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Indicate whether the statement is true or false.
1. Kaoru Ishikawa contends that 95 percent of the typical company’s quality problems can be solved by using “The Basic
Six” quality tools.
a. True
b. False
2. Job shops in manufacturing use specialized equipment.
a. True
b. False
3. Because the small business owner must perform many functions that consume many hours each day, it is acceptable
practice to decline a salesperson’s request for an appointment.
a. True
b. False
4. The terms repetitive manufacturing and mass production are synonymous.
a. True
b. False
5. Quality is best defined as the totality of features and characteristics of a product or service that impacts the firm’s
ability to satisfy stated or implied needs.
a. True
b. False
6. Only product firms have an operations process.
a. True
b. False
7. Flexible management systems uses machine automation to cut manufacturing costs while satisfying customer needs.
a. True
b. False
8. Weighing bags of mulch during a production process is an example of an variable inspection.
a. True
b. False
9. An example of associative forecasting is when a concert promoter predicts attendance based on the trend of attendance
of the same event in the same location in previous years.
a. True
b. False
10. Most companies run out of stock from incorrect ordering.
a. True
b. False
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11. When a company expands resources in response to a constraint, they are using the option of increasing efficiency.
a. True
b. False
12. For service firms, the customer has to arrive before production begins resulting in employee scheduling issues.
a. True
b. False
13. Outsourcing non-competitive functions can free the entrepreneur to focus on his/her greatest strengths.
a. True
b. False
14. Manufacturers with seasonal demand schedules often hire temps during peak production and keep only skeleton crews
the rest of the year.
a. True
b. False
15. The ideal quantity of an item to purchase is referred to as the economic order quantity (EOQ).
a. True
b. False
16. Poka-yoke is a proactive approach that seeks to mistake-proof a firm’s operations.
a. True
b. False
17. Acceptance sampling makes it possible to determine tolerance limits that allow for inherent variation due to chance.
a. True
b. False
18. Forrester Research has shown that using computerized information systems can cut accounts payable costs by 95%.
a. True
b. False
19. The simplest method of inventory record-keeping is called cycle counting.
a. True
b. False
20. The Supply Chain Operations Reference model is a list of five critical factors when assessing a strategic alliance.
a. True
b. False
21. When Kentucky Chocolates mixes ingredients for their candies, this act is part of operations.
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a. True
b. False
22. The quality of a finished product depends on the quality of the raw materials used to make it.
a. True
b. False
23. A genuine concern for customer needs and customer satisfaction can assist the TQM efforts of a small business.
a. True
b. False
24. A demand management strategy is the use of pagers by restaurants to notify persons on the waiting list that a table is
ready.
a. True
b. False
25. Firms who pay attention to operating details are stronger than those who empower their customers for quality
improvement.
a. True
b. False
26. Buying components is preferable to making them when it is necessary to protect a secret design for a seasonal item.
a. True
b. False
27. Continuous manufacturing refers to assembly lines that run 24 hours a day, seven days a week.
a. True
b. False
28. Obsolescence is a cost of inventory.
a. True
b. False
29. The cost of getting quality right may be more than a small business can bear.
a. True
b. False
30. Bottlenecks in a process are responsible for slower throughput times for the entire process.
a. True
b. False
31. Because close interactions with customers allow employees to better understand them, management should be sent in
the field periodically.
a. True
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b. False
32. Technology can adequately replace the human touch when the needs of the customer involve large amounts of data.
a. True
b. False
33. Event management companies use project manufacturing.
a. True
b. False
34. Cooperative purchasing organizations are firms that specialize in the purchasing function and provide this service to
small businesses.
a. True
b. False
35. The goal of lean production is to use the minimum amount of resources necessary to achieve a total bundle of
satisfaction for the customer.
a. True
b. False
36. Measuring quality in a service business is easier than measuring quality in a production business. All you have to do
is ask the customer.
a. True
b. False
37. In order to achieve market success, a firm merely needs to concentrate on either providing an excellent product or
service, or devising an insightful marketing strategy.
