1 Chapter True/False 1. Some of the operations-related activities of Hard Rock Caf include designing meals and analyzing them for ingredient cost and labor requirements. True (Global company profile, easy) 2. The production process at Hard Rock Caf is limited to meal preparation and serving customers. False (Global company profile, easy) 3. All organizations, including service firms such as banks and hospitals, have a production function. True (What is operations management? moderate) 4. Operations management is the set of activities that create value in the form of goods and services by transforming inputs into outputs. True (What is operations management? easy) 5. An example of a "hidden" production function is money transfers at banks. True (What is operations management? moderate) 6. One reason to study operations management is to learn how people organize themselves for productive enterprise. True (Why study OM, easy) 7. The operations manager performs the management activities of planning, organizing, staffing, leading, and controlling of the OM function. True (What operations managers do, easy) 8. "How much inventory of this item should we have?" is within the critical decision area of managing quality. False (What operations managers do, easy) 9. In order to have a career in operations management, one must have a degree in statistics or quantitative methods. False (What operations managers do, easy) 10. Henry Ford is known as the Father of Scientific Management. False (The heritage of operations management, easy) 11. Shewhart's contributions to operations management came during the Scientific Management Era. False (The heritage of operations management, easy) 12. Students wanting to pursue a career in operations management will find multidisciplinary knowledge beneficial. True (Where are the OM jobs? easy) 13. Customer interaction is often high for manufacturing processes, but low for services. False (Operations in the service sector, moderate) 14. Productivity is more difficult to improve in the service sector. True (The productivity challenge, moderate) 15. Manufacturing now constitutes the largest economic sector in postindustrial societies. False (Operations in the service sector, moderate) 16. In the past half-century, the number of people employed in manufacturing has more or less held steady, but each manufacturing employee is manufacturing about 20 times as much. True (Operations in the service sector, easy) 17. A knowledge society is one that has migrated from work based on knowledge to one based on
manual work. False (The productivity challenge, easy) 18. Productivity is the total value of all inputs to the transformation process divided by the total value of the outputs produced. False (The productivity challenge, easy) 19. Measuring the impact of a capital acquisition on productivity is an example of multi-factor productivity. False (The productivity challenge, moderate) 20. Ethical and social dilemmas arise because stakeholders of a business have conflicting perspectives. True (Ethics and social responsibility, easy) {AACSB: Ethical Reasoning} Multiple Choice 21. At Hard Rock Caf, tasks that reflect operations or operations management include a. designing meals b. testing meals (recipes) c. analyzing meals for the cost of ingredients d. preparing employee schedules e. all of the above e (Global company profile, easy) 22. An operations task performed at Hard Rock Caf is a. borrowing funds to build a new restaurant b. advertising changes in the restaurant menu c. calculating restaurant profit and loss d. preparing employee schedules e. all of the above d (Global company profile, moderate) 23. 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 d (What is operations management? moderate) 24. 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) 25. 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) 26. 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) 27. 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) 28. 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) 29. 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 e (Why study OM? easy) 30. 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 d (What do operations managers do? easy) 31. Illiteracy and poor diets have been known to cost countries up to what percent of their productivity? a. 2% b. 5% c. 10% d. 20% e. 50% d (Productivity variables, moderate) {AACSB: Multiculture and Diversity} 32. Which of the following is not an element of the management process? a. controlling b. leading c. planning d. pricing e. staffing d (What do operations managers do? easy) 33. 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 c (What do operations managers do? easy) 34. 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. a (What do operations managers do? easy) 35. 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 e (Why study OM? easy) 36. 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) 37. 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) 38. 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 d (The heritage of operations management, moderate) 39. 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 a ( The heritage of operations management, moderate) 40. 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 d (The heritage of operations management, moderate) 41. 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 c (The heritage of operations management, moderate) 42. 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 b (The heritage of operations management, easy) 43. 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 c (The heritage of operations management, easy) 44. 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 d (The heritage of operations management, moderate) 45. 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 e (The heritage of operations management, moderate) 46. 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) 47. Which of the following statements is true? a. The person most responsible for initiating use of interchangeable parts in manufacturing was Eli Whitney. b. The origins of management by exception are generally credited to Frederick W. Taylor. c. The person most responsible for initiating use of interchangeable parts in manufacturing was Walter Shewhart. d. The origins of the scientific management movement are generally credited to Henry Ford. e. The person most responsible for initiating use of interchangeable parts in manufacturing was Henry Ford. a (The heritage of operations management, moderate) 48. 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) 49. 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) 50. 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) 51. 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) 52. 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) 53. 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) 54. 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) 55. 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) 56. 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) 57. 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) 58. 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) 59. A foundry produces circular utility access hatches (manhole covers). If 120 covers are produced in a 10-hour shift, the productivity of the line is a. 1.2 covers/hr b. 2 covers/hr c. 12 covers/hr d. 1200 covers/hr e. none of the above c (The productivity challenge, easy) {AACSB: Analytic Skills} 60. 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} 61. Gibson Valves produces cast bronze valves on an assembly line. If 1600 valves are produced in an 8-hour shift, the productivity of the line is a. 2 valves/hr b. 40 valves/hr c. 80 valves/hr d. 200 valves/hr e. 1600 valves/hr d (The productivity challenge, easy) {AACSB: Analytic Skills} 62. 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} 63. 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} 64. 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} 65. 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} 66. 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} 67. 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) 68. 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) 69. 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) 70. 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) 71. 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) 72. 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) 73. 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) 74. 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) 75. 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) 76. 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) 77. Among the ethical and social challenges facing operations managers are a. honoring community commitments b. maintaining a clean environment c. efficiently developing and producing safe quality products d. providing a safe workplace
e. all of the above e (Ethics and social responsibility, easy) {AACSB: Ethical Reasoning} 78. Among the ethical and social challenges facing operations managers are a. honoring financial commitments b. maintaining a clean environment c. developing low-cost products d. providing an efficient workplace e. all of the above b (Ethics and social responsibility, moderate) {AACSB: Ethical Reasoning} 79. Which of the following is not among the ethical and social challenges facing operations managers? a. honoring community commitments b. maintaining a clean environment c. efficiently developing and producing safe quality products d. increasing executive pay e. providing a safe workplace d (Ethics and social responsibility, easy) {AACSB: Ethical Reasoning} 80. A business's stakeholders, whose conflicting perspectives cause ethical and social dilemmas, include a. lenders b. suppliers c. owners d. employees e. all of the above e (Ethics and social responsibility, easy) {AACSB: Ethical Reasoning}
Chapter 2 True/False 1. NAFTA seeks to phase out all trade and tariff barriers among Canada, Mexico, and the United States. True (A global view of operations, moderate) {AACSB: Multiculture and Diversity} 2. The World Trade Organization has helped to significantly reduce tariffs around the world. True (Global company profile, moderate) {AACSB: Multiculture and Diversity} 3. Production processes are being dispersed to take advantage of national differences in labor costs. True (A global view of operations, moderate) {AACSB: Multiculture and Diversity} 4. NAFTA seeks to phase out all trade and tariff barriers between the United States and Asia. False (A global view of operations, moderate) {AACSB: Multiculture and Diversity} 5. One reason for global operations is to gain improvements in the supply chain. True (A global view of operations, moderate) {AACSB: Multiculture and Diversity} 6. One reason to globalize is to learn to improve operations. True (A global view of operations, easy) {AACSB: Multiculture and Diversity} 7. To attract and retain global talent, and to expand a product's life cycle, are both reasons to globalize. True (A global view of operations, moderate) {AACSB: Multiculture and Diversity} 8. A product will always be in the same stage of its product life cycle regardless of the country. False (A global view of operations, moderate) {AACSB: Multiculture and Diversity} 9. The World Trade Organization helps provide governments and industries around the world with protection from firms that engage in unethical conduct. True (A global view of operations, moderate) {AACSB: Ethical Reasoning} 10. Boeing's development of the 787 Dreamliner is an example of a company obtaining a competitive advantage via product differentiation/innovation. True (Global company profile, easy) 11. An organization's strategy is its purpose or rationale for an organization's existence. False (Developing missions and strategies, easy) 12. Operations strategies are implemented in the same way in all types of organizations. False (Developing missions and strategies, moderate) 13. Between 1980 and 2005, the amount of money (bank deposits, government and corporate debt securities, and equity securities) invested in global capital markets more than tripled. True (Introduction, difficult) {AACSB: Multiculture and Diversity} 14. Experience differentiation is an extension of product differentiation, accomplished by using people's five senses to create an experience rather than simply providing a service. True (Achieving competitive advantage through operations, moderate) 15. An organization's ability to generate unique advantages over competitors is central to a successful strategy implementation. True (Achieving competitive advantage through operations, moderate) 16. Low-cost leadership is the ability to distinguish the offerings of the organization in any way that the customer perceives as adding value. False (Ten strategic decision of OM, moderate) 17. Most services are tangible; this factor determines how the ten decisions of operations management
