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Semester End Examination July 2016

Exam Date: 7/12/2016

MFM (2nd Semester)


AMF202 - Operations Management
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Section A: Case Study Total 5 Questions, each question carries 4 marks.


Section B: Total 50 Questions, each question carries 1 mark.
All questions are compulsory.
There is no negative marking for wrong answers.

Section A: CASE STUDY


(each question carries 4 marks)
The fact that the operations function has an exacting and critical corporate role to play is never in
dispute. Couple this with the high cost and fixed nature (changes take a long time to bring about) of its
investments, then it is paramount for a company to understand the business trade-offs involved in
operations decisions. As operations is a principal player in providing those criteria that maintain and
improve market share and successfully allow the company to enter new markets, then not knowing how
operations will ensure the provision of that support is risk-taking of the highest order, especially given
the highly competitive and fast-changing nature of todays markets and the fixed and high-cost
dimensions involved in development and investment.
Ques:1 Operations management is applicable
Option A mostly to the service sector
Option B to services exclusively
Option C mostly to the manufacturing sector
Option D to all firms, whether manufacturing and service
Ques:2 Reasons to study Operations Management include learning about
Option A why people organize themselves for productive enterprise
Option B how goods and services are produced
Option C what operations managers do
Option D all of the above
Ques:3 The five elements in the management process are
Option A plan, direct, update, lead, and supervise
Option B plan, organize, staff, lead, and control
Option C accounting/finance, marketing, operations, and management
Option D plan, lead, organize, manage, and control
Ques:4 A firm can effectively use its operations function to yield competitive advantage via all of the
following except
Option A customization of the product
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Option B setting equipment utilization goals below the industry average


Option C speed of delivery
Option D maintain a variety of product options
Ques:5 A strategy is a(n
Option A set of opportunities in the marketplace
Option B broad statement of purpose
Option C action plan to achieve the mission
Option D plan for cost reduction

Section B
(each question carries 1 mark)
Ques:1 Operations management is concerned with
Option A the design of a firms productive systems.
Option B the operation of a firms productive systems.
Option C the improvement of a firms productive systems.
Option D all of the above.
Ques:2 The production system that prizes flexibility over efficiency and quality over quantity is known
as
Option A mass production
Option B craft production
Option C lean production
Option D electronic commerce
Ques:3 Dividing a job into a series of small tasks each performed by a different worker is known as
Option A craft production
Option B scientific management
Option C division of labor
Option D interchangeable parts
Ques:4 Which of the following statements is true?
Option A Almost all services and almost all goods are a mixture of a service and a tangible product.
Option B A pure good has no tangible product component.
Option C A pure service has only a tangible product component.
Option D There is no such thing as a pure good.
Ques:5 Which is not true regarding differences between goods and services?
Option A Services are generally produced and consumed simultaneously; tangible goods are not.
Option B
Option C
Option D

Services tend to be more knowledge-based than products.


Services tend to have a more inconsistent product definition than goods.
Goods tend to have higher customer interaction than services.

Ques:6 Which of the following is true about business strategies?


Option A All firms within an industry will adopt the same strategy.
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Option B Well defined missions make strategy development much easier.


