Business Operations
Question Bank
Course Introduction
Business Operations introduces students to the core principles, strategies, and functions that drive efficient and effective organizational performance. The course explores key operational processes such as supply chain management, production planning, quality control, logistics, and resource optimization, emphasizing their interconnected roles in achieving business objectives. Students will analyze case studies, apply process improvement tools, and examine technological advancements that impact operational decision-making. By understanding how operations support overall business strategy, students gain practical insights into creating value, increasing productivity, and maintaining competitive advantage in dynamic markets.
Recommended Textbook
OM 5 5th Edition by David Alan Collier
Available Study Resources on Quizplus
23 Chapters
1926 Verified Questions
1926 Flashcards
Source URL: https://quizplus.com/study-set/3569
Page 2
Chapter 1: Goods, Services, and Operations Management
Available Study Resources on Quizplus for this Chatper
81 Verified Questions
81 Flashcards
Source URL: https://quizplus.com/quiz/70869
Sample Questions
Q1) Which one of the following statements about the scope and direction of operations management is FALSE?
A) Service-providing processes are the dominant type of processes in the U.S. economy.
B) Business analytics includes predictive and prescriptive data analytics.
C) Today, sustainability is placing increased pressure on all goods-producing and service-providing organizations worldwide.
D) Goods-producing industries account for over 80 percent of the jobs in the U.S.
Answer: D
Q2) Which one of the following statements is TRUE of sustainability?
A) Environmental sustainability applies only to goods-producing firms.
B) Resource management is a component of social sustainability.
C) The three dimensions of sustainability are often referred to as the "triple bottom line."
D) Sustainability includes the idea of preserving resources for three years.
Answer: C
To view all questions and flashcards with answers, click on the resource link above.
3
Chapter 2: Value Chains
Available Study Resources on Quizplus for this Chatper
87 Verified Questions
87 Flashcards
Source URL: https://quizplus.com/quiz/70871
Sample Questions
Q1) Pre-planning, response, and recovery from natural or anthropogenic disasters is called _____.
A) reshoring
B) offshoring
C) emergency management
D) vertical integration
Answer: C
Q2) The focus on value has forced many traditional goods-producing companies to reduce services to their customer benefits packages.
A)True
B)False
Answer: False
Q3) A value chain views an organization from an integrative perspective of goods and services, while a supply chain focuses mainly on the physical movement of goods and materials.
A)True
B)False
Answer: True
To view all questions and flashcards with answers, click on the resource link above. Page 4
Chapter 3: Measuring Performance in Operations
Available Study Resources on Quizplus for this Chatper
98 Verified Questions
98 Flashcards
Source URL: https://quizplus.com/quiz/70873
Sample Questions
Q1) It takes fifteen minutes to complete a drilling operation using a lathe. The duration of this operation is known as _____ time.
A) delay
B) queue
C) processing
D) standard
Answer: C
Q2) The value chain model is probably the dominant model for operations managers.
A)True
B)False
Answer: True
Q3) A guest at Raphael's Italian Restaurant generally spends $250 on a meal. Most of Raphael's customers are locals and eat at the restaurant twice a month. If the restaurant's margin is 50 percent, and a loyal customer is estimated to be worth $4000, determine the average defection rate.
Answer: VLC = P × CM × RF × BLC
4000 = (250) x (0.5) x (24) x (1/D), where D is the average defection rate
D = 3000 / 4000 = 0.75
To view all questions and flashcards with answers, click on the resource link above.
5
Chapter 4: Operations Strategy
Available Study Resources on Quizplus for this Chatper
82 Verified Questions
82 Flashcards
Source URL: https://quizplus.com/quiz/70875
Sample Questions
Q1) Reductions in flow time generally lead to a deterioration of quality.
A)True
B)False
Q2) Which one of the following statements in the Lawn Care Company (LCC) case study is TRUE?
A) The LCC already had experience and capabilities in the residential lawn application service and market segment, and was considering using this expertise to enter the golf and park market segment.
B) The gross margin on grass seed and fertilizer were higher than on the lawn application service.
