Complete the mcq:
1. A purposeful collection of people, objects, and procedures for operating within an environment is known as a(n):
a) Operation
b) Sub-system
c) System
d) Sub-operation
2. Which of the following is among the sixmajor elements of a production system?
a) Inputs
b) Output
c) Monitoring andlegislative compliance
d) Only A and B
3. Value can be added to an entity in all the following ways, EXCEPT:
a) Altering
b) Facilitating
c) Storing
d) Transporting
4. A type of output that commonly results from a production system is:
a) A product
b) A service
c) Neither A nor B
d) Both A and B
5. Which of the following is NOT considered a characteristic of a service?
a) Intangible
b) Labor-intense production
c) Quality difficult to measure
d) Delayed consumption
6. A distinction between normal goods and information/knowledge is that
a) Normal goods wear out, but information/knowledge does not
b) Information/knowledge can be given or sold to many others
c) Information/knowledge is subject to diminishing returns, but physical outputs are subject to increasing returns
d) Both A and B
7. Inputs in a bank's production system may include:
a) Loan default rates and the environment
b) Interest rates and wage rates
c) Checks and deposits
d) Federal Reserve decisions and the economy
8. Which of the following uses techniques from Toyota Production System and JIT to eliminate waste and nonvalue-added activities?
a) Enterprise and material requirements planning
b) Lean Management
c) Quality Control
d) Capacity Management
9. Learning how to plan and control project activities to meet specifications for performance, schedule, and cost are among the subjects of:
a) Project management
b) Lean management
c) Supply chain management
d) Inventory management
10. Customization occurs when
a) Products or services are world-class, suitable for most markets
b) Products or services are offered on a made-to-order basis
c) Products or services are developed with several options
d) Both A and C
11. What are the two trends in the range of accommodation to customers' needs?
a) Extraction and delivery
b) Standardization and flexibility
c) Customization and standardization
d) Experience and flexibility
12. Which of the following is NOT a mass customization strategy?
a) Adaptive customizers
b) Transparent customizers
c) Cosmetic customizers
d) Flexible customizers
13. Which of the following is NOT an advantage of rapid response?
a) First-mover advantage
b) Elimination of overhead
c) Improved morale and communication
d) Sharper focus on the customer
14. Which business strategy waits for the product to become fairly standardized and is demanded in large volumes?
a) First-to-market
b) Cost minimization or late-to-market
c) Second-to-market
d) Market Segmentation
15. Operations management is applicable
a. mostly to the service sector
b. to services exclusively
c. mostly to the manufacturing sector
d. to all firms, whether manufacturing and service
e. to the manufacturing sector exclusively
16. Which of the following are the primary functions of all organizations?
a. operations, marketing, and human resources
b. marketing, human resources, and finance/accounting
c. sales, quality control, and operations
d. marketing, operations, and finance/accounting
e. research and development, finance/accounting, and purchasing
17. Budgeting, paying the bills, and collection of funds are activities associated with the
a. management function
b. control function
c. finance/accounting function
d. production/operations function
e. staffing function
18. Which of the following would not be an operations function in a fast-food restaurant?
a. advertising and promotion
b. designing the layout of the facility
c. maintaining equipment
d. making hamburgers and fries
e. purchasing ingredients
19. The marketing function's main concern is with
a. producing goods or providing services
b. procuring materials, supplies, and equipment
c. building and maintaining a positive image
d. generating the demand for the organization's products or services
e. securing monetary resources
20. Reasons to study Operations Management include
a. studying why people organize themselves for free enterprise
b. knowing how goods and services are consumed
c. understanding what human resource managers do
d. learning about a costly part of the enterprise
e. all of the above
21. Reasons to study Operations Management include learning about
a. why people organize themselves for productive enterprise
b. how goods and services are produced
c. what operations managers do
d. a costly part of the enterprise
e. all of the above
22. The five elements in the management process are
a. plan, direct, update, lead, and supervise
b. accounting/finance, marketing, operations, and management
c. organize, plan, control, staff, and manage
d. plan, organize, staff, lead, and control
e. plan, lead, organize, manage, and control
23. Which of the following is not an element of the management process?
a. controlling
b. leading
c. planning
d. pricing
e. staffing
24. An operations manager is not likely to be involved in
a. the design of goods and services to satisfy customers' wants and needs
b. the quality of goods and services to satisfy customers' wants and needs
c. the identification of customers' wants and needs
d. work scheduling to meet the due dates promised to customers
e. maintenance schedules
25. All of the following decisions fall within the scope of operations management except for
a. financial analysis
b. design of goods and processes
c. location of facilities
d. managing quality
e. All of the above fall within the scope of operations management.
26. The Ten Critical Decisions of Operations Management include
a. Layout strategy
b. Maintenance
c. Process and capacity design
d. Managing quality
e. all of the above
27. Which of the following is not one of The Ten Critical Decisions of Operations Management?
a. Layout strategy
b. Maintenance
c. Process and capacity design
d. Mass customization
e. Supply chain management
28. The Ten Critical Decisions of Operations Management include
a. Finance/accounting
b. Advertising
c. Process and capacity design
d. Pricing
e. all of the above
29. Walter Shewhart is listed among the important people of operations management because of his contributions to
a. assembly line production
b. measuring the productivity in the service sector
c. just-in-time inventory methods
d. statistical quality control
e. all of the above
30. Walter Shewhart, in the _____, provided the foundations for ______ in operations management.
a. 1920s; statistical sampling
b. United Kingdom; mass production
c. U.S. Army; logistics
d. nineteenth century; interchangeable parts
e. none of the above
31. Eli Whitney, in the _____, provided the foundations for ______ in operations management.
a. 1920s; statistical sampling
b. United Kingdom; mass production
c. U.S. Army; logistics
d. nineteenth century; interchangeable parts
e. none of the above
32. The person most responsible for popularizing interchangeable parts in manufacturing was
a. Frederick Winslow Taylor
b. Henry Ford
c. Eli Whitney
d. Whitney Houston
e. Lillian Gilbreth
33. The "Father of Scientific Management" is
a. Henry Ford
b. Frederick W. Taylor
c. W. Edwards Deming
d. Frank Gilbreth
e. just a figure of speech, not a reference to a person
34. Henry Ford is noted for his contributions to
a. standardization of parts
b. statistical quality control
c. assembly line operations
d. scientific management
e. time and motion studies
35. Who among the following is associated with contributions to quality control in operations management?
a. Charles Babbage
b. Henry Ford
c. Frank Gilbreth
d. W. Edwards Deming
e. Henri Fayol
36. The field of operations management is shaped by advances in which of the following fields?
a. chemistry and physics
b. industrial engineering and management science
c. biology and anatomy
d. information technology
e. all of the above
37. Which of the following statements is true?
a. Almost all services and almost all goods are a mixture of a service and a tangible product.
b. A pure good has no tangible product component.
c. A pure service has only a tangible product component.
d. There is no such thing as a pure good.
e. None of the above is a true statement.
