1) The lean philosophy recognizes that some work-in-process inventories are a
necessary investment to allow for smooth work flow.
2) The maximax approach is a pessimistic strategy.
3) The probability that the project will go beyond the desired time is equal to one minus
the joint probability that all paths will be completed within the desired time.
4) Attributes need to be measured, whereas variable data can be counted.
5) Every change in the value of an objective function coefficient will lead to changes in
the optimal solution.
6) The dimensions of quality are important for products but are not applicable in service
organizations.
7) Centralized or decentralized purchasing is directly related to the size of an
organization.
8) A company’s product line consists of 40 percent Product A, 40 percent Product B,
and 20 percent Product C. The aggregate plan calls for total production that averages
1,100 units per quarter. Quarter 1 production will be 800 units, quarter 2 production will
be 1,400 units, and quarter 3 production will be 1,200 units. How many units of Product
A will be produced in quarter 4?
A.320 units
B.400 units
C.440 units
D.480 units
E.560 units
9) A manager uses the following equation to predict monthly receipts: Yt = 40,000 +
150t. What is the forecast for July if t = 0 in April of this year?
A.40,450
B.40,600
C.42,100
D.42,250
E.42,400
10) A production kanban card is used to signal that:
A.work is needed at the work center.
B.work is ready to be moved to the next station.
C.a problem exists.
D.a machine has broken down and needs immediate attention.
E.a machine is ready for preventive maintenance.
11) A chart showing the number of occurrences by category would be used in:
A.Pareto analysis.
B.interviewing.
C.cause-and-effect diagrams.
D.benchmarking.
E.quality function deployment.
12) Productivity is expressed as:
A.output plus input.
B.output minus input.
C.output times input.
D.output divided by input.
E.input divided by output.
13) Which of the following is used for constructing a control chart?
A.mean absolute deviation
B.mean squared error
C.tracking signal
D.bias
14) Cost of equipment breakdown does not include:
A.loss of output.
B.cost of idle workers.
C.damage to other equipment.
D.replacement costs.
E.potential safety hazard.
15) A company is designing a product layout for a new product. It plans to use this
production line eight hours a day in order to meet projected demand of 480 units per
day. The tasks necessary to produce this product are:
Without regard to demand, what is the minimum possible cycle time (in seconds) for
this situation?
A.162
B.72
C.54
D.12
E.60
16) Option A has an expected value of $2,000, a minimum payoff of -$4,000, and a
maximum payoff of $18,000. Option B has an expected value of $2,200, a minimum
payoff of -$1,000, and a maximum payoff of $6,000. Option C has an expected value of
$1,900, a minimum payoff of $100, and a maximum payoff of $2,000. In this situation,
a risk-averse decision maker would pay __________ for his risk aversion, and a
risk-seeking decision maker would pay __________ for his risk seeking.
A.$200; $300
B.$1,100; $5,000
C.$300; $200
D.$2,100; $16,000
E.$400; $200
17) Daily usage is exactly 60 gallons per day. Lead time is normally distributed with a
mean of 10 days and a standard deviation of 2 days. What is the standard deviation of
demand during lead time?
A.60 times 2
B.60 times the square root of 2
C.60 times the square root of 10
D.60 times 10
E.10 times the square root of 2
18) The minimum possible cycle time in a product layout is determined by the:
A.longest task time.
B.shortest task time.
C.average task time.
D.total task time.
E.per-unit setup time.