Deck 20: Sales and Operations Planning

Question 1

In industries where it is difficult to find skilled workers,companies should not

A)follow a chase demand strategy
B)follow a level production strategy
C)use a capacity lag strategy
D)rely on economies of scale

Answer 1

A

Question 2

Aggregate planning for services is difficult because

A)labor is the most constraining resource
B)demand fluctuates more frequently and has higher peaks and valleys
C)there is not as much variety in services as in products
D)all of the above

Answer 2

B

Question 3

Under the level production strategy,a company with quarterly demands of 500,800,700 and 400 units would produce ____ units each quarter.

A)500,800,700 and 400
B)500,700,700,and 500
C)600,600,600 and 600
D)650,650,650 and 650

Answer 3

C

Question 4

Strategies for managing demand include

A)Shifting demand into other time periods with sales and promotions
B)Offering products or services with similar demand patterns
C)Using backorders and lost sales
D)All of the above

Question 5

In the hierarchy of production planning,sales and operations planning

A)Is at the top level
B)Plans for product lines or families
C)Sets the framework within which shorter term production decisions are made
D)All of the above

Question 6

Sharing customer demand data with suppliers

A)Helps reduce information distortion
B)Makes estimating demand less risky for suppliers
C)Gives suppliers a longer length of time to react to fluctuations in demand
D)All of the above

Question 7

The transportation method of linear programming considers all of the following alternatives for meeting demand except

A)Regular production
B)Overtime and subcontracting
C)Hiring and firing workers
D)Inventory and backorders

Question 8

The chase demand strategy

A)produces to reach set inventory levels each period
B)uses subcontracting and overtime to meet demand
C)uses hiring and firing of workers to meet demand
D)all of the above

Question 9

For single order quantities,the cost of overestimating demand would be

A)Lost revenue
B)Cost
C)Cost - salvage value)
D)Revenue - cost)

Question 10

The major cost of a level production strategy is

A)hiring and firing
B)inventory
C)subcontracting
D)overtime

Question 11

An annual S&OP plan is usually updated

A)Weekly
B)Monthly
C)Quarterly
D)Annually

Question 12

Which of the following techniques produces an optimal solution to the aggregate planning problem?

A)Linear programming
B)Management coefficients model
C)Search decision rule
D)All of the above

Question 13

S&OP planning is also called Aggregate Planning.What is 'aggregate' about it?

A)Demand is aggregated into product lines or families.
B)Demand is forecasted roughly by aggregating opinions from experts instead of using a quantitative forecasting model.
C)Supply is aggregated into annual production at each location.
D)all of the above.

Question 14

The S&OP process develops

A)A demand plan
B)A supply plan
C)An economic strategy for meeting demand
D)All of the above

Question 15

Available -to-promise is

A)The quantity that can be backordered and sent to a customer at a later date
B)The difference between planned production and customer orders already received
C)Inventory + production this period - customer orders this period
D)All of the above

Question 16

The process of determining the percentage of seats to be assigned to different fare classes in the airline industry is an example of

A)disaggregation
B)diseconomies of scale
C)the assignment method
D)revenue management

Question 17

The level production strategy

A)Produces the same amount each period
B)Determines production each period by dividing annual demand by the number of periods
C)Uses inventory to absorb variations in demand
D)All of the above

Question 18

Which of the following are pure strategies for meeting demand?

A)level production and chase demand
B)overtime and undertime
C)backorders and backlogs
D)all of the above

Question 19

The major cost of a chase demand strategy is

A)hiring and firing
B)inventory
C)subcontracting
D)overtime