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 d (Organizing to produce goods and services, moderate)
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 c (Organizing to produce goods and services, moderate)
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 a (Organizing to produce goods and services, moderate)
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 d (Organizing to produce goods and services, moderate
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 d (Why study OM? moderate)
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 d (Why study OM? moderate)

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 c (Why study OM? moderate)
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. a (Operations in the service sector, difficult)
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. e (Exciting new trends in operations management, moderate)
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. e (Exciting new trends in operations management, moderate)
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. e (Exciting new trends in operations management, moderate)
Which of the following statements about trends in operations management is false?
a. Job specialization is giving way to empowered employees.
b. Local or national focus is giving way to global focus.
c. Environmentally-sensitive production is giving way to low-cost focus.
d. Rapid product development is partly the result of shorter product cycles.
e. All of the above statements are true. c (Exciting new trends in operations management, moderate)

A foundry produces circular utility access hatches (manhole covers). Currently, 120 covers are produced in a 10-hour shift. If labor productivity can be increased by 20%, it would then be
a. 14.4 covers/hr
b. 24 covers/hr
c. 240 valves/hr
d. 1200 covers/hr
e. none of the above a (The productivity challenge, moderate) {AACSB: Analytic Skills}
Gibson Valves produces cast bronze valves on an assembly line, currently producing 1600 valves each 8-hour shift. If the productivity is increased by 10%, it would then be
a. 180 valves/hr
b. 200 valves/hr
c. 220 valves/hr
d. 880 valves/hr
e. 1760 valves/hr c (The productivity challenge, moderate) {AACSB: Analytic Skills}
Gibson Valves produces cast bronze valves on an assembly line, currently producing 1600 valves per shift. If the production is increased to 2000 valves per shift, labor productivity will increase by
a. 10%
b. 20%
c. 25%
d. 40%
e. 50% c (The productivity challenge, moderate) {AACSB: Analytic Skills}
The Dulac Box plant produces 500 cypress packing boxes in two 10-hour shifts. What is the productivity of the plant?
a. 25 boxes/hr
b. 50 boxes/hr
c. 5000 boxes/hr
d. none of the above
e. not enough data to determine productivity a (The productivity challenge, moderate) {AACSB: Analytic Skills}
The Dulac Box plant works two 8-hour shifts each day. In the past, 500 cypress packing boxes were produced by the end of each day. The use of new technology has enabled them to increase productivity by 30%. Productivity is now approximately
a. 32.5 boxes/hr
b. 40.6 boxes/hr
c. 62.5 boxes/hr
d. 81.25 boxes/hr
e. 300 boxes/hr b (The productivity challenge, moderate) {AACSB: Analytic Skills}

The Dulac Box plant produces 500 cypress packing boxes in two 10-hour shifts. Due to higher demand, they have decided to operate three 8-hour shifts instead. They are now able to produce
600 boxes per day. What has happened to production?
a. It has increased by 50 sets/shift.
b. It has increased by 37.5 sets/hr.
c. It has increased by 20%.
d. It has decreased by 8.3%.
e. It has decreased by 9.1%. c (The productivity challenge, moderate) {AACSB: Analytic Skills}

Productivity measurement is complicated by
a. the competition's output
b. the fact that precise units of measure are often unavailable
c. stable quality
d. the workforce size
e. the type of equipment used b (The productivity challenge, moderate)
The total of all outputs produced by the transformation process divided by the total of the inputs is
a. utilization
b. greater in manufacturing than in services
c. defined only for manufacturing firms
d. multifactor productivity
e. none of the above d (The productivity challenge, moderate)
Which of the following inputs has the greatest potential to increase productivity?
a. labor
b. globalization
c. management
d. capital
e. none of the above c (The productivity challenge, moderate)
Productivity can be improved by
a. increasing inputs while holding outputs steady
b. decreasing outputs while holding inputs steady
c. increasing inputs and outputs in the same proportion
d. decreasing inputs while holding outputs steady
e. none of the above d (The productivity challenge, moderate)

