Operations Planning and Control
Final Exam
Course Introduction
Operations Planning and Control explores the strategies, processes, and tools used to efficiently manage production and service operations within organizations. This course covers topics such as forecasting, capacity planning, inventory management, scheduling, production control, and quality assurance. Students will learn how to align operational activities with organizational goals, utilizing techniques like Material Requirements Planning (MRP), Just-in-Time (JIT), and Lean Operations to optimize resource utilization and minimize waste. Emphasis is placed on decision-making in dynamic environments, the integration of supply chain activities, and the application of quantitative and qualitative methods to solve real-world operational challenges.
Recommended Textbook
Operations Management 11th Edition by William J. Stevenson
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Chapter 1: Introduction to Operations Management
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Sample Questions
Q1) Production systems with customized outputs typically have relatively:
A)high volumes of output
B)low unit costs
C)high amount of specialized equipment
D)fast work movement
E)skilled workers
Answer: E
Q2) Service involves a much higher degree of customer contact than manufacturing.
A)True
B)False
Answer: True
Q3) The operations manager has primary responsibility for making operations system design decisions, such as system capacity and location of facilities.
A)True
B)False
Answer: False
Q4) Goods producing organizations are not involved in service activities.
A)True
B)False
Answer: False
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Chapter 2: Competitiveness, Strategy, and Productivity
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Sample Questions
Q1) The fundamental purpose for the existence of any organization is described by its: A)policies
B)procedures
C)corporate charter
D)mission statement
E)bylaws
Answer: D
Q2) As long as we match a competitor on quality and price we will gain market share.
A)True
B)False
Answer: False
Q3) A company has introduced a process improvement that reduces processing time for each unit, so that output is increased by 25% with less material, but one additional worker required.Under the old process, five workers could produce 60 units per hour.Labor costs are $12/hour, and material input was previously $16/unit.For the new process, material is now $10/unit.Overhead is charged at 1.6 times direct labor cost.Finished units sell for $31 each.What increase in productivity is associated with the process improvement?
Answer: 11ea6d31_2dc3_c09e_ada9_8987c9920022_TB2514_00
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Page 4
Chapter 3: Forecasting
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Sample Questions
Q1) Which is not a characteristic of exponential smoothing?
A)smoothes random variations in the data
B)weights each historical value equally
C)has an easily altered weighting scheme
D)has minimal data storage requirements
E)smoothes real variations in the data
Answer: B
Q2) The mean absolute deviation (MAD) is used to:
A)estimate the trend line
B)eliminate forecast errors
C)measure forecast accuracy
D)seasonally adjust the forecast
E)all of the above
Answer: C
Q3) A tracking signal focuses on the ratio of cumulative forecast error to the corresponding value of MAD.
A)True
B)False
Answer: True
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Page 5
Chapter 4: Product and Service Design
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Sample Questions
Q1) Elements of the service process in which there is little to no contact with the customer are referred to as ____________.
A)robust
B)delayed differentiators
C)back-of-the-house
D)user-friendly
E)mission-consistent
Q2) A software company is weighing whether to release a new version of its software.The company can go ahead and release the version now and correct flaws with subsequent patches or upgrades, or it can wait until the new version is reasonably bug-free.This is an example of _____.
A)life-cycle analysis
B)value analysis
C)vaporware
D)concurrent engineering
E)design for production
Q3) Delayed differentiation and modular design are tactics for mass customization.
A)True
B)False
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Page 6
Chapter 5: Strategic Capacity Planning for Products and Services
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Sample Questions
Q1) What would be your cost savings for the preferred alternative, for 32,000 units per year, compared to the other alternative?
Q2) Capacity in excess of expected demand that is intended to offset uncertainty is a:
A)margin protect
B)line balance
C)capacity cushion
D)timing bubble
E)none of the above
Q3) An example of an external factor that influences effective capacity is government safety regulations.
A)True
B)False
Q4) The ratio of actual output to effective capacity is:
A)design capacity
B)effective capacity
C)actual capacity
D)efficiency
E)utilization
Q5) What is the anticipated utilization?
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Chapter 6: Process Selection and Facility Layout
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Sample Questions
Q1) A cafeteria line would be an example of a process focused layout.
A)True
B)False
Q2) In general, Job-Shop systems have a lower unit cost than continuous systems do because continuous systems use costly specialized equipment.
