Operations Management
Midterm Exam
Course Introduction
Operations Management explores the design, operation, and improvement of the processes that create and deliver an organizations goods and services. Students learn key concepts such as process analysis, capacity planning, inventory management, quality control, supply chain coordination, and operational strategy. Emphasizing both manufacturing and service contexts, the course highlights the importance of efficiency, quality, and customer satisfaction in gaining a competitive advantage. Through case studies, quantitative tools, and real-world examples, students develop practical skills to solve operational challenges and drive organizational success.
Recommended Textbook
Introduction to Management Science A Modeling and Case Studies Approach With Spreadsheets
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Page 2
Chapter 1: Introduction
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Sample Questions
Q1) Managers make decisions based solely on the quantitative factors involved in the problem.
A)True
B)False
Answer: False
Q2) Which of the following is a constant in a mathematical model?
A)Decision variable.
B)Parameter.
C)Objective function.
D)Constraint.
E)None of the above.
Answer: B
Q3) The objective function for a model is a mathematical expression of the measure of performance for the problem in terms of the decision variables.
A)True
B)False
Answer: True
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Page 3
Chapter 2: Linear Programming: Basic Concepts
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Sample Questions
Q1) A feasible solution is one that satisfies all the constraints of a linear programming problem simultaneously.
A)True
B)False
Answer: True
Q2) What is the weekly profit when producing the optimal amounts?
A)$10,000.
B)$4,600.
C)$2,500.
D)$5,200.
E)$6,400.
Answer: A
Q3) Which objective function has the same slope as this one: 4x + 2y = 20.
A)2x + 4y = 20.
B)2x - 4y = 20.
C)4x - 2y = 20.
D)8x + 8y = 20.
E)4x + 2y = 10.
Answer: E
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Page 4
Chapter 3: Linear Programming: Formulation and Applications
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Sample Questions
Q1) A key assumption of linear programming is that the equation for each of the output cells,including the target cell,can be expressed as a SUMPRODUCT (or SUM)function.
A)True
B)False
Answer: True
Q2) An assignment problem:
A)is a special transportation problem.
B)will always have an integer solution.
C)has all supplies and demands equal to 1.
D)None of the above.
E)All of the above.
Answer: E
Q3) It is usually quite simple to obtain estimates of parameters in a linear programming problem.
A)True
B)False
Answer: False
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Page 5
Chapter 4: The Art of Modeling With Spreadsheets
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Sample Questions
Q1) What are some ways to distinguish data cells,changing cells,output cells,and target cells on a spreadsheet?
A)Borders.
B)Shading.
C)Color.
D)All of the above.
E)a and c only.
Q2) Which of the following is an appropriate first step when building a spreadsheet model?
A)Start with building a small scale model.
B)Visualize where you want to finish.
C)Test the model.
D)Expand the model to full scale.
E)Optimize the model.
Q3) Each data value should be entered into how many cells?
A)0
B)1
C)2
D)3
E)The value should be entered into any formula in which it is needed.
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Chapter 5: What-If Analysis for Linear Programming
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Sample Questions
Q1) According to the 100% rule for simultaneous changes in objective function coefficients,if the sum of the percentage changes exceeds 100%,the optimal solution definitely will change.
A)True
B)False
Q2) When a change in the value of an objective function coefficient remains within the allowable range,the optimal solution will also remain the same.
A)True
B)False
Q3) The allowable range gives ranges of values for the objective function coefficients within which the values of the decision variables are optimal.
A)True
B)False
Q4) A shadow price indicates how much the optimal value of the objective function will increase per unit increase in the right-hand side of a constraint.
A)True
B)False
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Chapter 6: Network Optimization Problems
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Sample Questions
Q1) In a shortest path problem,the lines connecting the nodes are referred to as arcs.
A)True
B)False
Q2) A minimum cost flow problem will have feasible solutions as long as there is a balance between the total supply from the supply nodes and the total demand at the demand nodes.
A)True B)False
Q3) The network simplex method can be used to solve minimum cost flow problems with over a million arcs.
A)True
B)False
Q4) Which of the following could be the subject of a maximum flow problem?
A)Products.
B)Oil.
C)Vehicles.
D)All of the above.
E)None of the above.
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Page 8
Chapter 7: Using Binary Integer Programming to Deal With
Yes-Or-No Decisions
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Sample Questions
Q1) In a BIP problem,1 corresponds to a yes decision and 0 to a no decision.If there are 4 projects under consideration (A,B,C,and D)and at most 2 can be chosen then the following constraint needs to be added to the formulation:
A)A+ B + C + D \(\le\) 1.
B)A+ B + C + D \(\le\) 2.
C)A+ B + C + D \(\le\) 4.
D)A+ B + C + D = 2.
E)None of the above.
