Introduction to Operations Management Exam
Materials
Course Introduction
Introduction to Operations Management explores the fundamental principles and strategies involved in the efficient production and delivery of goods and services. The course covers core topics such as process analysis, capacity planning, inventory management, supply chain coordination, quality control, and project management. Students will gain insights into how organizations design and improve operational processes to achieve competitive advantage, increase productivity, and meet customer demands. Through case studies and real-world examples, learners will develop practical skills for identifying and solving operational challenges across various industries.
Recommended Textbook
Contemporary Business Mathematics with Canadian Applications 9th Edition by S. A. Hummelbrunner
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16 Chapters
1484 Verified Questions
1484 Flashcards
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Page 2
Chapter 1: Review of Arithmetic
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Sample Questions
Q1) A sales representative selling computer parts receives a commission of 3.5% on net sales up to $15 000.00, 7% on the next $6000.00, and 9% on any further sales. If his sales for a month were $34 250.00 and sales returns were $1055.00, what was his commission for the month?
Answer: Gross sales = $34250.00
Less: returns = 1055.00
Net sales = $33195.00
Commission: = .035 × 15000.00 = $525.00
= .07 × 6000.00 = 420.00 = .09 × 12195.00 = 1097.55
Total commission = $2042.55
Q2) Mark's gross wages for a week were $711.20. His regular workweek is 40 hours and overtime is paid at time and one-half regular pay. What is Mark's regular hourly wage if he worked 45 1/2 hours?
Answer: Total hours = 45.5
Regular hours = 40.00
Overtime hours = 5.5
5.5 overtime hours are equivalent to 5.5 × 1.5 = 8.25 regular hours.
Hourly rate of pay = 11ea8930_327f_99dd_b375_7f9d4b6bc3d8_TB4213_11 = $14.74
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Page 3
Chapter 2: Review of Basic Algebra
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193 Flashcards
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Sample Questions
Q1) Solve: -3x = 9 - 6x
Answer: 3x = 9, x = 3
Q2) Simplify: [(33) - 62]3
A) 279
B) -279
C) 729
D) -729
E) 972
Answer: D
Q3) Solve: 5(2x - 4) - 3(1 - 3x) = -64
Answer: 5(2x - 4) -3(1 - 3x) = -64
10x - 20 - 3 + 9x = -64
19x = -41
x = 2.1578947
LS: 5[2(-2.1578947) - 4] - 3[1 - 3(-2.1578947)] = -64
5[-4.3157895 - 4] - 3[1 - (-6.4736842)] = -64
5[-8.3157895] - 3[7.4736842] = -64
-41.578948 - 22.421053 = -64
-64 = -64
RS: = -64
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Chapter 3: Ratio, Proportion, and Percent
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Sample Questions
Q1) $275 is 87 1/2% of what amount?
Answer: 275 = 87 11ea8930_32c2_6f21_b375_b10e8e9b18f3_TB4213_11 % of x 11ea8930_32c2_9632_b375_a16062b73ae7_TB4213_11 x = 275
x = 275 11ea8930_32c2_9633_b375_538a4722bc24_TB4213_11 x = $314.29
Q2) In Manitoba, a car was sold for $21 500.55 including 5% GST and 7% PST. How much was the provincial sales tax on the car?
Answer: Let the price of the car be $x.
x + 5% of x + 7% of x = 21500.55
x + 0.05x + 0.07x = 21500.55
1.12x = 21500.55
x = 19196.92
Sales tax = 7% of 19 196.92 = $1 343.78
Q3) Overhead content in an article is 37 1/2% of total cost. How much is the overhead cost if the total cost is $72?
Answer: Let labor cost be $x.
x = 37 11ea8930_32c1_d2dc_b375_a9e6f73559ce_TB4213_11 % of 72
x = 11ea8930_32c1_d2dd_b375_252f37972da4_TB4213_11 × 72
x = 27
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Chapter 4: Linear Systems
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Sample Questions
Q1) Find the slope and y-intercept: 1.5x + 3y = 2.4
Q2) Solve the system of equations: 8x + 12y = 72
6x + 7y = 84
Q3) Solve the system of equations: 0.8x + 0.3y = 1.3
0.3x + 0.2y = 1.1
Q4) Find the slope and y-intercept: 3x + 2y = 10
Q5) A tavern holds 50 seats. Two types of seats are available the Friday night jazz festival: stage and dining. The cost of a stage seat is $15.00 and the cost of a dining seat is $5.00. If all 50 seats are sold the tavern would collect $400.00. How many of each type of seat is available?