A)True
B)False
Q3) For output to equal projected demand, what will be the efficiency of the assembly line that uses the minimum number of workstations?
A)0.0%
B)6.7%
C)70.0%
D)93.3%
E)100%
Q4) The percentage of idle time in an assembly line is called cycle time.
A)True
B)False
Q5) What is the appropriate cycle time for eight hours of operating time per day and a desired output rate of 960 units per day?
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Chapter 7: Work Design and Measurement
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Sample Questions
Q1) In a stopwatch time study, the average time it takes a given worker to perform a task a certain number of times is the:
A)observed time
B)normal time
C)standard time
D)allowance time
E)performance rating time
Q2) How many observations should be made if he wants to be 95.44 percent confident that the maximum error in the observed time is one second?
A)3
B)4
C)13.3
D)16
E)25
Q3) A time study of a job produced the following: average cycle time = 1.5 minutes, performance rating = 1.15.Allowances are 18 percent of the work day (480 minutes).Determine the standard time for this job.
Q4) For a confidence level of 86.64%, what is the maximum error of the estimate for activity A?
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Chapter 8: Location Planning and Analysis
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Sample Questions
Q1) A manager must decide between two location alternatives, Boston and Chicago.Boston would have annual fixed costs of $70,000, transportation costs of $60 per unit, and labor and material costs of $200 per unit.Chicago would have annual fixed costs of $90,000, transportation costs of $40 per unit, and labor and material costs of $170 per unit.Revenue will be $300 per unit.
(A) Which alternative would yield the higher profit for an annual demand of 3,000 units?
(B) Would the two locations yield the same profit at a certain volume? If so, at what volume would that be?
Q2) The center of gravity method of location planning is accurate only when the quantities to be shipped to each location are equal.
A)True
B)False
Q3) The fact that most types of firms are located in every section of the country suggests that in many cases, location decisions are not overly important; one location typically is as good as another.
A)True
B)False
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Chapter 9: Management of Quality
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Sample Questions
Q1) There is a positive link between quality and productivity.
A)True
B)False
Q2) Poor quality has a positive effect on productivity because it usually takes longer to produce a good part.
A)True
B)False
Q3) Quality of conformance refers to the degree to which goods and services conform to the intent of the designers as documented in the specifications.
A)True
B)False
Q4) A tool that depicts process variation graphically is a(n) _________.
A)Affinity diagram
B)Check list
C)Control Chart
D)Flow Chart
E)Relationship diagram
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11
Chapter 10: Quality Control
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Sample Questions
Q1) The number of runs up and down is:
A)2
B)3
C)4
D)5
E)none of these
Q2) A c-chart is used to monitor the number of defects per unit for process output. A)True
B)False
Q3) If the process proportion of defectives is unknown, what are the upper and lower control limits for an alpha risk of .10? .05? .01?
Q4) Processes that are in control eliminate variations.
A)True B)False
Q5) An x-bar control chart can only be valid if the underlying population it measures is a normal distribution.
A)True B)False
Q6) Perform run tests on the given data.What can you conclude?
Q7) If the process proportion of defectives is unknown, what is the estimate of it?
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Chapter 11: Aggregate Planning and Master Scheduling
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Sample Questions
Q1) In the master production schedule, production is planned for the next period whenever the available-to-promise quantity becomes negative.
A)True
B)False
Q2) What are total regular time costs?
Q3) A time fence in the master schedule is used to prevent unauthorized people from making changes to the schedule.
A)True
B)False
Q4) The assignment of work to specific machines and people are examples of aggregate planning.
A)True
B)False
Q5) Disaggregating an aggregate plan leads to a master schedule.
A)True
B)False
Q6) What are total costs for each period?
Q7) How should overtime capacity be utilized?
Page 13
Q8) Prepare a master schedule based on the following information:
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Chapter 12: MRP and ERP
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Sample Questions
Q1) Safety time is sometimes used in MRP rather than safety stock quantities.
A)True
B)False
Q2) Lot-for-lot ordering in MRP eliminates the holding costs for parts that are carried over to other periods.
A)True
B)False
Q3) Given the following data, construct a material requirements plan which will result in 100 units of Parent #1 (P1) at the beginning of week 6, and 200 units of Parent #2 (P2) at the beginning of week 8: B.
Q4) A bill of materials contains a listing of all the assemblies, parts, and materials needed to produce one unit of an end item.
A)True
B)False
Q5) Back flushing takes place after the production has been completed.
