Archives: Quiz

Kanbans and andons are both elements of the visual workplace, because they are visual signals that replace printouts and paperwork. Demand (sales) forecasts serve as inputs to financial, marketing, and personnel planning. Answer: TRUE The moment-of-truth is the crucial moment […]

For a linear programming problem with the constraints 2X + 4Y =<100 and 1X + 8Y =<100, two of its corner points are (0, 0) and (0, 25). Group technology enables the grouping of parts into families based on similar […]

A dependent demand item is so called because its demand is dependent on customer preferences. The MTBF (mean time between failures) is calculated as the reciprocal of the number of failures during a period of time. Answer: TRUE One reason […]

If demand exceeds supply in a transportation problem, the problem must be balanced by adding a dummy source with additional supply. In most real-world inventory problems, lead time and demand vary in ways that make simulation a necessity because mathematical […]

Psychological factors have little relevance in the design of assembly line jobs since they involve physical products and production technology. The assembly line is a classic example of a repetitive process. Answer: TRUE All forms of simulation are based on […]

Firms may discover that, rather than adapting ERP to the way they do business, they have to adapt the way they do business to accommodate the ERP software. The key to effective supply-chain management is to get many suppliers to […]

Some of the operations-related activities of Hard Rock Caf© include designing meals and analyzing them for ingredient cost and labor requirements. Lists have been developed that rank countries on issues such as “competitiveness” and “corruption.” Answer: TRUE The supply-chain systems […]

Because service firms do not inventory their output, pure chase strategy is not appropriate. Labor cost and labor availability often drive the location decision in the call center industry. Answer: TRUE A fast-food retailer that acquired a spice manufacturer would […]

If the mean time between failures has been calculated to be 2,000 hours, then FR(N) = 0.0005 failures/unit-hour.. The expected value of each course of action in a decision tree is determined by starting at the beginning of the tree […]

Aggregate planning in manufacturing ties organizational strategic goals to a production plan. Unfavorable exchange rates can offset other savings in a location decision. Answer: TRUE Johnson€s rule sequences a set of jobs through two different machines or work centers in […]

For a location decision, labor productivity may be important in isolation, but low wage rates are a more important criterion. Offshoring is the practice of procuring from foreign external sources services or products that are normally part of an organization. […]

In linear programming, if there are three constraints, each representing a resource that can be used up, the optimal solution must use up all of each of the three resources. When developing the standard time for a task, the elements […]

Constraints are needed to solve linear programming problems by hand, but not by computer. One guideline for a retail layout is to locate high-draw items around the periphery of the store. Answer: TRUE If a manager conducting a time study […]

High-quality products and services are the most profitable. An example of an intangible cost, as it relates to location decisions, is the quality of education. Answer: TRUE The term renewal has been created to describe the return of business activity […]

In a decision tree, the expected monetary values are computed by working from right to left. The transportation model is a special class of linear programming models. Answer: TRUE Processes can be environmentally friendly and socially responsible while still contributing […]

Learning curves can only be applied to labor. Labor standards based on historical experience are relatively inexpensive to obtain. Answer: TRUE Scheduling optimization systems used in retail stores typically track customer traffic in 4-hour time increments. Answer: FALSE Substantial research […]

A transportation problem requires exactly as many origins as destinations. A firm that successfully pursues a steeper-than-industry-average learning curve and manages costs down may still fail if, by underestimating a strong competitor, it fails to gain the added volume necessary […]

Cross-docking processes items as they are received, rather than placing them in storage; this helps explain why “warehouses” are now called “distribution centers.” With the many-suppliers strategy, the order usually goes to the supplier that offers the best quality. Answer: […]

Neither the northwest corner rule nor the intuitive method considers shipping cost in making initial allocations. Shortening the project’s duration by deleting unnecessary activities is called “project crashing.” Answer: FALSE In several industries, online exchanges have been created by buyers. […]

The objective of the make-or-buy decision is to help identify the products and services that can be obtained externally. The maximax criterion of decision making requires that all decision alternatives have an equal probability of occurrence. Answer: FALSE When implemented […]

Southwest Airlines’ core competence is operations. Blanket orders are a long-term purchase commitment to a supplier for items that are to be delivered against short-term releases to ship. Answer: TRUE A finite population waiting line model has an average service […]

An optimal maintenance policy strikes a balance between the costs of breakdown and preventive maintenance so that the total cost of maintenance is at a minimum. The optimal solution to a linear programming problem is within the feasible region. Answer: […]

Maintaining a stable workforce generally results in the firm paying higher wages than a firm that follows demand. Degeneracy in a transportation problem is when no closed path exists for evaluating an unused cell. Answer: TRUE ISO 9000 has evolved […]

Offshoring is the practice of moving a business process to a foreign country but retaining control of it. If the schedule calls for the production of 120 units per day and 480 minutes of production time are available per day, […]

Research data suggest that foreigners outsource far more services to the U.S. than American companies send abroad. Supply-chain decisions are not generally strategic in nature, because purchasing is an ordinary expense to most firms. Answer: FALSE To handle degeneracy, a […]

