Deck 13: Aggregate Planning

Question 1

The Production Plan is usually updated and reevaluated:

A)weekly
B)monthly
C)quarterly
D)semi-annually
E)annually

Answer 1

B

Question 2

Raissa's Pizza parlor has an average monthly demand of 1200 pizzas. Statistically, each employee can produce 10 pizzas per hour. The parlor is open 20 days each month. How many employees must they need to meet the demand using a level aggregate plan?

A)4
B)5
C)6
D)7
E)8

Answer 2

C

Question 3

For the level aggregate plan, fluctuations in demand are absorbed by ________________.

A)inventory and subcontracting
B)back orders and price changes
C)inventory and back orders
D)price changes and subcontracting
E)subcontracting and back orders

Answer 3

C

Question 4

A proactive marketing approach in aggregate planning involves ____________________.

A)varying inventory levels
B)modifying work force size
C)back orders
D)shifting the demand patterns to level demand fluctuations
E)varying overtime rate

Question 5

All of the following are detailed by the aggregate plan except for?

A)purchases of components from vendors
B)the aggregate production rate
C)subcontracting
D)the amount of overtime authorized
E)back ordering of customer orders

Question 6

The Marketing Plan identifies all but which of the following:

A)targeted market segments
B)necessary market share
C)quality
D)flexibility
E)resources

Question 7

A disadvantage of the level aggregate plan is _________________.

A)workforce instability
B)excess hiring
C)layoffs
D)possible poor customer service from extensive use of backorders
E)excessive purchase of additional tools and equipment

Question 8

In a level production plan, equipment capacity is set equal to

A)number of trained and qualified operators
B)average demand
C)mean demand
D)maximum number of equipment minus 10% contingency reserves
E)peak demand

Question 9

What type of aggregate plan maintains a constant workforce and produces the same amount of product in each time period?

A)uniform
B)level
C)chase
D)mixed
E)steady

Question 10

What type of aggregate plan keeps a stable workforce and uses backorders to compensate for excess demand needs?

A)uniform
B)level
C)chase
D)hybrid
E)steady

Question 11

The master production schedule is reviewed:

A)annually
B)semi-annually
C)quarterly
D)monthly
E)weekly

Question 12

The master production schedule is typically stated as:

A)resource requirements
B)sales quotas
C)work-in-process
D)specific finished goods
E)composite products

Question 13

Using a chase strategy with the following 4 month demand and starting employee count, how many employees will be fired and how many will be hired if each employee can fix 20 engines perperiod?
November = 1920 $\quad$ Starting Employee Count = 90
December = 2160
January = 1440
February = 1200

A)12, 12
B)12, 14
C)13, 16
D)18, 48
E)14, 14

Question 14

The next level down in the planning process after development of the aggregate plan is the _____________.

A)materials requirements plan
B)engineering plan
C)rough-cut capacity plan
D)master production schedule
E)purchasing plan

Question 15

The goal of developing an aggregate plan using composite product information is:

A)group like things together
B)reduce the number of calculations
C)keep it simple for senior management
D)help marketing plan
E)provide detail reports

Question 16

An advantage of the chase aggregate plan is ____________________________.

A)workforce instability
B)excess hiring
C)space requirements
D)minimizes finished good holding costs
E)excessive purchase of additional tools and equipment

Question 17

. What type of aggregate plan sets labor and equipment capacity to satisfy demand each period?

A)uniform
B)level
C)chase
D)mixed
E)steady

Question 18

Sales and operations planning integrates the medium-range functional plans for all except which of the following?

A)marketing
B)operations
C)human resources
D)engineering
E)finance

Question 19

Using a level production plan how many oil changes must each employee be capable of to meet a weekly demand of 1400 oil changes in a five day work week if there are 4 employees?

A)40
B)50
C)60
D)70
E)80

Question 20

A company's ____________ plan is a statement of the resources available to the operations group during the next 6 to 18 months.

A)project
B)master
C)strategic
D)aggregate
E)tactical

Question 21

Evaluating an aggregate plan in terms of employment stability is using what perspective?