38. Typical differences between goods and services do not include
a. cost per unit
b. ability to inventory items
c. timing of production and consumption
d. customer interaction
e. knowledge content
39. Which is not true regarding differences between goods and services?
a. Services are generally produced and consumed simultaneously; tangible goods are not.
b. Services tend to be more knowledge-based than products.
c. Services tend to have a more inconsistent product definition than goods.
d. Goods tend to have higher customer interaction than services.
e. None of the above is true.
40. Which of the following is not a typical attribute of goods?
a. output can be inventoried
b. often easy to automate
c. aspects of quality difficult to measure
d. output can be resold
e. production and consumption are separate
41. Current trends in operations management include all of the following except
a. just-in-time performance
b. rapid product development
c. mass customization
d. empowered employees
e. All of the above are current trends.
42. Which of the following is not a current trend in operations management?
a. just-in-time performance
b. global focus
c. supply chain partnering
d. mass customization
e. All of the above are current trends.
43. One new trend in operations management is
a. global focus
b. mass customization
c. empowered employees
d. rapid product development
e. All of the above are new trends in operations management.
45. Which of the following is NOT a basic form of transformation systems?
a) Job shop
b) Flow shop
c) Continuous transformation process
d) All of the above are basic forms of transformation systems
46. Layout analysis is usually performed for the following purposes:
a) Maximize operational efficiency
b) Reduce safety hazard or health hazards
c) Minimize interference or noise between areas
d) All of the above
47. A __ is commonly used to produce highly standardized outputs in extremely large volume
a) Job shop
b) Flow shop
c) Continuous transformation process
d) Cellular production
48. Continuous processes typically run 24 hours a day, seven days a week because:
a) There is a need to spread their huge fixed cost over as large a volume as possible
b) Price is often the single most important factor in competing with their products
c) Facilities are a maze of pipes, conveyors, tanks, valves, vats, and bins
d) Both A and B
49. Which of the following is a major difference between continuous processes and flow shops?
a) Inputs are fixed for the former and the flow of work is continuous for the latter
b) In flow shops, there is a discrete product or service instead of products not naturally divisible
c) Degree of automation is higher for flow shops
d) Both B and C
50. Which of the following is NOT a well-known problem in flow shops?
a) Boredom
b) Workers may be dehumanized by manufacturing lines
c) Absenteeism
d) All of the above are well-known problems in flow shops
51. Balancing a production line includes the following tasks, EXCEPT:
a) Finding a cycle time in which each workstation can complete its tasks
b) Take into account precedence relationships among tasks
c) Identify the task with the longest operation time
d) Calculate the number of workstations that completes the job in the minimum amount of time
52. Which of the following is FALSE for job shops?
a) Unique jobs must be produced
b) Output batch size is moderately large, to make it cost effective
c) The flow of work through facilities tends to be intermittent
d) Groupings of staff and equipment are done according to function
53. Which form of transportation system utilizes group technology?
a) Flow shop
b) Job shop
c) Cellular production
d) Project operations
54. A/An ___ item is produced in batches of some size that is set by the customer, and then delivered upon its completion.
a) Make-to-order
b) Make-to-stock
c) Order-to-make
d) Stock-to-order
56. Of the following, which form of transformation system has the lowest output variety but the highest batch size?
a) Job shop
b) Cellular
c) Project
d) Flow shop
57. In the Service Matrix, to which quadrant does recreation belong?
a) Service shop
b) Professional service
c) Mass service
d) Service factory
58. Which of the following statements regarding the Dreamliner 787 is true?
a. Boeing has found partners in over a dozen countries.
b. The new aircraft incorporates a wide range of aerospace technologies.
c. The new aircraft uses engines from not one, but two manufacturers.
d. Boeing will add only 20 to 30 percent of the aircraft's value.
e. All of the above are true.
59. Boeing's new 787 Dreamliner
a. is assembled in Washington, D.C.
b. uses engines from Japan
c. has its fuselage sections built in Australia
d. has increased efficiency from new engine technology
e. results from a partnership of about a dozen companies
60. Examples of response to the global environment include
a. Boeing's worldwide sales and production
b. Benneton's flexibility in design, production, and distribution
c. A Chinese manufacturer, Haier, opening plants in the United States
d. Ford's partnerships with Volvo and Mazda
e. All of the above are examples.
61. Which of the following is an example of globalization of operations strategy?
a. Boeing's Dreamliner has engines with higher fuel/payload efficiency.
b. Ford's new auto models have dent-resistant panels.
c. A Chinese manufacturer, Haier, now operates plants in the United States.
d. Hard Rock Café provides an "experience differentiation" at its restaurants.
e. All of the above are examples.
62. Cost cutting in international operations can take place because of
a. lower taxes and tariffs
b. lower wage scales
c. lower indirect labor costs
d. less stringent regulations
e. all of the above
63. Which of the following did the authors not suggest as a reason for globalizing operations?
a. reduce costs
b. improve the supply chain
c. stockholder approval ratings
d. attract new markets
e. All of the above were suggested.
64. Multinational organizations can shop from country to country and cut costs through
a. lower wage scales
b. lower indirect labor costs
c. less stringent regulations
d. lower taxes and tariffs
e. all of the above
65. The term maquiladora is most synonymous with
a. free trade zones
b. Chinese forced labor camps
c. home-based or cottage industry
d. areas that do not meet U.S. standards for workplace safety and pollution
e. none of the above
66. Which of the following represent reasons for globalizing operations?
a. to gain improvements in the supply chain
b. to improve operations
c. to expand a product's life cycle
d. to attract and retain global talent
e. All of the above are valid.
67. Which of the following does not represent reasons for globalizing operations?
a. reduce costs
b. improve supply chain
c. reduce responsiveness
d. attract and retain global talent
e. All of the above are valid reasons for globalizing operations.
68. NAFTA seeks to
a. substitute cheap labor in Mexico for expensive labor in the United States
b. curb illegal immigration from Mexico to the United States
c. phase out all trade and tariff barriers between the United States and Mexico
d. phase out all trade and tariff barriers between the United States, Canada, and Mexico
e. All of the above are NAFTA goals.