Q2) The constraint x<sub>1</sub> + x<sub>2</sub> + x<sub>3</sub> \(\le\) 3 in a BIP represents mutually exclusive alternatives.
A)True
B)False
Q3) The constraint x<sub>1</sub> \(\le\) x<sub>2</sub> in a BIP problem means that alternative 2 cannot be selected unless alternative 1 is also selected.
A)True
B)False
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Page 9
Chapter 8: Nonlinear Programming
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Sample Questions
Q1) Trying different starting points and picking the best solution will always yield the optimal solution to a nonlinear programming problem.
A)True
B)False
Q2) The members of the population used to create the next generation are picked randomly by the Evolutionary Solver.
A)True
B)False
Q3) If the data cells are in column D and the changing cells are in column C,which of the following are not linear formulas in a spreadsheet?
A)IF(D1 >= 6,C1,C2)
B)ROUND(C3)
C)ABS(C3)
D)All of the above.
E)b and c only.
Q4) A quadratic programming problem is a special type of linear programming problem.
A)True B)False
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Chapter 9: Decision Analysis
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Sample Questions
Q1) Utilities can be useful when monetary values do not accurately reflect the true values of an outcome.
A)True
B)False
Q2) Sensitivity analysis may be useful in decision analysis since prior probabilities may be inaccurate.
A)True
B)False
Q3) A utility function for money can be constructed by applying a lottery procedure.
A)True
B)False
Q4) A decision tree branches out all of the possible decisions and all of the possible events.
A)True
B)False
Q5) A posterior probability is a revised probability of a state of nature after doing a test or survey to refine the prior probability.
A)True
B)False
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Chapter 10: Cd Supplement - Decision Analysis
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Sample Questions
Q1) The realism strategy with a pessimism-optimism index of 0.5 is:
A)small.
B)medium.
C)medium large.
D)large.
E)extra large.
Q2) The realism strategy with a pessimism-optimism index of 0.5 is:
A)Buy.
B)Rent.
C)Lease.
D)High.
E)Low.
Q3) The minimax regret strategy is:
A)small.
B)medium.
C)medium large.
D)large.
E)extra large.
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12
Chapter 11: Forecasting
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Sample Questions
Q1) Which of the following is not a type of judgmental forecasting?
A)Managerial opinion.
B)Sales force composite.
C)Time-series analysis.
D)The Delphi method.
E)Consumer market survey.
Q2) Given forecast errors of -5,-10,and 15,what is the mean absolute deviation?
A)0.
B)5.
C)10.
D)30.
E)None of the above.
Q3) The Delphi method involves the use of a series of questionnaires to achieve a consensus forecast.
A)True
B)False
Q4) Exponential smoothing with trend was designed for time-series that have great variability both up and down.
A)True
B)False
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Chapter 12: Queueing Models
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Sample Questions
Q1) For a system that has a high utilization factor,decreasing the service rate will have only a negligible effect on customer waiting time.
A)True
B)False
Q2) The standard deviation for the degenerative distribution equals zero.
A)True
B)False
Q3) A system has one service facility that can service 10 customers per hour.The customers arrive at an average rate of 6 per hour.In this case,no waiting line will form.
A)True
B)False
Q4) What is the average number of high priority items waiting in line for service?
A)0.
B)0.24.
C)1.74.
D)1.98.
E)2.22.
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Chapter 13: CD Supplement - Additional Queueing Models
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Sample Questions
Q1) The Erlang distribution has less variability than the exponential distribution for the same mean.
A)True
B)False
Q2) The finite calling population queueing model is appropriate when the potential calling population is relatively small.
A)True
B)False
Q3) The Erlang distribution with k = 4 has higher variability than the Erlang distribution with k = 2.
Multiple Choice Questions
A)True
B)False
Q4) When designing a queueing system with a finite queue,one important decision is how much waiting room to provide.
A)True
B)False
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Chapter 14: Computer Simulation: Basic Concepts
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Sample Questions
Q1) A simulation clock keeps track of how long the simulation has run in real time.
A)True
B)False
Q2) Which of the following would not be a probable reason for choosing simulation as a decision-making tool?
A)The situation is too complex for a mathematical model.
B)The is a limited time in which to obtain results.
C)Good results have been obtained in the past using simulation.
D)Users are able to understand the model.
E)All of these are probable reasons for choosing simulation.
Q3) If a simulation begins with the first random number,the second simulated value would be:
A)0.
B)1.
C)2.
D)3.
E)4.
Q4) A simulation model is often formulated in terms of a flow diagram. A)True
B)False
Page 16
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Chapter 15: CD Supplement - the Inverse Transformation
Method for Generating Random Observations
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Sample Questions
Q1) The inverse transformation method can be used to generate random observations from a probability distribution.
A)True
B)False
Q2) Excel's RAND()function is designed specifically for applying the inverse transformation method to any discreet probability distribution.
