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1
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A rice mill in south Louisiana purchases the trucking firm that transports packaged rice to distributors. This is an example of which of the following?
forward integration
horizontal integration
current transformation
backward integration
keiretsu
forward integration
horizontal integration
current transformation
backward integration
keiretsu
backward integration
2
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Which of the following is an advantage of the postponement technique?
reduction in training costs
reduction in automation
early customization of the product
better quality of the product
reduction in inventory investment
reduction in training costs
reduction in automation
early customization of the product
better quality of the product
reduction in inventory investment
reduction in inventory investment
3
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Which of the following costs would be incurred even if no units were produced?
purchasing costs
building rental costs
direct labor costs
transportation costs
raw material costs
purchasing costs
building rental costs
direct labor costs
transportation costs
raw material costs
building rental costs
4
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The main trait of a single-period model is that:
the cost of a shortage cannot be determined accurately.
supply is limited.
it has the largest EOQ sizes.
inventory has limited value after a certain period of time.
the order quantity should usually equal the expected value of demand.
the cost of a shortage cannot be determined accurately.
supply is limited.
it has the largest EOQ sizes.
inventory has limited value after a certain period of time.
the order quantity should usually equal the expected value of demand.
inventory has limited value after a certain period of time.
5
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Which of the following statements is true regarding the leverage of supply chain savings?
Supply chain savings exert more leverage as the firm's net profit margin decreases.
Supply chain savings exert more leverage as the firm's purchases are a smaller percent of sales.
Supply chain leverage depends only upon the percent of sales spent in the supply chain.
Supply chain leverage is about the same for all industries.
None of the above is true.
Supply chain savings exert more leverage as the firm's net profit margin decreases.
Supply chain savings exert more leverage as the firm's purchases are a smaller percent of sales.
Supply chain leverage depends only upon the percent of sales spent in the supply chain.
Supply chain leverage is about the same for all industries.
None of the above is true.
Supply chain savings exert more leverage as the firm's net profit margin decreases.
6
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Which of the following would NOT generally be a motive for a firm to hold inventories?
to hedge against inflation
to provide a selection of goods for anticipated customer demand and to separate the firm from fluctuations in that demand
to take advantage of quantity discounts
to minimize holding costs
to decouple various parts of the production process
to hedge against inflation
to provide a selection of goods for anticipated customer demand and to separate the firm from fluctuations in that demand
to take advantage of quantity discounts
to minimize holding costs
to decouple various parts of the production process
to minimize holding costs
7
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Which of the following is an element of inventory holding costs?
material handling costs
housing costs
investment costs
pilferage, scrap, and obsolescence
All of the above are elements of inventory holding costs.
material handling costs
housing costs
investment costs
pilferage, scrap, and obsolescence
All of the above are elements of inventory holding costs.
All of the above are elements of inventory holding costs.
8
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Which of these statements about the production order quantity model is FALSE?
All else equal, the smaller the ratio of demand rate to production rate, the smaller is the production order quantity.
Average inventory is more than one-half of the production order quantity.
Because receipt is noninstantaneous, some units are used immediately and not stored in inventory.
The production order quantity model is appropriate when the assumptions of the basic EOQ model are met, except that receipt is noninstantaneous.
None of the above is false.
All else equal, the smaller the ratio of demand rate to production rate, the smaller is the production order quantity.
Average inventory is more than one-half of the production order quantity.
Because receipt is noninstantaneous, some units are used immediately and not stored in inventory.
The production order quantity model is appropriate when the assumptions of the basic EOQ model are met, except that receipt is noninstantaneous.
None of the above is false.
Average inventory is more than one-half of the production order quantity.
9
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The purpose of safety stock is to:
control the likelihood of a stockout due to variable demand and/or lead time.
eliminate the likelihood of a stockout due to erroneous inventory tally.
protect the firm from a sudden decrease in demand.
eliminate the possibility of a stockout.
replace failed units with good ones.
control the likelihood of a stockout due to variable demand and/or lead time.
eliminate the likelihood of a stockout due to erroneous inventory tally.
protect the firm from a sudden decrease in demand.
eliminate the possibility of a stockout.
replace failed units with good ones.
control the likelihood of a stockout due to variable demand and/or lead time.
10
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A disadvantage of the fixed-period inventory system is that:
additional inventory records are required.
the average inventory level is decreased.
since there is no count of inventory during the review period, a stockout is possible.
it involves higher ordering costs than the fixed quantity inventory system.
orders usually are for larger quantities.
additional inventory records are required.
the average inventory level is decreased.
since there is no count of inventory during the review period, a stockout is possible.
it involves higher ordering costs than the fixed quantity inventory system.
orders usually are for larger quantities.
since there is no count of inventory during the review period, a stockout is possible.
11
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Low-level coding means that:
the lowest-paid staff member in the production department performs the coding.
the top level of the BOM is below level zero and that BOMs are not organized around the finished product.
a component item is coded at the lowest level at which it appears in the BOM structure.
a final item has only a few levels in the BOM structure.
the code being used is the code for the lowest level in the BOM structure.
the lowest-paid staff member in the production department performs the coding.
the top level of the BOM is below level zero and that BOMs are not organized around the finished product.
a component item is coded at the lowest level at which it appears in the BOM structure.
a final item has only a few levels in the BOM structure.
the code being used is the code for the lowest level in the BOM structure.
a component item is coded at the lowest level at which it appears in the BOM structure.