Q6) Solve graphically: 2y = x + 200 and 3x + 2y = 240
Q7) Find the slope of the line: 2y = 4(y + 2)
A) 0
B) 2
C) 4
D) 0.5
E) 1
Q8) Solve graphically: 4x = -2y and x = 6
Q9) Graph: y = -6
Q10) Solve graphically: y = -x - 5 and x - y = 6 Page 6
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Page 7
Chapter 5: Trade Discount, Cash Discount, Markup, and Markdown
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Sample Questions
Q1) Compute the rate of discount allowed on a cordless drill that lists for $149.99 and is sold for $79.99.
Q2) Find the cost of an item sold for $4 115 to realize a markup of 36% based on cost.
Q3) Fred's Electric Supplies sells an electric women's shaver for $112.83. The markup is 39% of cost. How much does the store pay for this electric razor?
A) $184.97
B) $58.46
C) $88.37
D) $152.40
E) $81.17
Q4) An invoice shows a net purchase price of $1809.13 after the subtraction of discounts of 12.5%, 25%, 8.3%. What was the list price?
Q5) A store advertises a discount of $54.72 on sandals. If the discount is 33.5%, for how much were the sandals sold?
Q6) An invoice for $5 999.00, dated June 27, terms 2/10 E.O.M., was received June 30. What payment must be made on July 10 to reduce the debt to $2000.00?
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Chapter 6: Break-Even and Cost-Volume-Profit Analysis
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Sample Questions
Q1) A company that makes cell phones has the following cost structure. The have fixed costs of $145 000 per period and manufacturing costs of $15.16 per cell phone. Advertising is expected to be $25 000 per period and a special promotional contest will involve providing a free case for a cost of $5.30 per cell phone. Each cell phone sells for $49.95. What is the break-even point in the number of phones?
A) 4886
B) 4917
C) 4168
D) 5765
E) 4240
Q2) Last year a printing company had total sales of $37 500. The total of its variable costs was $15 000, and fixed costs were $18 000. Capacity is at sales maximum of $50 000.
a) Calculate the break-even point in (i) dollars of sales
(ii) as a percent of capacity
b) Draw a detailed break-even chart
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9
Chapter 7: Simple Interest
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Sample Questions
Q1) The exact number of days between January 25, 2012 and March 25, 2012 is?
A) 59 days
B) 60 days
C) 61 days
D) 62 days
E) 63 days
Q2) What rate of interest is required for $940.48 to earn $42.49 interest from September 30, 2011, to March 4, 2012?
Q3) A debt of $7120 is to be settled by two equal payments due today, and three years from now respectively. Determine the size of the equal payments if money is worth 8.73% and the agreed focal day is today.
Q4) Payments of $1430 due one year ago and $1175 due with interest of 6% in nine months are to be settled by three equal payments due today, seven months from now, and one year from now at 7.5%. Determine the size of the equal payments if the agreed focal date is one year from today.
Q5) An appliance store advertises a stove for $747.50 with nothing down, no payments and no interest for six months. Determine the cash value the store would be willing to accept if on a six-month investment, it can earn an interest of 4%.
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Chapter 8: Simple Interest Applications
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Sample Questions
Q1) A government of Ontario 364-day T-bills with a face value of $50 000 were purchased on January 2 for $48 000.76. The T-bills were sold on September 28 for $48 999.99.
a) What was the market yield rate on January 2?
b) What was the yield rate on September 28?
c) What was the rate of return realized?
Q2) Calculate the legal due date of a $10 000, 120 day note with interest at 4.56% dated March 31, 2012.
A) July 28
B) July 29
C) August 1
D) August 2
E) August 3
Q3) A 60-day non-interest-bearing promissory note for $10 000 is dated June 1, 2013. Compute the present value of the note on June 14, 2013, if money is worth 5%.
Q4) Find the maturity value of a six-month, $642 note dated November 1, 2013, earning interest at 7.5%.
Q5) Find the maturity date and the maturity value of a $1 415.00, 5.25%, 220-day note dated February 25, 2012.