are handled differently for goods than for services. False (Ten strategic decisions of OM, moderate) 18. The relative importance of each of the ten operations decisions depends on the ratio of goods and services in an organization. True (Ten strategic decisions of OM, moderate) 19. Decisions that involve what is to be made and what is to be purchased fall under the heading of supply chain management. True (Ten strategic decision of OM, moderate) 20. Manufacturing organizations have ten strategic OM decisions, while service organizations have only eight. False (Ten strategic decisions of OM, easy) 21. Errors made within the location decision area may overwhelm efficiencies in other areas. True (Ten strategic decisions of OM, moderate) 22. The PIMS study indicated that high ROI firms tend to have high product quality. True (Issues in operations strategy, easy) 23. Southwest Airlines' core competence is operations. True (Strategy development and implementation, moderate) 24. Critical success factors and core competencies are synonyms. False (Strategy development and implementation, moderate) 25. SWOT analysis identifies those activities that make a difference between having and not having a competitive advantage. False (Strategy development and implementation, moderate) 26. For the greatest chance of success, an organization's operations management strategy must support the company's strategy. True (Strategy development and implementation, moderate) 27. Critical Success Factors are those activities that are key to achieving competitive advantage. True (Strategy development and implementation, moderate) 28. A multinational corporation has extensive international business involvements. True (Global operations strategy options, easy) {AACSB: Multiculture and Diversity} 29. The multidomestic OM strategy maximizes local responsiveness while achieving a significant cost advantage. False (Global operations strategy options, moderate) {AACSB: Multiculture and Diversity} 30. Firms using the global strategy can be thought of as "world companies." False (Global operations strategy options, moderate) {AACSB: Multiculture and Diversity} Multiple Choice 31. 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. e (Global company profile, moderate) 32. 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 d (Global company profile, moderate) 33. 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. e (Introduction, easy) {AACSB: Multiculture and Diversity} 34. 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 Caf provides an "experience differentiation" at its restaurants. e. All of the above are examples. c (Introduction, moderate) {AACSB: Multiculture and Diversity} 35. 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 e (A global view of operations, moderate) {AACSB: Multiculture and Diversity} 36. 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. c (A global view of operations, moderate) {AACSB: Multiculture and Diversity} 37. 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 e (A global view of operations, moderate) {AACSB: Multiculture and Diversity} 38. 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 a (A global view of operations, moderate) {AACSB: Multiculture and Diversity} 39. 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. e (A global view of operations, moderate) {AACSB: Multiculture and Diversity}
40. 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. c (A global view of operations, moderate) {AACSB: Multiculture and Diversity} 41. 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. d (A global view of operations, moderate) {AACSB: Multiculture and Diversity} 42. 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 b (A global view of operations, difficult) {AACSB: Ethical Reasoning} 43. 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) 44. 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) 45. 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) 46. 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) 47. 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) 48. 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. c (Developing missions and strategies, difficult) 49. 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) 50. 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) 51. 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 a (Issues in operations strategy, moderate) 52. 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) 53. Which of the following has made the least progress along its product life cycle? a. drive-thru restaurants b. Internet search engines c. iPods d. LCD & plasma TVs e. Xbox 360 e (Issues in operations strategy, moderate) 54. 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)
55. 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 b (Achieving competitive advantage through operations, difficult) 56. 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) 57. 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) 58. 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. e (Achieving competitive advantage through operations, easy) 59. 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 b (Achieving competitive advantage through operations, easy) 60. 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. a (Achieving competitive advantage through operations, difficult) 61. 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 e (Achieving competitive advantage through operations, easy) 62. Franz Colruyt has achieved low-cost leadership through a. effective use of voice mail b. plastic, not paper, shopping bags
c. background music that subtly encourages shoppers to buy more d. converting factories, garages, and theaters into retail outlets e. use of the Euro, not the currency of each European country d (Achieving competitive advantage through operations, easy) 63. 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. c (Achieving competitive advantage through operations, difficult) 64. 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. d (Ten strategic decisions of OM, moderate) 65. 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. e (Ten strategic decisions of OM, moderate) 66. 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 d (Ten strategic decisions of OM, moderate) 67. Which of the following is not an operations strategic decision? a. maintenance b. price c. layout design d. quality e. inventory b (Ten strategic decisions of OM, moderate) 68. 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 a (Ten strategic decisions of OM, moderate) 69. Which of these companies is most apt to have quality standards that are relatively subjective? a. Chrysler b. Dell Computer c. Sanyo Electronics d. Harvard University e. Whirlpool d (Ten strategic decision of OM, moderate)
70. 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. d (Ten strategic decisions of OM, moderate) 71. 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. d (Ten strategic decisions of OM, moderate) 72. 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 d (Ten strategic decisions of OM, moderate) 73. The PIMS program has identified the a. operations decisions all organizations must make b. distinctive competencies any company needs c. characteristics of firms with high "ROI" d. corporate decisions any company needs to make e. all of the above c (Issues in operations strategy, moderate) 74. Which of these is not one of the PIMS characteristics of high return on investment organizations? a. high product quality b. high capacity utilization c. low investment intensity d. low direct cost per unit e. All of the above are PIMS characteristics. e (Issues in operations strategy, moderate) 75. Standardization is an appropriate strategy in which stage of the product life cycle? a. introduction b. growth c. maturity d. decline e. retirement c (Issues in operations strategy, moderate) 76. Cost minimization is an appropriate strategy in which stage of the product life cycle? a. introduction b. growth c. maturity d. decline e. retirement d (Issues in operations strategy, moderate) 77. 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 c (Issues in operations strategy, moderate) 78. 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 c (Issues in operations strategy, moderate) 79. 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 e (Issues in operations strategy, moderate) 80. 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 c (Issues in operations strategy, moderate) 81. 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 d (Issues in operations strategy, moderate) 82. Which of the following statements is most correct? a. CSFs are often necessary, but not sufficient for competitive advantage. b. CSFs are often sufficient, but not necessary for competitive advantage. c. CSFs are neither necessary nor sufficient for competitive advantage. d. CSFs are both necessary and sufficient for competitive advantage. e. None of the above statements is correct. a (Strategy development and implementation, difficult) 83. Given the position of the iPod in the growth stage of its life cycle, which of the following OM Strategy/Issues should the makers of iPods be least concerned with at the current time? a. forecasting b. cost cutting c. increasing capacity d. product and process reliability e. enhancing distribution b (Issues in operations strategy, moderate) 84. 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
d (Strategy development and implementation, moderate) 85. 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 a (Strategy development and implementation, moderate) 86. 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 d (Strategy development and implementation, moderate) 87. 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 c (Global operations strategy options, moderate) {AACSB: Multiculture and Diversity} 88. 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 a (Global operations strategy options, moderate) {AACSB: Multiculture and Diversity} 89. 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 a (Global operations strategy options, moderate) {AACSB: Multiculture and Diversity} 90. 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 d (Global operations strategy options, moderate) {AACSB: Multiculture and Diversity} 91. The acronym MNC stands for a. Mexican National Committee (for international trade) b. Maquiladora Negates Competition c. Maytag- Nestl Corporation d. Multinational Corporation e. none of the above d (Global operations strategy options, easy) {AACSB: Multiculture and Diversity}