A)cost
B)customer service
C)quality
D)operations
E)human resources

Question 22

When evaluating the production plan you should use all but which of the following:

A)total/unit cost
B)inventory levels
C)number of back orders
D)effect on marketing plan
E)effect on workforces

Question 23

A difficulty with back orders, even when the customer waits, can be ________________.

A)finding space to store the product
B)extra administrative costs
C)added inventory holding costs
D)possible deterioration of the product
E)that other customers will want back orders also

Question 24

When you are considering different production planning approaches, the magnitude of change:

A)is not important from an aggregate planning perspective.
B)larger changes need more dramatic measures.
C)drives the point of departure.
D)reduces the point of departure.
E)modifies the duration of change.

Question 25

Once you implement a new aggregate plan you must then:

A)begin the planning process again.
B)evaluate the plan's performance in terms of cost.
C)evaluate the plan's performance in terms of customer service.
D)evaluate the plan's performance in terms of human resources.
E) evaluate the plan's performance in terms of cost and human resources.

Question 26

The comparison of aggregate plans is difficult when they produce different quantities and thus _________.

A)have different ending inventories
B)have different staffing levels
C)have different amounts of overtime
D)have different amounts of subcontracting
E)have different revenues

Question 27

Which of the following is not typical of overtime?

A)50% wage premium
B) quality may decrease
C)productivity decreases
D)workers' output rate increases
E)cost of labor per unit increases

Question 28

One disadvantage of using undertime is

A)employee hourly rate decreases
B)employee hourly rate increases
C)product labor cost decreases
D)product labor cost increases
E)product labor cost is constant

Question 29

Evaluating an aggregate plan in terms of inventory levels is using what perspective?

A)cost
B)customer service
C)quality
D)operations
E)human resources

Question 30

Which of the following is not true for firing permanent employees?

A)Deciding who will go and who will stay is difficult.
B)Keeping senior employees is always the least cost effective approach.
C)It can involve severance pay.
D)Valuable knowledge may leave with the employee.
E)It can harm morale.

Question 31

A demand-based option in which the operations department uses inventories and back orders to react to demand fluctuations is called

A)hyperactive
B)inactive
C)proactive
D)reactive
E)retroactive

Question 32

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

A)beginning workforce
B)demand forecast
C)beginning inventory
D)master production schedule
E)overtime available per period

Question 33

What is the most common method for increasing output capacity?

A)outsourcing
B)hiring temps
C)overtime
D)back orders
E)purchasing more machines

Question 34

Companies that use back orders are asking their customers to ___________________.

A) resubmit their orders
B)wait for delivery of the product
C)check back to see what their last order was
D)receive the product immediately and pay for it later
E)send back their last order

Question 35

Shifting demand makes sense when the company has ______________________.

A)lots of space for inventory
B)low inventory carrying costs
C)equipment that is highly flexible with respect to production volume changes
D)high fixed costs and low variable costs
E)excess capacity

Question 36

Which of the following best describes subcontracting?

A)provides additional output capacity during periods of high demand
B)it is a strategic decision
C)cost per unit is less for subcontracting
D)used when a company has no in-house capability
E)it defines the company's core business

Question 37

For the following data, verify the amount of employees needed.

A)20
B)5
C)34
D)25
E)15

Question 38

Evaluating an aggregate plan in terms of number of back orders is using what perspective?

A)cost
B)customer service
C)quality
D)operations
E)human resources

Question 39

In evaluating the current situation, the ____________ is the percentage of normal capacity at which the company is currently operating.

A)point of departure
B)amount of subcontracting needed
C)magnitude of the change
D)duration of the change
E)rated capacity

Question 40

Which of the following is an advantage of producing at average demand levels?

A)inventory fluctuates
B)allows for a lower investment in capacity
C)minimizes space needs for inventory
D)minimizes finished good holding costs
E)makes it difficult to calculate average production

Question 41

If you allocate scarce resources to customers at prices that maximize the yield to the company you are using:

A)level aggregate planning
B)chase production planning
C)price fixing
D)yield management
E)price compression

Question 42

In evaluating the current situation, the point of departure is the size of the change that is needed.

Question 43

An advantage of the chase aggregate plan is that it minimizes finished good holding costs.

Question 44

When a company's product is nontangible (a service), which of the following is no longer a viable option?