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Chapter 9: Compound Interest - Future Value and Present
Value
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Sample Questions
Q1) Debts of $400.00, $450.00 and $500.00 are due in one year, eighteen months and thirty months from now respectively. Determine the single payment now that would settle the debts if interest is 8% p.a. compounded quarterly.
Q2) The Rob U Blind Bank advertises capital savings at 7.128% compounded semi-annually while Take Your Money Trust offers premium savings at 7.1% compounded monthly. Suppose you have $4400.00 to invest for two years.
a) Which deposit will earn more interest?
b) What is the difference in the amount of interest?
Q3) Determine the maturity value of $5400 due in 91 months compounding annually at 8.75%.
Q4) Six years after Mr. Robertson deposited $7110.00 in a savings account that earned interest at 6.8% p.a., compounded semi-annually, the interest was changed to 7.2% p.a., compounded quarterly. How much was in the account ten years after the deposit was made?
Q5) A $41200.00, non-interest-bearing note due August 1, 2003, discounted on March 1, 2001, at 7.32% compounded monthly. Find the proceeds.
Q6) Calculate the proceeds of $8956.00 due in seven years, eleven months discounted at 7.5% compounded semi-annually.
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Chapter 10: Compound Interest - Further Topics
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Sample Questions
Q1) Luciano sold a property and is to receive $14200.00 in nine months, $14000.00 in 42 months, and $15500.00 in 57 months. The deal was renegotiated after six months at which time Luciano received a payment of $17000.00; he was to receive a further payment of $19000.00 later. When should Luciano receive the second payment if money is worth 10% compounded quarterly?
Q2) A five-year, $4500.00 promissory note with interest at 7.5% compounded semi-annually was discounted at 8% compounded quarterly yielding proceeds of $6150.00. How many months before the due date was the discount date?
Q3) If the effective rate of interest on an investment is 6.52%, what is the nominal rate of interest compounded monthly?
Q4) A five-year, $2000.00 note bearing interest at 10% compounded annually was discounted at 12% compounded semi-annually yielding proceeds of $1900.00. How many months before the due date was the discount date?
Q5) A financial obligation requires the payment of $250.00 in eighteen months, $350.00 in thirty months, and $300.00 in fifty-four months. When can the obligation be discharged by a single payment of $800.00 if interest is 5% compounded semi-annually?
Q6) In how many days will $770.00 grow to $880.00 at 11.5% p.a. compounded monthly?
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Chapter 11: Ordinary Simple Annuities
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Sample Questions
Q1) In what period of time could you pay back a loan of $13900.00 by making monthly payments of $296.00 if interest is 6.5% compounded monthly?
Q2) A man put aside $5710.00 at the end of every 3 months for seven years. How much will he have six years after the least deposit, if his account earned 5.6% p.a. compounded quarterly?
Q3) You want to save $710 per quarter for 15.5 years towards the purchase of a motor home. You think that you can earn 6.56% compounded quarterly for this period of time. If your first deposit is in 3 months, what is the most expensive motor home that you will be able to purchase?
A) $44020.00
B) $75999.79
C) $75399.79
D) $27501.82
E) $79999.79
Q4) What payment is required at the end of each month for 3 years to repay a loan of $8000.00 at 6.4% compounded monthly?
Q5) What nominal rate of interest is earned by monthly deposits of $560.00 made for 6 years if the balance just after the last deposit is $52 700.00?
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Chapter 12: Ordinary General Annuities
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Sample Questions
Q1) For how long will Harold have to make payments of $550.00 at the end of every three months to repay a loan of $16900.00 if interest is 9% compounded monthly?
Q2) What is the discounted value of $4760.00 paid at the end of each year for 7 years if interest is 6.52% compounded quarterly?
Q3) A mortgage requires payments of $1000.00 at the end of every month for twenty-five years. If interest is 6% compounded semi-annually, calculate the principal of the loan.
A) $156,297.23
B) $155,206.86
C) $46,188.41
D) $300,000
E) $33,328.64
Q4) What is the accumulated value of deposits of $1120.00 made at the end of every six months for three years if interest is 8.48% compounded quarterly?
Q5) A mortgage of $198 000.00 is to be amortized by payments over 22.5 years. If the payments are made at the end of each month and interest is 8.75% compounded semi-annually, what is the size of the monthly payments?
