Production and Operations Management Practice Exam
Course Introduction
Production and Operations Management focuses on the effective planning, organizing, directing, and controlling of resources and processes involved in the production of goods and services. The course explores key topics such as operations strategy, process design, facility layout, capacity planning, inventory management, supply chain coordination, quality control, and project management. Emphasizing the integration of technology and data analytics, students will learn how organizations optimize productivity, enhance quality, reduce costs, and meet customer demands in competitive markets. Case studies and real-world examples are used to develop practical skills in problem-solving and decision-making within manufacturing and service operations.
Recommended Textbook
OM 4th Edition by David Alan Collier
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Chapter 1: Goods, Services, and Operations Management
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Sample Questions
Q1) Moments of truth consist of one or more service encounters.
A)True
B)False
Answer: False
Q2) Time-based competition means providing new and innovative products that surprise and delight customers.
A)True
B)False
Answer: False
Q3) Value creation processes focus on primary goods and services.
A)True
B)False
Answer: True
Q4) A golf simulator in a retail sports store is an example of
A)non- durable goods replacing services
B)primary good
C)goods content
D)biztainment
Answer: D
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Chapter 2: Value Chains
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Sample Questions
Q1) One approach to increasing value is to maintain perceived benefits while increasing price or cost.
A)True
B)False
Answer: False
Q2) List the variety of economic and noneconomic issues to be considered when making offshore decisions.
Answer: Low labor costs, lower import duties and fees, lower capital costs, grow global market share, avoid national currency fluctuations, preempt competitors from entering global market, hire worldwide skills and knowledge workers, build robust value chain networks for global markets, build relationships with government officials, negative impact on media attention on remaining employees, potential loss of intellectual property, lose control of key processes, develop secure sources of supply and reduce risks, build relationships with suppliers, avoid environmental regulations and laws, possible political instability in offshore country, lack of communication and/or technical skills, learn foreign markets and cultures..
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Chapter 3: Measuring Performance in Operations
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Sample Questions
Q1) The quote "Happy employees create happy customers" best characterizes the Service-Profit Chain (SPC) model.
A)True
B)False
Answer: True
Q2) The balanced scorecard model uses the same categories as the Baldrige Award.
A)True
B)False
Answer: False
Q3) Which one of the following statements is true regarding FedEx's Service Quality Indicator (SQI)?
A)FedEx's SQI is an example of volume flexibility.
B)FedEx's SQI places the most weight (importance) on late pickups.
C)FedEx's SQI places the most weight (importance) on damaged and lost packages.
D)FedEx's SQI places the most weight (importance) on delivery on the wrong day.
Answer: C
Q4) Queue time is a fancy term for service time variance.
A)True
B)False
Answer: False
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Chapter 4: Operations Strategy
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Q1) What are competitive priorities? Provide some examples of how OM influences the five major types of competitive priorities.
Q2) Apple's primary competitive priority would probably be innovation while Dell's would be flexibility.
A)True
B)False
Q3) Explain the difference between an order qualifier and an order winner.Provide some examples.
Q4) Regarding quality, which statement is not true?
A)Businesses offering premium quality goods usually have larger market share and are early entrants into their market.
B)Quality is positively and significantly related to higher return on investment for almost all kinds of market situations.
C)A strategy of quality improvement usually leads to increased market share but at a cost in terms of reduced short-run profits.
D)High goods quality producers can usually excel by charging low prices.
Q5) Explain the concept of search, experience, and credence attributes.
Q6) What is the difference between corporate, business and functional strategy?
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Chapter 5: Technology and Operations Management
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Sample Questions
Q1) Regarding industrial robots, which choice is not correct?
A)ability to test manufacturing products before they physically exist
B)can be taught
C)can be used with hazardous material
D)can be used in brain surgery
Q2) Without the internet, there would be little application of technology in services.
A)True
B)False
Q3) _______ involves computer control of a manufacturing process, such as determining tool movements and cutting speeds.
A)Computer-Aided Design/Computer-Aided Engineering (CAD/CAE)
B)Computer-Aided Manufacturing (CAM)
C)Enterprise Resource Planning (ERP)
D)Flexible Manufacturing Systems (FMS)
Q4) Amazon.com would be an example of a customer-to-customer value chain.
A)True
B)False
Q5) Describe the three stages of the technology development and adoption process.
Q6) Discuss the role of technology on productivity.
Page 7
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Chapter 6: Goods and Service Design
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Sample Questions
Q1) Ensuring that hotel staff at the front desk address a guest by name is an example of a servicescape requirement.
