Question 1

Rough-cut capacity planning converts the MPS into requirements for key resources in order to test the feasibility of a proposed MPS.

Accepted Answer

Rough-cut capacity planning is a method of converting the Master Production Schedule (MPS) into requirements for key resources like labor, machines, and space to test the feasibility of a proposed MPS. This allows companies to identify any potential capacity constraints and make adjustments to the production plan before it is finalized.

Question 2

Disaggregating an aggregate production plan leads to a master production schedule.

Accepted Answer

Disaggregating an aggregate production plan involves breaking it down into more detailed plans for each product, which leads to the creation of a master production schedule that outlines the specific quantities and timing of production for each individual product.

Question 3

Aggregate operations planning is capacity planning for:

Accepted Answer

Aggregate operations planning typically involves capacity planning for an intermediate-term horizon, which is usually around 12 months. This allows companies to make strategic decisions regarding overall production levels, workforce requirements, and inventory management. Options A, C, D, and E all involve shorter timeframes and/or more specific operational concerns that do not fall under the umbrella of aggregate operations planning.

Question 4

The master production schedule indicates the quantity and timing for planned production of an item.

Accepted Answer

The master production schedule (MPS) is a plan that indicates the quantity and timing for the planned production of an item. It takes into account factors such as forecasted demand and available inventory to ensure that production is optimized to meet customer needs while minimizing excess inventory.

Question 5

Which of the following are examples of intermediate operations planning decisions?

Accepted Answer

Intermediate operations planning decisions typically involve determining the amount of inventory to hold, as it is a decision that needs to be adjusted periodically based on demand forecasts and production schedules.

Question 6

Master production scheduling has three inputs for each product: the beginning inventory,quantities already committed to customers,and back orders.

Accepted Answer

Master production scheduling (MPS) typically has four main inputs for each product: the forecast demand, the production plan, customer orders, and the inventory status (which includes beginning inventory, quantities already committed to customers, and back orders).

Question 7

One area that aggregate operations planning decisions relate to is:

Accepted Answer

Aggregate operations planning decisions are related to determining the appropriate inventory levels for raw materials, work in process, and finished goods, which are critical to meeting customer demand while minimizing costs. Job sequencing, order quantities, location, and layout decisions are more tactical and operational in nature.

Question 8

An example of a capacity option in aggregate operations planning for services is inventory.

Accepted Answer

Inventory is not a capacity option in services because you cannot store a service. In services, capacity options include hiring/laying off employees, adjusting work hours, adding or removing equipment or facilities, and outsourcing.

Question 9

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

Accepted Answer

Subcontracting is not a basic option for altering demand. Promotion, pricing, backordering and exporting are all commonly used methods for altering demand. However, subcontracting involves outsourcing a portion of production or services to another company, which is not directly related to altering demand.

Question 10

Which of the following best describes aggregate operations planning?

Accepted Answer

Aggregate operations planning is the process of using predicted demand to plan the general levels of employment, output, and inventories required in the intermediate term, typically up to 12 months. This involves balancing capacity and demand to ensure that resources are used efficiently, costs are minimized, and customer service goals are achieved. Option A (Linking long term capacity decisions with intermediate term production) is more related to strategic capacity planning, while option B (Integrating several planning techniques to develop an MPS) is related to master production scheduling. Option C (An operations plan to support sales forecasting) is vague and not specific to aggregate planning. Option E (An employee scheduling technique) is related to workforce scheduling and not relevant to aggregate operations planning.

Question 11

Available-to-promise (ATP)inventory for the first week is equal to the beginning inventory plus planned production quantity,if any,less the committed customer orders before the next planned production quantity.

Accepted Answer

Available-to-promise (ATP) inventory calculation involves adding the beginning inventory to planned production quantity and deducting committed customer orders before the next planned production quantity.

Question 12

After the first period of the planning horizon,available-to-promise (ATP)inventory is computed only for those periods in which there is a planned production quantity.

Accepted Answer

This is because the available-to-promise (ATP) inventory is calculated by subtracting the customer orders that have already been promised from the current available inventory. If there is no planned production quantity for a certain period, then there is no need to calculate the ATP inventory for that period since it will remain the same as the previous period.

Question 13

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

Accepted Answer

Master production schedules are an output of the aggregate operations planning process and not an input. The inputs include production rates (capacities), demand forecasts, initial inventory levels, and limits on the use of overtime.

Question 14

Aggregate operations planning does not require which of the following information?

Accepted Answer

Aggregate operations planning focuses on meeting forecasted demand and determining the optimal levels of production, inventory, and workforce to meet that demand efficiently. Maintenance schedules, while important for operational efficiency and equipment reliability, are not a direct input into the aggregate operations planning process, which is more concerned with overall production planning, demand forecasting, and resource allocation.

Question 15

Master production schedules are often divided into three zones: the emergency,trading,and planning zones.

Accepted Answer

Master production schedules are typically divided into three time zones: the emergency zone, the trading zone, and the planning zone.

Question 16

Essentially,the output of aggregate operations planning is:

Accepted Answer

The output of aggregate operations planning is the production plan, which outlines the overall approach to meeting demand over a specified period of time. This plan considers factors such as capacity, workforce levels, inventory levels, and distribution channels. The other options listed are outputs of more detailed planning processes that follow the production planning stage.

Question 17

Aggregate operations planners balance actions that influence:

Accepted Answer

Aggregate operations planners are responsible for balancing the capacity of a company with the demand for its products or services. Therefore, the most important factors that they must take into account are capacity and demand. While inventories, costs, and other factors also come into play, they are secondary to the primary goal of ensuring that a company is able to meet customer demand while utilizing its resources efficiently. Thus, option E, which focuses on the relationship between capacity and demand, is the most accurate.

Question 18

One option in aggregate planning that shifts the pattern of demand from one period to another is:

Accepted Answer

Backorders shift demand to a future period by delaying fulfillment of orders until inventory is available.

Question 19

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

Accepted Answer

Production costs are not considered a decision option in aggregate operations planning; rather, they are an outcome of decisions made regarding inventory levels, manpower levels, pricing, and promotion. Aggregate operations planning focuses on balancing production and demand by adjusting these variables, not directly on the costs of production itself.

Question 20

In doing "aggregate operations planning" for a firm producing paint,the aggregate operations planners would most likely base their planning on:

Accepted Answer

Aggregate operations planning typically involves planning at a more general level, focusing on overall production volume rather than detailed aspects like colors or sizes. In the context of paint production, using gallons of paint as an equivalent unit of production without concern for the different colors simplifies the planning process and aligns with the goals of aggregate planning, which is to balance production capacity and demand in a cost-effective manner.

Quiz 19: Aggregate Operations Planning and Master Scheduling