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Chapter 13: Annuities Due, Deferred Annuities, and Perpetuities
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Sample Questions
Q1) Mrs. Lavergne deposits $562.71 at the beginning of every three months. Starting three months after the last deposit, she intends to withdraw $587.00 every three months for 16 years. If interest is 8.14% compounded quarterly, for how long must Mrs. Lavergne make deposits?
Q2) A lease valued at $47 600.00 requires payments of $4500.00 every three months. If the first payment is due 2 years after the lease was signed and interest is 6.88% compounded quarterly, what is the term of the lease?
Q3) A contract valued at $81 500.00 requires payment of $3350.00 at the beginning of every six months. If interest is 6.5% compounded semi-annually, what is the term of the contract?
Q4) A lease requires payments of $1200.00 at the beginning of every quarter for ten years. If interest is 6% compounded monthly, calculate the value of the lease.
Q5) Paul intends to retire in 15 years and would like to receive $8000.00 every 6 months for 20 years, starting on the date of his retirement. How much must he deposit in an account today if interest is 5% compounded semi-annually?
Q6) What deposit made at the beginning of each month will accumulate to $36 000.00 at 5% compounded quarterly at the end of eight years?
Page 16
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Chapter 14: Amortization of Loans, Including Residential
Mortgages
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Sample Questions
Q1) A mortgage balance of $137 960.70 is to be repaid over a eleven-year term by equal monthly payments at 8.1% compounded semi-annually. At the request of the mortgagor, the monthly payments were set at $1140.00.
a) How many payments will the mortgagor have to make?
b) What is the size of last payment?
c) Determine the difference between the total actual amount paid and the total amount required to amortize the mortgage by the contractual monthly payments.
Q2) The owner of the Guelph Inc. borrowed $20000.00 at 1.2% compounded semi-annually and agreed to repay the loan by making payments of $1000.00 at the end of every three months.
a) How many payments will be needed to repay the loan?
b) How much will be owed at the end of five years?
Q3) A debt of $40 000.00 is repaid in monthly installments of $500.00. If interest is 8.0% compounded quarterly, what is the size of the final payment?
Q4) A debt of $41 000.00 is repaid in monthly installments of $660.00. If interest is 8.4% compounded quarterly, what is the size of the final payment?
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Page 17
Chapter 15: Bond Valuation and Sinking Funds
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Sample Questions
Q1) A $10 000.00, 5% bond with semi-annual coupons redeemable at 105 in 23 years is purchased at 102.5. What is the approximate yield rate?
Q2) What is the total increase in the 71st monthly deposit interval of a sinking fund that is for 14 years and the sinking fund earn 4.8% compounded monthly? The original principal was $250000.
A) $1883.94
B) $1383.94
C) $1333.94
D) $1888.94
E) $1880.94
Q3) A $200 000 bond is redeemable at 108 in 14 years. If interest on the bond is 5.5% payable semi-annually, what is the purchase price to yield 4% compounded semi-annually?
Q4) A $100 000, 6.0% bond with semi-annual coupons redeemable at par is bought 17.5 years before maturity at 74.25. What was the approximate yield rate?
Q5) A 50 000 bond that pays 5% semi-annually is redeemable at par on July 15, 2025.It is quoted at 97.5 on December 2, 2013. Determine the yield rate.
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Page 18
Chapter 16: Investment Decision Applications
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Sample Questions
Q1) Assume that the net present value of a project is $ 3870 at 10%, and -$1853 at 12%. Use linear interpolation to compute the rate of return correct to the nearest tenth of a percent.
Q2) A company has two investment choices. Alternative A requires an immediate outlay of $4000.00 and offers a return of $14 000.00 after seven years. Alternative B requires an immediate outlay of $3600.00 in return for which $500.00 will be received at the end of every six months for the next seven years. If the rate of return is 6% compounded semi-annually, determine which alternative is preferable.
Q3) A telephone system with a disposable value of $4200 after five years can be purchased for $16 600. Alternatively, a leasing agreement is available that requires an immediate payment of $1900 plus payments of $150.00 at the beginning of each month for five years. If money is worth 9.6% compounded monthly, should the telephone system be leased or purchased?
Q4) Replacing old equipment at an immediate cost of $5 000 and $7 000 six years from now will result in a savings of $3000 semi-annually for ten years. At 11% compounded annually, should the old equipment be replaced?
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