Deck 18: Managing Service and Manufacturing Operations

Question 1

Manufacturing operations can be classified according to the depth of their inventory stock.

Answer 1

False

Question 2

The American National Standards Institute guarantees continued ISO 9000 certification for all the ISO certified American companies.

Answer 2

False

Question 3

Durability is a characteristic that determines the quality of a service.

Answer 3

False

Question 4

ISO 9000 is a series of five international standards for achieving consistency in quality management and quality assurance in companies throughout the world.

Question 5

Empowering workers means permanently passing decision-making authority and responsibility from managers to workers

Question 6

Service capability is an ongoing commitment to increase product and service quality by constantly assessing and improving the processes and procedures used to create those products and services.

Question 7

LightLife uses 200,000 eggs a year. If the ordering cost is $1 per order and the holding cost is $0.4 per egg, then the optimal quantity to order eggs is _____.

A) 1,000 eggs
B) 1,500 eggs
C) 2,000 eggs
D) 2,500 eggs

Question 8

Woodlander is a chain of resorts where part of employees' monthly incentives depends on customer satisfaction. Sixty percent of the incentive is based on performance and the remaining forty percent is based on customer satisfaction ratings and the quality of service. In this case, Woodlander is committed to _____.

A) total quality management
B) line-flow production
C) implementing a just-in-time program
D) internal service quality

Question 9

Customer satisfaction and customer loyalty lead to long-term profits and growth.

Question 10

The easier it is to maintain a working product or fix a broken product, the more _____ that product is.

A) reliable
B) serviceable
C) tangible
D) durable

Question 11

Ordering cost refers to the costs of downtime and lost efficiency that occur when a machine is changed or adjusted to produce a different kind of inventory.

Question 12

A just-in-time (JIT) inventory system is used with independent demand systems.

Question 13

As the Baldrige Award is directly based on the ISO 9000 standards, it is essentially the U.S. version of recognition for excellence in meeting the ISO 9000 standards.

Question 14

Timothy is a manager in a footwear manufacturing company. He calculates the daily productivity by determining the amount of plastic required to produce a pair. This daily productivity is an example of _____.

A) partial productivity
B) internal service quality
C) multifactor productivity
D) service recovery

Question 15

Churchill Automobiles is a delivery truck manufacturer. It is a new company and wants to gather information on how to improve the standard of quality delivered by the company's production team. Based on this information, which of the following ISO standards must the company refer to?

A) ISO 15001
B) ISO 9000
C) ISO 10001
D) ISO 12000

Question 16

Economic order quantity (EOQ) formulas are intended for use with dependent demand systems.

Question 17

Initial assembly is the process in which all the work-in-process inventories are assembled to create finished goods inventories.

Question 18

Which of the following is a kind of input that is frequently used when determining partial productivity?

A) Service quality
B) Labor
C) Finished goods
D) Profits

Question 19

Average aggregate inventory for a month can be determined by simply averaging the inventory counts at the end of each business day for that month.

Question 20

Labor productivity typically indicates the cost or number of hours of labor it takes to produce an output.

Question 21

Sombre is a toy manufacturer that orders the components required to make toys way before its customers make a purchase. They make modules with those components and later, upon receiving customer requests, make toys using those modules. They do this to make sure they are able to cater to the demands of the customers. It is evident that Sombre has adopted a(n) _____.

A) assemble-to-stock operation
B) make-to-stock operation
C) make-to-order operation
D) assemble-to-order operation

Question 22

Hue Fabrics, a garment manufacturing company, produces around 2000 identical skirts per day. The production system used by the company is very efficient, and it makes close to 100 skirts per hour. Once the production starts, the system functions round the clock to spin and release garments until the machine is turned off. The production system of Hue Fabrics is an example of _____.

A) continuous-flow production
B) prototype production
C) batch production
D) job shop production

Question 23

The extent to which service providers give individual attention and care to customers' concerns and problems is called _____.

A) reliability
B) responsiveness
C) assurance
D) empathy

Question 24

The Cabin Retreat is a chain of hotels where part of employees' monthly bonus depends on customer satisfaction. Ninety percent of the incentive is based on performance and the remaining ten percent is based on customer satisfaction ratings and the quality of service. In this case, The Cabin Retreat is committed to _____.