The largest contributor to productivity increases is ________, estimated to be responsible for
_____ of the annual increase.
a. management; over one-half
b. Mr. Deming; one-half
c. labor; two-thirds
d. capital; 90%
e. technology; over one-half a (The productivity challenge, moderate)
The factor responsible for the largest portion of productivity increase in the U.S. is
a. labor
b. management
c. capital
d. all three combined; it is impossible to determine the contribution of individual factors
e. none of these; most productivity increases come from investment spending b (The productivity challenge, moderate)
Which of the following is not true when explaining why productivity tends to be lower in the service sector than in the manufacturing sector?
a. Services are typically labor-intensive.
b. Services are often difficult to evaluate for quality.
c. Services are often an intellectual task performed by professionals.
d. Services are difficult to automate.
e. Service operations are typically capital intensive. e (The productivity challenge, moderate)
Three commonly used productivity variables are
a. quality, external elements, and precise units of measure
b. labor, capital, and management
c. technology, raw materials, and labor
d. education, diet, and social overhead
e. quality, efficiency, and low cost b (The productivity challenge, moderate)
The service sector has lower productivity improvements than the manufacturing sector because
a. the service sector uses less skilled labor than manufacturing
b. the quality of output is lower in services than manufacturing
c. services usually are labor-intensive
d. service sector productivity is hard to measure
e. none of the above c (The productivity challenge, moderate)
Productivity tends to be more difficult to improve in the service sector because the work is
a. often difficult to automate
b. typically labor-intensive
c. frequently processed individually
d. often an intellectual task performed by professionals
e. all of the above e (The productivity challenge, moderate)

The service industry makes up approximately what percentage of all jobs in the United States?
a. 12%
b. 40%
c. 66%
d. 79%
e. 90% d (Operations in the service sector, moderate)
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 a (Operations in the service sector, moderate)
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. d (Operations in the service sector, moderate)
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 c (Operations in the service sector, moderate)
Which of the following services is least likely to be unique, i.e., customized to a particular individual's needs?
a. dental care
b. hairdressing
c. legal services
d. elementary education
e. computer consulting d (Operations in the service sector, moderate
Which of the following is not a typical service attribute?
a. intangible product
b. easy to store
c. customer interaction is high
d. simultaneous production and consumption
e. difficult to resell b (Operations in the service sector, moderate)

Which of the following statements concerning growth of services is true?
a. Services now constitute the largest economic sector in postindustrial societies.
b. The number of people employed in manufacturing has more or less held steady since 1950.
c. Each manufacturing employee now produces about 20 times more than in 1950
d. All of the above are true.
e. None of the above is true. d (Operations in the service sector, moderate)
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. c (Introduction, moderate) {AACSB: Multiculture and Diversity}
An organization's process strategy
a. will have long-run impact on efficiency and flexibility of production
b. is the same as its transformation strategy
c. must meet various constraints, including cost
d. is concerned with how resources are transformed into goods and services
e. All of the above are true. e (Introduction, moderate)
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. c (Developing missions and strategies, moderate)
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. c (Developing missions and strategies, moderate)
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. c (Developing missions and strategies, moderate)
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 c (Developing missions and strategies, moderate)

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 b (Developing missions and strategies, moderate
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 b (Achieving competitive advantage through operations, moderate)
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 b (Achieving competitive advantage through operations, moderate)
The ability of an organization to produce goods or services that have some uniqueness in their characteristics is
a. mass production
b. time-based competition
c. competing on productivity
d. competing on flexibility
e. competing on differentiation e (Achieving competitive advantage through operations, moderate)
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 e (Achieving competitive advantage through operations, moderate)
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. d (Achieving competitive advantage through operations, moderate)

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 e (Achieving competitive advantage through operations, moderate)
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. d (Defining quality, moderate)
"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 b (Defining quality, moderate)
"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 c (Defining quality, moderate)
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 d (Defining quality, moderate

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 e (Defining quality, moderate)
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 e (Defining quality, moderate)
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. c (Defining quality, moderate)
"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 d (Defining quality, moderate)
"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 c (Defining quality, moderate)

The philosophy of zero defects is
a. the result of Deming's research
b. unrealistic
c. prohibitively costly
d. an ultimate goal; in practice, 1 to 2% defects is acceptable
e. consistent with the commitment to continuous improvement e (Total quality management, moderate)

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 d (Total quality management, moderate)

Stakeholders who are affected by the production and marketing of poor quality products include
a. stockholders, employees, and customers
b. suppliers and creditors, but not distributors
c. only stockholders, creditors, and owners
d. suppliers and distributors, but not customers
e. only stockholders and organizational executives and managers a (Defining quality, moderate) {AACSB: Ethical Reasoning}