A)True
B)False
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Chapter 16: Computer Simulation With Crystal Ball
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Sample Questions
Q1) The number of trials is one of the options to be set in the Run Preferences for Crystal Ball.
A)True
B)False
Q2) The sensitivity chart in Crystal Ball indicates how strongly various assumption cells influence the forecast cell.
A)True
B)False
Q3) Which of the following are three-parameter distributions?
A)Weibull distribution.
B)Normal distribution.
C)Beta distribution.
D)All of the above.
E)a and c only.
Q4) The triangular distribution has a fixed upper and lower bound.
A)True
B)False
Q5) Crystal Ball can be used to fit a discrete distribution to data. A)True
B)False
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Chapter 17: CD - Solution Concepts for Linear Programming
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Sample Questions
Q1) Most linear programming problems have just one optimal solution.
A)True
B)False
Q2) The simplex method can only solve problems with up to 100 functional constraints. A)True
B)False
Q3) An optimal solution must lie on the boundary of the feasible region.
A)True
B)False
Q4) If a maximization problem has an objective function of 3x<sub>1</sub> + 10x<sub>2</sub>,which of the following corner points is the optimal solution?
A)(0,2).
B)(0,3).
C)(3,3).
D)(5,1).
E)(0,0).
Q5) The simplex method is a specific type of interior-point algorithm. A)True B)False
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Chapter 18: CD - Transportation and Assignment Problems
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Sample Questions
Q1) The supplies and demands provide all the data for a transportation problem.
A)True
B)False
Q2) It is not possible to solve a transportation problem that has \(\le\) instead of = signs for the supply constraints.
A)True
B)False
Q3) The requirements assumption states that each source has a fixed supply of units,where the entire supply must be distributed to the destinations and that each destination has a fixed demand for units,where the entire demand must be received from the sources.
A)True
B)False
Q4) The Hungarian Method is an algorithm used to solve transportation problems.
A)True
B)False
Q5) When demand and supply are not equal in a transportation problem then the problem cannot be solved.
A)True
B)False
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Chapter 19: CD - Pertcpm Models for Project Management
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Sample Questions
Q1) The earliest start of an activity is the latest early finish of any immediately preceding activity.
A)True
B)False
Q2) Which of the following are ways of crashing an activity?
A)Using overtime.
B)Hiring more workers.
C)Using specialized equipment.
D)All of the above.
E)None of the above.
Q3) The slack of an activity is the difference between the latest finish and the earliest finish times.
A)True
B)False
Q4) At which point does crashing of a project cease?
A)When the project is completed.
B)When no additional crashing is possible.
C)When the cost to crash equals or exceeds the benefit of crashing.
D)All of the above.
E)None of the above.
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Chapter 20: CD - Goal Programming
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Sample Questions
Q1) In preemptive goal programming,the goals are ranked from most important to least important.
A)True
B)False
Q2) In weighted goal programming,the objective is to:
A)Minimize the weighted sum of deviations from the goals.
B)Minimize the deviation from the most important goal.
C)Meet the most important goal.
D)Maximize the profit.
E)None of the above.
Q3) In preemptive goal programming,penalty weights are assigned to measure the relative seriousness of missing the respective goals.
A)True
B)False
Q4) In preemptive goal programming,the first step is to:
A)Minimize the weighted sum of deviations from the goals.
B)Minimize the deviation from the most important goal.
C)Meet the most important goal.
D)Maximize the profit.
E)None of the above.
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Chapter 21: CD - Inventory Management With Known Demand
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Sample Questions
Q1) The goal of the basic EOQ model is to:
A)minimize order size.
B)minimize order cost.
C)minimize holding cost.
D)minimize the sum of purchasing and setup costs.
E)minimize the sum of setup and holding costs.
Q2) An inventory management strategy should work towards:
A)increasing order sizes.
B)decreasing order sizes.
C)increasing safety stocks.
D)increasing demand.
E)None of the above.
The manager of the Quick Stop Corner Convenience Store (which never closes)sells four cases of beer each day.Ordering costs are $8 per order,and beer costs $0.80 per six-pack (each case of beer contains four six-packs).Orders arrive three days from the time they are placed.Daily holding costs are equal to 5% of the cost of the beer.
Q3) In the EOQ model with planned shortages,Q* always will be smaller than S*.
A)True
B)False
Page 23
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Chapter 22: CD - Inventory Management With Uncertain Demand
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Sample Questions
Q1) In a perishable products model,if shortage and excess costs are equal,then the optimum service level is:
A)0.
B)0.33.
C)0.5.
D)0.67.
E)1.
Q2) The perishable product model can be very helpful in determining how much to order.
A)True
B)False
Q3) The objective of inventory management is to maximize customer service levels.
A)True
B)False
Q4) Two main concerns of inventory control relate to the costs and the level of customer service.
A)True
B)False
Page 24
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