C) Service management skills play a major role in the LCC current strategy and vision of the business at the time of the case.
D) The order winner for the current strategy at LCC is the high quality of physical goods.
Q3) Professor Terry Hill's operations strategy framework provides a systems perspective of how operations are linked to corporate and marketing strategies.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
Chapter 5: Technology and Operations Management
Available Study Resources on Quizplus for this Chatper
77 Verified Questions
77 Flashcards
Source URL: https://quizplus.com/quiz/70876
Sample Questions
Q1) High scalability is most related to _____.
A) low incremental cost
B) high fixed cost
C) sales revenue
D) diseconomies of scale
Q2) Low scalability was one of the reasons for failure of many early Internet-based companies.
A)True
B)False
Q3) One of the major benefits of technology has been its impact on sustainability.
A)True
B)False
Q4) List some of the key issues that organizations face in using technology.
Q5) Explain the concept of industrial robots.
Q6) If the forecast annual production volume is 100,000 units, which technology alternative should the company choose?
A) FMS
B) CNC
Q7) How does customer relationship management (CRM) help a firm gain competitive advantage?
To view all questions and flashcards with answers, click on the resource link above. Page 7
Chapter 6: Goods and Service Design
Available Study Resources on Quizplus for this Chatper
118 Verified Questions
118 Flashcards
Source URL: https://quizplus.com/quiz/70868
Sample Questions
Q1) An ATM machine provides four sequential steps in processing a transaction. Over the last quarter, the reliability of each of these steps was 0.92, 0.97, 0.95, and 0.96. What is the overall reliability of the machine? How much can reliability be improved if the reliability of the fourth step is increased to 0.99?
Q2) The system reliability for a three-component series system is 0.80. If the reliabilities of two of the components are 0.92 and 0.99, determine the reliability of the third component.
A) Less than 0.60
B) Equal to or greater than 0.60 but less than 0.70
C) Equal to or greater than 0.70 but less than 0.80
D) Equal to or greater than 0.80 but less than 0.90
Q3) Which of the following is NOT a concept or dimension of the servicescape?
A) Signs, symbols, and artifacts
B) Ambient conditions
C) Transaction processing
D) Spatial layout and functionality
Q4) In a two-component parallel system, the overall reliability is 0.9984. If the reliability of the first component is 0.9880, determine the reliability of the second component.
To view all questions and flashcards with answers, click on the resource link above.
Page 8
Chapter 7: Process Selection, Design, and Analysis
Available Study Resources on Quizplus for this Chatper
116 Verified Questions
116 Flashcards
Source URL: https://quizplus.com/quiz/70870
Sample Questions
Q1) The service-positioning matrix focuses on the service encounter level rather than the overall design of the service system.
A)True
B)False
Q2) An accounting firm is capable of processing 30 EZ tax forms per day, and the average number of forms on hand in the office is 74 forms. What is the average processing time per EZ tax form?
Q3) Which of the following is LEAST related to value stream mapping?
A) Non-value-added activity
B) Time
C) Cost
D) Reengineering
Q4) A wealth management company is able to process 300 customer statements (bills) per day. The average processing time is six (6) days. What is the average number of statements (bills) the company has in process at any time?
A) More than 500 but less than or equal to 750
B) More than 750 but less than or equal to 1000
C) More than 1000 but less than or equal to 1250
D) More than 1250
To view all questions and flashcards with answers, click on the resource link above. Page 9
Chapter 8: Facility and Work Designs
Available Study Resources on Quizplus for this Chatper
92 Verified Questions
92 Flashcards
Source URL: https://quizplus.com/quiz/70877
Sample Questions
Q1) Services such as legal and medical specialties employ cellular layouts.
A)True
B)False
Q2) Describe approaches used for process layout design.
Q3) _____ occurs when a work center completes a unit but cannot release it because the in-process storage at the next stage is full.
A) Lack-of-work delay
B) Propagation delay
C) Flow-blocking delay
D) Overload delay
Q4) In a product layout, a breakdown of one piece of equipment will not cause the entire process to shut down.
