity lag
- capacity lead
- average lead
- average capacity
Capacity lag
A _____________ layout arranges activities in line according to the sequence of operations.
- hybrid
- fixed position
- process
- product
product
A pizza assembly line consists of three workstations (WS) with each station's activity time as shown.

WS 1 (3 min) -----> WS 2 (4 min) -----> WS 3 (2 min)

What's the flow time for items in this line would be?
9 min

3+4+2 = 9
A pizza assembly line consists of three workstations (WS) with each station's activity time as shown.

WS 1 (3 min) -----> WS 2 (4 min) -----> WS 3 (2 min)

The actual cycle time for this line is
4 min

Take largest value out of all options.
Pratt's Department Store is opening a new store in The Centre's Mall. Customer movement tracked in its existing stores is shown below. Which layout for Pratt's new store on a 2 × 3 grid that will minimize non-adjacent customer movement.

(SEE ASSIGNMENT 2 QUESTION 18)
| B | G | H |
| M | W | I |
A company wants to produce 150 units during a 7-hour day. The desired cycle time needed to achieve this level of output is
- 2.8 minutes.
- 3.5 minutes.
- 3.00 minutes.
- 3.25 minutes.
2.8 minutes.

Convert hours into minutes
7*60
=420
420/150
=2.8
Because of increased technological advances, employees are expected to
- be better educated.
- have more skills.
- take on greater responsibilities.
- all of these answer choices are correct.
All of the above
All of the following have been shown to improve motivation except
- satisfaction of employee needs.
- work responsibility.
- achievement of company goals.
- frequent restructuring of jobs.
frequent restructuring of jobs.
Allowing employees more control over their own work and some of the supervisory responsibilities is called
- vertical job enrichment.
- horizontal job enrichment.
- vertical job enlargement.
- horizontal job enlargement.
vertical job enlargement.
The objective of ergonomics is to
- develop comfortable chairs for employees.
- make jobs easier with less fatigue and stress.
- make sure a job meets safety and health requirements.
- all of these answer choices are correct.
All of the above
The direct labour times required to produce the first four units of a new product are shown below:

UNIT NUMBER // DIRECT LABOUR HOURS
1 // 1,000
2 // 900
4 // 810
8 // 792

Based on this data the estimated learning or improvement rate is ____%
- 90%.
- 80%.
- 100%.
- 85%.
90%

Each time production doubles, only 90% of the direct labour hours are required.
All of the following are advantages of task specialization except
- minimal training.
- reduced boredom.
- increased output.
- lower labour costs.
Reduced Boredom
All of the following improve employee motivation except
- positive reinforcement and feedback
- effective organization and discipline
- setting of immoderate goals for employees
- satisfaction of employee needs
setting of immoderate goals for employees
The elements of job design include
- task analysis.
- worker analysis.
- environmental analysis.
- all of the above.
All of the above
Worker-machine chart determines
- if a job is done by a team of workers who are interacting with a piece of equipment or a machine.

- if capital for workers and machines is used effectively.

- if the steps of a job fit together into the overall flow of the production process.

- if worker and machine time is used efficiently.
if worker and machine time is used efficiently.
A company has accepted a contract to produce a special electric motor. The number of direct labour hours required to produce the first motor is 250. If an 85% learning curve applies to the production of motors, then the number of labour hours needed to produce the 4th motor is
- 180.6 hours.
- 212.5 hours.
- 0 37.5 hours
- 153.5 hours.
180.6 Hours

1st= 250
2ed= (250*0.85)=212.5
4th= (212.5*0.85)=180.6
Which of the following best completes the statement below?
The capacity lag strategy _______.
- expands capacity to coincide with average expected demand

- increases capacity after an increase in demand has been documented

- allows companies to respond to unexpected surges in demand and to provide superior levels of service during peak demand periods

- is used to lure customers from competitors who are capacity constrained or to gain a foothold in a rapidly expanding market
increases capacity after an increase in demand has been documented
What are the 4 areas of a Balanced Scorecard
1. finances
2. customers
3. processes
4. learning and growing
Other sets by this creator