12
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Which of the following is NOT a goal of JIT partnerships?
obtain improved quality and reliability
removal of unnecessary activities
removal of in-plant inventory
removal of in-transit inventory
All of the above are goals of JIT partnerships.
obtain improved quality and reliability
removal of unnecessary activities
removal of in-plant inventory
removal of in-transit inventory
All of the above are goals of JIT partnerships.
All of the above are goals of JIT partnerships.
13
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A product-focused process is commonly used to produce:
high-volume, low-variety products.
low-variety products at either high- or low-volume.
low-volume, high-variety products.
high-volume, high-variety products.
high-volume products of either high- or low-variety.
high-volume, low-variety products.
low-variety products at either high- or low-volume.
low-volume, high-variety products.
high-volume, high-variety products.
high-volume products of either high- or low-variety.
high-volume, low-variety products.
14
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Which of the following phrases best describes process focus?
Operators are less broadly skilled.
low volume, high variety
Finished goods are usually made to a forecast and stored.
low inventory
high fixed costs, low variable costs
Operators are less broadly skilled.
low volume, high variety
Finished goods are usually made to a forecast and stored.
low inventory
high fixed costs, low variable costs
low volume, high variety
15
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The transfer of some of what are traditional internal activities and resources of a firm to outside vendors is:
outsourcing.
keiretsu.
offshoring.
a standard use of the make-or-buy decision.
not allowed by the ethics code of the Supply Management Institute.
outsourcing.
keiretsu.
offshoring.
a standard use of the make-or-buy decision.
not allowed by the ethics code of the Supply Management Institute.
outsourcing
16
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Savings in the supply chain exert more leverage as the firm's net profit margin decreases.
True
False
True
False
True
17
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Which of the following is NOT an opportunity for effective management in the supply chain?
accurate "pull" data
vendor-managed inventory
CPFR
postponement
local optimization
accurate "pull" data
vendor-managed inventory
CPFR
postponement
local optimization
local optimization
18
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A fried chicken fast-food chain that acquired feed mills and poultry farms has performed which of the following?
horizontal integration
current transformation
backward integration
job expansion
forward integration
horizontal integration
current transformation
backward integration
job expansion
forward integration
backward integration
19
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The bullwhip effect refers to the increasing fluctuations in orders that often occur as orders move through the supply chain.
True
False
True
False
True
20
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The bullwhip effect:
occurs because of distortions in information in the supply chain.
results in increasing fluctuations at each step of the sequence.
increases the costs associated with inventory in the supply chain.
occurs as orders are relayed from retailers to distributors to wholesalers to manufacturers.
All of the above are true.
occurs because of distortions in information in the supply chain.
results in increasing fluctuations at each step of the sequence.
increases the costs associated with inventory in the supply chain.
occurs as orders are relayed from retailers to distributors to wholesalers to manufacturers.
All of the above are true.
All of the above are true.
21
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Which of the following is NOT an opportunity for effective management in the supply chain?
local optimization
CPFR
accurate "pull" data
postponement
vendor-managed inventory
local optimization
CPFR
accurate "pull" data
postponement
vendor-managed inventory
local optimization
22
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Which of the following statements about ABC analysis is FALSE?
ABC analysis is based on the presumption that all items must be tightly controlled to produce important cost savings.
In ABC analysis, forecasting methods for "C" items may be less sophisticated than for "A" items.
Criteria other than annual dollar volume, such as high holding cost or delivery problems, can determine item classification in ABC analysis.
In ABC analysis, "A" items should have tighter physical inventory control than "B" or "C" items have.
ABC analysis is based on the presumption that controlling the few most important items produces the vast majority of inventory savings.
ABC analysis is based on the presumption that all items must be tightly controlled to produce important cost savings.
In ABC analysis, forecasting methods for "C" items may be less sophisticated than for "A" items.
Criteria other than annual dollar volume, such as high holding cost or delivery problems, can determine item classification in ABC analysis.
In ABC analysis, "A" items should have tighter physical inventory control than "B" or "C" items have.
ABC analysis is based on the presumption that controlling the few most important items produces the vast majority of inventory savings.
ABC analysis is based on the presumption that all items must be tightly controlled to produce important cost savings.
23
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Which of the following is an element of inventory holding costs?
material handling costs
housing costs
pilferage, scrap, and obsolescence
investment costs
All of the above are elements of inventory holding costs.
material handling costs
housing costs
pilferage, scrap, and obsolescence
investment costs
All of the above are elements of inventory holding costs.
All of the above are elements of inventory holding costs.
24
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In the basic EOQ model, if the cost of placing an order doubles, and all other values remain constant, the EOQ will:
increase by about 41%.
increase by 200%.
either increase or decrease.
increase, but more data is needed to say by how much.
increase by 100%.
increase by about 41%.
increase by 200%.
either increase or decrease.
increase, but more data is needed to say by how much.
increase by 100%.
increase by about 41%
25
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Which of the following statements regarding the production order quantity model is TRUE?