A)True
B)False
Q5) The objective of assembly-line balancing is to group tasks among workstations so that the amount of work assigned to each workstation is highly variable, thus maximizing flexibility.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 10
Chapter 9: Supply Chain Design
Available Study Resources on Quizplus for this Chatper
87 Verified Questions
87 Flashcards
Source URL: https://quizplus.com/quiz/70878
Sample Questions
Q1) A firm that specializes in certain types of goods-producing activities, such as customized design, manufacturing, assembly, and packaging, and works for end users is called a _____.
A) third-party logistics provider
B) contract manufacturer
C) distribution center
D) vendor-managed inventory supplier
Q2) A(n) _____ produces goods in advance of customer demand using a forecast of sales and moves them to points of sale where they are stored as finished goods inventory.
A) responsive supply chain
B) efficient supply chain
C) push system
D) pull system
Q3) Which of the following is TRUE regarding a responsive supply chain?
A) Demand is stable and predictable.
B) Product life cycles are short and change often because of innovation.
C) Customers require standardization.
D) Contribution margins are low.
Q4) Summarize the supply chain operations reference (SCOR) model.
Page 11
To view all questions and flashcards with answers, click on the resource link above.
Chapter 10: Capacity Management
Available Study Resources on Quizplus for this Chatper
89 Verified Questions
89 Flashcards
Source URL: https://quizplus.com/quiz/70879
Sample Questions
Q1) A measure of capacity is the number of seats in an airplane per flight.
A)True
B)False
Q2) The total process (throughput) capacity in units per hour for the four-stage process
A to D assuming 3 administrative clerks, 3 coding specialist, and 3 assistant managers on duty is:
A) less than 10 units per hour.
B) more than 10 units but less than or equal to 20 units.
C) more than 20 units but less than or equal to 30 units.
D) more than 30 units but less than or equal to 40 units.
Q3) The strategy of matching capacity additions with demand as closely as possible is often called a capacity straddle strategy.
A)True
B)False
Q4) All the following are means to manage capacity by changing or stimulating demand EXCEPT:
A) varying price of goods or services.
B) adding peripheral goods and/or services.
C) providing reservations.
D) shifting work to slack periods.
Page 12
To view all questions and flashcards with answers, click on the resource link above.
Chapter 11: Forecasting and Demand Planning
Available Study Resources on Quizplus for this Chatper
95 Verified Questions
95 Flashcards
Source URL: https://quizplus.com/quiz/70880
Sample Questions
Q1) A group of international experts published a set of principles of forecasting that includes all of the following EXCEPT:
A) use quantitative rather than qualitative methods.
B) combine forecasts from approaches that are similar.
C) ask experts to justify their forecasts in writing.
D) use multiple measures of forecast accuracy.
Q2) The four-period moving average for next week (week 5) is:
A) less than or equal to 100.
B) more than 100 but less than or equal to 110.
C) more than 110 but less than or equal to 120.
D) more than 120 but less than or equal to 130.
Q3) Which of the following is NOT a characteristic of a time series?
A) Time bucket
B) Trend
C) Cyclical pattern
D) Random variation
Q4) Regression models are often used in forecasting to incorporate causal variables that may influence a time series.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 13
Chapter 12: Managing Inventories
Available Study Resources on Quizplus for this Chatper
117 Verified Questions
117 Flashcards
Source URL: https://quizplus.com/quiz/70881
Sample Questions
Q1) If the current order quantity used by Kelly is 20 pumps per order, how much money can she save by adopting an economic order quantity (EOQ) policy?
A) Less than $50
B) More than $50 but less than or equal to $100
C) More than $100 but less than or equal to $150
D) more than $150
Q2) Average inventory in the economic order quantity (EOQ) model is defined as:
A) the order quantity divided by the number of inventory cycles per year.
B) the annual usage divided by the number of inventory cycles per year.
C) one-half of the order quantity.
D) one-half of the annual usage.
Q3) The optimal replenishment level for the given fixed-period system (FPS) is:
A) less than 300 boxes.
