Production and Operations Management :MCQ-2

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51. Someone who has responsibility for marketing decisions concerning a group of products is:

  1. A marketing manager
  2. A brand manager.
  3. A sales manager.
  4. A product manager.

Correct answer: (D) A product manager.

52. The paradigm that leads to more complex products at ever-increasing prices is ______________.

  1. Product orientation
  2. Production orientation
  3. Marketing orientation
  4. Sales orientation

Correct answer: (A) Product orientation

53. Which of the following best describes the decision making required in dealing with customer enquiries?

  1. Unstructured, strategic
  2. Unstructured, operational
  3. Structured, strategic
  4. Structured, operational

Correct answer: (B) Unstructured, operational

54. Two systems are described as_________________ if a change in the outputs of one causes a substantial change in the state of the other.

  1. Highly decoupled
  2. Highly coupled
  3. Black boxes
  4. Sub-systems

Correct answer: (B) Highly coupled

55. Chang and Chang observe that the competition is increasing the size of its warehouses. They have decided to do the same. They are following a _______________________ strategy.

  1. Theory of Constraints
  2. Follow the leader
  3. Expansionist
  4. Wait-and-see

Correct answer: (B) Follow the leader

56. A facility with a design capacity of 1,000 units, an actual average of 800 units, and effective capacity of 850 units has a utilization of ______________ .

  1. 85%
  2. 80%
  3. 125%
  4. 94%

Correct answer: (B) 80%

57. Yield management is not especially useful where:

  1. The service/product can be stored
  2. Capacity is relatively fixed
  3. The service cannot be sold in advance
  4. The market can be fairly clearly segmented

Correct answer: (A) The service/product can be stored

58. Which of the following is true?

  1. Value is always lower than price.
  2. Value is what consumers are prepared to pay.
  3. Cost is always lower than price.
  4. Price is always lower than value.

Correct answer: (B) Value is what consumers are prepared to pay.

59. A specific satisfier for a need is called a______________.

  1. Product
  2. Demand
  3. Want
  4. Market

Correct answer: (C) Want

60. Structured decisions are also called_________________ decisions.

  1. Strategic
  2. Programmable
  3. Read-intensive
  4. Non-programmable

Correct answer: (B) Programmable

 

61. Inputs come from and outputs are transferred to the_________________ of a system.

  1. Environment
  2. Sub-system
  3. Comparator
  4. Effector

Correct answer: (A) Environment

62. When evaluating alternative capacity decisions, qualitative concerns exclude:

  1. Cash flow.
  2. Uncertainties about demand.
  3. Competitive reaction.
  4. Technology change.

Correct answer: (A) Cash flow.

63. When demand exceeds capacity, a firm should

  1. Lower prices.
  2. Add workers.
  3. Temporarily lay-off workers.
  4. Advertise.

Correct answer: (B) Add workers.

64. The marketing concept should be central to business strategy because:

  1. Business strategy is aimed at customers.
  2. Companies have a moral responsibility to care for their customers.
  3. Marketing enables firms to persuade their customers to buy things they do not really need.
  4. Customers will only spend money with firms that look after their needs.

Correct answer: (D) Customers will only spend money with firms that look after their needs.

65. one way to decouple the production system and the sales system is:

  1. To introduce a feedback loop
  2. To treat the systems as black boxes
  3. To decrease sales
  4. To introduce an inventory

Correct answer: (D) To introduce an inventory

66. Long-term capacity planning deals with which of the following factors?

  1. Overtime budgets
  2. Workforce size
  3. Inventories
  4. Investment in new facilities

Correct answer: (D) Investment in new facilities

67. Efficiency is given by

  1. Actual output divided by design capacity.
  2. Capacity divided by utilization.
  3. Effective capacity divided by actual output.
  4. Actual output divided by effective capacity.

Correct answer: (D) Actual output divided by effective capacity.

68. The most aggressive and risky approach to capacity planning is

  1. Capacity lags with incremental expansion.
  2. Leading demand with one-step expansion.
  3. Leading demand with incremental expansion.
  4. Attempts to have an average capacity that straddles demand with incremental expansion.

Correct answer: (B) Leading demand with one-step expansion.

69. Demand is created when:

  1. A need is identified.
  2. A significant group of people want to buy something.
  3. People who can afford something want to buy it.
  4. Marketers persuade people to want something.