a. True
b. False
38. Powerful companies, whether they are large or small, gain power when satisfying customer needs and wants better
than their competitors.
a. True
b. False
39. The importance of purchasing rests on three areas: quality, service, and cost.
a. True
b. False
40. Operations refers to the processes used to create and deliver a good or service.
a. True
b. False
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41. While large corporations have access to data mining techniques for insights into customer buying patterns, small
companies typically cannot afford the software.
a. True
b. False
42. The just-in-time inventory system classifies inventory into three categories based on value.
a. True
b. False
43. Unless a firm is planning to market products in Europe or supply components to U.S. automakers, getting ISO 9000
certification is a waste of time and money.
a. True
b. False
44. Purchasing and inventory management share the same objective by contributing to profitable operations.
a. True
b. False
45. Work groups tend to be better at coordination than specialization.
a. True
b. False
Indicate the answer choice that best completes the statement or answers the question.
46. A category “C” item in the ABC method of inventory management for a college bookstore would be
a. pens.
b. magazines.
c. shirts.
d. textbooks.
47. Linda creates websites for her customers. Each one is designed to meet the specific needs of the customer. This type
of manufacturing is called:
a. continuous manufacturing.
b. flexible manufacturing.
c. project manufacturing.
d. repetitive manufacturing.
48. Repetitive operations in manufacturing use
a. general-purpose machines.
b. job-order schedules.
c. highly specialized equipment.
d. short production runs.
49. The most important reason why a small business should build good relationships with large suppliers is
a. forecasting can be made easier with the suppliers input.
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b. it will make the small business stand out from other firms buying from the supplier.
c. the need for the small business to have prices as low as possible on purchases.
d. the relationship can make the small business more competitive.
50. The ABC method of inventory management is founded on the notion that
a. some inputs are more valuable or more critical to the firm’s operations than others.
b. inventory costs should be cut to an absolute minimum by reducing inventory on hand.
c. a firm should know its economic order quantity at all times.
d. the cost of placing an order is a fixed cost.
51. Rather than rely on the bartender to use the correct proportions of ingredients in mixed drinks, the owner installed a
drink-mixing machine that automatically selects and measures the ingredients into the glass. This method is a type of:
a. idiot-proofing.
b. poka-yoke.
c. kan-ban
d. robotics.
52. If a small plumbing company is installing a TQM program, management should be aware that
a. quality must become a very important goal of the entire business.
b. ISO 9000 will be the controlling criterion.
c. costs cannot be allowed to limit quality goals.
d. acceptance sampling may be necessary.
53. The basic quality tool that Kaoru Ishikawa recognized that identifies potential causes of a problem while sorting them
into categories is the
a. check sheet.
b. cause-and effect diagram.
c. control chart.
d. parento chart.
54. Of the following, which is of greatest concern to a production manager?
a. a bottleneck
b. capacity waste
c. a constraint
d. overproduction
55. The approach that recognizes the assets and activities of the company are interdependent and should be managed so as
to maximize the company’s performance is
a. capacity management.
b. lean production.
c. synchronous management.
d. waste-less production.
56. Raj’s company can either make the components or buy them. He should decide to make the components rather than
buy them from a supplier
a. when utilization of plant capacity permits more economical production.
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b. when an outside supplier specializes in the production of that component.
c. if in-house operations can concentrate on the firm’s specialty—the finished product.
d. if the risk of equipment obsolescence can be transferred to the supplier.
57. Job shops are best suited for
a. short production runs.
b. long production runs.
c. special-purpose equipment.
d. standardized products.
58. Aaron operates a lemonade stand in the New York City’s Central Park. His business is seasonal but within those
seasons several other factor influence the demand for lemonade. Aaron is most likely to use _______________ to help
him predict demand on a daily basis.
a. associative forecasting
b. linear regression
c. historical sales data
d. the weather report
59. Terrell is trying to decide whether to concentrate his purchases with one supplier or diversify with two or three. One
factor in favor of a single supplier is:
a. insurance against interruptions caused by strikes.
b. a particular supplier’s superiority in product quality.
c. knowing the customer’s loyalty, the supplier may provide better prices and service.
d. locating the best source in terms of price, quality and service with each purchase.