92. Caterpillar and Texas Instruments are two firms that have benefited from the use of a. the multidomestic strategy option. b. the multinational corporation strategy. c. the transnational strategy option. d. the maquiladora system in Europe. e. the global strategy option. e (Global operations strategy options, moderate) {AACSB: Multiculture and Diversity} 93. Which of the following are examples of transnational firms? a. Nestl b. Asea Brown Boveri c. Reuters d. Citicorp e. All of the above are transnationals. e (Global operations strategy options, moderate) {AACSB: Multiculture and Diversity}
Chapter 4 True/False 1. A nave forecast for September sales of a product would be equal to the forecast for August. False (Time-series forecasting, moderate) 2. The forecasting time horizon and the forecasting techniques used tend to vary over the life cycle of a product. True (What is forecasting? moderate) 3. Demand (sales) forecasts serve as inputs to financial, marketing, and personnel planning. True (Types of forecasts, moderate) 4. Forecasts of individual products tend to be more accurate than forecasts of product families. False (Seven steps in the forecasting system, moderate) 5. Most forecasting techniques assume that there is some underlying stability in the system. True (Seven steps in the forecasting system, moderate) 6. The sales force composite forecasting method relies on salespersons' estimates of expected sales. True (Forecasting approaches, easy) 7. A time-series model uses a series of past data points to make the forecast. True (Forecasting approaches, moderate) 8. The quarterly "make meeting" of Lexus dealers is an example of a sales force composite forecast. True (Forecasting approaches, easy) 9. Cycles and random variations are both components of time series. True (Time-series forecasting, easy) 10. A naive forecast for September sales of a product would be equal to the sales in August. True (Time-series forecasting, easy) 11. One advantage of exponential smoothing is the limited amount of record keeping involved. True (Time-series forecasting, moderate) 12. The larger the number of periods in the simple moving average forecasting method, the greater the method's responsiveness to changes in demand. False (Time-series forecasting, moderate) 13. Forecast including trend is an exponential smoothing technique that utilizes two smoothing constants: one for the average level of the forecast and one for its trend. True (Time-series forecasting, easy) 14. Mean Squared Error and Coefficient of Correlation are two measures of the overall error of a forecasting model. False (Time-series forecasting, easy) 15. In trend projection, the trend component is the slope of the regression equation. True (Time-series forecasting, easy) 16. In trend projection, a negative regression slope is mathematically impossible. False (Time-series forecasting, moderate) 17. Seasonal indexes adjust raw data for patterns that repeat at regular time intervals. True (Time-series forecasting, moderate) 18. If a quarterly seasonal index has been calculated at 1.55 for the October-December quarter, then raw data for that quarter must be multiplied by 1.55 so that the quarter can be fairly compared to
other quarters. False (Time-series forecasting: Seasonal variation in data, moderate) 19. The best way to forecast a business cycle is by finding a leading variable. True (Time-series forecasting, moderate) 20. Linear-regression analysis is a straight-line mathematical model to describe the functional relationships between independent and dependent variables. True (Associative forecasting methods: Regression and correlation analysis, easy) 21. The larger the standard error of the estimate, the more accurate the forecasting model. False (Associative forecasting methods: Regression and correlation analysis, easy) 22. A trend projection equation with a slope of 0.78 means that there is a 0.78 unit rise in Y for every unit of time that passes. True (Time-series forecasting: Trend projections, moderate) 23. In a regression equation where Y is demand and X is advertising, a coefficient of determination (R2) of .70 means that 70% of the variance in advertising is explained by demand. False (Associative forecasting methods: Regression and correlation analysis, moderate) 24. Demand cycles for individual products can be driven by product life cycles. True (Time-series forecasting, moderate) 25. If a forecast is consistently greater than (or less than) actual values, the forecast is said to be biased. True (Monitoring and controlling forecasts, moderate) 26. Focus forecasting tries a variety of computer models and selects the best one for a particular application. True (Monitoring and controlling forecasts, moderate) 27. Many service firms use point-of-sale computers to collect detailed records needed for accurate short-term forecasts. True (Forecasting in the service sector, moderate) Multiple Choice 28. What two numbers are contained in the daily report to the CEO of Walt Disney Parks & Resorts regarding the six Orlando parks? a. yesterday's forecasted attendance and yesterday's actual attendance b. yesterday's actual attendance and today's forecasted attendance c. yesterday's forecasted attendance and today's forecasted attendance d. yesterday's actual attendance and last year's actual attendance e. yesterday's forecasted attendance and the year-to-date average daily forecast error a (Global company profile, moderate) 29. Using an exponential smoothing model with smoothing constant = .20, how much weight would be assigned to the 2nd most recent period? a. .16 b. .20 c. .04 d. .09 e. .10 a (Time-series forecasting, moderate) {AACSB: Analytic Skills} 30. Forecasts a. become more accurate with longer time horizons b. are rarely perfect c. are more accurate for individual items than for groups of items d. all of the above e. none of the above
b (What is forecasting? moderate) 31. One use of short-range forecasts is to determine a. production planning b. inventory budgets c. research and development plans d. facility location e. job assignments e (What is forecasting? moderate) 32. Forecasts are usually classified by time horizon into three categories a. short-range, medium-range, and long-range b. finance/accounting, marketing, and operations c. strategic, tactical, and operational d. exponential smoothing, regression, and time series e. departmental, organizational, and industrial a (What is forecasting? easy) 33. A forecast with a time horizon of about 3 months to 3 years is typically called a a. long-range forecast b. medium-range forecast c. short-range forecast d. weather forecast e. strategic forecast b (What is forecasting? moderate) 34. Forecasts used for new product planning, capital expenditures, facility location or expansion, and R&D typically utilize a a. short-range time horizon b. medium-range time horizon c. long-range time horizon d. naive method, because there is no data history e. all of the above c (What is forecasting? moderate) 35. The three major types of forecasts used by business organizations are a. strategic, tactical, and operational b. economic, technological, and demand c. exponential smoothing, Delphi, and regression d. causal, time-series, and seasonal e. departmental, organizational, and territorial b (Types of forecasts, moderate) 36. Which of the following is not a step in the forecasting process? a. Determine the use of the forecast. b. Eliminate any assumptions. c. Determine the time horizon. d. Select forecasting model. e. Validate and implement the results. b (The strategic importance of forecasting, moderate) 37. The two general approaches to forecasting are a. qualitative and quantitative b. mathematical and statistical c. judgmental and qualitative d. historical and associative e. judgmental and associative a (Forecasting approaches, easy) 38. Which of the following uses three types of participants: decision makers, staff personnel, and respondents?
a. executive opinions b. sales force composites c. the Delphi method d. consumer surveys e. time series analysis c (Forecasting approaches, moderate) 39. The forecasting model that pools the opinions of a group of experts or managers is known as the a. sales force composition model b. multiple regression c. jury of executive opinion model d. consumer market survey model e. management coefficients model c (Forecasting approaches, moderate) 40. Which of the following is not a type of qualitative forecasting? a. executive opinions b. sales force composites c. consumer surveys d. the Delphi method e. moving average e (Forecasting approaches, moderate) 41. Which of the following techniques uses variables such as price and promotional expenditures, which are related to product demand, to predict demand? a. associative models b. exponential smoothing c. weighted moving average d. simple moving average e. time series a (Forecasting approaches, moderate) 42. Which of the following statements about time series forecasting is true? a. It is based on the assumption that future demand will be the same as past demand. b. It makes extensive use of the data collected in the qualitative approach. c. The analysis of past demand helps predict future demand. d. Because it accounts for trends, cycles, and seasonal patterns, it is more powerful than causal forecasting. e. All of the above are true. c (Time-series forecasting, moderate) 43. Time series data may exhibit which of the following behaviors? a. trend b. random variations c. seasonality d. cycles e. They may exhibit all of the above. e (Time-series forecasting, moderate) 44. Gradual, long-term movement in time series data is called a. seasonal variation b. cycles c. trends d. exponential variation e. random variation c (Time-series forecasting, moderate) 45. Which of the following is not present in a time series? a. seasonality b. operational variations c. trend
d. cycles e. random variations b (Time-series forecasting, moderate) 46. The fundamental difference between cycles and seasonality is the a. duration of the repeating patterns b. magnitude of the variation c. ability to attribute the pattern to a cause d. all of the above e. none of the above a (Time-series forecasting, moderate) 47. In time series, which of the following cannot be predicted? a. large increases in demand b. technological trends c. seasonal fluctuations d. random fluctuations e. large decreases in demand d (Time-series forecasting, moderate) 48. What is the approximate forecast for May using a four-month moving average? Nov. Dec. Jan. Feb. Mar. April 39 36 40 42 48 46 a. 38 b. 42 c. 43 d. 44 e. 47 d (Time-series forecasting, moderate) {AACSB: Analytic Skills} 49. Which time series model below assumes that demand in the next period will be equal to the most recent period's demand? a. naive approach b. moving average approach c. weighted moving average approach d. exponential smoothing approach e. none of the above a (Time-series forecasting, easy) 50. John's House of Pancakes uses a weighted moving average method to forecast pancake sales. It assigns a weight of 5 to the previous month's demand, 3 to demand two months ago, and 1 to demand three months ago. If sales amounted to 1000 pancakes in May, 2200 pancakes in June, and 3000 pancakes in July, what should be the forecast for August? a. 2400 b. 2511 c. 2067 d. 3767 e. 1622 b (Time series forecasting, moderate) {AACSB: Analytic Skills} 51. A six-month moving average forecast is better than a three-month moving average forecast if demand a. is rather stable b. has been changing due to recent promotional efforts c. follows a downward trend d. follows a seasonal pattern that repeats itself twice a year e. follows an upward trend a (Time-series forecasting, moderate) 52. Increasing the number of periods in a moving average will accomplish greater smoothing, but at