It minimizes inventory.
It relaxes the assumption that all the order quantity is received at one time.
It minimizes the total production costs.
It applies only to items produced in the firm's own production departments.
It relaxes the assumption that the demand rate is constant.
It minimizes inventory.
It relaxes the assumption that all the order quantity is received at one time.
It minimizes the total production costs.
It applies only to items produced in the firm's own production departments.
It relaxes the assumption that the demand rate is constant.
It relaxes the assumption that all the order quantity is received at one time.
26
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The purpose of safety stock is to:
protect the firm from a sudden decrease in demand.
eliminate the possibility of a stockout.
control the likelihood of a stockout due to variable demand and/or lead time.
replace failed units with good ones.
eliminate the likelihood of a stockout due to erroneous inventory tally.
protect the firm from a sudden decrease in demand.
eliminate the possibility of a stockout.
control the likelihood of a stockout due to variable demand and/or lead time.
replace failed units with good ones.
eliminate the likelihood of a stockout due to erroneous inventory tally.
control the likelihood of a stockout due to variable demand and/or lead time.
27
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The main trait of a single-period model is that:
supply is limited.
the cost of a shortage cannot be determined accurately.
it has the largest EOQ sizes.
the order quantity should usually equal the expected value of demand.
inventory has limited value after a certain period of time.
supply is limited.
the cost of a shortage cannot be determined accurately.
it has the largest EOQ sizes.
the order quantity should usually equal the expected value of demand.
inventory has limited value after a certain period of time.
inventory has limited value after a certain period of time.
28
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All EXCEPT which of the following statements about ABC analysis are true?
ABC analysis suggests that all items require the same high degree of control.
ABC analysis is an application of the Pareto principle.
ABC analysis suggests that there are the critical few and the trivial many inventory items.
ABC analysis categorizes on-hand inventory into three groups based on annual dollar volume.
In ABC analysis, inventory may be categorized by measures other than dollar volume.
ABC analysis suggests that all items require the same high degree of control.
ABC analysis is an application of the Pareto principle.
ABC analysis suggests that there are the critical few and the trivial many inventory items.
ABC analysis categorizes on-hand inventory into three groups based on annual dollar volume.
In ABC analysis, inventory may be categorized by measures other than dollar volume.
ABC analysis suggests that all items require the same high degree of control.
29
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The two most basic inventory questions answered by the typical inventory model are:
timing of orders and cost of orders.
ordering cost and carrying cost.
timing of orders and order quantity.
order quantity and cost of orders.
order quantity and service level.
timing of orders and cost of orders.
ordering cost and carrying cost.
timing of orders and order quantity.
order quantity and cost of orders.
order quantity and service level.
timing of orders and order quantity.
30
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Low-level coding means that:
the code being used is the code for the lowest level in the BOM structure.
the top level of the BOM is below level zero and that BOMs are not organized around the finished product.
a component item is coded at the lowest level at which it appears in the BOM structure.
a final item has only a few levels in the BOM structure.
the lowest-paid staff member in the production department performs the coding.
the code being used is the code for the lowest level in the BOM structure.
the top level of the BOM is below level zero and that BOMs are not organized around the finished product.
a component item is coded at the lowest level at which it appears in the BOM structure.
a final item has only a few levels in the BOM structure.
the lowest-paid staff member in the production department performs the coding.
a component item is coded at the lowest level at which it appears in the BOM structure.
31
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Concerning relationships with suppliers, which of the following combinations is critical to the success of JIT?
close relationships with trust
close relationships with skepticism
distant relationships with trust
distant relationships with skepticism
none of the above
close relationships with trust
close relationships with skepticism
distant relationships with trust
distant relationships with skepticism
none of the above
close relationships with trust
32
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What is one of the tools that is particularly useful in reducing system nervousness in an MRP system?
lot sizing
time phasing
time fences
closed loop system
modular bills
lot sizing
time phasing
time fences
closed loop system
modular bills
time fences
33
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Enterprise resource planning (ERP):
automates and integrates the majority of business processes.
does not integrate well with functional areas other than operations.
seldom requires software upgrade or enhancement.
is inexpensive to implement.
all of the above
automates and integrates the majority of business processes.
does not integrate well with functional areas other than operations.
seldom requires software upgrade or enhancement.
is inexpensive to implement.
all of the above
automates and integrates the majority of business processes.