A)True
B)False
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Chapter 13: Inventory Management
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Sample Questions
Q1) At what point should she reorder pepperoni?
A)20 pounds remaining
B)40 pounds remaining
C)60 pounds remaining
D)80 pounds remaining
E)100 pounds remaining
Q2) The introduction of quantity discounts will cause the optimum order quantity to be:
A)smaller
B)unchanged
C)greater
D)smaller or unchanged
E)unchanged or greater
Q3) In a single-period model, if shortage cost is four times excess cost, then the optimum service level is ___ percent.
A)100
B)80
C)60
D)40
E)20
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Page 15
Chapter 14: Jit and Lean Operations
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Sample Questions
Q1) With regard to suppliers, lean systems typically involve:
A)delivery of large lots on short notice
B)the highest quality at the lowest price
C)long-term relationships
D)multiple suppliers to assure continuous availability
E)dedicated staging areas for material
Q2) If a firm's product mix is 60% of product A and 20% each of products B and C, an optimal mix-model production schedule would be successive sequences of AAABC.
A)True
B)False
Q3) An operations strategy reflecting the lean philosophy of production should recognize that lean:
A)is most suited for non-repetitive manufacturing
B)cannot be implemented sequentially
C)requires a wholesale commitment from the outset
D)may provide a competitive advantage
E)all of the above
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Chapter 15: Supply Chain Management
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Sample
Questions
Q1) Examination of the sources of supply for purchased parts or materials in order to improve performance is called:
A)vendor analysis
B)value analysis
C)negotiated purchasing
D)reverse engineering
E)disintegration
Q2) Delayed differentiation is a means of increasing product variety without building the customized product from scratch or keeping large inventories of custom products.
A)True
B)False
Q3) Last quarter, a retailer sold 8,000 t-shirts, 7,000 of which were sold directly from on-hand inventory.This retailer's ________ was 88%.
A)fill rate
B)inventory yield
C)profit margin
D)inventory turnover
E)none of the above
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Chapter 16: Scheduling
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Sample Questions
Q1) Using the EDD rule, the sequence of jobs would be:
A)d-e-b-a-c
B)a-d-c-b-e
C)e-d-b-a-c
D)a-d-c-e-d
E)e-b-c-d-a
Q2) The costs to do each of the three jobs on three alternate pieces of equipment are given below.Determine the job-equipment combination that will minimize total cost.
Q3) If jobs A, B, and C require two operations each, while jobs D and E require one operation each, what is the schedule sequence using the slack per operation (S/O) priority rule?
Q4) Where in the optimum sequence should car E be scheduled?
A)first
B)second
C)third
D)fourth
E)fifth
Q5) In developing the sequence which will minimize throughput time, what is the initial job to be placed in the schedule sequence?
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Chapter 17: Project Management
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Sample Questions
Q1) What is the estimated standard deviation in the time for activity D?
A)0 days
B)2 days
C)3 days
D)4 days
E)12 days
Q2) There are four activities on the critical path, and they have standard deviations of 1, 2, 4, and 2 days.The standard deviation of the critical path is:
A)3
B)5
C)9
D)16
E)25
Q3) Project managers are sometimes able to reduce indirect project costs by increasing direct costs.
A)True
B)False
Q4) What are the estimated slack times (in weeks) for activities A-H?
Q5) Consider the project depicted by the following A-O-A diagram:
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Chapter 18: Management of Waiting Lines
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Sample Questions
Q1) Why is there waiting in an infinite source queuing system?
A)poor scheduling of servers
B)slow service
C)low utilization
D)variability in arrival and service rates
E)multiple phase processing
Q2) In an infinite source model, the average number being served is equal to the ratio of the arrival rate to the service rate.
A)True
B)False
Q3) To reduce the average number waiting in line, it is important to increase utilization.
A)True
B)False
Q4) What is average time in line for a high priority item?
Q5) An approach to reducing the variability in processing times might include greater standardization.
A)True
B)False
Q6) What is the overall average arrival rate?
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Chapter 19: Linear Programming
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Sample Questions
Q1) What is the assembly time constraint (in hours)?
A)1 A + 1 B \(\le\) 800
B)0.25 A + 0.5 B \(\le\) 800
C)0.5 A + 0.25 B\(\le\) 800
D)1 A + 0.5 B \(\le\) 800
E)0.25 A + 1 B \(\le\) 800
Q2) Which of the following could not be a linear programming problem constraint?