the expense of a. manager understanding b. accuracy c. stability d. responsiveness to changes e. All of the above are diminished when the number of periods increases. d (Time-series forecasting, moderate) 53. Which of the following statements comparing the weighted moving average technique and exponential smoothing is true? a. Exponential smoothing is more easily used in combination with the Delphi method. b. More emphasis can be placed on recent values using the weighted moving average. c. Exponential smoothing is considerably more difficult to implement on a computer. d. Exponential smoothing typically requires less record keeping of past data. e. Exponential smoothing allows one to develop forecasts for multiple periods, whereas weighted moving averages does not. d (Time-series forecasting, moderate) 54. Which time series model uses past forecasts and past demand data to generate a new forecast? a. naive b. moving average c. weighted moving average d. exponential smoothing e. regression analysis d (Time-series forecasting, moderate) 55. Which is not a characteristic of exponential smoothing? a. smoothes random variations in the data b. easily altered weighting scheme c. weights each historical value equally d. has minimal data storage requirements e. none of the above; they are all characteristics of exponential smoothing c (Time-series forecasting, moderate) 56. Which of the following smoothing constants would make an exponential smoothing forecast equivalent to a naive forecast? a. 0 b. 1 divided by the number of periods c. 0.5 d. 1.0 e. cannot be determined d (Time-series forecasting, moderate) 57. Given an actual demand of 103, a previous forecast value of 99, and an alpha of .4, the exponential smoothing forecast for the next period would be a. 94.6 b. 97.4 c. 100.6 d. 101.6 e. 103.0 c (Time-series forecasting, moderate) {AACSB: Analytic Skills} 58. A forecast based on the previous forecast plus a percentage of the forecast error is a(n) a. qualitative forecast b. naive forecast c. moving average forecast d. weighted moving average forecast e. exponentially smoothed forecast e (Time-series forecasting, moderate) 59. Given an actual demand of 61, a previous forecast of 58, and an of .3, what would the forecast
for the next period be using simple exponential smoothing? a. 45.5 b. 57.1 c. 58.9 d. 61.0 e. 65.5 c (Time-series forecasting, moderate) {AACSB: Analytic Skills} 60. Which of the following values of alpha would cause exponential smoothing to respond the most slowly to forecast errors? a. 0.10 b. 0.20 c. 0.40 d. 0.80 e. cannot be determined a (Time-series forecasting, moderate) 61. A forecasting method has produced the following over the past five months. What is the mean absolute deviation? Actual Forecast Error |Error| 10 11 -1 1 8 10 -2 2 10 8 2 2 6 6 0 0 9 8 1 1 a. -0.2 b. -1.0 c. 0.0 d. 1.2 e. 8.6 d (Time-series forecasting, moderate) {AACSB: Analytic Skills} 62. The primary purpose of the mean absolute deviation (MAD) in forecasting is to a. estimate the trend line b. eliminate forecast errors c. measure forecast accuracy d. seasonally adjust the forecast e. all of the above c (Time-series forecasting, moderate) 63. Given forecast errors of -1, 4, 8, and -3, what is the mean absolute deviation? a. 2 b. 3 c. 4 d. 8 e. 16 c (Time-series moderate) forecasting, {AACSB: Analytic Skills} 64. The last four months of sales were 8, 10, 15, and 9 units. The last four forecasts were 5, 6, 11, and 12 units. The Mean Absolute Deviation (MAD) is a. 2 b. -10 c. 3.5 d. 9 e. 10.5 c (Time-series forecasting, moderate) {AACSB: Analytic Skills} 65. A time series trend equation is 25.3 + 2.1 X. What is your forecast for period 7? a. 23.2
b. 25.3 c. 27.4 d. 40.0 e. cannot be determined d (Time-series forecasting, moderate) {AACSB: Analytic Skills} 66. For a given product demand, the time series trend equation is 53 - 4 X. The negative sign on the slope of the equation a. is a mathematical impossibility b. is an indication that the forecast is biased, with forecast values lower than actual values c. is an indication that product demand is declining d. implies that the coefficient of determination will also be negative e. implies that the RSFE will be negative c (Time-series forecasting, moderate) 67. Yamaha manufacturers which set of products with complementary demands to address seasonal fluctuations? a. golf clubs and skis b. swimming suits and winter jackets c. jet skis and snowmobiles d. pianos and guitars e. ice skates and water skis c (Time-series forecasting, moderate) 68. Which of the following is true regarding the two smoothing constants of the Forecast Including Trend (FIT) model? a. One constant is positive, while the other is negative. b. They are called MAD and RSFE. c. Alpha is always smaller than beta. d. One constant smoothes the regression intercept, whereas the other smoothes the regression slope. e. Their values are determined independently. e (Time-series forecasting, moderate) 69. Demand for a certain product is forecast to be 800 units per month, averaged over all 12 months of the year. The product follows a seasonal pattern, for which the January monthly index is 1.25. What is the seasonally-adjusted sales forecast for January? a. 640 units b. 798.75 units c. 800 units d. 1000 units e. cannot be calculated with the information given d (Time-series forecasting, moderate) {AACSB: Analytic Skills} 70. A seasonal index for a monthly series is about to be calculated on the basis of three years' accumulation of data. The three previous July values were 110, 150, and 130. The average over all months is 190. The approximate seasonal index for July is a. 0.487 b. 0.684 c. 1.462 d. 2.053 e. cannot be calculated with the information given b (Time-series forecasting, moderate) {AACSB: Analytic Skills} 71. A fundamental distinction between trend projection and linear regression is that a. trend projection uses least squares while linear regression does not b. only linear regression can have a negative slope c. in trend projection the independent variable is time; in linear regression the independent variable need not be time, but can be any variable with explanatory power d. linear regression tends to work better on data that lack trends e. trend projection uses two smoothing constants, not just one
c (Associative forecasting methods: Regression and correlation analysis, moderate) 72. The percent of variation in the dependent variable that is explained by the regression equation is measured by the a. mean absolute deviation b. slope c. coefficient of determination d. correlation coefficient e. intercept c (Associative forecasting methods: Regression and correlation analysis, moderate) 73. The degree or strength of a linear relationship is shown by the a. alpha b. mean c. mean absolute deviation d. correlation coefficient e. RSFE d (Associative forecasting methods: Regression and correlation analysis, moderate) 74. If two variables were perfectly correlated, the correlation coefficient r would equal a. 0 b. -1 c. 1 d. b or c e. none of the above d (Associative forecasting methods: Regression and correlation analysis, moderate) 75. The last four weekly values of sales were 80, 100, 105, and 90 units. The last four forecasts were 60, 80, 95, and 75 units. These forecasts illustrate a. qualitative methods b. adaptive smoothing c. slope d. bias e. trend projection d (Monitoring and controlling forecasts, easy) 76. The tracking signal is the a. standard error of the estimate b. running sum of forecast errors (RSFE) c. mean absolute deviation (MAD) d. ratio RSFE/MAD e. mean absolute percentage error (MAPE) d (Monitoring and controlling forecasts, moderate) 77. Computer monitoring of tracking signals and self-adjustment if a signal passes a preset limit is characteristic of a. exponential smoothing including trend b. adaptive smoothing c. trend projection d. focus forecasting e. multiple regression analysis b (Monitoring and controlling forecasts, moderate) 78. Many services maintain records of sales noting a. the day of the week b. unusual events c. weather d. holidays e. all of the above e (Forecasting in the service sector, moderate)
79. Taco Bell's unique employee scheduling practices are partly the result of using a. point-of-sale computers to track food sales in 15 minute intervals b. focus forecasting c. a six-week moving average forecasting technique d. multiple regression e. a and c are both correct e (Forecasting in the service sector, moderate)
Chapter 7 True/False 1. Dell's approach to personal computer manufacturing is to use a product focus, which gives the company its low-cost competitive advantage. False (Global company profile, easy) 2. A firm's process strategy is its approach to transforming resources into goods and services. True (Introduction, easy) 3. Intermittent processes are organized around processes. True (Four process strategies, easy) 4. In process-focused facilities, equipment utilization is low. True (Four process strategies, moderate) 5. The typical full-service restaurant uses a product-focused process. False (Four process strategies, moderate) 6. Harley-Davidson, because it has so many possible combinations of products, utilizes the process strategy of mass customization. False (Four process strategies, moderate) 7. A value-stream map includes both (1) inventory quantities, and (2) symbols for customers and suppliers. True (Process analysis and design, moderate) 8. The assembly line is a classic example of a repetitive process. True (Four process strategies, easy) 9. One essential ingredient of mass customization is modular design. True (Four process strategies, moderate) 10. The tool that calculates which process has the lowest cost at any specified production volume is a crossover chart. True (Four process strategies, moderate) 11. The term focused processes refers to the quest for increased efficiency, whether in goods or services, that results from specialization. True (Four process strategies, moderate) 12. Service blueprinting is a process analysis technique that focuses on the customer and the provider's interaction with the customer. True (Process analysis and design, moderate) 13. Activity times should not be included in a service blueprint. False (Process analysis and design, moderate) 14. A process map with the addition of a time axis becomes a process chart. False (Process analysis and design, moderate) 15. Time-function mapping is a flow diagram with time added to the horizontal axis. True (Process analysis and design, moderate) 16. Process maps use distance, but not time, to show the movement of material, product, or people through a process. False (Process analysis and design, moderate) 17. Professional services typically require low levels of labor intensity. False (Service process design, moderate)