In forward scheduling, jobs are scheduled as late as possible within the time allowed by the customer due dates. Finding an ideal mixed strategy is complicated by the huge number of possible strategies. Answer: TRUE Keiretsus offer a middle ground […]

The transportation model seeks satisfactory, but not necessarily optimal, solutions for shipping goods from several origins to several destinations. Focus forecasting tries a variety of computer models and selects the best one for a particular application. Answer: TRUE A c-chart […]

Because of the significance of labor in the scheduling of services, behavioral and social issues, wage and hour law, and union contracts all complicate the scheduling process. The shortest of all paths through the network is the critical path. Answer: […]

Simulation provides optimal solutions to problems. X-bar charts are used when we are sampling attributes. Answer: FALSE Profit-sharing is a motivation and incentive system where executives receive stock options. Answer: FALSE Service firms choose locations based, in part, on the […]

_____ is described as setting the price for an item relatively low and then charging much higher prices for the expendables it uses. A. Bait pricing B. External reference pricing C. Captive pricing D. Odd-even pricing The group of people […]

The existence stage is defined by: A. a period of exceptional growth. B. a stable level of sales, profits, and guarantee of sales. C. thoughts about starting a business. D. a lack of stability in terms of markets, operations, or […]

Which of the following is a characteristic of a lifestyle firm? A. It starts small and grows very rapidly to become a big business. B. It represents about 20 percent of all businesses. C. It typically has sales of $25,000 […]

Which of the following primary research methods is the least expensive for small businesses? A. Conducting in-person surveys B. Conducting formal focus group interviews C. Using online survey services D. Hiring marketing research firms _____ advertisements provide both geographic and […]

The future action plan component of the feasibility study includes which of the following elements? A. Profitability B. The competition C. Legal restrictions and rights D. Writing a business plan Aaron, a businessman, has a method of keeping track of […]

Which of the following is a financial statement that will be checked during due diligence when buying an existing business? A. White paper B. Balance sheet C. Codicil D. Amicus brief _____ is the amount of money left after deducting […]

The research and development team of Leonide Inc. has generated five different product ideas. All five ideas are being rated against each other on their characteristics such as product uniqueness, idea profitability, protectable intellectual property, and product team quality. Based […]

Which of the following is the formula for calculating owner’s return on equity (ROE)? A. Net Income/Average Investment B. Net Income/Owner’s Equity Investment C. Total Liabilities/Total Owner’s Equity D. Total Liabilities/Total Assets Which of the following is a reason for […]

_____ are processes, benchmarks, or components of the business that are essential for the business to be profitable and competitive in its market. A. IPOs B. CSFs C. ESOPs D. BRIE Danielle, a graduate in fashion technology, always found it […]

A(n) _____ refers to having only sufficient amount of products on the shelves to meet immediate purchases and usually requires frequent shipment from the supplier. A. just-in-time inventory B. macro inventory C. micro inventory D. in-process inventory Rejecting existing ideas, […]

Which of the following is true of financial management for a business exit? A. Its main emphasis is on conserving what little cash the business has. B. Its main emphasis is on maximizing the value of the business for successors. […]

According to the BRIE model, which of the following is an element that is necessary to start a business? A. Boundary B. Recognition C. Efficiency D. Income Which of the following is a good technique to counter undercapitalization in part-time […]

_____ is a general term for real estate, but it can also be applied as a legal term for anything owned or possessed. A. Equipment B. Plant C. Inventory D. Property Changes in competitors, sales and profits in an industry […]

Which of the following categories does the majority of small businesses fall under? A. High-growth ventures B. High-performing small businesses C. Lifetime/Part-time firms D. Traditional small business Charging lower prices at certain times to encourage customers to come during slack […]

_____ means that a firm is worthy of consideration or doing business with because of the impressions or opinions of customers, suppliers, investors, or competitors. A. Bureaucracy B. Illiquidity C. Legitimacy D. Insolvency _____ are laws and regulations that specify […]

_____ refers to the size of the market, whereas _____ refers to the geographic range covered by the market. A. Scope; scale B. Mass; niche C. Scale; scope D. Niche; mass _____ is the degree of attention a target market […]

Which of the following is true of payment procedures? A. A letter of credit can be exercised only with specified shipping documents. B. Providing credit to customers is a risk to the customers. C. Up-front cash payment is a risk […]

When an individual buys products like shoes, music, or cell phones online, it is referred to as _____ type of e-commerce. A. business-to-business (B2B) B. business-to-consumer (B2C) C. consumer-to-consumer (C2C) D. business-to-Internet (B2I) The difference between an actual and budgeted […]

A business that collects, collates, and reports information concerning an entity’s use of debt is referred to as a(n) _____. A. accelerator B. credit reporting agency C. debt reporting organization D. community development organization Which of the following is true […]

_____ refers to the value of a business that exceeds the sum of the value of all individual assets but that cannot be sold separately from the business. A. Goodwill B. Collateral C. Inventory D. Debt Legal obligations to give […]

Harry ordered a television online for $800, he was asked to pay $100 toward shipping charges, $50 as installation charges, and another $100 for extended warranty. This example best illustrates _____. A. bait pricing B. internal reference pricing C. partitioned […]