69. With reference to cultural and ethical issues, the World Trade Organization has
a. succeeded in providing equal protection of intellectual property among nations
b. made progress in providing equal protection of intellectual property among nations
c. phased out all trade and tariff barriers between the United States and Mexico
d. eliminated slave labor and child labor
e. played little role in addressing cultural and ethical issues among nations
70. Which of the following is true about business strategies?
a. An organization should stick with its strategy for the life of the business.
b. All firms within an industry will adopt the same strategy.
c. Well defined missions make strategy development much easier.
d. Strategies are formulated independently of SWOT analysis.
e. Organizational strategies depend on operations strategies.
71. Which of the following activities takes place once the mission has been developed?
a. The firm develops alternative or back-up missions in case the original mission fails.
b. The functional areas develop their functional area strategies.
c. The functional areas develop their supporting missions.
d. The ten OM decision areas are prioritized.
e. Operational tactics are developed.
72. Which of the following statements about organizational missions is false?
a. They reflect a company's purpose.
b. They indicate what a company intends to contribute to society.
c. They are formulated after strategies are known.
d. They define a company's reason for existence.
e. They provide guidance for functional area missions.
73. The impact of strategies on the general direction and basic character of a company is
a. short range
b. medium range
c. long range
d. temporal
e. minimal
74. The fundamental purpose of an organization's mission statement is to
a. create a good human relations climate in the organization
b. define the organization's purpose in society
c. define the operational structure of the organization
d. generate good public relations for the organization
e. define the functional areas required by the organization
75. Which of the following is true?
a. Corporate mission is shaped by functional strategies.
b. Corporate strategy is shaped by functional strategies.
c. Functional strategies are shaped by corporate strategy.
d. External conditions are shaped by corporate mission.
e. Functional area missions are merged to become the organizational mission.
76. According to the authors, which of the following strategic concepts allow firms to achieve their missions?
a. productivity, efficiency, and quality leadership
b. differentiation, cost leadership, and quick response
c. differentiation, quality leadership, and quick response
d. distinctive competency, cost leadership, and experience
e. differentiation, distinctive competency, quality leadership, and capacity
77. A firm can effectively use its operations function to yield competitive advantage via all of the following except
a. customization of the product
b. setting equipment utilization goals below the industry average
c. speed of delivery
d. constant innovation of new products
e. maintain a variety of product options
78. Which of the following has progressed the furthest along its product life cycle?
a. drive-thru restaurants
b. Internet search engines
c. iPods
d. LCD & plasma TVs
e. Xbox 360
79. A strategy is a(n)
a. set of opportunities in the marketplace
b. broad statement of purpose
c. simulation used to test various product line options
d. plan for cost reduction
e. action plan to achieve the mission
80. Which of the following statements best characterizes delivery reliability?
a. a company that always delivers on the same day of the week
b. a company that always delivers at the promised time
c. a company that delivers more frequently than its competitors
d. a company that delivers faster than its competitors
e. a company that has a computerized delivery scheduling system
81. Which of the following is an example of competing on the basis of differentiation?
a. A firm manufactures its product with less raw material waste than its competitors do.
b. A firm's products are introduced into the market faster than its competitors' products are.
c. A firm's distribution network routinely delivers its product on time.
d. A firm offers more reliable products than its competitors do.
e. A firm advertises more than its competitors do.
82. The ability of an organization to produce services that, by utilizing the consumer's five senses, have some uniqueness in their characteristics is
a. mass production
b. time-based competition
c. differentiation
d. flexible response
e. experience differentiation
83. Which of the following best describes "experience differentiation"?
a. immerses consumers in the delivery of a service
b. uses people's five senses to enhance the service
c. complements physical elements with visual and sound elements
d. consumers may become active participants in the product or service
e. All are elements of experience differentiation.
84. Experience Differentiation
a. isolates the consumer from the delivery of a service
b. is an extension of product differentiation in the service sector
c. uses only the consumer's senses of vision and sound
d. keeps consumers from becoming active participants in the service
e. is the same as product differentiation, but applied in the service sector
85. Which of the following is the best example of competing on low-cost leadership?
a. A firm produces its product with less raw material waste than its competitors.
b. A firm offers more reliable products than its competitors.
c. A firm's products are introduced into the market faster than its competitors' products.
d. A firm's research and development department generates many ideas for new products.
e. A firm advertises more than its competitors.
86. Franz Colruyt has achieved low-cost leadership through
a. Spartan headquarters
b. absence of voice mail
c. low-cost facilities
d. no background music
e. all of the above
87. Which of the following is an example of competing on quick response?
a. A firm produces its product with less raw material waste than its competitors.
b. A firm offers more reliable products than its competitors.
c. A firm's products are introduced into the market faster than its competitors' products.
d. A firm's research and development department generates many ideas for new products.
e. A firm advertises more than its competitors.
88. Costs, quality, and human resource decisions interact strongly with the _______ decision.
a. layout design
b. process and capacity design
c. supply chain management
d. goods and service design
e. All of the above are correct.
89. Which of the following influences layout design?
a. inventory requirements
b. capacity needs
c. personnel levels
d. technology decisions
e. All of the above influence layout decisions.
90. Response-based competitive advantage can be
a. flexible response
b. reliable response
c. quick response
d. all of the above
e. none of the above
91. Which of the following is not an operations strategic decision?
a. maintenance
b. price
c. layout design
d. quality
e. inventory
92. Which of the following OM strategic decisions pertains to sensible location of processes and materials in relation to each other?
a. layout design
b. goods and service design
c. supply chain management
d. inventory
e. scheduling
93. Which of these companies is most apt to have quality standards that are relatively subjective?
a. Chrysler
b. Dell Computer
c. Sanyo Electronics
d. HarvardUniversity
e. Whirlpool
94. Which of the following will more likely locate near their customers?
a. an automobile manufacturer
b. an aluminum manufacturer
c. an insurance company headquarters
d. a medical clinic
e. All of the above will tend to locate near their customers.
95. Which of the following statements concerning the operations management decision is relevant to services?
a. There are many objective quality standards.
b. The customer is not involved in most of the process.
c. The work force's technical skills are very important.
d. Labor standards vary depending on customer requirements.
e. Ability to inventory may allow the leveling of the output rates.