18. An example of the postponement strategy for improving service productivity is having the customer wait until you have sufficient time to serve the customer. False (Service process design, moderate) 19. Process control is the use of information technology to monitor and control a physical process. True (Production technology, easy) {AACSB: Use of IT} 20. One use of camera-and-computer-based vision systems is to replace humans doing tedious and error-prone visual inspection activities. True (Production technology, easy) {AACSB: Use of IT} 21. Automated storage and retrieval systems are commonly used in distribution facilities of retailers. True (Production technology, moderate) {AACSB: Use of IT} 22. Flexible manufacturing systems, because of easily changed control programs, are able to perform such tasks as manufacturing one-of-a-kind parts economically. True (Production technology, moderate) {AACSB: Use of IT} 23. Production technology has had a major impact on services, but as yet there has been little reduction in service labor requirements. False (Technology in services, moderate) {AACSB: Use of IT} 24. Optical checkout scanners and ATMs are examples of technology's impact on services. True (Technology in services, moderate) {AACSB: Use of IT} 25. Successful process redesign focuses on departmental areas where small, continuous improvements can be made. False (Process redesign, moderate) 26. Processes can be environmentally friendly and socially responsible while still contributing to profitable strategies. True (Ethics and environmentally friendly processes, easy) {AACSB: Ethical Reasoning} 27. In selecting new equipment and technology, decision-makers look for flexibility--the ability to respond with little penalty in time, cost, or customer value. True (Selection of equipment and technology, moderate) Multiple Choice 28. Which of the following statements regarding Dell Computer is false? a. Dell is a practitioner of the mass customization process. b. Dell builds its computers overseas in order to gain a low-cost advantage. c. Dell keeps very little inventory of finished goods. d. Dell utilizes a global supply chain, but assembles its computers in the U.S. e. Dell's research focuses on manufacturing issues, not computer part design. b (Global company profile, moderate) 29. 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) 30. 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) 31. 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) 32. 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) 33. 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) 34. 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) 35. 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) 36. 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) 37. 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) 38. 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) 39. 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) 40. 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) 41. 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) 42. Which of the following phrases best describes product focus? a. low volume, high variety b. finished goods are usually made to order c. processes are designed to perform a wide variety of activities d. high fixed costs, low variable costs e. raw material inventories are low relative to the value of the product d (Four process strategies, difficult) 43. Which of the following phrases best describes process focus? a. low volume, high variety b. finished goods are usually made to a forecast and stored c. operators are modestly skilled d. high fixed costs, low variable costs e. raw material inventories are high relative to the value of the product a (Four process strategies, difficult) 44. Which of the following characteristics best describes repetitive focus? a. It uses sophisticated scheduling to accommodate custom orders. b. Its output is a standardized product produced from modules. c. It is too expensive when volumes are low or flexibility is required. d. It is widely used for the manufacture of steel. e. Its costs are often known only after a job is done. b (Four process strategies, difficult) 45. 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)
46. 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) 47. Process A has fixed costs of $1000 and variable costs of $5 per unit. Process B has fixed costs of $500 and variable costs of $15 per unit. The crossover point between process A and process B is a. 50 units b. 200 units c. $2,500 d. $5,000 e. $9,500 a (Four process strategies, moderate) {AACSB: Analytic Skills} 48. Process X has fixed costs of $10,000 and variable costs of $2.40 per unit. Process Y has fixed costs of $9,000 and variable costs of $2.25 per unit. Which of the following statements is true? a. The crossover point is approximately 6667 units. b. It is impossible for one process to have both of its costs lower than those of another process. c. Process Y is cheaper than process X at all volumes; there is no crossover point. d. Process X should be selected for very large production volumes. e. Process X is more profitable than process Y and should be selected. c (Four process strategies, moderate) {AACSB: Analytic Skills} 49. 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) 50. Product Focused processes a. allow more customization, but are not very efficient b. are desirable because resource needs increase slowly with the complexity of a process c. are processes that are specialized for relatively few products or customer groups d. apply only to service firms, not to manufacturers e. are profitable because customers demand flexibility, not specialization c (Process analysis and design, moderate) 51. Value Stream Mapping a. is a variation on time function mapping b. examines the supply chain to determine where value is added c. extends time function mapping back to the supplier d. starts with the customer and works backwards e. All of the above are true. e (Process analysis and design, moderate) 52. One fundamental difference between a process chart and a process map is that a. the process chart uses a time dimension while a process map is not time-oriented b. the process chart includes the supply chain, while the process map stays within an organization c. the process chart is more like a table, while the process map is more like a schematic diagram d. the process chart focuses on the customer and on the provider's interaction with the customer, while the process map does not deal directly with the customer e. None of these is true, because a process chart and a process map are the same thing. c (Process analysis and design, moderate)
53. Service blueprinting a. provides the basis to negotiate prices with suppliers b. mimics the way people communicate c. determines the best time for each step in the process d. focuses on the provider's interaction with the customer e. can only be successful with two-dimensional processes d (Service process and design, moderate) {AACSB: Communication} 54. A drawing of the movement of material, product, or people is a a. flow diagram b. process chart c. service blueprint d. process map e. none of the above a (Process analysis and design, moderate) 55. 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) 56. 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) 57. 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) 58. 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) 59. 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} 60. 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} 61. 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} 62. 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} 63. "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} 64. 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} 65. 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} 66. 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} 67. "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} 68. 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) 69. 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) 70. 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) 71. 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} 72. Making environmentally sound products through efficient processes a. is unprofitable, as long as recyclable materials prices are soft b. is known as lean manufacturing c. can still be profitable d. is easier for repetitive processes than for product-focused processes e. none of the above c (Ethical and environmentally friendly processes, moderate) {AACSB: Ethical Reasoning} 73. Flexibility can be achieved with a. movable equipment b. inexpensive equipment c. sophisticated electronic equipment d. modular equipment e. all of the above e (Selection of equipment and technology, moderate) 74. Which of the following statements regarding ethical and environmentally friendly processes is true? a. Operations managers can be environmentally sensitive, but they must avoid following a low cost strategy. b. Processes can be environmentally friendly or socially responsible, but not both. c. Operations managers can be environmentally sensitive and still follow a low cost strategy. d. Using energy-efficient lighting saves so little that it should not be labeled environmentally friendly.
e. The only business strategy consistent with ethical and environmentally sensitive management is the differentiation strategy. c (Ethical and environmentally friendly processes, moderate) {AACSB: Ethical Reasoning} 75. Which of the following is true regarding the concept of flexibility? a. It is the ability to change production rates with little penalty in time, cost, or customer value. b. It can be accomplished with sophisticated electronic equipment. c. It may involve modular, movable, even cheap equipment. d. All of the above are true. e. None of the above is true. d (Selection of equipment and technology, moderate)
Chapter 7S True/False 1. Utilization is the number of units a facility can hold, receive, store, or produce in a period of time. False (Capacity, easy) 2. Design capacity is the theoretical maximum output of a system in a given period under ideal conditions. True (Capacity, moderate) 3. Capacity decisions are based on technological concerns, not demand forecasts. False (Capacity, easy) 4. Expected output is sometimes referred to as rated capacity. True (Capacity, moderate) 5. Price changes are useful for matching the level of demand to the capacity of a facility. True (Capacity, moderate) 6. A useful tactic for increasing capacity is to redesign a product in order to get more throughput. True (Capacity, moderate) 7. Changes in capacity may lead, lag, or straddle the demand. True (Capacity planning, moderate) 8. Building an additional warehouse is an incremental expansion, not a one-step expansion. False (Capacity planning, moderate) 9. Fixed costs are those costs that continue even if no units are produced. True (Break-even analysis, moderate) 10. Break-even analysis identifies the volume at which fixed costs and revenue are equal. False (Break-even analysis, moderate) 11. Break-even analysis is a powerful analytical tool, but is useful only when the organization produces a single product. False (Break-even analysis, moderate) 12. A decision tree indicates at what quantity profit changes from negative to positive. False (Break-even analysis, moderate) 13. A decision tree for analyzing capacity would have future demands or market favorability as the decision alternatives. False (Applying decision trees to capacity decisions, moderate) 14. One limitation of the net present value approach to investments is that investments with identical net present values may have very different cash flows. True (Applying investment analysis to strategy-driven investments, moderate) 15. The net present value of $10,000 to be received in exactly three years is considerably greater than $10,000. False (Applying investment analysis to strategy-driven investments, easy) Multiple Choice 16. What is sometimes referred to as rated capacity? a. efficiency b. utilization c. effective capacity d. expected output
