Deck 11: Aggregate Planning and Master Scheduling

Question 1

Linear programming models yield the optimal solution.

Answer 1

True

Question 2

A level capacity strategy is also known as a chase demand strategy.

Answer 2

False

Question 3

Aggregate planning is used to establish general levels of employment, output, and inventories over an intermediate-range of time.

Answer 3

True

Question 4

Departmental budgeting is an example of aggregate planning.

Question 5

The output from aggregate planning is a detailed business plan covering the next 2 to 12 months.

Question 6

Aggregate planning is intermediate-range capacity planning that typically covers a time horizon of one to three months.

Question 7

An advantage of a "chase" strategy for aggregate planning is that inventories can be kept relatively low.

Question 8

Disaggregating an aggregate plan leads to a master schedule.

Question 9

Aggregate planners commonly use trial-and-error methods in developing aggregate plans.

Question 10

The assignment of work to specific machines and people are examples of aggregate planning.

Question 11

Demand can be altered in aggregate planning by promotion and producing additional product using overtime.

Question 12

Aggregate planners are concerned with the quality and quantity of expected demand.

Question 13

Seasonality in demand has the advantage of leveling out requirements for our product or service.

Question 14

Ultimately the overriding factor in choosing a strategy in aggregate planning is overall cost.

Question 15

The master schedule indicates the quantity and timing for delivery of a product, but not the dates production will need to start.

Question 16

Capacity can be modified in aggregate planning by promotion and producing additional product using overtime.

Question 17

Aggregate planners typically use mathematical techniques such as linear programming and linear decision rules for planning.

Question 18

Organizations facing seasonal changes in demand are prevented from using aggregate planning techniques.

Question 19

The goal of aggregate planning is to achieve a production plan that attempts to balance the organization's resources and meet expected demand.

Question 20

The use of tables and charts in aggregate planning usually enables planners to arrive at an optimal plan.

Question 21

Aggregate planners attempt to balance:

A)demand and inventories
B)demand and costs
C)capacity and inventories
D)capacity and costs
E)capacity and demand

Question 22

Aggregate planning is capacity planning for:

A)the long range
B)the intermediate range
C)the short range
D)typically one to three months
E)typically one or more years

Question 23

Which of the following is not an input to the aggregate planning process?

A)resources available
B)demand forecast
C)policies on work force changes
D)master production schedules
E)cost information

Question 24

Available-to-promise in the first week is equal to beginning inventory plus MPS quantity, if any, less committed customer orders before the next MPS quantity.

Question 25

After the first period of the planning horizon, available-to-promise is computed only for those periods in which there is an MPS quantity.

Question 26

One area to which aggregate planning decisions relate is:

A)job sequencing
B)customer order quantities
C)inventory levels
D)location
E)layout

Question 27

A time fence in the master schedule is used to prevent unauthorized people from making changes to the schedule.

Question 28

Subcontracting 'in' would apply to periods in which our organization has excess capacity.

Question 29

Aggregate planning requires which of the following information?

A)a forecast of expected demand
B)current levels of inventory
C)(a) and (b)
D)policies regarding employment levels
E)all of the above

Question 30

Which one of the following is not a basic option for altering demand?

A)promotion
B)backordering
C)pricing
D)subcontracting
E)All are demand options.

Question 31

Which of the following is not a basic option for altering the availability of capacity in a service environment?

A)overtime
B)hiring/layoff
C)part time
D)inventory
E)All of these are basic capacity options.

Question 32

Essentially, the output of aggregate planning is the:

A)marketing plan
B)production plan
C)rough-cut capacity plan
D)assignment plan
E)material requirements plan

Question 33

One option for altering the pattern of demand is:

A)backorders
B)overtime
C)part-time workers
D)inventories
E)subcontracting

Question 34

Which of the following best describes aggregate planning?