Option C Strategies are formulated independently of SWOT analysis.
Option D Organizational strategies depend on operations strategies.
Ques:7 The impact of strategies on the general direction and basic character of a company is
Option A short range
Option B medium range
Option C long range
Option D temporal
Ques:8 Which of the following statements best characterizes delivery reliability?
Option A a company that always delivers on the same day of the week
Option B a company that always delivers at the promised time
Option C a company that delivers more frequently than its competitors
Option D a company that delivers faster than its competitors
Ques:9 Which of the following is an example of competing on the basis of differentiation?
Option A A firm manufactures its product with less raw material waste than its competitors do.
Option B A firm's products are introduced into the market faster than its competitors products are.
Option C A firm's distribution network routinely delivers its product on time.
Option D A firm offers more reliable products than its competitors do.
Ques:10 In which stage of the product life cycle should product strategy focus on process modifications?
Option A introduction
Option B growth
Option C maturity
Option D decline
Ques:11 Quality function deployment (QFD)
Option A determines what will satisfy the customer
Option B translates customer desires into the target design
Option C is used to determine where to deploy quality efforts
Option D all of these
Ques:12 A graphic technique for defining the relationship between customer desires and product/service
is
Option A Product Lifecycle Management
Option B the House of Quality
Option C the moment of truth
Option D the assembly drawing
Ques:13 Industrial location analysis typically attempts to
Option A reduce costs
Option B maximize sales
Option C focus more on human resources
Option D be environmentally friendly
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Ques:14 A location decision for an appliance manufacturer would tend to have a(n)
Option A cost focus
Option B labour focus
Option C revenue focus
Option D environmental focus
Ques:15 A company has a target output rate of 40 units every five (5) hours when its line is fully
operational. To achieve this target the firm must have a cycle time of
Option A more than 12.50 minutes
Option B more than 10.00 minutes
Option C 7.5 minutes or less
Option D 8 minutes or less
Ques:16 Which of the following describes a process layout?
Option A equipment is general purpose and the workers are unskilled
Option B equipment is specialized and the workers are highly skilled
Option C equipment is general purpose and the workers are highly skilled
Option D equipment is specialized and the workers are unskilled
Ques:17 Which of the following statements is most true?
Option A product layouts are flexible; process layouts are efficient
Option B product layouts are efficient; process layouts are flexible
Option C product and process layouts are equally flexible; neither are efficient
Option D product and process layout are equally efficient; neither are flexible
Ques:18 Which of the following is not a capacity expansion strategy?
Option A Capacity lead strategy
Option B Capacity lag strategy
Option C Capacity stability strategy
Option D Average capacity
Ques:19 What is sometimes referred to as rated capacity?
Option A efficiency
Option B utilization
Option C effective capacity
Option D expected output
Ques:20 The Academic Computing Center has five trainers available in its computer labs to provide
training sessions to students. Assume that the capacity of the system is 1900 students per semester and
the utilization is 90%. If the number of students who actually got their orientation session is 1500, what
is the efficiency of the system?
Option A 1350 students
Option B 1710 students
Option C 75%
Option D 87.7%

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Ques:21 A(n) _______________ is a project team structure that includes members from different
functional areas.
Option A matrix organization
Option B project network
Option C organizational breakdown structure
Option D work breakdown structure
Ques:22 The _______________ is a document that provides a common understanding, justification, and
expected result for a project.
Option A statement of work
Option B work breakdown structure
Option C scope statement.
Option D responsibility assignment matrix
Ques:23 A bar graph displaying when activities are scheduled to start, when they will be finished, and
where extra time is available is known as a
Option A PERT chart.
Option B work breakdown structure (WBS).
Option C Gantt chart.
Option D responsibility assignment matrix (RAM).
Ques:24 The longest path through a project network is referred to as the
Option A activity-on-node path.
Option B path of greatest slack.
Option C critical path.
Option D noncritical path.
Ques:25 Which of the following is not typically considered an objective of scheduling?
Option A minimizing job lateness
Option B maximizing time in the system
Option C minimizing overtime
Option D maximizing machine utilization
Ques:26 The time required to complete a group of jobs is referred to as
Option A flow time.
Option B make span.
Option C completion time.
Option D none of the above.
Ques:27 The sequencing rule that will minimize average job completion time for a set number of jobs to
be processed on one machine is
Option A first-come-first served (FCFS).
Option B longest processing time (LPT).
Option C shortest process time (SPT).
Option D due date (DDATE).
Ques:28 The following set of jobs must be processed serially through a two-step system. Jobwise times
at processes 1 and 2 respectively are, Job A: 12, 9; B: 8, 11; C: 7, 6; D: 10, 14; and E: 5, 8. If Johnsons Rule
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is used to sequence the jobs then Job A would complete processing on operation 2 at
Option A 21
Option B 35
Option C 38
Option D 47
Ques:29 The estimated mean time for an activity with a most likely time (m) equal to 11 days, the
optimistic time (a) equal to 6 days, and the pessimistic time (b) equal to 18 days is
Option A 9.67 days.
Option B 11 days.
Option C 11.33 days.
Option D 11.67 days.
Ques:30 Distributors, warehouses, and retailers are referred to as _____________ supply chain members.
Option A downstream
Option B upstream
Option C procurement
Option D none of the above.
Ques:31 Inventory turnover is computed by
Option A dividing the cost of goods sold by the average aggregate inventory value.
Option B dividing the average aggregate inventory value by costs of goods sold.
Option C multiplying the average aggregate inventory value by cost of goods sold.
Option D subtracting cost of goods sold from the average aggregate inventory value.