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 a (Defining quality, moderate) {AACSB: Ethical Reasoning}

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 b (Total quality management, moderate)

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 d (Total quality management, moderate)

"Kaizen" is a Japanese term meaning
a. a foolproof mechanism
b. just-in-time (JIT)
c. a fishbone diagram
d. setting standards
e. continuous improvement e (Total quality management, easy) {AACSB: Multiculture and Diversity}
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). a (Total quality management, moderate)

Quality circles members are
a. paid according to their contribution to quality
b. external consultants designed to provide training in the use of quality tools
c. always machine operators
d. all trained to be facilitators
e. none of the above; all of the statements are false e (Total quality management, moderate)

Techniques for building employee empowerment include
a. building communication networks that include employees
b. developing open, supportive supervisors
c. moving responsibility from both managers and staff to production employees
d. building high-morale organizations
e. All of the above are techniques for employee empowerment. e (Total quality management, moderate)

The process of identifying other organizations that are best at some facet of your operations and then modeling your organization after them is known as
a. continuous improvement
b. employee empowerment
c. benchmarking
d. copycatting
e. patent infringement c (Total quality management, moderate)

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 a (Total quality management, moderate)

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 d (Tools of TQM, moderate)

Pareto charts are used to
a. identify inspection points in a process
b. outline production schedules
c. organize errors, problems, or defects
d. show material flow
e. all of the above c (Tools of TQM, moderate)

The "four Ms" of cause-and-effect diagrams are
a. material, machinery/equipment, manpower, and methods
b. material, methods, men, and mental attitude
c. named after four quality experts
d. material, management, manpower, and motivation
e. none of the above a (Tools of TQM, moderate)

Among the tools of TQM, the tool ordinarily used to aid in understanding the sequence of events through which a product travels is a
a. Pareto chart
b. process chart
c. check sheet
d. Taguchi map
e. poka-yoke b (Tools of TQM, moderate)

The process improvement technique that sorts the "vital few" from the "trivial many" is
a. Taguchi analysis
b. Pareto analysis
c. benchmarking
d. Deming analysis
e. Yamaguchi analysis b (Tools of TQM, moderate)

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 d (Tools of TQM, moderate)

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 b (Tools of TQM, moderate)
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 d (Tools of TQM, moderate,)

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. a (Tools of TQM, moderate

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 a (The role of inspection, moderate)

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 e (The role of inspection, moderate)

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 e (The role of inspection, moderate)

A job shop is an example of a(n)
a. repetitive process
b. continuous process
c. line process
d. intermittent process
e. specialized process d (Four process strategies, moderate)
Three types of processes are
a. goods, services, and hybrids
b. manual, automated, and service
c. process focus, repetitive focus, and product focus
d. modular, continuous, and technological
e. input, transformation, and output c (Four process strategies, moderate)
Which of the following industries is likely to have low equipment utilization?
a. auto manufacturing
b. commercial baking
c. television manufacturing
d. chemical processing
e. restaurants e (Four process strategies, moderate)
A product-focused process is commonly used to produce
a. high-volume, high-variety products
b. low-volume, high-variety products
c. high-volume, low-variety products
d. low-variety products at either high- or low-volume
e. high-volume products of either high- or low-variety c (Four process strategies, moderate)
Which one of the following products is most likely made in a job shop environment?
a. a daily newspaper
b. paper forms
c. television sets
d. cigarettes
e. canned vegetables b (Four process strategies, moderate
Which of the following products is likely to be assembled on a repetitive process line?
a. automobiles
b. personal computers
c. dishwashers
d. television sets
e. all of the above e (Four process strategies, moderate)