B) more than or equal to 300 but less than 400 boxes.
C) more than or equal to 400 but less than 500 boxes.
D) more than or equal to 500 boxes.
Q4) What are the four categories of inventory costs?
Q5) Setup costs depend on the number of items manufactured.
A)True
B)False
Page 14
To view all questions and flashcards with answers, click on the resource link above.
Chapter 13: Resource Management
Available Study Resources on Quizplus for this Chatper
106 Verified Questions
106 Flashcards
Source URL: https://quizplus.com/quiz/70882
Sample Questions
Q1) A sheet metal company has developed the following six-month production schedule (in thousands of square yards):
\[\begin{array} { | l | l | l | l | l | l | l | }
\hline \text { Week } & 1 & 2 & 3 & 4 & 5 & 6 \\
\hline \text { Metal } & 150 & 100 & 175 & 200 & 160 & 160 \\
\hline
\end{array}\] In addition, their monthly labor and machine capacities (in hours) available, and the production standards (in hours per square yard) are:
\(\begin{array}{|l|l|l|}
\hline & \text { Labor } & \text { Machine } \\
\hline \text { Capacity Available } & 16,000 & 20,000 \\
\hline \text { Production Standard } & .10 & .18 \\
\hline
\end{array}\)
a.What is the percentage utilization of the labor capacity in month 4?
b.What is the percentage utilization of the machine capacity in month 3?
c.In which weeks are the labor requirements over capacity?
Q2) Define material requirements planning (MRP) and how it can benefit an organization.
To view all questions and flashcards with answers, click on the resource link above.
Page 15
Chapter 14: Operations Scheduling and Sequencing
Available Study Resources on Quizplus for this Chatper
79 Verified Questions
79 Flashcards
Source URL: https://quizplus.com/quiz/70883
Sample Questions
Q1) A restaurant needs the following number of wait staff to serve its evening guests.
\[\begin{array} { | l | l | l | l | l | l | l | l |}
\hline \text { Day: } & \text { M } & \text { Tu } & \text { W } & \text { Th } & \text { F } &
\text { Sa } & \text { Su } \\
\hline \begin{array} { l }
\text { Minimum Number of Wait Staff } \\
\text { Needed: }
\end{array} & 5 & 2 & 1 & 4 & 6 & 7 & 2\\\hline
\end{array}\] How many employees are needed so that each has two consecutive days off? Construct a work schedule for these employees.
Q2) Using the earliest due date (EDD) rule, the average flow time for the five jobs is _____.
A) less than or equal to 5 days
B) more than 5 but less than or equal to 10 days
C) more than 10 but less than or equal to 15 days
D) more than 15 but less than or equal to 20 days
Q3) Describe the algorithm that defines Johnson's sequencing rule for the two-resource sequencing problem.
To view all questions and flashcards with answers, click on the resource link above.
16
Chapter 15: Appendix: Quality Management
Available Study Resources on Quizplus for this Chatper
56 Verified Questions
56 Flashcards
Source URL: https://quizplus.com/quiz/70867
Sample Questions
Q1) The performance rating factor and allowances are based on human judgment.
A)True
B)False
Q2) All of following are true of learning curves EXCEPT:
A) they are not used for a pricing strategy.
B) they are affected by the ratio of manual to machine work.
C) 80 percent learning curves exhibit a step initial decline and then level off.
D) they are used in defense industries.
Q3) The learning curve does not apply to supervisory personnel, some skilled craftspeople, or jobs that have non-repetitive job tasks.
A)True
B)False
Q4) Allowances include time for all of the following EXCEPT: A) fatigue.
B) equipment breakdowns.
C) rest periods.
D) poor scheduling.
Q5) Explain the use of regression analysis in establishing standard times with an example.
Q6) Describe an experience curve.
Page 17
To view all questions and flashcards with answers, click on the resource link above.
Chapter 15: Quality Management
Available Study Resources on Quizplus for this Chatper
81 Verified Questions
81 Flashcards
Source URL: https://quizplus.com/quiz/70884
Sample Questions
Q1) The most relevant definition of quality for an operations manager is conformance to specifications.