34
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Which of the following is generally found in most Lean environments?
a push system for high margin items and a pull system for low margin items
pull systems
a push or pull system, depending upon the rate of demand
push systems
a push system for purchased parts and a pull system for manufactured parts
a push system for high margin items and a pull system for low margin items
pull systems
a push or pull system, depending upon the rate of demand
push systems
a push system for purchased parts and a pull system for manufactured parts
pull systems
35
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Which one of the following is a characteristic of a JIT partnership?
third-party logistics never used
removal of incoming inspection
frequent deliveries in large lot quantities
active pursuit of vertical integration
maximal product specifications imposed on supplier
third-party logistics never used
removal of incoming inspection
frequent deliveries in large lot quantities
active pursuit of vertical integration
maximal product specifications imposed on supplier
removal of incoming inspection
36
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How can a reduction of in-transit inventory be encouraged?
supplier location near plants
low carrying costs
low-cost, global suppliers
use of trains, not trucks
high setup costs
supplier location near plants
low carrying costs
low-cost, global suppliers
use of trains, not trucks
high setup costs
supplier location near plants
37
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Lean operations are known for their:
supplier partnerships.
employee development.
challenging jobs.
supplier education.
All of the above are attributes of lean operations.
supplier partnerships.
employee development.
challenging jobs.
supplier education.
All of the above are attributes of lean operations.
All of the above are attributes of lean operations.
38
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Which of the following industries is most likely to have low equipment utilization?
restaurants
steel manufacturing
commercial baking
auto manufacturing
television manufacturing
restaurants
steel manufacturing
commercial baking
auto manufacturing
television manufacturing
restaurants
39
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An assembly line is an example of a:
line process.
product-focused process.
process-focused process.
repetitive process.
specialized process.
line process.
product-focused process.
process-focused process.
repetitive process.
specialized process.
repetitive process.
40
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Which of the following phrases best describes product focus?
high inventory
high fixed costs, low variable costs
Finished goods are usually made to order.
Processes are designed to perform a wide variety of activities.
low volume, high variety
high inventory
high fixed costs, low variable costs
Finished goods are usually made to order.
Processes are designed to perform a wide variety of activities.
low volume, high variety
high fixed costs, low variable costs
41
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A grocery store is attempting to implement a kanban system. Which of the following would NOT be an application of kanbans?
An empty doughnut tray signaling the bakery to produce 2 dozen glazed doughnuts.
A red light on top of the cashier's lane signals that the cashier needs additional change replenished.
A line of 5 people in the Chinese department signaling the department to heat 5 orders of crab rangoon.
The meat department stocking up on turkeys before Thanksgiving.
All of the above are kanban applications.
An empty doughnut tray signaling the bakery to produce 2 dozen glazed doughnuts.
A red light on top of the cashier's lane signals that the cashier needs additional change replenished.
A line of 5 people in the Chinese department signaling the department to heat 5 orders of crab rangoon.
The meat department stocking up on turkeys before Thanksgiving.
All of the above are kanban applications.
The meat department stocking up on turkeys before Thanksgiving.
42
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Which of the following industries is most likely to have low equipment utilization?
television manufacturing
restaurants
commercial baking
auto manufacturing
steel manufacturing
television manufacturing
restaurants
commercial baking
auto manufacturing
steel manufacturing
restaurants
43
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Which of the following is one of the four principles of bottleneck management?
Bottlenecks should be moved to the end of the system process.
Lost time at a non-bottleneck is lost system capacity.
Increased non-bottleneck capacity is increased system capacity.
Increasing capacity at bottleneck stations is a mirage.
Release work orders to the system at the bottleneck's capacity pace.
Bottlenecks should be moved to the end of the system process.
Lost time at a non-bottleneck is lost system capacity.
Increased non-bottleneck capacity is increased system capacity.
Increasing capacity at bottleneck stations is a mirage.
Release work orders to the system at the bottleneck's capacity pace.
Release work orders to the system at the bottleneck's capacity pace.
44
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Utilization will typically be lower than efficiency because:
effective capacity is less than design capacity.
expected output is less than rated capacity.
effective capacity is greater than design capacity.
expected output is less than actual output.
effective capacity equals design capacity.
effective capacity is less than design capacity.
expected output is less than rated capacity.
effective capacity is greater than design capacity.
expected output is less than actual output.
effective capacity equals design capacity.
effective capacity is less than design capacity.
45
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Which of the following is FALSE regarding repetitive processes?
They include the assembly of basically all automobiles.
They use modules.
They allow easy switching from one product to the other.
They have more structure and less flexibility than a job shop layout.
They are the classic assembly lines.
They include the assembly of basically all automobiles.
They use modules.
They allow easy switching from one product to the other.
They have more structure and less flexibility than a job shop layout.
They are the classic assembly lines.
They allow easy switching from one product to the other.
46
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In mass service and professional service, the operations manager should focus extensively on:
automation.
human resources.
cost-cutting initiatives.
equipment maintenance.
sophisticated scheduling.
automation.
human resources.
cost-cutting initiatives.
equipment maintenance.
sophisticated scheduling.
human resources.
47
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Which of the following are all strategies for improving productivity in services?
high interaction, mass customization, service factory, and just-in-time
lean production, strategy-driven investments, automation, and process focus
reduce inventory, reduce waste, reduce inspection, and reduce rework
separation, self-service, automation, and scheduling
process focus, repetitive focus, product focus, and mass customization focus
high interaction, mass customization, service factory, and just-in-time
lean production, strategy-driven investments, automation, and process focus
reduce inventory, reduce waste, reduce inspection, and reduce rework
separation, self-service, automation, and scheduling
process focus, repetitive focus, product focus, and mass customization focus
separation, self-service, automation, and scheduling
48
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Christopher's Cranks uses a machine that can produce 100 cranks per hour. The firm operates 12 hours per day, five days per week. Due to regularly scheduled preventive maintenance, the firm expects the machine to be running during approximately 95% of the available time. Based on experience with other products, the firm expects to achieve an efficiency level for the cranks of 75%. What is the expected weekly output of cranks for this company?