An assembly line is an example of a
a. product-focused process
b. process-focused process
c. repetitive process
d. line process
e. specialized process c (Four process strategies, moderate)
Standard Register
a. has dozens of U.S. plants in its Forms Division
b. groups people and machines into departments that perform specific activities
c. utilizes a product strategy to keep production volume high
d. obtains its low-cost advantage by not spending money on CAD systems
e. obtains its low-cost advantage by specializing in a relatively small number of products b (Four process strategies, moderate)
Which of the following transformations generally has the highest equipment utilization?
a. process-focused process
b. repetitive process
c. product-focused process
d. specialized process
e. modular process c (Four process strategies, moderate)
Harley Davidson
a. utilizes job shops to make each of its modules
b. uses product focused manufacturing
c. uses a large number of modules to build a small number of different bikes
d. uses work cells to feed its assembly line
e. All of the above are true. d (Four process strategies, moderate)
Which of the following is false regarding repetitive processes?
a. They use modules.
b. They allow easy switching from one product to the other.
c. They are the classic assembly lines.
d. They have more structure and less flexibility than a job shop layout.
e. They include the assembly of basically all automobiles. b (Four process strategies, moderate)
When done correctly, mass customization
a. increases pressure on supply chain performance
b. helps eliminate the guesswork that comes with sales forecasting
c. drives down inventories
d. increases pressure on scheduling
e. all of the above e (Four process strategies, moderate)

Utilization in process-oriented facilities is frequently low because
a. the postponement strategy for improving service productivity is being used
b. scheduling in process-oriented facilities is not very complex
c. with high fixed costs, utilization is not very important
d. excess capacity for peak demands is desirable
e. low raw material inventories cause machines to be idled d (Four process strategies, moderate)
A quasi-custom product
a. gets its apparent customization from the combinations available from a small number of modules b. is often the output of repetitive focus facilities
c. is a valid description of a fast food sandwich
d. is only possible when the focus strategy of service productivity improvement is in use
e. All but d are true. e (Four process strategies, moderate)
The crossover point is that production quantity where
a. variable costs of one process equal the variable costs of another process
b. fixed costs of a process are equal to its variable costs
c. total costs equal total revenues for a process
d. total costs for one process equal total costs for another process
e. the process no longer loses money d (Four process strategies, moderate)
Which of the following is not one of the essential ingredients for mass customization?
a. high machine utilizations
b. personnel and facility flexibility
c. reliance on modular design
d. rapid throughput
e. very effective scheduling a (Four process strategies, moderate)
Strategies for improving productivity in services are
a. separation, self-service, automation, and scheduling
b. lean production, strategy-driven investments, automation, and process focus
c. reduce inventory, reduce waste, reduce inspection, and reduce rework
d. high interaction, mass customization, service factory, and just-in-time
e. none of the above a (Service process design, moderate)
In mass service and professional service, the operations manager should focus on
a. automation
b. equipment maintenance
c. sophisticated scheduling
d. human resources
e. all of the above d (Service process design, moderate)

In mass service and service factory quadrants of the service process matrix, the operations manager could focus on all of the following except
a. automation
b. standardization
c. tight quality control
d. removing some services
e. customization e (Service process design, moderate)

Which of the following is true regarding opportunities to improve service processes?
a. Automation can do little to improve service processes, because services are so personal.
b. Layout is of little consequence, since services seldom use an assembly line.
c. If a work force is strongly committed, it need not be cross-trained and flexible.
d. All of the above are true.
e. None of the above is true. e (Service process design, moderate)
Which of the following are typical of process control systems?
a. They have sensors.
b. The digitized data are analyzed by computer, which generates feedback.
c. Their sensors take measurements on a periodic basis.
d. The sensors' measurements are digitized.
e. all of the above e (Production technology, moderate) {AACSB: Use of IT}
Which of the following is true regarding vision systems?
a. They are consistently accurate.
b. They are modest in cost.
c. They do not become bored.
d. All of the above are true.
e. None of the above is true. d (Production technology, moderate) {AACSB: Use of IT}
The use of information technology to monitor and control a physical process is known as
a. process control
b. computer-aided design
c. information numeric control
d. numeric control
e. none of the above a (Production technology, moderate) {AACSB: Use of IT}
Which of the following technologies would enable a cashier to scan the entire contents of a shopping cart in seconds?
a. ASRS
b. AGV
c. CAD/CAM
d. RFID
e. FMS d (Production technology, moderate) {AACSB: Use of IT}
"Automatic placement and withdrawal of parts and products into and from designated places in a warehouse" describes
a. AGV
b. CAD/CAM
c. CIM
d. ASRS
e. FMS d (Production technology, moderate) {AACSB: Use of IT}