Correct answer: (C) People who can afford something want to buy it.

70. Input measures of capacity are preferred when there is/are:

  1. Service processes.
  2. High-volume processes.
  3. Flexible flow processes.
  4. Low customization.

Correct answer: (A) Service processes.

71. In general, a less capital-intensive industry such as a hotel chain would do well with a utilization rate of:

  1. Approximately 18%.
  2. 30-40%.
  3. 60-70%.
  4. 100%.

Correct answer: (C) 60-70%.

72. A facility with a design capacity of 1,000 units, an actual average of 800 units, and effective capacity of 850 units has an efficiency of ______________.

  1. 80%
  2. 50%
  3. 85%
  4. 94%

Correct answer: (D) 94%

73. The first steps of capacity planning and control do not include:

  1. Identifying the alternative capacity plans?
  2. Measuring aggregate demand and capacity?
  3. Studying the effect of queuing theory
  4. Choosing the most appropriate capacity plan?

Correct answer: (C) Studying the effect of queuing theory

74. Someone who controls media purchases and deals with advertising agencies is ____________________.

  1. An advertising manager
  2. A brand manager
  3. A public relations manager
  4. A sales manager

Correct answer: (A) An advertising manager

75. A measure of the reserve capacity a process has to handle in unexpected increases in demand is the:

  1. Capacity utilization rate.
  2. Capacity cushion.
  3. Capacity bottleneck.
  4. Capacity constraint limit.

Correct answer: (B) Capacity cushion.

76. The maximum output of a system in a given period is called the

  1. Efficiency.
  2. Effective capacity.
  3. Design capacity.
  4. Break-even point.

Correct answer: (C) Design capacity.

77. The multiple product case of determining breakeven in dollars

  1. Weights the variable cost of each product.
  2. Weights the selling price of each product.
  3. Weights the fixed cost attributable to each product.
  4. Weights the contribution of each product.

Correct answer: (D) Weights the contribution of each product.

78. The basic break-even model

  1. Demonstrates that the break-even point increases as output volume increases.
  2. Demonstrates that fixed costs remain constant as output volume increases.
  3. Demonstrates that total revenue is fixed as output volume increases.
  4. Demonstrates that per unit variable costs vary as output volume increases.

Correct answer: (B) Demonstrates that fixed costs remain constant as output volume increases.

79. Which of the following provides the best definition of 'information'?

  1. Computer hardware
  2. Data processed for a purpose
  3. Computer software
  4. Transaction Data

Correct answer: (B) Data processed for a purpose

80. Which of the following decision is least likely to be supported by a management information system?

  1. Company reorganisation
  2. Analysis of performance
  3. Allocating budgets
  4. Dealing with customer enquiries

Correct answer: (A) Company reorganisation

81. What are the four stages of Simon's model of decision making?

  1. Intelligence, design, choice, implementation
  2. Intelligence, design, computation, implementation
  3. Information, design, choice, implementation
  4. Intelligence, data, choice, implementation

Correct answer: (A) Intelligence, design, choice, implementation

82. Which of the following best describes 'formal information'?

  1. Produced by standard procedures. Passed by word of mouth
  2. Produced by standard procedures. Objective
  3. Objective. Passed by word of mouth
  4. Subjective. Based on estimates

Correct answer: (B) Produced by standard procedures. Objective

83. MRP stands for:

  1. Master Resources Production
  2. Management Reaction Planning
  3. Materials Requirements Planning
  4. Manufacturing Resource Planning

Correct answer: (C) Materials Requirements Planning

84. A master production schedule contains information about

  1. Quantities and required delivery dates of all sub-assemblies
  2. Quantities and required delivery dates of final products
  3. Inventory on hand for each sub-assembly
  4. Inventory on hand for each final product

Correct answer: (B) Quantities and required delivery dates of final products

85. Optimized production technology (OPT) is a computer-based technique and tool which helps to schedule production systems. Which of the following are not principles of OPT?

