1) Creating an effective supply chain requires linking the marketing, distribution, and
supplier channels.
2) A run test checks a sequence of observations for randomness.
3) A Gantt chart is built using established precedence relationships.
4) A mission statement should provide a guide for the formulation of strategies for the
organization.
5) There is a positive link between quality and productivity.
6) Web-based, retail businesses should be located near the customer to reduce their long
distance phone charges.
7) Bias is measured by the cumulative sum of forecast errors.
8) Continuous processing is the best way to produce customized output.
9) Aggregate planning is capacity planning that typically covers a time horizon of one
to three months.
10) A Gantt chart is a basic scheduling tool that works best for high-volume systems.
11) Variability in demand and/or lead time can be compensated for by safety stock.
12) The earliest finish time for an activity is equal to the latest finish time minus the
activity slack.
13) The owner of Firewood To Go is considering buying a hydraulic wood splitter
which sells for $50,000. He figures it will cost an additional $100 per cord to purchase
and split wood with this machine, while he can sell each cord of split wood for $125. If,
for this machine, design capacity is 50 cords per day, effective capacity is 40 cords per
day, and actual output is anticipated to be 35 cords per day, what would be its
utilization?
A.100 percent
B.80 percent
C.75 percent
D.70 percent
E.0 percent
14) Inventory information for firm ABC:
What was the inventory at the end of March 2008?
A.350
B.250
C.150
D.50
E.400
15) Consider the following decision scenario:
*PV for profits ($000)
The maximin strategy would be:
A.A
B.B
C.C
D.D
E.E
16) Which of the following is not a step in the quality control process?
A.Define what is to be controlled.
B.Compare measurements to a standard.
C.Eliminate each of the defects as they are identified.
D.Take corrective action if necessary.
E.Evaluate corrective action.
17) The logistics/operations manager of a mail order house purchases two products for
resale: king beds (K) and queen beds (Q). Each king bed costs $500 and requires 100
cubic feet of storage space, and each queen bed costs $300 and requires 90 cubic feet of
storage space. The manager has $75,000 to invest in beds this week, and her warehouse
has 18,000 cubic feet available for storage. Profit for each king bed is $300 and for each
queen bed is $150.
What is the objective function?
A.Z = $150K + $300Q
B.Z = $500K + $300Q
C.Z = $300K + $150Q
D.Z = $300K + $500Q
E.Z = $100K + $90Q
18) Once we go beyond two decision variables, typically the ___________ method of
linear programming must be used.
A.simplicit
B.unidimensional
C.simplex
D.dynamic
E.exponential
19) A department has five machines that each run for an average of 8.4 hours
(exponential) before service is required. Service time average is 1.6 hours
(exponential).
(A) While running, each machine can produce 120 pieces per hour. With one server,
what is the average hourly output actually achieved?
(B) With two servers, what is the probability that a machine would be served
immediately when it requires service?
(C) If machine downtime cost is $100 per hour per machine, and server time costs $30
per hour, how many servers would be optimal?
20) A job will have a learning rate of 75 percent. If the third unit requires 10 hours, the
12th unit should require about this many hours:
A.5.6
B.6.5
C.7.4
D.8.3
E.9.2
21) Which of these pairs of functions would tend to be affected most dramatically by a
product or service redesign?
A.Operations and Accounting
B.Marketing and Operations
C.Finance and Human Resources
D.Engineering and Accounting
E.Finance and Engineering
22) A time-ordered plot of representative sample statistics is called a(n):
A.Gantt chart.
B.simo chart.
C.control chart.
D.up-down matrix.
E.standard deviation table.
23) Service design generally differs from product design in which of the following
ways?
A.Service design tends to focus on tangible factors.
B.There is less latitude in detecting and correcting errors prior to delivery.
C.There is a lesser requirement to be aware of competitors’ offerings.
D.There is less visibility to customers.
E.There is no difference.
24) A major advantage of job specialization in business is increased:
A.motivation.
B.opportunity for advancement.
C.opportunity for self-fulfillment.
D.productivity.
E.job enrichment.
25) The following data occurs chronologically from left to right:
The number of runs with respect to the sample median is:
A.2
B.3
C.4
D.5
E.none of these.
26) The lean philosophy suggests that workers are:
A.assets.
B.liabilities.
C.interchangeable.
D.replaceable.
E.to be phased out.
27) In many organizations, information flows much more freely within functions than it
does across functions. __________ represents an expanded effort to overcome this
tendency.
A.MRP
B.ERP
C.CRP
D.MRPII
E.DRP
28) A manufacturing firm is considering two locations for a plant to produce a new
product. The two locations have fixed and variable costs as follows:
If the annual demand will be 20,000 units, what would be the cost advantage of the
better location?
A.$20,000
B.$460,000
C.$480,000
D.$80,000
E.$60,000
29) Production units have an optimal rate of output where:
A.total costs are minimum.
B.average unit costs are minimum.
C.marginal costs are minimum.
D.rate of output is maximum.
E.total revenue is maximum.
30) A bank of 10 machines requires regular periodic service. Machine running time and
service time are both exponential. Machines run for an average of 44 minutes between
service requirements, and service time averages six minutes per machine. What is the
average number of machines down when there is one operator?
A.1.49
B.3.35
C.4.40
D.6.65
E.8.51
31) The logical approach, from beginning to end, for assembling a linear programming
model begins with:
A.identifying the decision variables.
B.identifying the objective function.
C.specifying the objective function parameters.
D.identifying the constraints.
E.specifying the constraint parameters.
32) A fill rate is the percentage of _____ filled by stock on hand.
A.shipments
B.demand
C.inventory
D.safety stock
E.lead time