Computer-integrated manufacturing (CIM) includes manufacturing systems that have
a. computer-aided design, a flexible manufacturing system, inventory control, warehousing and shipping integrated
b. transaction processing, management information systems, and decision support systems integrated c. automated guided vehicles, robots, and process control
d. robots, automated guided vehicles, and transfer equipment
e. all of the above a (Production technology, moderate) {AACSB: Use of IT}
Which one of the following technologies is used only for material handling, not actual production or assembly?
a. robots
b. CNC
c. CAD
d. AGVs
e. FMS d (Production technology, moderate) {AACSB: Use of IT}
A system using an automated work cell controlled by electronic signals from a common centralized computer facility is called a(n)
a. adaptive control system
b. robotics
c. flexible manufacturing system
d. automatic guided vehicle (AGV) system
e. manufacturing cell c (Production technology, moderate) {AACSB: Use of IT}
"Operators simply load new programs, as necessary, to produce different products" describes
a. CAD
b. automated guided vehicles
c. flexible manufacturing systems
d. vision systems
e. process control c (Production technology, moderate) {AACSB: Use of IT}

Advances in technology
a. have impacted the manufacturing sector only
b. have had only limited impact on services
c. have failed to change the level of customer interaction with an organization
d. have had dramatic impact on customer interaction with services and with products
e. have dramatically changed health care, but have not changed retailing d (Technology in services, moderate)
Process redesign
a. is the fundamental rethinking of business processes
b. can focus on any process
c. tries to bring about dramatic improvements in performance
d. focuses on activities that cross functional lines
e. all of the above e (Process reengineering, moderate)
Ethical and environmentally friendly processes include which of the following?
a. emission controls
b. recycling
c. efficient use of resources
d. reduction of waste by-products
e. all of the above e (Technology in services, moderate) {AACSB: Ethical Reasoning}
In location planning, environmental regulations, cost and availability of utilities, and taxes are
a. global factors
b. country factors
c. regional/community factors
d. site-related factors
e. none of the above c (Factors that affect location decisions, moderate)
Which of these factors would be considered when making a location decision at the region/community level?
a. government rules, attitudes, stability, incentives
b. cultural and economic issues
c. zoning restrictions
d. environmental impact issues
e. proximity to raw materials and customers e (Factors that affect location decisions, moderate)
When making a location decision at the region/community level, which of these would be considered? a. government rules, attitudes, stability, incentives
b. cultural and economic issues
c. cost and availability of utilities
d. zoning restrictions
e. air, rail, highway, waterway systems c (Factors that affect location decisions, moderate

Which of these factors would be considered when making a location decision at the site level?
a. government rules, attitudes, stability, incentives
b. cultural and economic issues
c. zoning regulations
d. cost and availability of utilities
e. proximity to raw materials and customers c (Factors that affect location decisions, moderate)
Tangible costs include which of the following?
a. climatic conditions
b. availability of public transportation
c. taxes
d. quality and attitude of prospective employees
e. zoning regulations c (Factors that affect location decisions, moderate)
Intangible costs include which of the following?
a. quality of prospective employees
b. quality of education
c. availability of public transportation
d. all of the above
e. none of the above d (Factors that affect location decisions, moderate)
Which of the following is the best example of the proximity rule that, for service firms, proximity to market is the most important location factor?
a. Soft drinks are bottled in many local plants, where carbonated water is added to proprietary syrups that may have been shipped long distances.
b. Few people will travel out-of state for a haircut.
c. Patients will travel very long distances to have their hernia surgeries performed at Shouldice
Hospital.
d. Furniture makers choose to locate near the source of good hardwoods, even though it means locating near other furniture manufacturers.
e. Metal refiners (smelters) locate near mines to accomplish significant weight reduction near the metal's source. b (Factors that affect location decisions, moderate)
Community attitudes, zoning restrictions, and quality of labor force are likely to be considered in which of the following location decision methods?
a. transportation method
b. locational break-even analysis
c. center-of-gravity method
d. simulation
e. factor rating method e (Methods of evaluating location alternatives, moderate)