Ques:32 Inventory costs _________________ when higher levels of inventory are needed to improve
customer service.
Option A decrease
Option B stay the same
Option C increase
Option D cannot be estimated
Ques:33 Receiving, handling and shipping costs are examples of
Option A shortage costs.
Option B carrying costs.
Option C ordering costs.
Option D none of the above.
Ques:34 In general, as the order size increases
Option A ordering costs decrease and carrying costs increase.
Option B ordering costs increase and carrying costs decrease.
Option C both ordering and carrying costs increase.
Option D both ordering and carrying costs decrease.
Ques:35 Japanese firms used the concept of ___________ to convert from mass production to lean
production.
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Option A division of labor


Option B scientific management
Option C just-in-time
Option D interchangeable parts
Ques:36 The ratio of a firms monthly output to the number of labor hours used in the same month
would be a measure of
Option A labour productivity
Option B capital productivity
Option C machine productivity
Option D multifactor productivity
Ques:37 A company is considering producing a product for a new market. The fixed costs required for
manufacturing and delivering the product is $50,000. Labor and material costs are estimated to be
approximately $25.00 per product. If the product is sold for $35.00 each, the firms break-even volume
would be
Option A 50,000 units
Option B 5,000 units
Option C 2500 units
Option D 500 units
Ques:38 Strategies for improving productivity in services are
Option A separation, self-service, automation, and scheduling
Option B lean production, strategy-driven investments, automation, and process focus
Option C reduce inventory, reduce waste, reduce inspection, and reduce rework
Option D high interaction, mass customization, service factory, and just-in-time
Ques:39 The probability that a product will operate properly within an expected time frame is the
dimension of quality known as
Option A durability
Option B reliability
Option C performance
Option D serviceability
Ques:40 Which of the following statements best describes the relationship between quality management
and product strategy?
Option A Product strategy is set by top management; quality management is an independent activity.
Option B Quality management is important to the low-cost product strategy, but not to the response or
differentiation strategies.
Option C High quality is important to all three strategies, but it is not a critical success factor.
Option D Managing quality helps build successful product strategies.
Ques:41 "Making it right the first time" is
Option A an unrealistic definition of quality
Option B a user-based definition of quality
Option C a manufacturing-based definition of quality
Option D a product-based definition of quality

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Ques:42 The ratio of a firms monthly output to the number of labor hours used in the same month
would be a measure of
Option A labour productivity
Option B capital productivity
Option C machine productivity
Option D multifactor productivity
Ques:43 Japanese firms used the concept of ___________ to convert from mass production to lean
production.
Option A division of labor
Option B scientific management
Option C just-in-time
Option D interchangeable parts
Ques:44 Directly involving employees in the quality-management process is referred to as
Option A partnering
Option B a quality circle
Option C Six Sigma
Option D participative problem solving
Ques:45 All of the following costs are likely to decrease as a result of better quality except
Option A customer dissatisfaction costs
Option B inspection costs
Option C scrap costs
Option D maintenance costs
Ques:46 Which of the following is not an event or concept associated with the quality revolution?
Option A TQM (total quality management)
Option B PERT/CPM
Option C Business process reengineering
Option D JIT
Ques:47 _____________ advocated continuous improvement to the production process to achieve
conformance to specifications and reduce variability.
Option A W. Edwards Deming
Option B Philip Crosby
Option C Kaoru Ishikawa
Option D Frederick Taylor
Ques:48 "Quality Is Free," meaning that the costs of poor quality have been understated, is the work of
Option A W. Edwards Deming
Option B Joseph M. Juran
Option C Philip B. Crosby
Option D Armand Feigenbaum
Ques:49 Making environmentally sound products through efficient processes
Option A is unprofitable, as long as recyclable materials prices are soft
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Option B is known as lean manufacturing


Option C can still be profitable
Option D is easier for repetitive processes than for product-focused processes
Ques:50 Ethical and environmentally friendly processes include which of the following?
Option A emission controls
Option B recycling
Option C efficient use of resources
Option D all of the above

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