96. Which of these organizations is likely to have the most important inventory decisions?
a. a marketing research firm
b. a lobbying agency
c. a management consulting firm
d. an aluminum manufacturer
e. a law firm
97. Standardization is an appropriate strategy in which stage of the product life cycle?
a. introduction
b. growth
c. maturity
d. decline
e. retirement
98. Cost minimization is an appropriate strategy in which stage of the product life cycle?
a. introduction
b. growth
c. maturity
d. decline
e. retirement
99. Which of the following preconditions does not affect the formulation of an OM strategy?
a. knowledge of each product's life cycle
b. external economic and technological conditions
c. the company's employment benefits
d. competitors' strengths and weaknesses
e. knowledge of the company's strategy
100. The stage in the product life cycle at which it is a poor time to change quality is
a. introduction
b. growth
c. maturity
d. decline
e. incubation
101. Which of the following changes does not result in strategy changes?
a. change in the company's financial situation
b. a company's adoption of new technology
c. change in the product life cycle
d. change in the competitive environment
e. change in job scheduling techniques
102. All of these preconditions affect an operations management strategy except
a. external economic and technological conditions
b. competitors' strengths and weaknesses
c. maintenance policies
d. knowledge of the company's strategy
e. knowledge of each product's life cycle
103. Understanding competitors' strengths and weaknesses, understanding current and prospective technological issues, and understanding product life cycle are examples of
a. what is important to the transnational strategy but not the multidomestic strategy
b. SWOT analysis
c. elements in the formulation of an organization's mission
d. preconditions to establishing and implementing a strategy
e. the critical decision area of supply chain analysis
104. Which of these organizations is likely to have the most complex inventory decisions?
a. a marketing research firm
b. a stock brokerage firm
c. a management consulting firm
d. a computer manufacturing company
e. a high school
105. The three steps of the operations manager's job, in order, are
a. develop the strategy, establish the organizational structure, find the right staff
b. develop the strategy, find the right staff, establish the organizational structure
c. find the right staff, establish the organizational structure, develop the strategy
d. find the right staff, develop the strategy, establish the organizational structure
e. establish the organizational structure, find the right staff, develop the strategy
106. When developing the operations strategy for a new manufacturing organization, one of the most important considerations is that it
a. requires minimal capital investment
b. utilizes as much automation as possible
c. utilizes an equal balance of labor and automation
d. supports the overall competitive strategy of the company
e. none of the above
106. Which of the international operations strategies involves high cost reductions and high local responsiveness?
a. international strategy
b. global strategy
c. transnational strategy
d. multidomestic strategy
e. none of the above
107. Which of the international operations strategies involves low cost reductions and low local responsiveness?
a. international strategy
b. global strategy
c. transnational strategy
d. multidomestic strategy
e. none of the above
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108. Which of the international operations strategies uses import/export or licensing of existing products?
a. international strategy
b. global strategy
c. transnational strategy
d. multidomestic strategy
e. none of the above
109. Which of the international operations strategies uses the existing domestic model globally?
a. international strategy
b. global strategy
c. transnational strategy
d. multidomestic strategy
e. none of the above
110. Which of the following statements is FALSE?
a) ISO stands for International Standards Organization
b) ISO 9000 and ISO 14000 are two of the best known ISO standards
c) ISO 14000 has been updated in December 2008 and is known as ISO 14000:2008
d) Over 630,000 organizations in 152 countries have implemented ISO standards
111. As control involves both mechanistic and human elements, it is one of the manager's most difficult tasks. Which of the following is the best answer about desirable characteristics of control systems?
a) Should be as simple as possible to operate and maintain
b) Should signal managers if they go out of order
c) Should be focused and admit the least amount of variation
d) Both A and B
114. Which of the following is FALSE regarding statistical sampling for control purposes?
a) The more samples are taken, the higher the likelihood of accidentally selecting a sample with excessive values when the process actually is still under control
b) Deciding what indicators are high or low enough to be considered out of control is the simplest of the problems facing operation managers
c) Measuring upper and lower control limits are the basis for management by exception
d) Using high thresholds for control increases the risk of not detecting processes that are getting out of control
115. Which of the following is NOT a step in constructing control charts?
a) Initial samples of the process to be monitored need to be taken
b) Means and ranges for the samples must be calculated
c) Deriving the means by the ranges previously calculated
d) Graphing sample means and ranges chronologically
116. The phases of project management are
a. planning, scheduling, and controlling
b. planning, programming, and budgeting
c. planning, organizing, staffing, leading, and controlling
d. different for manufacturing projects than for service projects
e. GANTT, CPM, and PERT
117. A project organization
a. is effective for companies with multiple large projects
b. is appropriate only in construction firms
c. often fails when the project cuts across organizational lines
d. is formed to ensure that programs (projects) get proper management and attention
e. a and d are both true
118. Which of the following statements regarding project management is false?
a. Gantt charts give a timeline for each of a project's activities, but do not adequately show the interrelationships of activities.
b. A project organization works best for a project that is temporary but critical to the organization.
c. Project organization works well when the work contains simple, independent tasks.
d. Gantt charts and PERT/CPM are never used together.
e. None of the above is true.
119. A code of ethics especially for project managers
a. has been established by the Project Management Institute
b. has been formulated by the Federal government
c. has been formulated by the World Trade Organization
d. is inappropriate, since everyone should use the same guidance on ethical issues
e. does not existat this time
120. Divulging information to some bidders on a project to give them an unfair advantage
a. is the same thing as altering a status report
b. is bribery
c. is permitted by NAFTA
d. is known as bid rigging
e. is acceptable for private corporations but not for government agencies
121. Ethical issues that may arise in projects large and small include
a. bid rigging
b. expense account padding
c. compromised safety or health standards
d. bribery
e. All of the above are true.
122. Which of the following statements regarding Gantt charts is true?
a. Gantt charts give a timeline and precedence relationships for each activity of a project.
b. Gantt charts use the four standard spines of Methods, Materials, Manpower, and Machinery.
c. Gantt charts are visual devices that show the duration of activities in a project.
d. Gantt charts are expensive.
e. All of the above are true.
123. Which of the following statements regarding critical paths is true?
a. The shortest of all paths through the network is the critical path.
b. Some activities on the critical path may have slack.
c. Every network has exactly one critical path.
d. On a specific project, there can be multiple critical paths, all with exactly the same duration.
e. The duration of the critical path is the average duration of all paths in the project network.
124. Which of the following statements regarding CPM is true?
a. The critical path is the shortest of all paths through the network.
b. The critical path is that set of activities that has positive slack.
c. Some networks have no critical path.
d. All activities on the critical path have their LS equal their predecessor's EF.
e. All of the above are false.
125. A simple CPM network has three activities, A, B, and C. A is an immediate predecessor of B and of C. B is an immediate predecessor of C. The activity durations are A=4, B=3, C=8.
a. The critical path is A-B-C, duration 15.
b. The critical path is A-C, duration 12.
c. The critical path is A-B-C, duration 13.5
d. The critical path cannot be determined without knowing PERT expected activity times.
e. The network has no critical path.