Which of the following methods best considers intangible costs related to a location decision?
a. crossover methods
b. locational break-even analysis
c. factor rating analysis
d. the transportation method
e. the assignment method c (Methods of evaluating location alternatives, moderate)
Evaluating location alternatives by comparing their composite (weighted-average) scores involves
a. factor rating analysis
b. cost-volume analysis
c. transportation model analysis
d. linear regression analysis
e. crossover analysis a (Methods of evaluating location alternatives, moderate)
A clothing chain is considering two different locations for a new retail outlet. They have identified the four factors listed in the following table as the basis for evaluation, and have assigned weights as shown on the left. The manager has rated each location on each factor, on a 100-point basis, as shown on the right.
Factor Factor Description Weight Barclay Chester
1 Average community income .40 30 20
2 Community growth potential .25 40 30
3 Availability of public transportation .15 20 20
4 Labor cost .20 10 30
What is the score for Chester?
a. 10.00
b. 24.50
c. 25.75
d. 27.00
e. 100.00 b (Methods of evaluating location alternatives, moderate) {AACSB: Analytic Skills}

An approach to location analysis that includes both qualitative and quantitative considerations is
a. locational cost-volume
b. factor rating
c. transportation model
d. assignment method
e. make or buy analysis b (Methods of evaluating location alternatives, moderate)

On the crossover chart where the costs of two or more location alternatives have been plotted, the quantity at which two cost curves cross is the quantity at which
a. fixed costs are equal for two alternative locations
b. variable costs are equal for two alternative locations
c. total costs are equal for all alternative locations
d. fixed costs equal variable costs for one location
e. total costs are equal for two alternative locations e (Methods of evaluating location alternatives, moderate)

A full-service restaurant is considering opening a new facility in a specific city. The table below shows its ratings of four factors at each of two potential sites.
Factor Weight Gary Mall Belt Line
Affluence of local population .20 30 30
Traffic flow .40 50 20
Parking availability .20 30 40
Growth potential .20 10 30
The score for Gary Mall is _____ and the score for Belt Line is ______.
a. 120; 120
b. 22; 24
c. 18; 120
d. 34; 28
e. none of the above d (Methods of evaluating location alternatives, moderate) {AACSB: Analytic Skills}

A firm is considering two location alternatives. At location A, fixed costs would be $4,000,000 per year, and variable costs 0.30 per unit. At alternative B, fixed costs would be $3,600,000 per year, with variable costs of $0.35 per unit. If demand is expected to be 10 million units, which plant offers the lowest total cost?
a. Plant A, because it is cheaper than Plant B for all volumes under 8,000,000 units
b. Plant B, because it is cheaper than Plant A for all volumes over 8,000,000 units
c. Plant A, because it is cheaper than Plant B for all volumes
d. Plant B, because it has the lower variable cost per unit
e. neither Plant A nor Plant B, because the crossover point is at 10 million units b (Methods of evaluating location alternatives, easy) {AACSB: Analytic Skills}

The center-of-gravity method does not take into consideration the
a. location of markets
b. volume of goods shipped to the markets
c. value of the goods shipped
d. combination of volume and distance
e. center-of-gravity method considers none of the above c (Methods of evaluating location alternatives, moderate)

The center-of-gravity method is used primarily to determine what type of locations?
a. service locations
b. manufacturing locations
c. distribution center locations
d. supplier locations
e. call center locations c (Methods of evaluating location alternatives, moderate)

A regional bookstore chain is about to build a distribution center that is centrally located for its eight retail outlets. It will most likely employ which of the following tools of analysis?
a. assembly line balancing
b. load-distance analysis
c. center-of-gravity model
d. linear programming
e. all of the above c (Methods of evaluating location alternatives, moderate)

East Texas Seasonings is preparing to build one processing center to serve its four sources of seasonings. The four source locations are at coordinates shown below. Also, the volume from each source is provided. What is the center of gravity?
X-coordinate Y-coordinate Volume
Athens, Texas 30 30 150
Beaumont, Texas 20 10 350
Carthage, Texas 10 70 100
Denton, Texas 50 50 200
a. X = 28.125; Y = 31.25
b. X = 22000; Y = 24000
c. X = 27.5; Y = 40
d. center of gravity = 28
e. none of the above a (Methods of evaluating location alternatives, moderate) {AACSB: Analytic Skills}