A) implementing a just-in-time program
B) line-flow production
C) total quality management
D) internal service quality

Question 25

The bottling system at Trink Inc., a soft drink manufacturing company, dispatches about 1,000 bottles an hour. Once the conveyor system is turned on, it functions constantly to cap and dispatch bottles until the machine is turned off. The bottling system of Trink Inc. illustrates _____.

A) continuous-flow production
B) prototype production
C) batch production
D) job shop production

Question 26

In the context of the principles of total quality management,__________is an organizational goal to concentrate on meeting customers' needs at all levels of the organization.

A) customer loyalty
B) customer focus
C) customer satisfaction
D) continuous improvement

Question 27

Raver Gear is a company that manufactures and sells riding gear, such as helmets, jackets, and gloves. It has adopted assemble-to-order operations. Based on this information, which of the following statements is true of Raver Gear?

A) The company orders parts and assembles modules ahead of customer orders.
B) The company produces or assembles highly specialized products for customers.
C) The company is highly dependent on the accuracy of sales forecasts.
D) The company starts assembling finished products before receiving customer orders.

Question 28

Which of the following statements is true of the International Organization for Standardization (ISO) 9000 certification?

A) It helps organizations achieve consistency in quality assurance.
B) It helps organizations specifically manage, monitor, and minimize harmful effects on the environment.
C) It requires a company to show that it is following its own procedures for improving production.
D) It is specifically applicable to the travel and tourism industry.

Question 29

AfterGlow, a body and bath products manufacturing company, produces around 12,000 bottles of shampoo a day. The production system used by the company is very efficient, and it packs close to 1000 bottles per hour. Once the production system is turned on, it functions round the clock to cap and deposit bottles until the machine is turned off. The production system of AfterGlow is an example of _____.

A) continuous-flow production
B) prototype production
C) batch production
D) job shop production

Question 30

The Belwick Railway Station operates 24 hours per day in all seven days of a week. On an average, the railway station handles 480 trains per day. Which of the following indicates the average productivity of the railway station?

A) 5 trains per hour
B) 10 trains per hour
C) 20 trains per hour
D) 25 trains per hour

Question 31

Strady Gadgets is an electronic goods manufacturer. The company orders the materials required to make its products from its suppliers and completes production before customers place their orders. This type of operation is called a(n) _____.

A) assemble-to-stock operation
B) assemble-to-order operation
C) make-to-order operation
D) make-to-stock operation

Question 32

The production team of Lining Corp., a company that manufactures soccer balls, has determined the quantity of latex rubber, threads, labor, and electricity required to make one soccer ball. The collective effort of all these resources would help Lining Corp. determine its _____.

A) economic order quantity
B) partial productivity
C) multifactor productivity
D) internal service quality

Question 33

Service recovery sometimes requires service employees to:

A) stop contacting highly dissatisfied customers.
B) permanently pass decision-making authority and responsibility to managers.
C) switch to the process of service delivery.
D) perform heroic service acts that delight highly dissatisfied customers.

Question 34

Blooming Minds is a content management company that fulfills its electricity needs by using solar power. The company advocates eco-friendly methods of working, such as recycling paper and prohibiting the use of plastic. Based on this information, Blooming Minds is eligible to obtain an _____ certificate.

A) ISO 22000
B) ISO 8000
C) ISO 14000
D) ISO 41001

Question 35

Rodney is a manager at Gordon Publications. He meets his subordinates every week to come up with new ideas for articles to publish in the company's weekly magazine. In this scenario, this collaboration is termed _____.

A) service recovery
B) teamwork
C) customer focus
D) leadership

Question 36

The International Organization for Standardization (ISO) helps set standards for _____ countries.

A) 143
B) 153
C) 163
D) 173

Question 37

When customers become dissatisfied with the service they have received, service businesses must switch to the process of _____.

A) service recovery
B) service enhancement
C) service delivery
D) customer reengineering

Question 38

__________assesses how efficiently companies use only one input, such as labor, when creating outputs.

A) Multifactor productivity
B) Partial productivity
C) Internal service quality
D) Service recovery

Question 39

The Cool Store manufactures 200 air conditioners every week. The company spends $500 on labor, $3,000 on rent, $1,200 on equipment, and $900 on electricity to produce 20 air conditioners a week. Which of the following indicates the multifactor productivity of the company?