4275
49
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Which of the following statements regarding fixed costs is TRUE?
Fixed costs are those costs associated with direct labor and materials.
Fixed costs rise by a constant amount for every added unit of volume.
Fixed costs equal variable costs at the break-even point.
Fixed cost is the difference between selling price and variable cost.
While fixed costs are ordinarily constant with respect to volume, they can "step" upward if volume increases result in additional fixed costs.
Fixed costs are those costs associated with direct labor and materials.
Fixed costs rise by a constant amount for every added unit of volume.
Fixed costs equal variable costs at the break-even point.
Fixed cost is the difference between selling price and variable cost.
While fixed costs are ordinarily constant with respect to volume, they can "step" upward if volume increases result in additional fixed costs.
While fixed costs are ordinarily constant with respect to volume, they can "step" upward if volume increases result in additional fixed costs.
50
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What is the ability to respond with little penalty in time, cost, or customer value?
flexibility
repetitive process
mass customization
postponement
flexibility
repetitive process
mass customization
postponement
flexibility
51
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Which of the following statements is NOT true?
Selecting the best equipment requires understanding the specific industry and available processes and technology.
Adding flexibility to the production process can be a major competitive advantage. Building flexibility into a production process is usually inexpensive, but difficult.
Selection of a particular process strategy requires decisions about equipment and technology.
The selection of equipment requires considering cost, cash flow, market stability, quality, capacity, and flexibility.
Selecting the best equipment requires understanding the specific industry and available processes and technology.
Adding flexibility to the production process can be a major competitive advantage. Building flexibility into a production process is usually inexpensive, but difficult.
Selection of a particular process strategy requires decisions about equipment and technology.
The selection of equipment requires considering cost, cash flow, market stability, quality, capacity, and flexibility.
Adding flexibility to the production process can be a major competitive advantage. Building flexibility into a production process is usually inexpensive, but difficult.
52
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What company has used process flexibility to allow it to become the industry leader at responding to market dynamics by modifying production volume and product mix?
Toyota
Harley Davidson
Honda
Walmart
Toyota
Harley Davidson
Honda
Walmart
Honda
53
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What is a drawing of the movement of material, product or people?
Part 2
flowchart
AIS
process chart
RFID
Part 2
flowchart
AIS
process chart
RFID
flowchart
54
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What is a flowchart with time added on the horizontal axis?
process chart
service blueprinting
process mapping
CNC
CNC
process chart
service blueprinting
process mapping
CNC
CNC
process mapping
55
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Which of the following is NOT a tool for process analysis and design?
flowchart
process mapping
Pareto chart
process chart
flowchart
process mapping
Pareto chart
process chart
Pareto chart
56
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Which of the following statements is NOT true regarding the process analysis tools?
Process mapping is another name for time-function mapping.
Time-function mapping extends value-stream mapping to include suppliers.
Service blueprinting is designed to help focus on the customer interaction part of the process.
A process chart is different than a flowchart.
Process mapping is another name for time-function mapping.
Time-function mapping extends value-stream mapping to include suppliers.
Service blueprinting is designed to help focus on the customer interaction part of the process.
A process chart is different than a flowchart.
Time-function mapping extends value-stream mapping to include suppliers.
57
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Which service strategy describes structuring services so customers must go where the service is offered?
Modules
Structure
Separation
Focus
Modules
Structure
Separation
Focus
Separation
58
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Which of the quadrants in the service process matrix has high labor intensity and high customization?
service factory
professional service
mass service
service shop
service factory
professional service
mass service
service shop
professional service
59
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Which of the quadrants in the service process matrix has low labor intensity and low customization?
service shop
professional service
service factory
mass service
service shop
professional service
service factory
mass service
service factory
60
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A fast food restaurant is an example of
high customization and low degree of labor.
high customization and high degree of labor.
low customization and high degree of labor.
low customization and low degree of labor.
high customization and low degree of labor.
high customization and high degree of labor.
low customization and high degree of labor.
low customization and low degree of labor.
low customization and low degree of labor.
61
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In many applications, human quality inspectors can be replaced effectively by
FMS.
vision systems.
automated storage and retrieval systems.
RFID tags.
FMS.
vision systems.
automated storage and retrieval systems.
RFID tags.
vision systems.
62
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What is an electronically guided and controlled cart used to move materials?
AIS
RFID
AGV
CNC
AIS
RFID
AGV
CNC
AGV
63
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Which of the following is NOT a production technology that enhances production and productivity?
vision systems
process control
automatic identification systems
service blueprinting
vision systems
process control
automatic identification systems
service blueprinting
service blueprinting
64
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Which of the following statements is NOT true regarding production technologies?