A)hiring permanent employees
B)subcontracting
C)inventory
D)working overtime
E)increasing normal capacity

Question 45

Shifting demand makes sense when the company has high fixed costs and low variable costs.

Question 46

The aggregate plan helps manufacturing with all of the following except:

A)whom to employ
B)how much work to subcontract
C)how much inventory can be held
D)when to add/subtract employees
E)when to use overtime

Question 47

Overtime is the most common method for increasing output capacity.

Question 48

An advantage of producing at average demand levels is that it allows for a lower investment in capacity.

Question 49

UPS is a company that hires a very high number of __________ and _________ workers.

A) steady, part time
B) older, wiser
C)seasonal, full time
D) part time, overtime
E) seasonal , part time

Question 50

The chase aggregate plan maintains a constant workforce and produces the same amount of product in each time period.

Question 51

What are the two primary objectives of aggregate planning?

A)material availability and supplier size
B)total cost and production rate
C)input rate and training for employees
D)output rate and workforce size
E)transportation rate and workforce size

Question 52

The aggregate plan is usually updated and reevaluated monthly by the operations group.

Question 53

Accounting uses the aggregate plan for all the following except:

A)projecting cash flows
B)making short term loans
C)calculating the capital needed to support operations
D)projecting earnings
E)benchmarking operation effectiveness

Question 54

Which of the following is not a primary objective of the master production schedule?

A)minimize shipping costs
B)achieve the desired customer service level.
C)make the best use of the company's resources: material, labor, and equipment.
D)ensure that the inventory investment is at the appropriate level
E)none of the answer choices are correct

Question 55

Which of the following is not a way to increase capacity?

A)Change depreciation methods.
B)Use overtime.
C)Employ temporary workers.
D)Subcontract.
E)Use alternative manufacturing processes.

Question 56

Which of the following is not typically indicated as part of the resources authorized in an aggregate plan?

A)number of machines to be used
B)size of the workforce
C)authorized level of overtime and undertime
D)number of units to be subcontracted
E)level of inventory held

Question 57

A demand-based option in which the marketing tries to shift demand patterns to minimize demand fluctuations is called

A)hyperactive
B)inactive
C)proactive
D)reactive
E)retroactive

Question 58

What is it called when a publishing company has decided to send the technical information development elsewhere and have no in-house capability?

A)outsourcing
B)subcontracting
C)subsidiary
D)affiliate
E)partner

Question 59

The master production schedule is shared:

A)only internally.
B)only with management.
C)only to marketing and engineering.
D)to all members of the executive team, exclusively.
E)to all members of the supply chain.

Question 60

Which of the following is not typically contained in the marketing plan?

A)product design
B)target markets
C)new products
D)profit margin
E)competitive focus

Question 61

A primary objective of the master production schedule is to achieve the desired customer service level.

Question 62

What are the characteristics of overtime?

Question 63

Nontangible capacity can be added by the use of an on-call labor pool.

Question 64

The purpose of the aggregate plan is to develop production rates and authorize resources that accommodate the engineering plan.

Question 65

What are the disadvantages for hiring permanent employees?

Question 66

Demand patterns cannot be smoothed through pricing incentives, reduced prices for out-of-season purchases, or nonprime service times.

Question 67

What are the difficulties associated with back orders?

Question 68

The financial plan indicates the sources and uses of funds, expected cash flows, anticipated profits and projected budgets.

Question 69

What are the disadvantages for firing permanent employees?

Question 70

What are the characteristics of the marketing plan?

Question 71

There are a limited number of options that are applicable to a hybrid aggregate plan.

Question 72

What are the capacity-based options in aggregate planning?

Question 73

When a company's product is nontangible (a service), inventory is no longer a viable option.

Question 74

During overtime worker productivity increases due to the increase salary received

Question 75

The master production schedule is a statement of upcoming demand.

Question 76

A master production schedule is more specific (tactical)than an aggregate plan.

Question 77

Aggregate planning, master production scheduling, and rough-cut capacity affect a select area of the organization.

Question 78

What are the characteristics of undertime?

Question 79

Demand-based options include two reactive options and two proactive options.

Question 80

The comparison of aggregate plans is difficult when they produce different quantities and have different ending inventories.