126. A simple CPM network has three activities, D, E, and F. D is an immediate predecessor of E and of F. E is an immediate predecessor of F. The activity durations are D=4, E=3, F=8.
a. The critical path is D-E-F, duration 15.
b. The critical path is D-F, duration 12.
c. Slack at D is 3 units
d. Slack at E is 3 units
e. Both a and c are true
127. Activity D on a CPM network has predecessors B and C, and has successor F. D has duration 6. B's earliest finish is 18, while C's is 20. F's late start is 26. Which of the following is true?
a. B is a critical activity.
b. C is completed before B.
c. D has no slack but is not critical.
d. D is critical, and has zero slack.
e. All of the above are true.
128. Which of the following statements regarding CPM networks is true?
a. There can be multiple critical paths on the same project, all with different durations.
b. The early finish of an activity is the latest early start of all preceding activities.
c. The late start of an activity is its late finish plus its duration.
d. If a specific project has multiple critical paths, all of them will have the same duration.
e. All of the above are true.
129. Activity M on a CPM network has predecessors N and R, and has successor S. M has duration 5. N's late finish is 18, while R's is 20. S's late start is 14. Which of the following is true?
a. M is critical and has zero slack.
b. M has no slack but is not critical.
c. The last start time of S is impossible.
d. N is a critical activity.
e. S is a critical activity.
130. Which of the following statements concerning CPM activities is false?
a. The early finish of an activity is the early start of that activity plus its duration.
b. The late finish is the earliest of the late start times of all successor activities.
c. The late start of an activity is its late finish less its duration.
d. The late finish of an activity is the earliest late start of all preceding activities.
e. The early start of an activity is the latest early finish of all preceding activities.
131. The time an activity will take assuming very unfavorable conditions is
a. the optimistic time
b. the pessimistic time
c. the activity variance
d. the minimum time
e. exactly twice as long as the expected time
132. The critical path for the network activities shown below is _____ with duration ______.
Activity Duration Immediate
Predecessors
A 4 ---
B 2 A
C 7 --
D 4 A
E 5 B,C,D
a. A-B-D; 10
b. A-B-E; 11
c. C-E; 12
d. A-D-E; 13
e. A-B-C-D-E; 22
133. The critical path for the network activities shown below is _____ with duration ______.
Activity Duration Immediate
Predecessors
A 2 --
B 4 --
C 6 A,B
D 1 A,B
E 2 B,C,D
a. A-D-E; 5
b. B-E; 6
c. B-D-E; 7
d. A-C-E; 10
e. B-C-E; 12
134. The expected activity time in PERT analysis is calculated as
a. the simple average of the optimistic, pessimistic, and most likely times
b. the weighted average of a, m, and b, with m weighted 4 times as heavily as a and b
c. the sum of the optimistic, pessimistic, and most likely times
d. the sum of the optimistic, pessimistic, and most likely times, divided by six
e. the sum of the activity variances, divided by six
135. The critical path for the network activities shown below is _____ with duration ______.
Activity Duration Immediate
Predecessors
A 10 ---
B 8 ---
C 2 A
D 4 A
E 5 B,C, D
a. A-C; 12
b. A-D-E; 19
c. B-E; 13
d. A-B-C-D-E; 29
e. none of the above
136. Which of the following statements regarding PERT times is true?
a. The optimistic time estimate is an estimate of the minimum time an activity will require.
b. The optimistic time estimate is an estimate of the maximum time an activity will require.
c. The probable time estimate is calculated as t = (a + 4m + b).
d. Pessimistic time estimate is an estimate of the minimum time an activity will require.
e. Most likely time estimate is an estimate of the maximum time an activity will require.
137. Which of the following statements regarding PERT times is true?
a. Expected time is an estimate of the time an activity will require if everything goes as planned.
b. The optimistic time estimate is an estimate of the maximum time an activity will require.
c. The probable time estimate is calculated as t = (a + 4m + b)/6.
d. Pessimistic time estimate is an estimate of the minimum time an activity will require.
e. Most likely time estimate is an estimate of the maximum time an activity will require.
138. The Beta distribution is used in project management to
a. calculate slack on activities not on the critical path
b. calculate the probability that a project will be completed within its budget
c. calculate pessimistic and optimistic activity times
d. determine which activity should be crashed
e. none of the above
139. The Beta distribution is used in project management to
a. determine which activity should be crashed
b. calculate the probability that a project will be completed within its budget
c. calculate expected activity times
d. calculate slack for activities on the critical path
e. none of the above
140. In a PERT network, non-critical activities that have little slack need to be monitored closely
a. because PERT treats all activities as equally important
b. because near-critical paths could become critical paths with small delays in these activities
c. because slack is undesirable and needs to be eliminated
d. because they are causing the entire project to be delayed
e. because they have a high risk of not being completed
141. Which of the following statements regarding PERT analysis is true?
a. Each activity has two estimates of its duration.
b. Project variance is the sum of all activity variances.
c. Project standard deviation is the sum of all critical activity standard deviations.
d. Only critical activities contribute to the project variance.
e. None of the above is true.
142. Which of these statements regarding time-cost tradeoffs in CPM networks is true?
a. Crashing is not possible unless there are multiple critical paths.
b. Crashing a project often reduces the length of long-duration, but noncritical, activities.
c. Activities not on the critical path can never be on the critical path, even after crashing.
d. Crashing shortens the project duration by assigning more resources to one or more of the critical tasks.
e. None of the above is true.
143. Six Sigma is among the most timely topics in business today because of the following, EXCEPT:
a) It was developed by Motorola
b) High profile organizations report strong benefits from using it
c) It can be applied in organizations that produce a tangible output or an intangible service
d) Nonprofit organizations may apply it as well as for profit companies
145. Six Sigma (DMAIC) is best applied when:
a) The process is fundamentally flawed
b) The process is brand new
c) There is too much variation in the process
d) There is too much waste in the process
146. Business Process Design (BPD) is also adequately named the following EXCEPT:
a) Reengineering
b) Business process innovation
c) Business process engineering
d) Downsizing or restructuring
147. A literal interpretation of six-sigma is:
a) 4.3 defects per million opportunities (DPMO)
b) 3.4 defects per billion opportunities (DPBO)
c) 3.4 defects per million opportunities (DPMO)
d) 3.1 defects per million opportunities (DPMO)
148. DMAIC stands for:
a) Define, Measure, Analyze, Implement, Control
b) Define, Maintain, Assure, Implement, Control
c) Define, Measure, Analyze, Improve, Control
d) Design, Maintain, Analyze, Improve, Control
149. Which term compares an organization's processes with the best practices to be found in its industry or others?
a) Benchmark
b) Performance
c) Value proposition
d) Bias
150. Which of the following is FALSE about Quality Function Deployment (QFD)?
a) It is a powerful tool to translate customer requirements into process capabilities
b) It utilizes a series of tables to maintain links between the data collected and the final process activities
c) Because of their shape, the tables are often referred to as "houses of quality"
d) Technical requirements are the basic input for the process deployment matrix
115. Quality Function Deployment (QFD) starts by using "voice of the customer" (VOC) data in which of the following matrices?