Robots are mechanical devices that use electronic impulses to activate motors and switches.
Vision systems combine video cameras and computer technology and are often used in inspection roles.
Flexible manufacturing systems and computer-integrated manufacturing are increasing the distinction between low-volume/high-variety and high-volume/low-variety production.
CNC is machinery with its own computer and memory.
Robots are mechanical devices that use electronic impulses to activate motors and switches.
Vision systems combine video cameras and computer technology and are often used in inspection roles.
Flexible manufacturing systems and computer-integrated manufacturing are increasing the distinction between low-volume/high-variety and high-volume/low-variety production.
CNC is machinery with its own computer and memory.
Flexible manufacturing systems and computer-integrated manufacturing are increasing the distinction between low-volume/high-variety and high-volume/low-variety production.
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Which of the following is NOT an example of technology's impact on the financial services industry?
RFID
Internet stock trading
electronic funds transfer
debit cards
RFID
Internet stock trading
electronic funds transfer
debit cards
RFID
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Which of the following is an example of technology's impact on wholesale/retail trade industry?
automatic teller machines
automatic toll booths
interactive TV
bar-coded data
automatic teller machines
automatic toll booths
interactive TV
bar-coded data
bar-coded data
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Which of the following is NOT an example of an advancement of service technology?
Retinal security scanners at airports
Electronic check-in/check-out at hotels
Automatic teller machines (ATMs) at banks
All of the above are examples of advancements of service technology
Retinal security scanners at airports
Electronic check-in/check-out at hotels
Automatic teller machines (ATMs) at banks
All of the above are examples of advancements of service technology
All of the above are examples of advancements of service technology
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Which statement best represents the impact of technology advancements for service and manufacturing industries?
Technology advancements have not improved productivity in service industries
Technology advancements have not improved productivity in manufacturing industries
Technology advancements have improved productivity in service and manufacturing industries
Technology advancements have increased labor hours in service and manufacturing industries
Technology advancements have not improved productivity in service industries
Technology advancements have not improved productivity in manufacturing industries
Technology advancements have improved productivity in service and manufacturing industries
Technology advancements have increased labor hours in service and manufacturing industries
Technology advancements have improved productivity in service and manufacturing industries
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Which of the following statements is NOT true regarding process redesign?
Process redesign is also called process reinvention.
Effective process redesign works only if the basic process and its objectives are reexamined.
Process redesign also focuses on those activities that cross functional lines.
Process redesign is also called process reengineering.
Process redesign is also called process reinvention.
Effective process redesign works only if the basic process and its objectives are reexamined.
Process redesign also focuses on those activities that cross functional lines.
Process redesign is also called process reengineering.
Process redesign is also called process reinvention.
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What is the fundamental rethinking of business processes to bring about dramatic improvements in performance?
process analysis
process redesign
process design
process strategy
process analysis
process redesign
process design
process strategy
process redesign
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What types of processes are often neglected with regard to process re-design?
Automated processes
Reengineered processes
Cross-functional processes
Expensive processes
Automated processes
Reengineered processes
Cross-functional processes
Expensive processes
Cross-functional processes
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Which of the following approaches may use subcontracting to accommodate excess demand?
leading demand with incremental expansion
following demand with incremental expansion
leading demand with a one-step expansion
Subcontracting should never be used to accommodate excess demand.
leading demand with incremental expansion
following demand with incremental expansion
leading demand with a one-step expansion
Subcontracting should never be used to accommodate excess demand.
following demand with incremental expansion
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Which of the following approaches makes new capacity a larger increase at the beginning of the period?
leading demand with a one-step expansion
leading demand with incremental expansion
lagging demand with incremental expansion
attempts to have an average capacity that straddles demand with incremental expansion
leading demand with a one-step expansion
leading demand with incremental expansion
lagging demand with incremental expansion
attempts to have an average capacity that straddles demand with incremental expansion
leading demand with a one-step expansion
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In manufacturing, excess capacity can be used to
do fewer setups, lengthen production runs, and drive down inventory costs.
do fewer setups, shorten production runs, and drive down inventory costs.
do more setups, lengthen production runs, and drive down inventory costs.
do more setups, shorten production runs, and drive down inventory costs.
do fewer setups, lengthen production runs, and drive down inventory costs.
do fewer setups, shorten production runs, and drive down inventory costs.
do more setups, lengthen production runs, and drive down inventory costs.
do more setups, shorten production runs, and drive down inventory costs.
do more setups, shorten production runs, and drive down inventory costs.
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The most aggressive and risky approach to capacity planning is
attempts to have an average capacity that straddles demand with incremental expansion.
leading demand with one-step expansion.
lagging demand with incremental expansion.
leading demand with incremental expansion.
attempts to have an average capacity that straddles demand with incremental expansion.
leading demand with one-step expansion.
lagging demand with incremental expansion.
leading demand with incremental expansion.
leading demand with one-step expansion.