e. design capacity d (Capacity, moderate) 17. Effective capacity is the a. maximum output of a system in a given period b. capacity a firm expects to achieve given the current operating constraints c. average output that can be achieved under ideal conditions d. minimum usable capacity of a particular facility e. sum of all of the organization's inputs b (Capacity, moderate) 18. Which of the following represents an aggressive approach to demand management in the service sector when demand and capacity are not particularly well matched? a. inexpensive rates for weekend phone calls b. appointments c. reservations d. first-come, first-served e. none of the above a (Capacity, moderate) 19. 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? a. 1350 students b. 1710 students c. 75% d. 87.7% e. 90% d (Capacity, moderate) {AACSB: Analytic Skills} 20. Christopher's Cranks uses a machine that can produce 100 cranks per hour. The firm operates 12 hours per day, five days per week. Due to regularly scheduled preventive maintenance, the firm expects the machine to be running during approximately 95% of the available time. Based on experience with other products, the firm expects to achieve an efficiency level for the cranks of 85%. What is the expected weekly output of cranks for this company? a. 5100 b. 5700 c. 4845 d. 969 e. 6783 c (Capacity, moderate) {AACSB: Analytic Skills} 21. The staff training center at a large regional hospital provides training sessions in CPR to all employees. Assume that the capacity of this training system was designed to be 1200 employees per year. Since the training center was first put in use, the program has become more complex, so that 1050 now represents the most employees that can be trained per year. In the past year, 950 employees were trained. The efficiency of this system is approximately _____ and its utilization is approximately _____. a. 79.2 percent; 90.5 percent b. 90.5 percent; 79.2 percent c. 87.5 percent; 950 employees d. 950 employees; 1050 employees e. 110.5 percent; 114.3 percent b (Capacity, moderate) {AACSB: Analytic Skills} 22. Which of the following represents a common way to manage capacity in the service sector? a. appointments b. reservations c. changes in staffing levels d. first-come, first served service rule
e. "early bird" specials in restaurants c (Capacity, easy) 23. If demand exceeds capacity at a new facility, an organization can use which of the following to move demand to an existing facility? a. aggressive marketing b. lower prices at all facilities c. build a facility of the correct size d. add a complementary product e. reduce lead times a (Capacity, moderate) 24. Adding a complementary product to what is currently being produced is a demand management strategy used when a. demand exceeds capacity b. capacity exceeds demand for a product which has stable demand c. the existing product has seasonal or cyclical demand d. price increases have failed to bring about demand management e. efficiency exceeds 100 percent c (Capacity, moderate) 25. An organization whose capacity is on that portion of the average unit cost curve that falls as output rises a. has a facility that is below optimum operating level and should build a larger facility b. has a facility that is above optimum operating level and should build a smaller facility c. is suffering from diseconomies of scale d. has utilization higher than efficiency e. has efficiency higher than utilization a (Capacity, moderate) 26. Of the four approaches to capacity expansion, the approach that "straddles" demand a. uses incremental expansion b. uses one-step expansion c. at some times leads demand, and at other times lags d. works best when demand is not growing but is stable e. Choices a and c are both correct. e (Capacity, moderate) 27. Which of the following is not one of the four approaches to capacity expansion? a. average capacity with incremental expansion b. lead demand with incremental expansion c. lag demand with incremental expansion d. lead demand with one-step expansion e. lag demand with one-step expansion e (Capacity, moderate) 28. Which of the following is false regarding capacity expansion? a. "Average" capacity sometimes leads demand, sometimes lags it. b. If "lagging" capacity is chosen, excess demand can be met with overtime or subcontracting. c. Total cost comparisons are a rather direct method of comparing capacity alternatives. d. Capacity may only be added in large chunks. e. All of the above are true. d (Capacity, moderate) 29. Break-even is the number of units at which a. total revenue equals price times quantity b. total revenue equals total variable cost c. total revenue equals total fixed cost d. total profit equals total cost e. total revenue equals total cost e (Break-even analysis, moderate)
30. Which of the following statements regarding fixed costs is true? a. Fixed costs rise by a constant amount for every added unit of volume. b. While fixed costs are ordinarily constant with respect to volume, they can "step" upward if volume increases result in additional fixed costs. c. Fixed costs are those costs associated with direct labor and materials. d. Fixed costs equal variable costs at the break-even point. e. Fixed cost is the difference between selling price and variable cost. b (Break-even analysis, moderate) 31. Which of the following costs would be incurred even if no units were produced? a. raw material costs b. direct labor costs c. transportation costs d. building rental costs e. purchasing costs d (Break-even analysis, moderate) 32. Basic break-even analysis typically assumes that a. revenues increase in direct proportion to the volume of production, while costs increase at a decreasing rate as production volume increases b. variable costs and revenues increase in direct proportion to the volume of production c. both costs and revenues are made up of fixed and variable portions d. costs increase in direct proportion to the volume of production, while revenues increase at a decreasing rate as production volume increases because of the need to give quantity discounts e. All of the above are assumptions in the basic break-even model. b (Break-even analysis, difficult) 33. Fabricators, Inc. wants to increase capacity by adding a new machine. The fixed costs for machine A are $90,000, and its variable cost is $15 per unit. The revenue is $21 per unit. The break-even point for machine A is a. $90,000 dollars b. 90,000 units c. $15,000 dollars d. 15,000 units e. cannot be calculated from the information provided d (Break-even analysis, moderate) {AACSB: Analytic Skills} 34. A fabrication company wants to increase capacity by adding a new machine. The firm is considering proposals from vendor A and vendor B. The fixed costs for machine A are $90,000 and for machine B, $75,000. The variable cost for A is $15.00 per unit and for B, $18.00. The revenue generated by the units processed on these machines is $21 per unit. If the estimated output is 5000 units, which machine should be purchased? a. machine A b. machine B c. either machine A or machine B d. no purchase because neither machine yields a profit at that volume e. purchase both machines since they are both profitable d (Break-even analysis, moderate) {AACSB: Analytic Skills} 35. Fred's Fabrication, Inc. wants to increase capacity by adding a new machine. The firm is considering proposals from vendor A and vendor B. The fixed costs for machine A are $90,000 and for machine B, $70,000. The variable cost for A is $9.00 per unit and for B, $14.00. The revenue generated by the units processed on these machines is $20 per unit. The crossover between machine A and machine B is a. 4,000 units, with A more profitable at low volumes b. 4,000 dollars, with A more profitable at low volumes c. 4,000 units, with B more profitable at low volumes d. 4,000 dollars, with B more profitable at low volumes e. none of the above c (Break-even analysis, moderate) {AACSB: Analytic Skills}
36. A shop wants to increase capacity by adding a new machine. The firm is considering proposals from vendor A and vendor B. The fixed costs for machine A are $90,000 and for machine B, $75,000. The variable cost for A is $15.00 per unit and for B, $18.00. The revenue generated by the units processed on these machines is $22 per unit. If the estimated output is 9,000 units, which machine should be purchased? a. machine A b. machine B c. either machine A or machine B d. no purchase because neither machine yields a profit at that volume e. purchase both machines since they are both profitable d (Break-even analysis, moderate) {AACSB: Analytic Skills} 37. Break-even analysis can be used by a firm that produces more than one product, but a. the results are estimates, not exact values b. the firm must allocate some fixed cost to each of the products c. each product has its own break-even point d. the break-even point depends upon the proportion of sales generated by each of the products e. None of these statements is true. d (Break-even analysis, moderate) 38. The basic break-even model can be modified to handle more than one product. This extension of the basic model requires a. price and sales volume for each product b. price and variable cost for each product, and the percent of sales that each product represents c. that the firm have very low fixed costs d. that the ratio of variable cost to price be the same for all products e. sales volume for each product b (Break-even analysis, moderate) 39. A product sells for $5, and has unit variable costs of $3. This product accounts for $20,000 in annual sales, out of the firm's total of $60,000. The weighted contribution of this product is approximately a. 0.133 b. 0.200 c. 0.40 d. 0.667 e. $1.667 a (Break-even analysis, moderate) {AACSB: Analytic Skills} 40. When decision trees are used to analyze capacity decisions, a. "do nothing" is not a possible decision alternative b. probabilities must be assigned to each of the decision alternatives c. states of nature are often demand-based, as in "market favorability" d. states of nature must be known with certainty e. fixed costs are not relevant c (Applying decision trees to capacity decisions, moderate) 41. Net present value a. is gross domestic product less depreciation b. is sales volume less sales and excise taxes c. is profit after taxes d. ignores the time value of money e. is the discounted value of a series of future cash receipts e (Applying investment analysis to strategy-driven investments, moderate) 42. Net present value will be greater a. as a fixed set of cash receipts occurs later rather than earlier b. as the total of the cash receipts, made in same time periods, is smaller c. for one end-of-year receipt of $1200 than for twelve monthly receipts of $100 each d. for a 4% discount rate than for a 6% discount rate
e. All of the above are true. d (Applying investment analysis to strategy-driven investments, moderate) 43. A capacity alternative has an initial cost of $50,000 and cash flow of $20,000 for each of the next four years. If the cost of capital is 5 percent, the net present value of this investment is a. greater than $80,000 b. greater than $130,000 c. less than $30,000 d. impossible to calculate, because no interest rate is given e. impossible to calculate, because variable costs are not known c (Applying investment analysis to strategy-driven investments, moderate) {AACSB: Analytic Skills} 44. A capacity alternative has an initial cost of $50,000 and cash flow of $20,000 for each of the next four years. If the cost of capital is 5 percent, the net present value of this investment is approximately a. $20,920 b. $26,160 c. $49,840 d. $70,920 e. $106,990 a (Applying investment analysis to strategy-driven investments, moderate) {AACSB: Analytic Skills}