A)the link between intermediate term planning and short term operating decisions
B)a collection of objective planning tools
C)make or buy decisions
D)an attempt to respond to predicted demand within the constraints set by product, process and location decisions
E)manpower planning

Question 35

Master schedulers are employed primarily by service organizations.

Question 36

In the master production schedule, production is planned for the next period whenever the available-to-promise quantity becomes negative.

Question 37

Accommodating peak demands and effectively using labor resources during periods of low demand would be the goal of aggregate planners in ....

A)Manufacturing
B)Military
C)Archeology
D)Libraries
E)Financial Services

Question 38

Which of the following is an input to aggregate planning?

A)beginning inventory
B)forecasts for each period of the schedule
C)customer orders
D)all of the above
E)quantity discounts

Question 39

In doing "aggregate planning" for a firm producing paint, the aggregate planners would most likely deal with:

A)just gallons of paint, without concern for the different colors and sizes
B)gallons of paint, but be concerned with the different colors to be produced
C)gallons, quarts, pints, and all the different sizes to be produced
D)all the different sizes and all the different colors by size
E)none of the above

Question 40

Which one of the following would not be considered a decision option for purposes of aggregate planning?

A)inventory levels
B)manpower levels
C)pricing
D)production costs
E)promotion

Question 41

Aggregate planners seek to match supply and demand:

A)at minimum overall cost
B)by staying within company policy
C)(a) and (b)
D)keeping inventories at a minimum
E)all of the above

Question 42

Moving from the aggregate plan to a master production schedule requires:

A)rough cut capacity planning
B)disaggregation
C)sub-optimization
D)strategy formulation
E)chase strategies

Question 43

Given the projected demands for the next six months, prepare an aggregate plan that uses inventory, regular time and overtime, and backorders.The plan must wind up with no units in ending inventory in Period 6.Regular time capacity is 150 units per month.Overtime capacity is 20 units per month.Overtime cost is $30 per unit, backorder cost is $20 per unit, inventory holding cost is $5 per unit, regular time cost of $20 per unit, and beginning inventory is zero.

Question 44

Proactive and Reactive aggregate planning strategies are best associated with:

A)Input and Output
B)Make and Buy
C)Quantitative and Qualitative
D)Exact and Approximate
E)Demand and Capacity options

Question 45

Simulation to produce an aggregate plan:

A)will produce the best plan
B)is the most widely used technique
C)both (a) and (b)
D)will produce a plan that may not be the best plan
E)requires a minimum of 4 iterations to be accurate

Question 46

That portion of projected inventory which enables marketing to make realistic commitments about delivery dates for new orders is:

A)beginning inventory
B)safety stock inventory
C)available-to-promise inventory
D)high margin inventory
E)none of the above

Question 47

In using the "chase strategy" variations in demand could be met by:

A)varying output during regular time without changing employment levels
B)varying output during regular time by changing employment levels
C)(a) and (b)
D)varying inventory levels
E)price increases

Question 48

The main disadvantage(s) of informal techniques used for aggregate planning is(are):

A)they are expensive to do
B)they may not result in the best plan
C)they take a long time to do
D)they require use of a computer
E)lack of formal education of the planners

Question 49

One option for altering the availability of capacity is:

A)use of overtime or slack time
B)pricing
C)promotion
D)backorders
E)none of the above

Question 50

Linear programming to produce an aggregate plan:

A)will produce the best plan if accurate inputs are used
B)is the most widely used technique
C)(a) and (b)
D)will produce a plan that may not be the best plan
E)requires an excel spread sheet

Question 51

The direct result of disaggregating the aggregate plan is the:

A)marketing plan
B)production plan
C)rough-cut capacity plan
D)master schedule
E)material requirements plan

Question 52

A manager has prepared a forecast of expected aggregate demand for the next six months.Develop an aggregate plan to meet this demand given this additional information: A level production rate of 100 units per month will be used.Backorders are allowed, and they are charged at the rate of $8 per unit per month.Inventory holding costs are $1 per unit per month in ending inventory.Determine the cost of this plan if regular time cost is $20 per unit and beginning inventory is zero.