A)1A + 2B \(\le\) 3
B)1A + 2B \(\ge\) 3
C)1A + 2B = 3
D)1A + 2B + 3C + 4D \(\le\) 5
E)1 A + 2B
Q3) The linear optimization technique for allocating constrained resources among different products is:
A)linear regression analysis
B)linear disaggregation
C)linear decomposition
D)linear programming
E)linear tracking analysis
Q4) What is the objective function?
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Chapter 20: Extension 4: Reliability
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Sample Questions
Q1) A system consists of two components, each of which must activate if the system is to activate.One component has a reliability of .99.The other has a reliability of .95.What is the overall system reliability?
A).99
B).95
C).94
D).90
E)Cannot be determined with this information.
Q2) An electrical appliance will not work unless component QK does.Component QK's reliability is 0.95.Every other part of the appliance is 100% reliable.What would the reliability of the appliance be if a backup QK were added?
A).95
B).9975
C).9025
D).9205
E).9795
Q3) Product reliability involves both short-term and long-term perspectives.
A)True
B)False
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Chapter 21: Extension 5: Decision Theory
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Sample Questions
Q1) What is the expected value of selecting script #1?
A)$15,000,000
B)$9,060,000
C)$8,400,000
D)$7,200,000
E)$6,000,000
Q2) The expected monetary value approach is most appropriate when the decision-maker is risk-neutral.
A)True
B)False
Q3) If you are uncertain which state of nature will occur, and use the maximin criterion, which alternative will you select?
Q4) The maximin approach involves choosing the alternative with the highest payoff. A)True
B)False
Q5) The EVPI indicates an upper limit on the amount a decision-maker should be willing to spend to obtain additional information.
A)True
B)False
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Chapter 22: Extension 7: Learning Curves
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Sample Questions
Q1) In which of the following managerial activities would learning curves probably be the least useful?
A)negotiated purchasing
B)manpower planning
C)location analysis
D)budgeting
E)pricing new products
Q2) Suppose the first unit required 800 hours and the second unit required only 680.Which of the following times for the fourth unit would be consistent with a true learning curve scenario?
A)492
B)587
C)578
D)603
E)583
Q3) If we have never made the first unit but only think we know how much the labor time will be, we cannot draw a learning curve.
A)True
B)False
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Chapter 23: Extension 8: The Transportation Model
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Q1) In a transportation problem with three locations and two destinations, the objective function is as follows: Min 20X<sub>11</sub> + 18X<sub>21</sub> + 23 X<sub>31</sub> + 16X<sub>12</sub> + 14X<sub>22</sub> + 12X<sub>32</sub>.How much does it cost to ship one unit from location 1 to destination 2?
A)18
B)12
C)23
D)16
E)14
Q2) Which of the following is not information needed to use the transportation model?
A)capacity of the sources
B)demand of the destinations
C)unit shipping costs
D)unit shipping distances
E)all of the above are necessary
Q3) The transportation model is a special type of linear regression model.
A)True
B)False
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Chapter 24: Extension 10: Acceptance Sampling
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Q1) Shipments of bowling balls are sampled before delivery to a warehouse.Lots of 600 balls are checked, using 10 observations from each lot.Any lot with more than one defective is rejected.Calculate values for the operating characteristic curve for this sampling plan.
Q2) If he uses an acceptance sampling plan of n = 5 and c = 2, what will be the average outgoing quality (AOQ) for batches with 40% defectives?
A)0.1270
B)0.2730
C)0.3174
D)0.6826
E)0.7270
Q3) Flexible acceptance sampling revises the sampling plan in response to actual results.
A)True
B)False
Q4) Acceptance sampling is applied to batches of items during the production process. A)True
B)False
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Chapter 25: Extension 14: Maintenance
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Q1) Factors affecting the decision of how much preventive maintenance is desirable typically include all of the following except:
A)age of equipment
B)type of product
C)degree of technology
D)type of production process
E)how critical to the production process
Q2) Cost of equipment breakdown doesn't include:
A)loss of output
B)cost of idle workers
C)damage to other equipment
D)replacement costs
E)potential safety hazard
Q3) In the broadest sense, preventive maintenance extends back to the installation stage of equipment and facilities.
A)True
B)False
Q4) Ideally, preventive maintenance will be performed before a breakdown or failure.
A)True
B)False
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