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Which of the following is a requirement to be able to compute expected monetary value?
the probability of each decision alternative is known
the probability of each state of nature is known
each decision alternative needs at least two states of nature
each state of nature is equally likely to occur
the probability of each decision alternative is known
the probability of each state of nature is known
each decision alternative needs at least two states of nature
each state of nature is equally likely to occur
the probability of each state of nature is known
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What does EMV stand for?
expected maintenance volume
expected monetary value
expected machine valuation
enterprise management valuation
expected maintenance volume
expected monetary value
expected machine valuation
enterprise management valuation
expected monetary value
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A supply chain ends with
manufacturers.
a satisfied customer.
suppliers.
distributors.
manufacturers.
a satisfied customer.
suppliers.
distributors.
a satisfied customer.
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Which of the following statements is NOT true?
An increased sales effort may help a firm reach its profit goals more easily than would effective cost cutting.
A supply chain includes suppliers; manufacturers and/or service providers; and distributors, wholesalers, and/or retailers who deliver the product and/or service to the final customer.
The objective of supply chain management is to coordinate activities within the supply chain to maximize the supply chain's competitive advantage and benefits to the ultimate consumer.
Supply chain management describes the coordination of all supply chain activities, starting with raw materials, and ending with a satisfied customer.
An increased sales effort may help a firm reach its profit goals more easily than would effective cost cutting.
A supply chain includes suppliers; manufacturers and/or service providers; and distributors, wholesalers, and/or retailers who deliver the product and/or service to the final customer.
The objective of supply chain management is to coordinate activities within the supply chain to maximize the supply chain's competitive advantage and benefits to the ultimate consumer.
Supply chain management describes the coordination of all supply chain activities, starting with raw materials, and ending with a satisfied customer.
An increased sales effort may help a firm reach its profit goals more easily than would effective cost cutting.
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Which of the following industries has the highest supply chain cost as a percentage of sales?
Part 2
restaurants
automobile
petroleum
metals
Part 2
restaurants
automobile
petroleum
metals
petroleum
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Prior to embarking on supply chain design, operations managers must first consider
what kind of distribution network to have.
how to select suppliers.
how to manage supply chain inventory.
"make-or-buy" and outsourcing decisions.
what kind of distribution network to have.
how to select suppliers.
how to manage supply chain inventory.
"make-or-buy" and outsourcing decisions.
"make-or-buy" and outsourcing decisions.
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What is transferring a firm's activities that have traditionally been internal to external suppliers?
make-or-buy
keiretsu network
vertical integration
outsourcing
make-or-buy
keiretsu network
vertical integration
outsourcing
outsourcing
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The advantage of having few suppliers is to
take advantage of diseconomies of scale.
pursue low cost.
look for short-term attributes.
form a long-term relationship.
take advantage of diseconomies of scale.
pursue low cost.
look for short-term attributes.
form a long-term relationship.
form a long-term relationship.
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The advantage of having many potential suppliers is their willingness to
participate in JIT.
provide technical expertise.
offer lower prices in the short term.
provide innovations.
participate in JIT.
provide technical expertise.
offer lower prices in the short term.
provide innovations.
offer lower prices in the short term.
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What is developing the ability to produce goods or services previously purchased or actually buying a supplier or a distributor?
vertical integration
outsourcing
horizontal integration
virtual companies
vertical integration
outsourcing
horizontal integration
virtual companies
vertical integration
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Which of the following strategies is part collaboration, part purchasing from few suppliers, and part vertical integration?
joint ventures
virtual companies
horizontal integration
keiretsu networks
joint ventures
virtual companies
horizontal integration
keiretsu networks
keiretsu networks
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Which of the following could reduce distribution risk?
cross-country diversification
secure IT systems
careful selection, monitoring and effective contracts with penalties
use multiple suppliers
cross-country diversification
secure IT systems
careful selection, monitoring and effective contracts with penalties
use multiple suppliers
careful selection, monitoring and effective contracts with penalties
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Which of the following mitigation tactics could reduce economic risk?
purchasing contracts that address price fluctuations
multiple transportation modes and warehouses
franchising and licensing
subcontractors on retainer
purchasing contracts that address price fluctuations
multiple transportation modes and warehouses
franchising and licensing
subcontractors on retainer
purchasing contracts that address price fluctuations
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Which of the following mitigation tactics is NOT designed to reduce the risk of information loss or distortion?
alternate sourcing
training of supply chain partners on the proper interpretations and use of information
redundant databases
secure IT systems
alternate sourcing
training of supply chain partners on the proper interpretations and use of information
redundant databases
secure IT systems
alternate sourcing
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Which of the following statements is true regarding cross-sourcing?
Cross-sourcing develops the ability to produce goods or services previously purchased or actually buying a supplier or distributor.
Cross-sourcing enhances technological skills.
Cross-sourcing describes suppliers who become part of a company coalition.
Cross-sourcing uses one supplier for a component and a second supplier for another component, where each supplier acts as a backup for the other.
Cross-sourcing develops the ability to produce goods or services previously purchased or actually buying a supplier or distributor.
Cross-sourcing enhances technological skills.
Cross-sourcing describes suppliers who become part of a company coalition.
Cross-sourcing uses one supplier for a component and a second supplier for another component, where each supplier acts as a backup for the other.