A county wants to build one centrally-located processing facility to serve the county's four recycling drop-off locations. The four drop-offs have characteristics as given in the table below.
What is the approximate center of gravity of these four locations?
Location X-coordinate Y-coordinate Tonnage
Drop-off point A 1 8 10
Drop-off point B 6 7 35
Drop-off point C 6 2 25
Drop-off point D 4 7 50
a. 4.75, 6.04
b. 17, 24
c. 33.5, 135.4
d. 6, 4.25
e. 570, 725 a (Methods of evaluating location alternatives, moderate) {AACSB: Analytic Skills}

Production and/or shipping costs are always considered in which of the following location decision methods? a. factor rating method
b. transportation method
c. locational break-even analysis
d. center-of-gravity method
e. crossover analysis b (Methods of evaluating location alternatives, moderate)

The transportation method, when applied to location analysis
a. minimizes total fixed costs
b. minimizes total production and transportation costs
c. minimizes total transportation costs
d. maximizes revenues
e. minimizes the movement of goods b (Methods of evaluating location alternatives, moderate)

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 e (Types of layout, moderate)

"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 d (Types of layout, moderate)

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 e (Types of layout, moderate)

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 d (Fixed-position layout, moderate)

For which of the following operations would a fixed-position layout be most appropriate?
a. assembling automobiles
b. producing TV sets
c. constructing a highway tunnel or bridge
d. refining of crude oil
e. running an insurance agency c (Fixed-position layout, difficult)

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 d (Fixed-position layout, moderate)

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 d (Fixed-position layout, moderate)

In the Office Relationship Chart, which rating reflects the highest importance for two departments' closeness to each other?
a. A
b. E
c. I
d. O
e. X a (Office layout, moderate)

Which of the statements below best describes office layout?
a. groups workers, their equipment, and spaces/offices to provide for movement of information
b. addresses the layout requirements of large, bulky projects such as ships and buildings
c. seeks the best personnel and machine utilization in repetitive or continuous production
d. allocates shelf space and responds to customer behavior
e. deals with low-volume, high-variety production a (Office layout, moderate)

Which of the following constitutes a major trend influencing office layouts?
a. downsizing
b. globalization
c. environmental issues
d. off-site employees
e. health issues d (Office layout, moderate)

Visibility throughout the supply chain is a requirement among supply chain members for
a. mutual agreement on goals
b. mutual trust
c. compatible organizational cultures
d. local optimization
e. the bullwhip effect b (Managing the supply chain, moderate)

Which of the following statements is true regarding the leverage of supply chain savings?
a. Supply chain leverage is about the same for all industries.
b. Supply chain savings exert more leverage as the firm's purchases are a smaller percent of sales.
c. Supply chain savings exert more leverage as the firm has a lower net profit margin.
d. Supply chain leverage depends only upon the percent of sales spent in the supply chain.
e. None of the above is true. c (Supply chain economics, moderate)

One dollar saved in purchasing is
a. equivalent to a dollar earned in sales revenue
b. worth even more than a dollar earned in sales revenue
c. worth slightly more than a dollar earned because of taxes
d. worth from 35% in the technical instrument industry to 70% in the food products industry
e. only worthwhile if you are in the 50% tax bracket and still have a low profit margin b (Supply chain economics, moderate)

Which one of the following statements about purchasing is true?
a. The cost of purchases as a percent of sales is often small.
b. Purchasing provides a major opportunity for price increases.
c. Purchasing is always more efficient than making an item.
d. Purchasing has an impact on the quality of the goods and services sold.
e. Competitive bidding is a major factor in long-term cost reductions. d (Supply chain economics, moderate)

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 e (Supply chain economics, moderate)

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. b (Supply chain economics, moderate)

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 d (Supply chain economics, moderate)

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. b (Supply chain economics, moderate)

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. e (Supply chain economics, moderate)

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 d (Supply chain economics, moderate)

Keeping a product generic as long as possible before customizing is known as
a. postponement
b. keiretsu
c. channel assembly
d. forward integration
e. backward integration a (Managing the supply chain, moderate)

Which one of the following is not a supply chain strategy?
a. negotiation with many suppliers
b. vertical integration
c. keiretsu
d. short-term relationships with few suppliers
e. virtual companies d (Supply chain strategies, moderate)

A disadvantage of the "few suppliers" strategy is
a. the risk of not being ready for technological change
b. the lack of cost savings for customers and suppliers
c. possible violations of the Sherman Antitrust Act
d. the high cost of changing partners
e. All of the above are disadvantages of the "few suppliers" strategy. d (Supply chain strategies, moderate)