a) Process planning
b) Process deployment
c) Output planning
d) Output specification
116. Choose a common problem from the Measure phase.
a) Calculation of a baseline to evaluate benefits of potential improvements
b) The process mean can shift as much as 1.5 standard deviations
c) Performance metrics based on the availability of data
d) 3.4 defects per million opportunities (DPMO) may occur easily in complex operations
117. The relationship between the natural variation in the production system and the product's design specifications can be quantified using:
a) Six sigma
b) Control charts
c) A process capability index
d) Fishbone diagrams
118. Which of the following is/are (a) primary tenet(s) in the Japanese work systems?
a) Waste is minimized
b) Continually improving process and systems
c) Six sigma implementation
d) Both A and B
119. The following are characteristics of Lean when contrasted with traditional systems, EXCEPT:
a) Priorities are a limited market and few options
b) Capacity is flexible and moderately utilized
c) Suppliers are many, competitive, deliver to central receiving area and have independent forecasts
d) Quality is at the source, continuous and with statistical process controls
120. Which of the following is NOT a direct benefit of lean?
a) Cost savings
b) Uncovering problems
c) Improved financial investments
d) Revenue increases
121. Which of the following project categories typically seeks the development of a new generation of outputs?
a) Derivative projects
b) Breakthrough projects
c) Platform projects
d) R&D projects
122.Which of the following project categories might lead to the other project categories?
a) Derivative projects
b) Breakthrough projects
c) Platform projects
d) R&D projects
123. Which of the following terms provides the basis for the project schedule, often formatted as a project Gantt chart?
a) Critical path
b) Work breakdown structure
c) Float
d) Earned value
124. . The set of all project activities graphically interrelated through precedence relationships is known as a/an:
a) Activity
b) Event
c) Network
d) Path
125. . Any path that if delayed will delay the completion of the entire project is known as a:
a) Significant path
b) Critical path
c) Central path
d) Network path
126. Duration of critical path - path duration = __________?
a) Latest finish time
b) Critical time
c) Path slack
d) Latest start time
127. The amount of time a project manager estimates it will take to complete the activity under ideal conditions is known as:
a) Pessimistic time
b) Optimistic time
c) Likeliest time
d) Utopian time
127. Which of the following statement(s) concerning probabilities of completion is/are incorrect?
a) Using the variance of each activity, we can compute the likelihood of completing the project in a given time period.
b) The probability of completing a path is found by calculating the standard normal deviate of the desired completion time less the expected completion time.
c) The distribution of a path's completion time will be approximately exponentially distributed if the path has a large number of activities on it.
d) Both B and C
128. Which of the following statements about Supply Chain Management (SCM) is correct?
a) SCM programs are putting ever greater emphasis on the finance function
b) SCM coordinates and integrates several activities into a process by linking the most important partners in the chain
c) The goal of SCM is to deliver the right product at the right time, while yielding the lowest possible costs
d) SCM enables manufacturers to actively plan and collaborate across a distributed supply chain
129. Which of the following is FALSE about supply chains?
a) Just-in-time deliveries (JIT) and lean manufacturing dictate a demand chain
b) When customers of a service are also suppliers, they should be attracted
c) A supply chain is suggestive of a system of production in which the customer "pulls" the product
d) Suppliers that are not customers must be chosen carefully
130. Logistics consist(s) of the following, EXCEPT:
a) Compensation and incentives
b) Storage and warehousing
c) Transportation and information processing
d) Inventories and distribution
131. What is the least expensive transportation mode?
a) Air
b) Trucking
c) Railroads
d) Water
132. Organizations that process natural or basic resources as raw materials or other essential inputs to obtain their outputs will locate near their resources if one of the following conditions holds:
a) High economies of scale exist for the product
b) The raw material can be shipped long distance before being processed
c) There is a large loss in size or weight during processing.
d) Both A and C
133. Purchasing tends to follow three practices; which of the following is NOT one of them?
a) They leverage their buying power
b) They work with and help suppliers reduce costs
c) They commit to a small number of dependable suppliers
d) All of the above are practices followed by purchasing in highly effective organizations
134. Arnold Palmer Hospital uses which of the following quality management techniques?
a. Pareto charts
b. flow charts
c. benchmarking
d. Just-in-Time
e. The hospital uses all of the above techniques.
135. Which of the following statements best describes the relationship between quality management and product strategy?
a. Product strategy is set by top management; quality management is an independent activity.
b. Quality management is important to the low-cost product strategy, but not to the response or differentiation strategies.
c. High quality is important to all three strategies, but it is not a critical success factor.
d. Managing quality helps build successful product strategies.
e. Companies with the highest measures of quality were no more productive than other firms.
136. "Quality is defined by the customer" is
a. an unrealistic definition of quality
b. a user-based definition of quality
c. a manufacturing-based definition of quality
d. a product-based definition of quality
e. the definition proposed by the American Society for Quality
137. "Making it right the first time" is
a. an unrealistic definition of quality
b. a user-based definition of quality
c. a manufacturing-based definition of quality
d. a product-based definition of quality
e. the definition proposed by the American Society for Quality
138. Three broad categories of definitions of quality are
a. product quality, service quality, and organizational quality
b. user-based, manufacturing-based, and product-based
c. internal, external, and prevention
d. low-cost, response, and differentiation
e. Pareto, Shewhart, and Deming
139. According to the manufacturing-based definition of quality,
a. quality is the degree of excellence at an acceptable price and the control of variability at an acceptable cost
b. quality depends on how well the product fits patterns of consumer preferences
c. even though quality cannot be defined, you know what it is
d. quality is the degree to which a specific product conforms to standards
e. quality lies in the eyes of the beholder
140. The role of quality in limiting a firm's product liability is illustrated by
a. ensuring that contaminated products such as impure foods do not reach customers
b. ensuring that products meet standards such as those of the Consumer Product Safety Act
c. designing safe products to limit possible harm to consumers
d. using processes that make products as safe or as durable as their design specifications call for
e. All of the above are valid.