A)True
B)False
Q2) Discuss different ways of defining quality and how these differ for goods and services.
Q3) Which of the following emphasizes defects per million opportunities as a key measure of quality?
A) Deming's 14 Points
B) ISO 9000:2000
C) The Gap model
D) Six Sigma
Q4) What are the Seven Quality Control (QC) Tools and what is their significance in quality improvement? Briefly explain how each tool is used.
Q5) Machine downtime is an example of which type of quality cost?
A) Prevention costs
B) Appraisal costs
C) Internal failure costs
D) External failure costs
To view all questions and flashcards with answers, click on the resource link above. Page 18
Chapter 16: Quality Control and Spc
Available Study Resources on Quizplus for this Chatper
110 Verified Questions
110 Flashcards
Source URL: https://quizplus.com/quiz/70872
Sample Questions
Q1) Which of the following is NOT related to a continuous metric?
A) Length
B) x-bar and R-charts
C) p-chart
D) Time
Q2) When the range of process variation does not conform to the design specifications, the process capability index will be less than 1.
A)True
B)False
Q3) The lower and upper specification limits for a component are 4.20 and 4.30 ounces, respectively. The process standard deviation is .02, and the process average is 4.24 ounces. Which one of the following statements is TRUE?
A) The C<sub>p</sub> index indicates the process is centered.
B) The C<sub>p</sub> index indicates the process is not centered.
C) The C<sub>pk</sub> index indicates the process is centered.
D) The C<sub>pk</sub> index indicates the process is not centered.
Q4) The lower the rate of defects, the higher the sample size should be in p-charts.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 19
Chapter 16: Appendix: Queuing Analysis
Available Study Resources on Quizplus for this Chatper
38 Verified Questions
38 Flashcards
Source URL: https://quizplus.com/quiz/70866
Sample Questions
Q1) List the seven operating characteristics of a single-channel waiting line (no formulas).
Q2) What are five key assumptions for the basic, single-channel waiting line model?
Q3) Since most service times follow an exponential distribution, there is no need to collect data on actual service times.
A)True
B)False
Q4) The process of customers leaving one waiting line to join another in a multiple-server (channel) configuration is called:
A) jockeying.
B) reneging.
C) balking.
D) preempting.
Q5) Which of the following is NOT a key assumption of the multiple-server queuing model?
A) The waiting line has two or more identical servers.
B) The arrivals wait in two or more lines.
C) The mean service rate, \(\mu\) is the same for each server.
D) No balking or reneging is allowed.
To view all questions and flashcards with answers, click on the resource link above. Page 20
Chapter 17: Appendix: Modeling Using Linear Programming
Available Study Resources on Quizplus for this Chatper
41 Verified Questions
41 Flashcards
Source URL: https://quizplus.com/quiz/70865
Sample Questions
Q1) A company is considering a rate change, either an increase or a decrease in production, where X<sub>t</sub> = production in a time period; R<sub>t</sub> = increase in production rate from Period t 1 to Period t; D<sub>t</sub> = decrease in production rate from Period t 1 to Period t. Which of the following is correct?
A) X<sub>t</sub> X<sub>t - 1</sub> = D<sub>t</sub> R<sub>t</sub>
B) X<sub>t - 1</sub> X<sub>t</sub> = D<sub>t</sub> R<sub>t</sub>
C) X<sub>t - 1</sub> X<sub>t</sub> = R<sub>t</sub> D<sub>t</sub>
D) X<sub>t</sub> X<sub>t - 1</sub> = R<sub>t</sub> D<sub>t</sub>
Q2) For linear programming to work for project crashing decisions, a dummy activity is needed at the beginning of the project, with a duration of zero (0) time.
A)True
B)False
Q3) The precedence relationships in a network limit the activity _____.
A) nonnegativity time
B) overtime
C) crash time
D) inventory time
Q4) Explain the essence of a transportation problem.
Q5) Discuss the concept of optimization models with examples.