A)True
B)False
Q2) To improve system reliability, one option is to
A)use better components
B)use more components in series
C)use quality function deployment
D)eliminate redundancy
Q3) List the five elements of a service delivery system.
Q4) Quality Function Deployment (QFD) starts with
A)Competitive evaluation
B)Technical requirements
C)Voice of the customer
D)Technical requirement priorities
Q5) Service guarantees provide a reward or compensation as a response to a service upset and are offered to customers after a service upset has occurred.
A)True
B)False
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Chapter 7: Process Selection, Design, and Analysis
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Sample Questions
Q1) Service encounter repeatability provides a measure analogous to product volume for goods-producing firms.
A)True
B)False
Q2) In designing processes, one often starts at the detail level and moves progressively toward the aggregate.
A)True
B)False
Q3) A manufacturer's average work-in-process inventory for Part 1234 is 1,250 parts.The workstation produces parts at the rate of 150 parts per day.What is the average amount of time a part spends at this workstation?
Q4) The service positioning matrix suggests that services should try to position themselves off the diagonal in order to achieve superior performance.
A)True
B)False
Q5) Differentiate among custom, option and standard goods and services.Also give a goods and a service example of each.
Q6) Define a value stream map.How does this differ from a regular process map?
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Chapter 8: Facility and Work Design
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Sample Questions
Q1) ____ is vertical expansion of job duties to give the worker more responsibility.
A)Job enlargement
B)Job rotation
C)Job enrichment
D)Job design
Q2) All of the following are common objectives of layout studies except
A)Minimize delays in materials handling and customer movement
B)Minimize the number of workstations
C)Provide for good housekeeping and maintenance
D)Maintain flexibility
Q3) Product layouts are less flexible than process layouts.
A)True
B)False
Q4) Considering ergonomics, which of the following does not fit?
A)Improving productivity
B)Group technology
C)Designing equipment and instrumentation
D)Considering physical capability of people
Q5) Explain assembly line balancing.Discuss the three types of information needed to balance an assembly line.
10
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Chapter 9: Supply Chain Design
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Sample Questions
Q1) If a multisite organization has a stable customer benefit package and many identical and standardized facilities, then a responsive supply chain is the best design.
A)True
B)False
Q2) In the Supply Chain Operations Reference (SCOR) model, the "Make" step involves managing orders, transportation, and distribution to provide goods and services.
A)True
B)False
Q3) In designing an efficient supply chain, an organization would need high levels of inventory stored in many small distribution centers.
A)True
B)False
Q4) The center-of-gravity model minimizes the weighted distance between the facility to be located and its supply and demand points.
A)True
B)False
Q5) Explain the concept of postponement and provide an example of it.
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Chapter 10: Capacity Management
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Sample
Questions
Q1) The long-term capacity expansion strategy that can be called a capacity straddle strategy is
A)One large capacity increase
B)Small capacity increases that match demand
C)Small capacity increases that lead demand
D)Small capacity increases that lag demand
Q2) Reservations reduce risks for customers but provide little benefit for service providers.
A)True
B)False
Q3) The capacity expansion approach that provides the most safety capacity is
A)One large capacity increase
B)Small capacity increases that match demand
C)Small capacity increases that lead demand
D)Small capacity increases that lag demand
Q4) In service organizations, capacity is more often viewed as ____
A)The maximum rate of output per unit time
B)Units of resource availability
C)The ability to meet any customer demand
D)The amount of overtime scheduled
Page 12
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Chapter 11: Forecasting and Demand Planning
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Sample Questions
Q1) ____ forecasts are needed for planning production schedules and to assign workers to jobs.
A)Long-range
B)Intermediate-range
C)Short-range
D)Demand planning
Q2) In forecasting, irregular variation that is explainable can normally be discarded.
A)True
B)False
Q3) The manager of a gas station along an interstate highway has observed that gasoline sales generally increase each week over the summer months as more families travel by car on vacations.He also believes that sales are sensitive to fluctuations in the price of gasoline.He developed the following regression model: Sales = 59407 + 509 (Week) - 16463 (Price/gallon)
a.Interpret the coefficients of the independent variables in this model.
b.What is the sales forecast for the 11<sup>th</sup> week of the summer if the price per gallon is estimated to be $3.00?
Q4) Define regression analysis and explain how it is an approach to forecasting.
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Chapter 12: Managing Inventories
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Sample Questions
Q1) Lead time is the time it takes to prepare an order for shipping to a customer.