  1. Capacity is "king"
  2. Balance flow is what is required
  3. Process batch should be variable
  4. Bottlenecks govern throughput

Correct answer: (A) Capacity is "king"

86. MPS stands for:

  1. Master Planning System
  2. Master Production Schedule
  3. Material Production Schedule
  4. Material Planning System

Correct answer: (B) Master Production Schedule

87. A master production schedule contains information about

  1. Quantities and required delivery dates of all sub-assemblies
  2. Quantities and required delivery dates of final products
  3. Inventory on hand for each sub-assembly
  4. Inventory on hand for each final product

Correct answer: (B) Quantities and required delivery dates of final products

88. Dependent demand and independent demand items differ in that

  1. For any product, all components are dependent-demand items
  2. The need for independent-demand items is forecasted
  3. The need for dependent-demand items is calculated
  4. All of the above are true

Correct answer: (D) All of the above are true

89. A master production schedule specifies

  1. The financial resources required for production
  2. What component is to be made, and when
  3. What product is to be made, and when
  4. The labour hours required for production

Correct answer: (C) What product is to be made, and when

90. Closed Loop MRP means:

  1. Actual inventory is counted regularly and adjustment made to the inventory records
  2. Capacity and resource planning is included in the MRP logic
  3. Unused materials are returned to stores and recorded back into the system
  4. Actual sales are netted off the forecasts in the MPS

Correct answer: (B)
Capacity and resource planning is included in the MRP logic

91. Enterprise Resource Planning (ERP) has been criticised on a number of grounds. Which of the following is not a common criticism of ERP?

  1. It doesn't allow decisions and databases from all parts of the organisation to be integrated
  2. Implementation is expensive
  3. The effect it has on businesses is disappointing
  4. It can have a disruptive effect on the organisation's operations

Correct answer: (A) It doesn't allow decisions and databases from all parts of the organisation to be integrated

92. Demand for a given item is said to be dependent if

  1. the item has several children
  2. there is a deep bill of materials
  3. the finished products are mostly services (rather than goods)
  4. there is a clearly identifiable parent

Correct answer: (D) there is a clearly identifiable parent

93. In MRP (Materials Requirements Planning) the Bill of Materials is:

  1. The required output from a process over time
  2. A list of required safety stock items
  3. The sum of stock-on-hand and work-in-progress
  4. The product structure showing where common parts are used

Correct answer: (D) The product structure showing where common parts are used

94. What is measurementship?

  1. Trying to agree low objectives so as to look good later
  2. Discussing "the numbers" at every opportunity
  3. Surveying by naval architects.
  4. Collecting too much performance data

Correct answer: (A) Trying to agree low objectives so as to look good later

95. The outputs of a MRP II system are:

  1. Sales order priorities / Bills of Materials / Material Requirement Plans
  2. Material Requirement Plans / scheduled purchase orders / capacity requirement plans
  3. Stock quantities / Bills of Materials / Master Production Schedule
  4. Capacity requirement plans / stock quantities / stock locations

Correct answer: (B) Material Requirement Plans / scheduled purchase orders / capacity requirement plans

96. Three levels of planning. What are they?

  1. Top, middle and bottom
  2. Headquarters, divisional and local
  3. Operational, intermediate and strategic
  4. None of these

Correct answer: (C) Operational, intermediate and strategic

97. Three inputs for every MRP system are:

  1. Sales forecast, delivery costs, capacity plan
  2. Average replenishment time, re-order point, economic order quantity
  3. Stock on hand, Master Production Schedule, Bill of Materials
  4. Bill of Materials, sales forecast, sales history

Correct answer: (C) Stock on hand, Master Production Schedule, Bill of Materials

98. What three problems commonly hindering successful planning did we identify?

  1. An oversized planning department; poor co-operation between managers and planners; managers with little time to gather information.
  2. Procedures unsuited to change; negative organisational culture; poor interpersonal relationships.
  3. Lack of planning expertise; little top management support; misuse of planning specialists.
  4. Conflict among objectives; impossibility of measuring outcomes; confusion between means and ends.

Correct answer: (C) Lack of planning expertise; little top management support; misuse of planning specialists.

99. What is the more formal term for what is known as 'Plan B'?

  1. A contingency plan
  2. A circumstantial plan
  3. A catastrophe plan
  4. A convergence plan

Correct answer: (A) A contingency plan

100. What is the planning horizon?

  1. The time ahead for which there is no information.
  2. The time period within which uncertainty is very low.
  3. The maximum time for which managers can make plans.
  4. The time between making a plan and putting it into effect.

Correct answer: (D) The time between making a plan and putting it into effect.

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