To view all questions and flashcards with answers, click on the resource link above. Page 21
Chapter 17: Lean Operating Systems
Available Study Resources on Quizplus for this Chatper
84 Verified Questions
84 Flashcards
Source URL: https://quizplus.com/quiz/70874
Sample Questions
Q1) The Timken Company used a Lean Six Sigma approach that was highly successful.
A)True
B)False
Q2) Just-in-time (JIT) systems are based on the concept associated with pull systems rather than push systems.
A)True
B)False
Q3) A manufacturing company is using a two container Kanban system between a downstream (using) and an upstream (producing) work center. Each container holds 25 parts. The using work center can handle 100 parts per day. The average elapsed time for the entire cycle is currently 0.4 days. The company is concerned about the efficiency (and safety stock policy) of the operation. The safety stock factor for the current operation is _____.
A) less than 0.20
B) more than 0.20 but less than or equal to 0.3
C) more than 0.3 but less than or equal to 0.4
D) more than 0.4 but less than or equal to 0.5
Q4) Compare and contrast a push system and a pull system.
Q5) Contrast batching with single-piece flow.
Q6) Explain the concept of Single Minute Exchange of Dies (SMED).
Page 22
To view all questions and flashcards with answers, click on the resource link above.
Chapter 18: Appendix: Simulation
Available Study Resources on Quizplus for this Chatper
40 Verified Questions
40 Flashcards
Source URL: https://quizplus.com/quiz/70864
Sample Questions
Q1) All of the following are verification techniques EXCEPT:
A) developing logical flowcharts.
B) developing a model with high face validity.
C) conceptualizing a problem into smaller pieces or modules.
D) enabling people other than the programmer to check codes.
Q2) Discuss two advantages and three disadvantages of simulation models.
Q3) Balking means a customer will join the waiting line if it is too long.
A)True
B)False
Q4) Simulation can guarantee an optimal solution.
A)True
B)False
Q5) Using two-digit random numbers, the interval 55-79 represents the probability of
A) 0.55 to 0.79
B) 0.25
C) 0.24
D) 0.67
Q6) Define simulation and give some operations management examples.
Q7) Discuss a simulator. Provide appropriate examples.
To view all questions and flashcards with answers, click on the resource link above. Page 23
Chapter 18: Project Management
Available Study Resources on Quizplus for this Chatper
108 Verified Questions
108 Flashcards
Source URL: https://quizplus.com/quiz/70885
Sample Questions
Q1) All activities on the critical path have a zero slack time.
A)True
B)False
Q2) In the previous project network, the latest finish for activity B is:
A) 5.
B) 6.
C) 7.
D) 8.
Q3) What is the total project (normal plus crash) cost?
A) Less than or equal to $60,000
B) Greater than $60,000 but less than or equal to $65,000
C) Greater than $65,000 but less than or equal to $70,000
D) Greater than $70,000
Q4) Which one of the following statements about the critical path method (CPM) is TRUE?
A) The activity time estimates are accurate and stable.
B) Activities are dependent on each other.
C) Activities can be interrupted before completion.
D) The project schedule defines a correct sequence of work in terms of technology and workflow.
To view all questions and flashcards with answers, click on the resource link above. Page 24
Chapter 19: Appendix: Decision Analysis
Available Study Resources on Quizplus for this Chatper
44 Verified Questions
44 Flashcards
Source URL: https://quizplus.com/quiz/70863
Sample Questions
Q1) Which of the following statements is TRUE of a decision tree?
A) The number at each endpoint of a decision tree represents the probability associated with a particular chain of events.
B) A decision tree cannot be used for complex business decisions.
C) In a decision tree, event nodes are represented by squares, while decision nodes are represented by circles.
D) Expected value calculations can be made directly on a decision tree to arrive at the best decision strategy.
Q2) Which of the following is NOT a similarity between the elements of a decision problem and a decision tree?
A) Time
B) States of nature
C) Alternatives
D) Probabilities
Q3) Irrespective of its quality, the expected value of perfect information represents the maximum amount a company should be willing to pay for any information about events.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.