The purchasing approach that holds the suppliers responsible for maintaining the necessary technology, expertise, and forecasting ability plus cost, quality, and delivery competencies is
a. few suppliers
b. many suppliers
c. Keiretsu
d. vertical integration
e. virtual companies b (Supply chain strategies, moderate)

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 c (Supply chain strategies, moderate)

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 c (Supply chain strategies, moderate)

a. availability of capital
b. availability of managerial talent
c. required demand
d. small market share
e. All of the above favor the success of vertical integration. d (Supply chain strategies, moderate)

Which of the following best describes vertical integration?
a. to sell products to a supplier or a distributor
b. to develop the ability to produce products which complement the original product
c. to produce goods or services previously purchased
d. to develop the ability to produce the specified good more efficiently than before
e. to build long-term partnerships with a few suppliers c (Supply chain strategies, moderate)

A fried chicken fast-food chain that acquired feed mills and poultry farms has performed
a. horizontal integration
b. forward integration
c. backward integration
d. current transformation
e. job expansion c (Supply chain strategies, moderate)

Vertical integration appears particularly advantageous when the organization has
a. a very specialized product
b. a large market share
c. a very common, undifferentiated product
d. little experience operating an acquired vendor
e. purchases that are a relatively small percent of sales b (Supply chain strategies, moderate)

A rice mill in south Louisiana purchases the trucking firm that transports packaged rice to distributors. This is an example of
a. horizontal integration
b. forward integration
c. backward integration
d. current transformation
e. keiretsu b (Supply chain strategies, moderate)

Which of the following is not an advantage of a virtual company?
a. speed
b. total control over every aspect of the organization
c. specialized management expertise
d. low capital investment
e. flexibility b (Supply chain strategies, moderate)

Local optimization is a supply chain complication best described as
a. optimizing one's local area without full knowledge of organizational needs
b. obtaining very high production efficiency in a decentralized supply chain
c. the prerequisite of global optimization
d. the result of supply chains built on suppliers with compatible corporate cultures
e. the opposite of the bullwhip effect a (Managing the supply chain, moderate)

The “bullwhip” effect
a. occurs as orders are relayed from retailers to wholesalers
b. results in increasing fluctuations at each step of the sequence
c. increases the costs associated with inventory in the supply chain
d. occurs because of distortions in information in the supply chain
e. all of the above e (Managing the supply chain, moderate)

Which of the following is not an opportunity for effective management in the supply chain?
a. accurate "pull" data
b. vendor managed inventory
c. postponement
d. local optimization
e. channel assembly d (Managing the supply chain, moderate)

Which of the following is an opportunity for effective management in the supply chain?
a. random "pull" data
b. multistage control of replenishment
c. the bullwhip effect
d. customer managed inventory
e. channel assembly e (Managing the supply chain, moderate)

Drop shipment
a. is equivalent to cross-docking
b. is the opposite of a blanket order
c. means the supplier will ship directly to the end consumer, rather than to the seller
d. is the same thing as keiretsu
e. is a good reason to find a new firm to ship your products c (Managing the supply chain, moderate)

A carpet manufacturer has delivered carpet directly to the end consumer rather than to the carpet dealer. The carpet manufacturer is practicing
a. postponement
b. cross-docking
c. channel assembly
d. drop shipping
e. float reduction d (Managing the supply chain, moderate)

Hewlett-Packard withholds customization of its laser printers as long as possible. This is an example of
a. vendor managed inventory
b. standardization
c. backward integration
d. postponement
e. timely customization d (Managing the supply chain, moderate)

All of the following are "opportunities" for supply chain management except
a. postponement
b. drop shipment
c. blanket orders
d. channel assembly
e. line balancing e (Managing the supply chain, moderate)

Which of the following is an advantage of the postponement technique?
a. reduction in automation
b. early customization of the product
c. better quality of the product
d. reduction in training costs
e. reduction in inventory investment e (Managing the supply chain, moderate)

A furniture maker has delivered a dining set directly to the end consumer rather than to the furniture store. The furniture maker is practicing
a. postponement
b. drop shipping
c. channel assembly
d. passing the buck
e. float reduction b (Managing the supply chain, moderate)