illustrative_final_2_solution(1) - Illustrative Final Exam1...

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Illustrative Final Exam 1 Solutions BUAD311 – Operations Management Section A: Multiple Choices [4 pts each] 1. To generate in Excel a uniformly distributed random variable between 5 and 10 you need to use the following: a) 5*RAND() b) 5+RAND() c) 10+5*RAND() d) 5+5*RAND() e) None of the above 2. Zara’s management has adopted policies that go against standard industry practices. Which one of the following is not one of those policies? a) Zara outsources less than its competitors. b) Zara is more vertically integrated than its competitors. c) Zara produces less in low cost countries compared its competitors. d) Zara does not partner as much with other companies compared to its competitors. e) Zara spends more on advertising relative to its competitors . 3. In the second simulation run of Littlefield Labs, the reorder point and reorder quantity were initially set to 24 and 120, respectively. Which of the following actions would be most disastrous and costly? (Assume that you have made the optimal contract/capacity choices.) a) Reducing the reorder point by 20%. b) Increasing the reorder point by 20%. c) Reducing the reorder quantity by 20%. d) Increasing the reorder quantity by 20%. e) The above four moves are equally costly. 4. A network manufacturer purchases 200,000 cables for assembly annually. The interest rate is 10% annually and the cost per cable is $12. The manufacturer estimates that the cost of a purchase order is $5,000. The delivery lead-time is one month. To minimize the annual inventory cost, how frequently should the order be placed? a) About once a year b) About twice a year c) About three times a year d) About five times a year e) About six times a year 1 This is the actual final exam from Fall 2008 1
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Section B: Problems 1. [ 10 pts] A branch office of Time Travelers Insurance Company processes 10,000 claims per year. The average processing and waiting time is 3 weeks (sum of waiting and processing time is 3 weeks). Assume 50 weeks per year. What is the average number of claims that are waiting to be processed or in process? TT=3 weeks and TR=200/week. WIP=3(200)=600 claims.
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illustrative_final_2_solution(1) - Illustrative Final Exam1...

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