141. Which of the following is not one of the major categories of costs associated with quality?
a. prevention costs
b. appraisal costs
c. internal failures
d. external failures
e. none of the above; they are all major categories of costs associated with quality
142. All of the following costs are likely to decrease as a result of better quality except
a. customer dissatisfaction costs
b. inspection costs
c. scrap costs
d. warranty and service costs
e. maintenance costs
143. Which of the following statements is not true?
a. Self-promotion is not a substitute for quality products.
b. Inferior products harm a firm's profitability and a nation's balance of payments.
c. Product liability transfers from the manufacturer to the retailer once the retailer accepts delivery of the product.
d. Quality-be it good or bad-will show up in perceptions about a firm's new products, employment practices, and supplier relations.
e. Legislation such as the Consumer Product Safety Act sets and enforces product standards by banning products that do not reach those standards.
144. "Employees cannot produce goods that on average exceed the quality of what the process is capable of producing" expresses a basic element in the writings of
a. Vilfredo Pareto
b. Armand Feigenbaum
c. Joseph M. Juran
d. W. Edwards Deming
e. Philip B. Crosby
145. "Quality Is Free," meaning that the costs of poor quality have been understated, is the work of
a. W. Edwards Deming
b. Joseph M. Juran
c. Philip B. Crosby
d. Crosby, Stills, and Nash
e. Armand Feigenbaum
146. Based on his 14 Points, Deming is a strong proponent of
a. inspection at the end of the production process
b. an increase in numerical quotas to boost productivity
c. looking for the cheapest supplier
d. training and knowledge
e. all of the above
147. Regarding the quality of design, production, and distribution of products, an ethical requirement for management is to
a. determine whether any of the organization's stakeholders are violated by poor quality products
b. gain ISO 14000 certification for the organization
c. obtain a product safety certificate from the Consumer Product Safety Commission
d. have the organization's legal staff write disclaimers in the product instruction booklets
e. compare the cost of product liability to the external failure cost
148. If 1 million passengers pass through the St. LouisAirport with checked baggage each month, a successful Six Sigma program for baggage handling would result in how many passengers with misplaced luggage?
a. 3.4
b. 6.0
c. 34
d. 2700
e. 6 times the monthly standard deviation of passengers
149. Which of the following is true about ISO 14000 certification?
a. It is not a prerequisite for ISO 9000 certification.
b. It deals with environmental management.
c. It offers a good systematic approach to pollution prevention.
d. One of its core elements is life-cycle assessment.
e. All of the above are true.
150. Suppose that a firm has historically been achieving "three-sigma" quality. If the firm later changes its quality management practices such that begins to achieve "six-sigma" quality, which of the following phenomena will result?
a. The average number of defects will be cut in half.
b. The specification limits will be moved twice as far from the mean.
c. The average number of defects will be cut by 99.9997%.
d. The average number of defects will be cut by 99.87%.
e. The average number of defects will be cut by 99.73%.
151. To become ISO 9000 certified, organizations must
a. document quality procedures
b. have an onsite assessment
c. have an ongoing series of audits of their products or service
d. all of the above
e. none of the above
152. Total quality management emphasizes
a. the responsibility of the quality control staff to identify and solve all quality-related problems
b. a commitment to quality that goes beyond internal company issues to suppliers and customers
c. a system where strong managers are the only decision makers
d. a process where mostly statisticians get involved
e. ISO 14000 certification
153. A successful TQM program incorporates all of the following except
a. continuous improvement
b. employee involvement
c. benchmarking
d. centralized decision-making authority
e. none of the above; a successful TQM program incorporates all of the above
154. Which of the following statements regarding "Six Sigma" is true?
a. The term has two distinct meanings-one is statistical; the other is a comprehensive quality system.
b. Six Sigma means that about 94 percent of a firm's output is free of defects.
c. The Six Sigma program was developed by Toyota in the 1970's.
d. The Six Sigma program is for manufacturing firms, and is not applicable to services.
e. Six Sigma certification is granted by the International Standards Organization (ISO).
155. Building high-morale organizations and building communication networks that include employees are both elements of
a. ISO 9000 certification
b. Six Sigma certification
c. employee empowerment
d. Taguchi methods
e. the tools of TQM
156. ISO 9000 seeks standardization in terms of
a. products
b. production procedures
c. suppliers' specifications
d. procedures to manage quality
e. all of the above
157. Costs of dissatisfaction, repair costs, and warranty costs are elements of cost in the
a. Taguchi Loss Function
b. Pareto chart
c. ISO 9000 Quality Cost Calculator
d. process chart
e. none of the above
158. A quality loss function includes all of the following costs except
a. the cost of scrap and repair
b. the cost of customer dissatisfaction
c. inspection, warranty, and service costs
d. sales costs
e. costs to society
159. A manager tells her production employees, "It's no longer good enough that your work fall anywhere within the specification limits. I need your work to be as close to the target value as possible." Her thinking is reflective of
a. internal benchmarking
b. Six Sigma
c. ISO 9000
d. Taguchi concepts
e. process control charts
160. If a sample of parts is measured and the mean of the measurements is outside the control limits, the process is
a. in control, but not capable of producing within the established control limits
b. out of control and the process should be investigated for assignable variation
c. within the established control limits with only natural causes of variation
d. monitored closely to see if the next sample mean will also fall outside the control limits
e. none of the above
161. When a sample measurement falls inside the control limits, it means that
a. each unit manufactured is good enough to sell
b. the process limits cannot be determined statistically
c. the process output exceeds the requirements
d. if there is no other pattern in the samples, the process is in control
e. the process output does not fulfill the requirements
162. Which of the following is false regarding control charts?
a. Values above the upper control limits always imply that the product's quality is exceeding expectations.
b. Control charts are built so that new data can be quickly compared to past performance data.
c. Control charts graphically present data.
d. Control charts plot data over time.
e. None of the above is false.