Cross-sourcing uses one supplier for a component and a second supplier for another component, where each supplier acts as a backup for the other.
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Which of the following statements is NOT true regarding the bullwhip effect?
Inaccurate information results in distortions and fluctuations, causing what is known as the bullwhip effect.
The bullwhip effect occurs as order are relayed from retails, to distributors, to wholesalers, to manufacturers, with fluctuations decreasing at each step in the sequence.
Bullwhip fluctuations in the supply chain decrease customer service and profitability.
Bullwhip fluctuations in the supply chain increase the costs associated with inventory, transportation, shipping and receiving.
Inaccurate information results in distortions and fluctuations, causing what is known as the bullwhip effect.
The bullwhip effect occurs as order are relayed from retails, to distributors, to wholesalers, to manufacturers, with fluctuations decreasing at each step in the sequence.
Bullwhip fluctuations in the supply chain decrease customer service and profitability.
Bullwhip fluctuations in the supply chain increase the costs associated with inventory, transportation, shipping and receiving.
The bullwhip effect occurs as order are relayed from retails, to distributors, to wholesalers, to manufacturers, with fluctuations decreasing at each step in the sequence.
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What is a long-term purchase commitment to a supplier for items that are to be delivered against short-term releases to ship?
advanced shipping notice
blanket order
drop shipping
postponement
advanced shipping notice
blanket order
drop shipping
postponement
blanket order
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A lawnmower assembly plant uses a variety of nuts, bolts, screws, and other fasteners in its operation. Its supplier delivers these items directly to the point of use on the assembly line and ensures that there are always sufficient quantities of fasteners to maintain the production schedule.
This is an example of
single stage control of replenishment.
postponement.
e-procurement.
vendor-managed inventory.
This is an example of
single stage control of replenishment.
postponement.
e-procurement.
vendor-managed inventory.
vendor-managed inventory.
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The do-it-yourselfer plucked a gallon can of base paint from the shelf of the local hardware store and handed it to Keith, the cheerful clerk at the paint counter. Their eyes met briefly and the do-it-yourselfer silently handed over sample 150C-1, Musical Mist, to the clerk. It was impractical to keep several gallons of every possible color on the shelves at the hardware store, so the paint manufacturer had created clever workaround. The workaround was a computer-based system that added predetermined quantities of pigments to a gallon can of base paint depending on the desired shade, in this case, Musical Mist. The hardware store now needed to stock only the base paint, this machine, and a small supply of paint pigments in order to create the thousands of colors in its catalog.
This scenario is a prime example of
drop shipping.
the bullwhip effect.
postponement.
vendor-managed inventory.
This scenario is a prime example of
drop shipping.
the bullwhip effect.
postponement.
vendor-managed inventory.
postponement.
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Which of the following is the first stage of supplier selection?
contracting
supplier evaluation
negotiations
supplier development
contracting
supplier evaluation
negotiations
supplier development
supplier evaluation
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Which negotiation strategy bases price on a published, auction, or index price?
market-based price model
competitive bidding
cost-based price model
supply-based price model
market-based price model
competitive bidding
cost-based price model
supply-based price model
market-based price model
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With regard to the cost-based price model negotiation strategy, which of the following is true?
Prices are based in some way upon market standards agreed to by both supplier and purchaser.
Prices float based on what the customer is willing to pay.
Potential suppliers each submit quotations as to price, delivery, and so on.
Prices are based upon supplier costs.
Prices are based in some way upon market standards agreed to by both supplier and purchaser.
Prices float based on what the customer is willing to pay.
Potential suppliers each submit quotations as to price, delivery, and so on.
Prices are based upon supplier costs.
Prices are based upon supplier costs.
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Which of the following is TRUE regarding the steps to reducing setup times?
The standardization of both tooling and work procedures is advantageous to setup time reduction.
The cycle of steps is repeated until setup time is reduced to under a minute.
The first step involves performing as much setup preparation as possible while the process/machine is operating.
Move material closer and improve material handling are done before operator training.
All of the above are true.
The standardization of both tooling and work procedures is advantageous to setup time reduction.
The cycle of steps is repeated until setup time is reduced to under a minute.
The first step involves performing as much setup preparation as possible while the process/machine is operating.
Move material closer and improve material handling are done before operator training.
All of the above are true.
All of the above are true.
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Which of the following is NOT one of the benefits accrued from a centralized purchasing function?
Devote more resources to the supplier selection and negotiation process.
Increase the duplication of tasks.
Leverage purchase volume for better pricing.
Maintain professional control over the purchasing process.
Devote more resources to the supplier selection and negotiation process.
Increase the duplication of tasks.
Leverage purchase volume for better pricing.
Maintain professional control over the purchasing process.
Increase the duplication of tasks.
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Trucking
does not play a role in multimodal shipping.
is increasingly using computers to manage its operations.
is the least used transportation mode for manufacturing goods.
is one of the least flexible transportation modes.
does not play a role in multimodal shipping.
is increasingly using computers to manage its operations.
is the least used transportation mode for manufacturing goods.
is one of the least flexible transportation modes.
is increasingly using computers to manage its operations.