A) 0.036
B) 0.207
C) 0.103
D) 0.072

Question 40

Jogan Electronics manufactures television sets. It gathers all the components required to make a television set before customers book television sets for purchase. It accumulates all the necessary materials for production from its suppliers and ensures that it has all the parts to manufacture the television sets before it receives a customer order. This type of operation is called a(n) _____.

A) assemble-to-stock operation
B) assemble-to-order operation
C) make-to-order operation
D) make-to-stock operation

Question 41

Which of the following statements is true of multifactor productivity?

A) It indicates a company's overall level of productivity relative to its competitors.
B) It assesses how efficiently companies use only one input, such as labor, when creating outputs.
C) It indicates the specific contributions that labor, capital, materials, or energy make to overall productivity.
D) It helps managers in analyzing the contributions of individual components that determine productivity.

Question 42

Which of the following is a common characteristic of quality products and quality services?

A) Reliability
B) Serviceability
C) Durability
D) Validity

Question 43

In the context of total quality management, _____ is a deviation in the form, condition, or appearance of a product from the quality standard for that product.

A) aberration
B) variation
C) divergence
D) contention

Question 44

Limitless Builders is a construction plant, wherein small aluminum rods are sheared, hammered, welded, and molded to form nuts and bolts that are used as fasteners. The nuts and bolts produced in this process are referred to as _____.

A) raw material inventories
B) component parts inventories
C) average aggregate inventories
D) work-in-process inventories

Question 45

Gomez Home Appliances manufactures 10,000 refrigerators every month. The company spends $2,000 on labor, $5,000 on rent, $3,000 on machinery, and $1,500 on electricity every month. It can be concluded that the multifactor productivity of the company is _____.

A) 0.91 dollars per refrigerator
B) 0.87 refrigerators per dollar
C) 0.62 dollars per refrigerator
D) 0.34 refrigerators per dollar

Question 46

In the context of the principles of total quality management,__________is an organization's ongoing commitment to constantly assess and improve the processes and procedures used to create products and services.

A) teamwork
B) customer focus
C) customer satisfaction
D) continuous improvement

Question 47

AT Oils, a gas station, retails 30,000 gallons of petrol per year. Its ordering costs are $20 per order and holding costs are $40 per gallon. According to the economic order quantity (EOQ) model, approximately how often should the company place a fresh order for petrol?

A) Every two days
B) Every three days
C) Every four days
D) Every five days

Question 48

IceCrem uses 1,600 pounds of sugar a year. If the ordering cost is $2 per order and the holding cost is $4 per pound, then the optimal quantity to order sugar is _____.

A) 10 pounds
B) 20 pounds
C) 30 pounds
D) 40 pounds

Question 49

Alaya's Secret is a chain of beauty salons, where part of employees' monthly leaves is granted depending on customer feedback. Two days of leave are granted based on performance and the remaining three days are granted based on customers' feedback on the quality of service. In this case, Alaya's Secret is committed to _____.

A) total quality management
B) line-flow production
C) implementing a just-in-time program
D) internal service quality

Question 50

White Planet Electronics is a company that sells the various inventories required by other companies to manufacture electronic gadgets. It spends $500 every month on a storage facility that manages and stores the parts. In this scenario, the money spent by White Planet Electronics toward the storage facility for the protection of the company's goods is called _____.

A) ordering cost
B) setup cost
C) holding cost
D) stockout cost

Question 51

Which of the following statements is true of the cost of applying for the Baldrige Award?

A) Eligibility fee is waived off for small businesses.
B) The application fee is higher for small businesses than for manufacturing firms.
C) A site visitation fee is charged for small businesses.
D) An assessment fee is charged for large corporations.

Question 52

Pathos Solutions, a technology solution company, recently became an ISO 14000-certified company. Based on this information, which of the following statements is true of Pathos Solutions?

A) It manages, monitors, and minimizes the harmful effects of the company on the environment.
B) It achieves consistency in quality management and quality assurance in the company.
C) It assures the management of security for all printing processes in the company.
D) It overlooks the occupational health and safety of management systems in the company.

Question 53

If a machine requires 8 hours to produce 35 M10 bolts, the productivity of the machine will be _____.