A)True
B)False
Q2) An auto parts store (open 350 days per year) in a major metropolitan area reviews its inventory on a periodic basis using a computer system.It has recently been experiencing some problems with a particular part, a tune?up kit.The kit is bought from a U.S.manufacturer.The annual demand for these kits is 10,500.The cost to carry one kit in inventory for one year is $4.90, and the cost to place a replenishment order is $17 per order.Replenishment lead time is 4 days.
a.What should be the review period for these tune-up kits?
b.What is the optimal replenishment level without safety stock?
c.What is the optimal replenishment level with safety stock, assuming a 95 percent service level?
Q3) A merchant wants to stock Christmas trees.She can place only one order per season.The merchant pays $30 for each tree and sells them for $80 each.She will incur an additional cost of $6 each for unsold trees that must be hauled to the landfill.If demand for Christmas trees is normally distributed with a mean of 365 trees and a standard deviation of 46 trees, how many trees should she order?
Q4) What are the four categories of inventory costs?
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Chapter 13: Resource Management
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Sample Questions
Q1) Resource management deals primarily with managing inventories in a value chain.
A)True
B)False
Q2) A bill of materials characterizes the structure of dependent demand among all items that comprise a finished good.
A)True
B)False
Q3) Aggregate planning and disaggregation methods in goods-producing industries involve fewer levels of planning than service-providing organizations, because service organizations deal with more than just materials.
A)True
B)False
Q4) Assigning people to tasks, setting priorities for jobs and scheduling equipment fits best with which level of the generic framework for resource planning?
A)Aggregate planning - Level 1
B)Disaggregation - Level 2
C)Execution - Level 3
D)Capacity requirements planning
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Chapter 14: Operations Scheduling and Sequencing
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Sample Questions
Q1) Like the SPT rule, the earliest due date (EDD) rule minimizes the average flow time.
A)True
B)False
Q2) Two examples of process-focused performance measures for sequencing rules are flow time and lateness.
A)True
B)False
Q3) Triage by nurses in an emergency room would be an example of
A)Scheduling
B)Sequencing
C)Appointments
D)Shortest-processing-time rule
Q4) Rescheduling rarely occurs unless customers change their requested due dates.
A)True
B)False
Q5) Scheduling applies to all aspects of the value chain.
A)True
B)False
Q6) What four (4) decisions are considered in designing an appointment system?
Page 16
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Chapter 15: Quality Management
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Sample Questions
Q1) Corporate sponsors who support Six Sigma activities are typically called "black belts."
A)True
B)False
Q2) W.Edward Deming believed that productivity would improve by setting numerical quotas.
A)True
B)False
Q3) Performance standards in services are analogous to manufacturing specifications.
A)True
B)False
Q4) At a gas station, a diesel pump nozzle that will not fit into a non-diesel automobile is an example of ____?
A)Kaizen blitz
B)dpmo
C)Poka-yoke
D)External failure
Q5) List the three principles of total quality and why they are important.
Q6) Explain the four components of the cost of quality.
Q7) Define root cause and describe root cause analysis.
Page 17
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Chapter 16: Quality Control and Spc
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Sample Questions
Q1) Evaluating the trade-offs between the costs of detecting and replacing a defective part or allowing it to continue on through the production process is related to
A)Supplier certification and management
B)In-process control
C)Finished goods control
D)Statistical process control
Q2) If process quality approaches six sigma levels, then standard types of control charts are not useful.
A)True
B)False
Q3) A process is considered to be in control when all common and special causes have been eliminated.
A)True
B)False
Q4) A production process is sampled 24 times with a sample size of 6 yields an overall mean of 25.2 and an average range of 0.8.Determine the control limits for the x-bar and R charts.
Q5) Find the control limits for a c chart with \(\overline{c}\) = 7.
Q6) Define "quality at the source."
Page 18
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Chapter 17: Lean Operating Systems
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Sample Questions
Q1) Compare and contrast a push system vs.a pull system.
Q2) Hinge Manufacturing Company employs a Kanban system for a component part.The daily demand is 900 hinges.Each container has a wait time of 0.05/day, and a processing time of 0.37 days.The Container size is 60 hinges and the safety factor (\(\alpha\)) is 10%.
a.How many Kanban card sets should be authorized?
b.What is the maximum inventory of this hinge in the system?
Q3) Large batches often provide economies of scale and helps firms match inventory to market demand.
A)True
B)False
Q4) Which of the following is not one of the 5Ss?
A)Synchronize
B)Standardize
C)Shine
D)Sustain
Q5) Explain the purpose of visual controls and give examples.