Question 53

Uncommitted inventory is called ....

A)Available-to-promise inventory
B)Free inventory
C)Safety stock
D)Lead time inventory
E)Obsolete inventory

Question 54

Which term is most closely associated with the term disaggregation?

A)subcontracting
B)master schedule
C)diversity
D)varying inventory levels
E)firing and laying off

Question 55

Which of the following would not be a strategy associated with adjusting aggregate capacity to meet expected demand?

A)subcontract
B)vary the size of the workforce
C)vary the intensity of workforce utilization
D)allow inventory levels to vary
E)use backorders

Question 56

Inventory information for firm ABC: What was the inventory at the end of March, 1999?

A)350
B)250
C)150
D)50
E)none of the above

Question 57

In order to use the "level capacity strategy," variations in demand are met by:

A)varying output during regular time without changing employment levels
B)varying output during regular time by changing employment levels
C)(a) and (b)
D)using combination of inventories, overtime, part time, and back orders
E)price adjustments

Question 58

Inventory information for firm ABC: What is the expected inventory at the end of April, 1999?

A)350
B)250
C)150
D)50
E)none of the above

Question 59

One option for altering the availability of manufacturing capacity is:

A)pricing
B)promotion
C)backorders
D)inventories
E)none of the above apply to manufacturing capacity

Question 60

In practice, the more commonly used techniques for aggregate planning are:

A)mathematical techniques
B)informal trial-and-error techniques
C)(a) and (b) about equally
D)simulation models
E)linear programming optimization

Question 61

What quantity is available for commitment to new customers in either of the first two periods?

A)21
B)1
C)20
D)4
E)impossible to say without more information

Question 62

What is total forecasted demand?

Question 63

In a service setting, the aggregate plan results in a time-phased projection of __________ requirements.

A)customer
B)staff
C)inventory
D)subcontracting
E)outsourcing

Question 64

What are total costs for the six periods?

Question 65

What quantity is available for commitment to new customers prior to the receipt of the MPS quantity in week 3?

A)14
B)32
C)12
D)20
E)impossible to say without additional information.

Question 66

What is the projected on-hand inventory at the end of period 2?

A)21
B)1
C)12
D)20
E)impossible to say without more information

Question 67

A master production schedule quantity of 300 units will arrive in week 6.Weekly demand over weeks 3 through 10 is forecasted at 50 units.At present, orders have been booked in various quantities in weeks 1, 2, 3 and 4.What is the available to promise for week 6?

A)50
B)6
C)300
D)100
E)Cannot be determined without projected on-hand information

Question 68

Prepare a master schedule based on the following information:

Question 69

What is total regular time capacity?

Question 70

Use either the transportation method or linear programming to develop an optimum aggregate plan, given the following data:

Question 71

What are total backorder costs?

Question 72

How should overtime capacity be utilized?

Question 73

When the opportunity cost of lost revenue is relatively high, _________ become(s) relatively more attractive.

A)Layoffs
B)Backorders
C)Excess capacity
D)Disaggregation
E)Both B and C

Question 74

Which of the following differs between aggregate planning in services and aggregate planning in manufacturing?

A)uncertainty in demand
B)costs of storing inventory
C)the perishability of capacity
D)cost of overtime
E)cost of hiring

Question 75

What are total carrying costs?

Question 76

What are total overtime costs?

Question 77

The more __________ demand is, the more the aggregate plan will tend to reflect the ____________ strategy.

A)Stable; Level
B)Aggregated; Outsourcing
C)Variable; Chase
D)Complex; Uncommitted
E)Both A and C

Question 78

What are total costs for each period?

Question 79

What is the projected on hand inventory at the end of period 2?

A)14
B)32
C)12
D)20
E)impossible to say without additional information

Question 80

What are total regular time costs?