A) 4.375 bolts per hour
B) 0.228 hours per bolt
C) 8.75 bolts per hour
D) 0.46 hours per bolt

Question 54

__________includes the costs of downtime and lost efficiency that occur when a machine is changed or adjusted to produce a different kind of inventory.

A) Ordering cost
B) Setup cost
C) Holding cost
D) Stockout cost

Question 55

A _____ does not start processing or assembling products until it receives a customer request.

A) assemble-to-batch operation
B) make-to-order operation
C) make-to-stock operation
D) assemble-to-order operation

Question 56

Cooling Systemz is a company that manufactures electric heaters and air conditioners. Customers purchase standardized items from this store for their homes and offices. The company has adopted make-to-stock operations. Based on this information, which of the following statements is true of Cooling Systemz?

A) The company orders parts and assembles modules ahead of customer orders.
B) The company produces or assembles highly specialized products for customers.
C) The company is not dependent on the accuracy of sales forecasts.
D) The company starts assembling finished products before receiving customer orders.

Question 57

_____ indicates how much labor, capital, materials, and energy it takes to create an output.

A) Multifactor productivity
B) Economic order quantity
C) Partial productivity
D) Inventory turnover

Question 58

The production team of Widget Corp., a furniture manufacturer, has determined the amount of wood, metal, fabric, and labor hours and the electricity required to make one chair. The collective effort of all these resources would help the company determine its _____.

A) economic order quantity
B) partial productivity
C) multifactor productivity
D) internal service quality

Question 59

PlayStat is a company that manufactures toys for toddlers. To begin the production, the manufacturers purchase unprocessed plastic and metals. In the context of manufacturing inventories, the unprocessed plastic and metal used to produce toys are referred to as _____.

A) raw material inventories
B) component parts inventories
C) average aggregate inventories
D) work-in-process inventories

Question 60

Which of the following scenarios best illustrates batch production?

A) Milkest, a company that sells dairy products, uses standard packaging for processed cheese.
B) Dantor, an automobile manufacturing company, performs the assembly of automobile parts in an assembly line.
C) Raydor, a company that sells component parts, performs turning, drilling, and milling of plastics and alloy steels to make fifty different parts in a day.
D) Alvend, a company that supplies raw materials to the machinery manufacturing industry, finishes the production of hundred bolts and hundred nuts in standard sizes in two hours.

Question 61

Brass Worx is a furniture manufacturer. The company's production team takes 240 hours to produce 800 pieces of furniture. Which of the following indicates the labor productivity of Brass Worx?

A) 2.17 hours per piece of furniture
B) 5.51 hours per piece of furniture
C) 3.33 pieces of furniture per hour
D) 2.60 pieces of furniture per hour

Question 62

The Lucitona International Airport operates 24 hours a day, seven days a week. On an average, the airport handles 4900 flights per week. Which of the following indicates the average productivity of the airport?

A) 204 flights per hour
B) 700 flights per day
C) 102 flights per hour
D) 350 flights per day

Question 63

Atrade Foods Inc. is a chain of supermarkets. Eighty percent of its employees' salary is based on earnings, and the remaining 20 percent is based on customer satisfaction ratings and service quality. In this case, Atrade Foods Inc. displays its commitment toward _____.

A) total quality management
B) line-flow production
C) implementing Kanban system
D) dependent demand systems

Question 64

Which of the following statements is true of the Baldrige Performance Excellence Awards?

A) Eligibility fee is not charged when someone applies for the Baldrige Award.
B) Application fee is not charged for small businesses that are eligible for the Baldrige Award.
C) The Baldrige Award includes up to three awards that are given annually in various categories.
D) The Baldrige Award is given on the basis of the level of compliance to ISO 9000 standards.

Question 65

Crystalize is a decorative glassware manufacturer. The company's production team takes 8 hours to produce 96 identical glass items. Which of the following is the labor productivity of Crystalize?

A) 10 items per hour
B) 12 items per hour
C) 0.08 hours per item
D) 0.09 hours per item

Question 66

Carlos Corp., a car servicing company, is known for consistently providing excellent services to its customers. In the context of the characteristics of a quality service, which of the following characteristics is being displayed by Carlos Corp.?