Chapter 7D True/False 1. Waiting-line models are useful to operations in such diverse settings as service systems, maintenance activities, and shop-floor control. True (Introduction, easy) 2. The two characteristics of the waiting line itself are whether its length is limited or unlimited and the discipline of the people or items in it. True (Characteristics of a waiting-line system, easy) 3. A waiting-line system has three parts: the size of the arrival population, the behavior of arrivals, and the statistical distribution of arrivals. False (Characteristics of a waiting-line system, easy) 4. A copy center has five machines that serve many customers throughout the day; the waiting-line system for copy service has an infinite population while the waiting-line system for copier maintenance has a finite population True (Characteristics of a waiting-line system, easy) 5. In queuing problems, arrival rates are generally described by the normal probability distribution. False (Characteristics of a waiting-line system, moderate) 6. Balk and renege are elements of queue discipline. False (Characteristics of a waiting-line problem, easy) 7. A hospital emergency room always follows a first-in, first-served queue discipline in the interest of fairness. False (Characteristics of a waiting-line system, moderate) 8. In queuing problems, the term "renege" refers to the fact that some customers leave the queue before service is completed. True (Characteristics of a waiting-line system, moderate) 9. A waiting-line system with one waiting line and three sequential processing stages is a multichannel single-phase system. False (Characteristics of a waiting-line problem, easy) 10. If the service time within a queuing system is constant, the service rate can be easily described by a negative exponential distribution. False (Characteristics of a waiting-line system, moderate) 11. The cost of waiting decreases as the service level increases. True (Queuing costs, moderate) 12. LIFS (last-in, first-served) is a common queue discipline, most often seen where people, not objects, form the waiting line. False (Characteristics of a waiting-line problem, moderate) 13. A bank office with five tellers, each with a separate line of customers, exhibits the characteristics of a multi-phase queuing system. False (Characteristics of a waiting-line system, moderate) 14. In the analysis of queuing models, the Poisson distribution often describes arrival rates and service times are often described by the negative exponential distribution. True (Characteristics of a waiting-line system, moderate) 15. The study of waiting lines calculates the cost of providing good service but does not value the cost of customers' waiting time. False (Queuing costs, moderate)
16. As the average service rate grows larger, the slope of the distribution of service time probabilities grows larger and larger, eventually becoming positive. False (The variety of queuing models, easy) 17. Four of the most widely used waiting line models--M/M/1 or A, M/M/S or B, M/D/1 or C, and Limited population or D--all share three characteristics: Poisson arrivals, FIFO discipline, and exponential service times. False (The variety of queuing models, moderate) 18. In the M/M/1 waiting line model with an arrival rate of 2 per hour and a service rate of 6 per hour, the utilization factor for the system is approximately 0.333. True (The variety of queuing models, easy) {AACSB: Analytic Skills} 19. The greater the margin by which the arrival rate exceeds the service rate, the better the performance of the waiting line. False (The variety of queuing models, easy) 20. An M/M/1 model and an M/D/1 model each have an arrival rate of 1 per minute and a service rate of 3 per minute; the average queue length of the M/M/1 will be twice that of the M/D/1. True (The variety of queuing models, moderate) 21. A finite population waiting line model has an average service time T of 100 minutes and an average time between service requirements U of 400 minutes; the service factor X is 0.25. False (The variety of queuing models, moderate) {AACSB: Analytic Skills} Multiple Choice 22. Study of waiting-line models helps operations managers better understand a. service systems such as bank teller stations b. maintenance activities that might repair broken machinery c. shop-floor control activities d. service systems such as amusement park rides e. all of the above e (Introduction, easy) 23. Which of the following is not a common queuing situation? a. grocery shoppers being served by checkout clerks b. commuters slowing or stopping at toll plazas to pay highway tolls c. machinery waiting to be repaired or maintained d. parcel delivery truck following its computer-generated route e. patients in a health clinic waiting to see one of several doctors d (Introduction, easy) 24. In queuing problems, which of the following probability distributions is typically used to describe the number of arrivals per unit of time? a. binomial b. normal c. Poisson d. exponential e. lognormal c (Characteristics of a waiting-line system, easy) 25. In queuing problems, which of the following probability distributions is typically used to describe the time to perform the service? a. binomial b. normal c. Poisson d. negative exponential e. lognormal d (Characteristics of a waiting-line system, easy)
26. The common measures of a queuing system's performance include a. probability that the service facility will be idle, average queue length, probability that the waiting time will exceed a specified duration b. average time each customer spends in the system, probability that the service system will be idle, average time each customer spends in the queue c. average queue length, maximum time a customer may spend in the queue, the utilization factor for the system d. average time each customer spends in the system, maximum queue length, probability of a specific number of customers in the system e. none of the above b (Characteristics of a waiting-line system, moderate) 27. The shopper who says to himself, "I've waited too long in this line. I don't really need to buy this product today," and leaves the store is an illustration of which element of arrival behavior? a. random arrival b. renege c. random departure d. balk e. none of the above b (Characteristics of a waiting-line system, moderate) 28. A waiting line, or queuing, system has three parts, which are a. distribution of arrival times, discipline while waiting, and distribution of service times b. arrival rate, service rate, and utilization rate c. arrival discipline, queue discipline, and service sequencing d. arrival or inputs, queue discipline or the waiting line itself, and the service facility e. sequencing policy, penalty for reneging, and expediting of arrivals d (Characteristics of a waiting-line system, moderate) 29. The source population is considered to be either ________ in its size. a. finite or infinite b. fixed or variable c. known or unknown d. random or scheduled e. small or large a (Characteristics of a waiting-line system, moderate) 30. The potential restaurant customer who says to her husband, "The line looks too long; let's eat somewhere else," is an illustration of which element of queue discipline? a. first-in, first-out b. balk c. renege d. random departure e. none of the above b (Characteristics of a waiting-line system, moderate) 31. An airline ticket counter, with several agents for one line of customers, is an example of a a. single channel, single phase system b. single channel, multi-phase system c. multi-channel, single phase system d. multi-channel, multi-phase system e. none of the above c (Characteristics of a waiting-line system, moderate) 32. A concert hall, employing both ticket takers and ushers to seat patrons, behaves typically as a a. multi-channel, single phase system b. multi-channel, multi-phase system c. single channel, single phase system d. single channel, multi-phase system e. none of the above
b (Characteristics of a waiting-line system, moderate) 33. If the food service for the university operates a cafeteria with a single serving line, that system behaves most like a a. single channel, single phase system b. single channel, multi-phase system c. multi-channel, single phase system d. multi-channel, multi-phase system e. none of the above b (Characteristics of a waiting-line system, moderate) 34. The sign at the bank that reads "Wait here for the first available teller" suggests the use of a _____ waiting line system. a. single phase b. multi-phase c. single channel d. multi-channel e. multiple line d (Characteristics of a waiting-line system, moderate) 35. A small hair styling salon has several operators. While customers do not have appointments, each is waiting to be served by a specific operator. This scenario provides an example of a a. multiple-channel, multi-phase, limited queue length b. single-channel, multi-phase, limited queue length c. multi-channel, limited queue length d. multiple single-channel systems, limited queue length e. none of the above d (Characteristics of a waiting-line system, moderate) 36. A large discount store and supermarket has a hair styling salon on its premises. The salon has several operators. Salon customers can shop in other parts of the store until their name is called for salon service, at which time the customer will be served by the next available stylist. This scenario provides an example of a a. multiple-channel, multi-phase, unlimited queue length b. single-channel, multi-phase, limited queue length c. multi-channel, unlimited queue length d. multiple single-channel systems, limited queue length e. none of the above c (Characteristics of a waiting-line system, moderate) 37. A university has only one technician in the repair station to care for the computers in the student labs. This system is most likely a. a single channel, limited queue system b. a single channel, limited population system c. a multi-channel, limited queue system d. a multi-channel, limited population system e. none of the above b (Characteristics of a waiting-line system, moderate) 38. "Women and children first!" declares the captain of a sinking ship. His directive employs which of the following queue disciplines in disembarking passengers? a. priority b. random c. FIFO or FIFS d. LIFO or LIFS e. none of the above a (Characteristics of a waiting-line system, moderate) 39. A university has several technicians in the repair station to care for the computers in the student labs. This system is most likely a. single channel, limited queue system