60. Bobbi Jo pulls one part from the production line every 15 minutes and measures its dimensions against the
specifications. Bobbi Jo is using:
a. acceptance sampling.
b. a control chart.
c. statistical process control.
d. TQM.
61. Which aspect is the most descriptive of a product operations as opposed to a service operations?
a. Customer interaction
b. Created and delivered on demand
c. Intangible aspects
d. Repetitive operations
62. If a small fencing company wants to check the length of fence posts to determine if they are acceptable, a(n) ______
should be used.
a. poka-yoke.
b. an attribute inspection.
c. acceptance sampling.
d. a variable inspection.
63. Adoption of the just-in-time inventory system requires
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a. the elimination of raw materials wherever possible.
b. an emphasis on work in progress.
c. a reduction in the firm’s finished goods.
d. close cooperation with suppliers.
64. Duff’s Buffet offers a discount for lunches on Tuesdays. Duff’s is using
a. capacity planning.
b. a demand management strategy.
c. project marketing.
d. service inputs.
65. One factor that differentiates the operations of a service firm from manufacturing is its
a. operating space.
b. ability to maintain high quality standards.
c. inability to produce services and hold them in inventory.
d. working hours.
66. Ralph operates a computer-controlled machine. His jobs can be either large or small. To change the set up from one
product to another usually requires only a change in programming. This type of manufacturing is known as:
a. continuous manufacturing.
b. flexible manufacturing.
c. project manufacturing.
d. repetitive manufacturing.
67. A suggestion for increasing outsourcing success is
a. have a back-up plan in case of supplier failure.
b. outsource the unique product of the business.
c. periodically monitor the company’s progress.
d. negotiate for priority in the production schedule.
68. Cooperative purchasing organizations for small businesses are more successful now because of the:
a. acceptance of coops as a business model by suppliers.
b. diversification of numerous global suppliers.
c. increased use of the Internet to locate more suppliers.
d. use of crowdsourcing to locate new suppliers.
69. Shoichiro Toyoda, former president of Toyota Motors, built on Ford’s concepts and focused on the need to eliminate
waste from the production system. He followed a(n) _______ approach.
a. assembly line
b. distribution
c. lean production
d. synchronous production
70. A method that judges products as acceptable or unacceptable is known as
a. poka-yoke.
b. attribute inspection.
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c. acceptance sampling.
d. variable inspection.
71. A small business owner decides that her firm has a good customer focus and adequate tools and techniques needed for
a TQM program. To be assured of a strong quality program, she must also have the proper
a. benchmarking.
b. marketing research.
c. organizational culture.
d. statistical quality control.
72. Which solution to a constraint would increase efficiency?
a. Move maintenance times.
b. Inspect quality.
c. Subdivide work.
d. Expand resources.
73. The topic of discussion during the monthly senior managers’ meeting is how best to manufacture the company’s
product with existing materials, manpower, and machinery. This discussion is about:
a. inventory management.
b. inventory overhead.
c. operations management.
d. production management.
74. The buying of products or services from a third party to manage a firm’s functions is known as
a. asset efficiency.
b. diversification of supplies.
c. importing.
d. outsourcing.
75. Which item is a tangible output for a bed and breakfast inn guest?
a. Questions answered about local attractions
b. Full breakfast in the morning
c. Use of a Room
d. Two of the above tangible outputs.
76. Bettina would like to improve the quality of the dining experience in her cafe. To achieve this, Bettina’s efforts
should begin with a focus on
a. customers.
b. employees.
c. management.
d. operations.
77. The traditional method of maintaining product quality has been the
a. check sheet.
b. control chart.
c. inspection.
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d. histogram.