Q6) Define lean enterprise and the four principles of lean operating systems.
Q7) Explain the 5Ss.
Q8) Contrast batching with single-piece flow.
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Chapter 18: Project Management
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Q1) In a matrix organization, functional managers may be reluctant to provide the resources and employees, and the employees assigned to projects may relegate a project to a lower priority than their daily functional job.
A)True
B)False
Q2) When the beta probability distribution is used to characterize uncertain activity times, the distribution of the project completion time will also have a beta probability distribution.
A)True
B)False
Q3) To compute the critical path, we assign all nodes in the network an earliest starting time of zero.
A)True
B)False
Q4) The critical path is the sequence of activities that takes the longest time. A)True
B)False
Q5) Define critical path and explain how it is identified once a project schedule is calculated
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Chapter 19: Work Measurement, Learning Curves, and Standards
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Q1) A method of randomly observing work over a period of time to obtain a distribution of the activities that an individual or a group of employees performs is called
A)learning curve analysis
B)a time study
C)work sampling
D)work measurement
Q2) For a work sampling study, there is a 95% probability that the processing time of an activity has an error of less than 0.06 minutes.The best estimate we have for "p" is 0.30.Determine the size sample that should be used for this work sampling study.
Q3) Work standards
A)Improve motivation if set by managers
B)Increase variability if set by works
C)Are best set informally
D)Work best when designed by workers
Q4) After developing a pre-determined standards, stop-watch or work-sampling times studies need not be performed.
A)True
B)False
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Chapter 20: Queuing Analysis
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Q1) A multiple-server queuing model has three servers with a mean service time of five customers per server per hour.It has been determined that arrivals will average 12 per hour.Arrivals follow a Poisson distribution and service times follow an exponential distribution.
a.Calculate the probability that all three service channels are idle.
b.Determine the probability of five customers in the system.
c.Determine the average number of customers waiting for service.
d.Determine the average number of customers in the system.
e.Determine the average time a customer spends waiting for service.
f.Determine the average time a customer spends in the system.
g.Determine the probability an arriving customer will wait for service.
Q2) When \(\lambda\) = \(\mu\), the operating characteristics are not defined, which means that these times and numbers of items grow infinitely large.
A)True
B)False
Q3) The multiple-server queuing model assumes jockeying can take place.
A)True
B)False
Q4) Discuss the seven key assumptions for the multiple-server waiting line model.
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Chapter 21: Modeling Using Linear Programming
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Q1) Constant terms in the objective function are called object function ____.
A)Variables
B)Decision solutions
C)Coefficients
D)Constraints
Q2) The term 'programming' is used in linear programming because these models find the best 'program' or course of action to follow.
A)True
B)False
Q3) The transportation problem is a special type of linear programming that arises in planning the distribution of goods and services from only one supply point to several demand locations.
A)True
B)False
Q4) Since price is usually set by market conditions, the blending problem use of linear programming attempts to meet demand at minimum cost.
A)True
B)False
Q5) Explain the essence of a blending problem.
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Chapter 22: Simulation
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Q1) There is no single test to prove that a model is 100% valid.
A)True
B)False
Q2) In regard to a simulation model for inventory management, all of the following are correct except
A)Results in an optimal solution with a large simulation
B)Many days of simulation run are needed to obtain meaningful results
C)Lead-time can vary
D)Assumes that a specific reorder point and order quantity have been selected
Q3) The queuing model operating characteristics formula only characterizes short-term average results and, in many practical situations, managers are interested in understanding long-term dynamic behaviors of queuing systems
A)True
B)False
Q4) Explain the major differences between a fixed-time and a next-event simulation model.Include advantages and disadvantages of each.
Q5) Discuss a simulator.How does it differ from simulation software such as ProcessModel?
Q6) Define simulation and give some operations management examples.
Page 24
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Chapter 23: Decision Analysis
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Q1) Risk is a form of uncertainty associated with an unexpected good or undesirable outcome.
A)True
B)False
Q2) The expected value of perfect information represents the maximum amount a company should be willing to pay for any information about events, no matter how good it is.
A)True
B)False
Q3) The expected value criteria is a good tool if
A)The decision will be made only one time
B)The decision will be made over-and-over again
C)The decision will be made under conditions of certainty
D)The decision has to be made quickly
Q4) A numerical value associated with a decision coupled with some event is called a decision tree.
A)True
B)False
Q5) In what type of situation would the expected monetary value criterion be useful? In what type situation would it not be useful?
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