b. single channel, limited population system c. multi-channel, limited queue system d. multi-channel, limited population system e. none of the above d (Characteristics of a waiting-line system, moderate) 40. A system in which the customer receives service from only one station and then exits the system is a. a single-phase system b. a single channel system c. a multiple-channel system d. a multiple-phase system e. none of the above a (Characteristics of a waiting-line system, easy) 41. In a repetitive focus factory, the number of phases found in the system might refer to a. the number of successive operations that have to be performed on a part b. the number of machines doing the same necessary operations c. the number of parts waiting to be processed d. all of the above depending on the layout e. none of the above a (Characteristics of a waiting-line system, moderate) 42. Which of the following is a measure of queue performance? a. utilization factor b. average queue length c. probability of a specific number of customers in the system d. average waiting time in the line e. all of the above e (Characteristics of a waiting-line system, moderate) 43. Which of the following is most likely to be served in a last-in, first-served (LIFS) queue discipline? a. customers checking out at a grocery store b. the in-basket on a manager's desk c. patients entering a hospital emergency room d. patrons waiting to be seated in a casual-dining restaurant e. all of the above b (Characteristics of a waiting-line system, easy) 44. In a repetitive focus factory, the number of channels available for the processing of a certain part would likely refer to a. the number of successive operations that have to be performed on that part b. the number of machines doing the same necessary operations c. the number of parts waiting to be processed d. all of the above depending on the layout e. none of the above b (Characteristics of a waiting-line system, moderate) 45. A waiting line meeting the assumptions of M/M/1 has average time between arrivals of 20 minutes and services items in an average of 10 minutes each; the utilization factor is approximately a. 0.25 b. 0.33 c. 0.50 d. 0.67 e. 3.00 c (The variety of queuing models, moderate) {AACSB: Analytic Skills} 46. A waiting line model meeting the assumptions of M/M/1 has an arrival rate of 2 per hour and a service rate of 6 per hour; the utilization factor for the system is approximately a. 0.25 b. 0.33 c. 0.50
d. 0.67 e. 3.00 b (The variety of queuing models, easy) {AACSB: Analytic Skills} 47. As the average service rate increases, the shape of the negative exponential distribution of service times a. grows steadily steeper without limit b. has an ever steeper slope that eventually turns positive c. becomes less gently curved as it moves ever closer to the graph origin d. takes on a more uniform slope over a wide range of service times e. changes in appearance from convex to concave c (The variety of queuing models, easy) 48. Which one of the following is not a characteristic of a Model A or M/M/1 system? a. exponential service time pattern b. single number of channels c. single number of phases d. Poisson arrival rate pattern e. limited population size e (The variety of queuing models, moderate) 49. Which one of the following is not a characteristic of a Model B or M/M/S system? a. unlimited population size b. single channel c. single queue d. single phase e. Poisson arrival rate pattern b (The variety of queuing models, moderate) 50. Which one of the following is not a characteristic of a Model C or M/D/1 system? a. single channel b. single phase c. Poisson arrival rate pattern d. exponential service time pattern e. unlimited population size d (The variety of queuing models, moderate) 51. In the basic queuing model (M/M/1), service times are described by a. continuous probability distributions b. negative exponential probability distributions c. Poisson probability distributions d. normal probability distributions e. lognormal distributions b (Characteristics of a waiting-line system, moderate) 52. In the basic queuing model (M/M/1), arrival rates are distributed by a. continuous probability distributions b. normal probability distributions c. negative exponential probability distributions d. Poisson distributions e. lognormal distributions d (The variety of queuing models, moderate) 53. A single-phase waiting-line system meets the assumptions of constant service time or M/D/1. Units arrive at this system every 10 minutes on average. Service takes a constant 4 minutes. The average length of the queue Lq is a. 0.4 b. 0.133 c. 4.167 d. 4.583 e. 6
b (Characteristics of a waiting-line system, moderate) {AACSB: Analytic Skills} 54. Which of the following is not an assumption of the M/M/1 model? a. The first customers to arrive are the first customers served. b. Each arrival comes independently of the arrival immediately before and after that arrival. c. The population from which the arrivals come is very large or infinite in size. d. Customers do not renege. e. Service times occur according to a normal curve. e (The variety of queuing models, moderate) 55. A single-phase waiting-line system meets the assumptions of constant service time or M/D/1. Units arrive at this system every 12 minutes on average. Service takes a constant 8 minutes. The average length of the queue Lq is approximately a. 0.67 b. 2.5 c. 4.5 d. 5.0 e. 7.5 a (Characteristics of a waiting-line system, moderate) {AACSB: Analytic Skills} 56. A single-phase waiting-line system meets the assumptions of constant service time or M/D/1. Units arrive at this system every 12 minutes on average. Service takes a constant 8 minutes. The average number in the system Ls is approximately a. 2.25 b. 2.5 c. 3.0 d. 1.33 e. 5.0 d (Characteristics of a waiting-line system, moderate) {AACSB: Analytic Skills} 57. A queuing model which follows the M/M/1 assumptions has = 2 and = 3. The average number in the system is a. 2/3 b. 1 c. 1.5 d. 2 e. 6 d (The variety of queuing models, moderate) {AACSB: Analytic Skills} 58. A queuing model which follows the M/M/1 assumptions has = 3 and = 2. The average number in the system is a. -3 b. 3 c. 0.667 d. 150 percent e. growing without limit, since is larger than . e (The variety of queuing models, moderate) {AACSB: Analytic Skills} 59. Students arrive randomly at the help desk of the computer lab. There is only one service agent, and the time required for inquiry varies from student to student. Arrival rates have been found to follow the Poisson distribution, and the service times follow the negative exponential distribution. The average arrival rate is 12 students per hour, and the average service rate is 20 students per hour. What is the average service time for this problem? a. 1 minute b. 2 minutes c. 3 minutes d. 5 minutes e. 20 minutes c (The variety of queuing models, moderate) {AACSB: Analytic Skills} 60. A queuing model which follows the M/M/1 assumptions has = 10 and = 12. The average
number in the system is a. 0.83 b. 2 c. 2.5 d. 5 e. 6 d (The variety of queuing models, moderate) {AACSB: Analytic Skills} 61. A queuing model which follows the M/M/1 assumptions has = 2 and = 8. The average number in the system Ls is ______ and the utilization of the system is _______. a. 3; 100 percent b. 0.33; 25 percent c. 4; 33 percent d. 6; 25 percent e. 4; 25 percent b (The variety of queuing models, moderate) {AACSB: Analytic Skills} 62. Four of the most widely used waiting line models--M/M/1 or A, M/M/S or B, M/D/1 or C, and Limited population or D--all share three characteristics, which are a. normal arrivals, FIFO discipline, and normal service times b. Poisson arrivals, FIFO discipline, and a single-service phase c. Poisson arrivals, FIFO discipline, and exponential service times d. Poisson arrivals, no queue discipline, and exponential service times e. none of these b (The variety of queuing models, moderate) 63. A queuing model which follows the M/M/1 assumptions has = 2 and = 3. The average waiting time in the system is a. 2/3 b. 1 c. 1.5 d. 2 e. 6 b (The variety of queuing models, moderate) {AACSB: Analytic Skills} 64. Students arrive randomly at the help desk of the computer lab. There is only one service agent, and the time required for inquiry varies from student to student. Arrival rates have been found to follow the Poisson distribution, and the service times follow the negative exponential distribution. The average arrival rate is 12 students per hour, and the average service rate is 20 students per hour. What is the utilization factor? a. 20% b. 30% c. 40% d. 50% e. 60% e (The variety of queuing models, moderate) {AACSB: Analytic Skills} 65. A finite population waiting line model has an average service time T of 100 minutes and an average time between service requirements U of 400 minutes; the service factor X is a. 0.20 b. 0.25 c. 4 d. 5 e. 300 minutes a (The variety of queuing models, easy) {AACSB: Analytic Skills} 66. A finite population waiting line model has an average service time T of 200 minutes and an average time between service requirements U of 300 minutes; the service factor X is a. 0.20 b. 0.40 c. 0.60
d. 0.67 e. 2.5 b (The variety of queuing models, easy) {AACSB: Analytic Skills} 67. Students arrive randomly at the help desk of the computer lab. There is only one service agent, and the time required for inquiry varies from student to student. Arrival rates have been found to follow the Poisson distribution, and the service times follow the negative exponential distribution. The average arrival rate is 12 students per hour, and the average service rate is 20 students per hour. A student has just entered the system. How long is she expected to stay in the system? a. 0.125 minute b. 0.9 minute c. 1.5 minutes d. 7.5 minutes e. 0.075 hour d (The variety of queuing models, moderate) {AACSB: Analytic Skills} 68. Students arrive randomly at the help desk of the computer lab. There is only one service agent, and the time required for inquiry varies from student to student. Arrival rates have been found to follow the Poisson distribution, and the service times follow the negative exponential distribution. The average arrival rate is 12 students per hour, and the average service rate is 20 students per hour. How many students, on the average, will be waiting in line at any one time? a. 0.9 students b. 1.5 students c. 3 students d. 4 students e. 36 students a (The variety of queuing models, moderate) {AACSB: Analytic Skills} 69. A waiting-line system that meets the assumptions of M/M/S has = 5, = 4, and M = 2. For these values, Po is approximately 0.23077 and Ls is approximately 2.05128. The average time a unit spends waiting in this system a. is approximately 0.1603 b. is approximately 0.2083 c. is approximately 0.4103 d. is approximately 0.8013 e. cannot be calculated because is larger than a (The variety of queuing models, moderate) {AACSB: Analytic Skills} 70. A waiting-line system that meets the assumptions of M/M/1 has = 1, = 4. For this system, Po is ______ and utilization is ________. a. 0.75; 0.25 b. 0.80; .20 c. -3; -4 d. 3; 4 e. none of these a (The variety of queuing models, moderate) {AACSB: Analytic Skills} 71. A waiting-line system that meets the assumptions of M/M/S has = 5, = 4, and M = 2. For these values, Po is approximately 0.23077 and Ls is approximately 2.05128. The average number of units waiting in the queue a. is approximately 0.1603 b. is approximately 0.4103 c. is approximately 0.8013 d. is approximately 1.0417 e. cannot be calculated because is larger than c (The variety of queuing models, moderate) {AACSB: Analytic Skills} 72. A waiting-line system that meets the assumptions of M/M/1 has = 1, = 4. For this system, the probability of more than two units in the system is approximately a. zero b. 0.015625
c. 0.0625 d. 0.25 e. 0.9375 b (The variety of queuing models, moderate) {AACSB: Analytic Skills} 73. A waiting-line system that meets the assumptions of M/M/1 has = 1, = 4. For this system, the probability of fewer than two units in the system is approximately a. 0.0625 b. 0.25 c. 0.75 d. 0.9375 e. certain d (The variety of queuing models, difficult) {AACSB: Analytic Skills}