78. At the weekly managers’ meeting, Marcel is discussing how the company’s product is made and delivered to its
customers. Marcel is talking about:
a. distribution.
b. human resources.
c. operations.
d. planning.
79. In March, chassis prep counts its inventory. In June, the cabinet shop does the same thing. In September, appliances
counts its inventory. This inventory system is known as:
a. cycle counting.
b. perpetual.
c. physical.
d. two-bin.
80. An approach that emphasizes efficiency through elimination of waste independent of other aspects of the process is
called
a. capacity management.
b. lean production.
c. synchronous management.
d. waste-less production.
81. By conforming to ISO 9000, a small manufacturing firm could achieve improvements in
a. sales to Walmart.
b. export sales.
c. product design.
d. quality of incoming raw materials.
82. Twice a year the entire production line shuts down and a complete count is taken of every inventory item. This
inventory system is called:
a. cycle counting.
b. perpetual inventory.
c. physical inventory.
d. two-bin inventory.
83. Which operations factor is centered around satisfying customers over time?
a. Flexibility
b. Facilities and equipment
c. Choice of a joint venture
d. Customer demand
84. Service businesses are typically more concerned with _____ costs than with the cost of materials for operations.
a. equipment
b. fixed asset
c. labor
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d. leasing
85. Which of the following is an example of “quality”?
a. The taste of a restaurant’s food
b. Turn time at an auto repair shop
c. Product fail rate for a manufacturer
d. All of the above
86. Martha knows that to be successful, everything her company does must create customer
a. premiums.
b. products.
c. services
d. value.
87. In his retail store, Jose’s point-of-sale software relieves inventory for each item purchased. At any time, Jose can look
at the inventory records on his computer and know exactly how many of each item are in stock. This type of inventory
system is called:
a. cycle counting.
b. perpetual.
c. physical.
d. two-bin.
88. ISO 9000
a. is more important for large global firms than small firms with domestic markets.
b. measures how companies have improved their environmental footprint.
c. is challenging to earn but is rewarding from a marketing viewpoint.
d. reflects international excellence in quality management standards.
89. The inventory control method that uses a targeted service level allowing for the variability of supply and demand is
a. ABC method.
b. economic order quantity.
c. just-in-time inventory system.
d. statistical inventory control.
90. Jasper operates a machine shop. Orders from his his customers are small, but his machines can easily be set up to
make other items for different customers. This type of manufacturing is known as
a. flexible manufacturing.
b. a job shop.
c. project manufacturing.
d. repetitive manufacturing.
91. Myra operates a punch press on a production line. Because she is slower than the operators both before and after her
in the process, work stacks up at her press. Myra is a:
a. bottleneck.
b. constraint.
c. defect.
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d. hazard
92. A reason to buy component parts is
a. closer coordination between scheduling and production.
b. equipment obsolescence.
c. improved plant utilization.
d. the parts are a specialty of the supplier.
93. At CPL Manufacturing, the one-millionth product must be identical to the first. The work is automated and
accomplished by machines designed expressly to make these products. This type of manufacturing is known as:
a. continuous manufacturing.
b. flexible manufacturing.
c. project manufacturing.
d. repetitive manufacturing.
Match the term with its definition. Some terms may not be used.
a. Acceptance sampling
b. Attributes
c. Bottleneck
d. Constraint
e. Inspection
f. ISO 9000
g. Operations
h. Operations management
i. Poka-Yoke
j. Quality
k. Total quality management
l. Variables
94. The features of a product or service that enable it to satisfy customers’ stated and implied needs
95. Any point in the operations process where limited capacity reduces the production capability of an entire chain of
activities
96. The examination of a part or a product to determine whether it meets quality standards
97. The planning and control of a conversion process that includes turning inputs into outputs that customers desire
98. A proactive approach to quality management that seeks to mistake-proof a firm’s operatoins
99. The most restrictive limit on capacity, determining the capacity of the entire system
100. The standards governing international certification of a firm’s quality management procedures
101. Product or service parameters that can be counted as being present or absent
102. Measured parameters that fall on a continuum, such as weight or length