163. The goal of inspection is to
a. detect a bad process immediately
b. add value to a product or service
c. correct deficiencies in products
d. correct system deficiencies
e. all of the above
164. Which of the following is not a typical inspection point?
a. upon receipt of goods from your supplier
b. during the production process
c. before the product is shipped to the customer
d. at the supplier's plant while the supplier is producing
e. after a costly process
165. A good description of "source inspection" is inspecting
a. materials upon delivery by the supplier
b. the goods at the production facility before they reach the customer
c. the goods as soon as a problem occurs
d. goods at the supplier's plant
e. one's own work, as well as the work done at the previous work station
166. Which of the determinants of service quality involves having the customer's best interests at heart?
a. access
b. courtesy
c. credibility
d. responsiveness
e. tangibles
167. Which of the determinants of service quality involves performing the service right the first time?
a. access
b. courtesy
c. credibility
d. reliability
e. responsiveness
168. The layout strategy that deals with low-volume, high-variety production is
a. fixed-position layout
b. retail layout
c. warehouse layout
d. office layout
e. none of the above
169. "A special arrangement of machinery and equipment to focus on production of a single product or group of related products" describes what layout type?
a. fixed-position layout
b. intermittent production
c. focused factory
d. work cell
e. warehouse layout
170. A good layout requires determining
a. material handling requirements
b. capacity and space requirements
c. environment and aesthetics
d. cost of moving between various work areas
e. all of the above
171. The fixed-position layout would be most appropriate in which of the following settings?
a. a fast-food restaurant
b. a doctor's office
c. a casual dining restaurant
d. a cruise ship assembly facility
e. none of the above
172. Because the fixed-position layout problem is so difficult to solve on-site, operations managers
a. virtually never employ this layout strategy
b. utilize this approach only for construction projects such as bridges and office towers
c. increase the size of the site
d. often complete as much of the project as possible off-site
e. utilize this layout only for defense contractors
173. One factor impacting the fixed-position layout strategy is
a. minimizing difficulties caused by material flow varying with each product
b. requiring frequent contact close to one another
c. the provision of low-cost storage with low-cost material handling
d. the movement of material to the limited storage areas around the site
e. balancing product flow from one work station to the next
174. The type of layout which features departments or other functional groupings in which similar activities are performed is
a. process-oriented
b. product-oriented
c. fixed-position
d. mass production
e. unit production
175. One of the major advantages of process-oriented layouts is
a. high equipment utilization
b. large work-in-process inventories
c. flexibility in equipment and labor assignment
d. smooth and continuous flow of work
e. none of the above
176. Which type of layout is specifically designed to encourage employees to interact?
a. warehouse
b. job shop
c. open office
d. retail
e. repetitive/continuous
177. Which of the following is true for process layouts, but false for product-oriented layouts?
a. low in-process inventories
b. flexibility in equipment and labor assignments
c. low variety of products
d. high volume of output
e. often solved by assembly line balancing
178. A big advantage of a process-oriented layout is
a. its flexibility in equipment and labor assignments
b. its low cost
c. the simplified scheduling problem presented by this layout strategy
d. the ability to employ low-skilled labor
e. its high equipment utilization
179. Balancing low-cost storage with low-cost material handling is important in a(n)
a. fixed-position layout
b. process-oriented layout
c. office layout
d. repetitive and product-oriented layout
e. warehouse layout
180. Which of the following is not an advantage of work cells?
a. reduced direct labor cost
b. decreased use of equipment and machinery
c. heightened sense of employee participation
d. reduced raw material and finished goods inventory
e. reduced investment in machinery and equipment
181. Balancing a work cell is done
a. before the work cell equipment is sequenced
b. as part of the process of building an efficient work cell
c. before takt time is calculated
d. so that each assembly line workstation has exactly the same amount of work
e. to minimize the total movement in a process layout
182. A process layout problem consists of 4 departments, each of which can be assigned to one of four rooms. The number of different solutions to this problem is _____, although not all of them may have different material handling costs.
a. 1
b. 4
c. 16
d. 24
e. unknown
183. In assembly line balancing, the minimum number of workstations is
a. the ratio of the sum of all task times to cycle time
b. always (when a fraction) rounded upward to the next larger integer value
c. not always possible to reach when tasks are actually assigned to stations
d. all of the above
e. none of the above
184. In assembly line balancing, cycle time (the ratio of available production time to scheduled production) is the
a. minimum time that a product is allowed at each workstation
b. maximum time that a product is allowed at each workstation
c. optimum time that a product is allowed at each workstation
d. desired cycle time that a product is allowed at each workstation
e. all of the above
185. Cycle time is computed as
a. desired output divided by the daily operating time
b. daily operating time divided by the product of desired output and the sum of job times
c. the product of desired output and the sum of job times divided by daily operating time
d. daily operating time divided by the scheduled output
e. 1.00 minus station time
186. Daily capacity of a product layout is determined by
a. operating time divided by cycle time
b. cycle time divided by operating time
c. operating time divided by total task time
d. total task time divided by cycle time
e. cycle time divided by total task time
187. An assembly line consists of 21 tasks grouped into 5 workstations. The sum of the 21 task times is 85 minutes. Cycle time for the line is 20 minutes. The efficiency of this line is
a. 4.2 percent
b. 17 percent
c. 85 percent
d. 100 percent
e. none of the above
188. In the make-or-buy decision, one of the reasons for making is
a. to reduce inventory costs
b. to obtain technical or management ability
c. inadequate capacity
d. reciprocity
e. to assure adequate supply in terms of quantity
188. In the make-or-buy decision, which of the following is a reason for making an item?
a. management can focus on its primary business
b. lower production cost
c. inadequate capacity
d. reduce inventory costs
e. None of the above is a reason for making an item.
189. In the make-or-buy decision, one of the reasons for buying is
a. to assure adequate supply
b. to obtain desired quality
c. to remove supplier collusion
d. inadequate capacity
e. to maintain organizational talents
190. In the make-or-buy decision, which of the following is not a reason for buying?
a. inadequate capacity
b. to obtain desired quality
c. patents or trade secrets
d. lower inventory costs
e. All of the above are reasons for buying.
191. Outsourcing
a. transfers traditional internal activities to outside vendors
b. utilizes the efficiency which comes with specialization
c. lets the outsourcing firm focus on its critical success factors
d. None of the above are true of outsourcing.
e. All of the above are true of outsourcing.
192. The transfer of some of what are traditional internal activities and resources of a firm to outside vendors is
a. a standard use of the make or buy decision
b. not allowed by the ethics code of the Supply Management Institute
c. offshoring
d. outsourcing
e. keiretsu
193. In supply chain management, ethical issues
a. are particularly important because of the enormous opportunities for abuse
b. may be guided by company rules and codes of conduct
c. become more complex the more global is the supply chain
d. may be guided by the principles and standards of the Institute for Supply Management
e. All of the above are true.
194. Which of the following is not an advantage of the "few suppliers" concept?
a. suppliers' willingness to participate in JIT systems
b. trust
c. vulnerability of trade secrets
d. creation of value by allowing suppliers to have economies of scale
e. suppliers' willingness to provide technological expertise
195. Which of the following supply chain strategies creates value by allowing suppliers to have economies of scale?
a. suppliers becoming part of a company coalition
b. vertical integration
c. long-term partnering with a few suppliers
d. negotiating with many suppliers
e. developing virtual companies