A) Service assurance
B) Service responsiveness
C) Service durability
D) Service reliability

Question 67

Courtney recently ordered a few books online. However, she received the wrong order. She was completely dissatisfied and returned the books. She then wrote to the customer service expressing her anger. In response, the manager of the store sent her an apology via e-mail. He also sent her the books she ordered and refunded her money. Courtney was impressed and ordered books only from that store thereafter. In this scenario, the process adopted by the online store to regain Courtney's trust is called _____.

A) service durability
B) service reliability
C) service recovery
D) service capability

Question 68

A moderate degree of processing occurs in _____.

A) assemble-to-order operations
B) make-to-order operations
C) build-to-stock operations
D) make-to-stock operations

Question 69

The lowest degree of processing occurs in _____.

A) assemble-to-order operations
B) make-to-order operations
C) assemble-to-batch operations
D) make-to-stock operations

Question 70

Widget Corp. produced $10 billion worth of goods in the year 2016. If the company had 50 million hours of work in 2016, the productivity of the company is _____.

A) $20 per hour
B) $25 per hour
C) $30 per hour
D) $35 per hour

Question 71

Finesse, a wall paint manufacturing company, produces around 15,000 cans of paint a day. The production system used by the company is very efficient, and it seals close to 2000 cans per hour. Once the production system is turned on, it functions round the clock to seal and dispatch cans until the machine is turned off. The production system of Finesse is an example of _____.

A) continuous-flow production
B) prototype production
C) batch production
D) job shop production

Question 72

Bake Treats is a confectionery who makes cakes for special occasions and delivers them. They use gourmet ingredients while baking and delivering customized treats. In fact, they only start baking once they receive an official request from a customer. It is evident that Bake Treats has adopted a(n) _____.

A) make-to-order operation
B) make-to-stock operation
C) assemble-to-order operation
D) assemble-to-stock operation

Question 73

Swiftspan Inc., a construction company, uses 202,500 gallons of paint a year. If the ordering cost is $32 per order and holding cost is $9 per gallon, the optimal quantity to order is _____.

A) 1,200 gallons
B) 2,400 gallons
C) 4,800 gallons
D) 3,600 gallons

Question 74

Bubbles Bath and Body Shop manufactures cosmetic products. Recently, the company manufactured a collection of new organic soaps and shampoos. One batch of the organic soaps was discarded because they were a bit different in size and could not meet the pre-defined quality standards. Which of the following is the main reason to discard the batch of soaps?

A) Low multifactor productivity
B) Serviceability of the soaps
C) Variation in the soaps
D) Low partial productivity

Question 75

Wyatt Four-Wheel Services is a popular garage, where part of employees' monthly salary depends on customer satisfaction. Seventy percent of the incentive is based on performance and the remaining thirty percent is based on customer satisfaction ratings and the quality of service. In this case, Wyatt Four-Wheel Services is committed to _____.

A) internal service quality
B) line-flow production
C) implementing a just-in-time program
D) total quality management

Question 76

According to total quality management (TQM), which of the following should be a company's primary goal?

A) Reciprocity
B) Distinctive competency
C) Participative management
D) Customer satisfaction

Question 77

The production team of U Sandals that manufactures women's footwear has determined the quantity of leather, threads, labor, and electricity required to make a pair of sandals. The collective efforts of all these resources would help the company determine its _____.

A) economic order quantity
B) internal service quality
C) partial productivity
D) multifactor productivity

Question 78

Businesses that apply for the Baldrige Performance Excellence Awards are judged on__________criteria.

A) five
B) six
C) seven
D) eight

Question 79

Michael ordered a pair of shoes from an e-commerce website. The company sent his order to the wrong address and this confusion delayed the delivery by 10 days. Michael was disappointed by this and stopped ordering shoes from that online store. To regain his trust, the company apologized for the inconvenience and sent him a gift voucher worth $1000 that he could redeem at any e-commerce website. This gesture turned things around and Michael recommended this e-commerce company to all his friends. The process adopted by the e-commerce company to regain Michael's trust is called _____.

A) service durability
B) service recovery
C) service reliability
D) service capability

Question 80

Kraers Inc. keeps an average of 200 finished widgets in inventory each month, and it has sold 2,000 widgets this year. Therefore, the inventory turnover of the company is _____.

A) 10
B) 20
C) 100
D) 200