Question 1

When considering the one-versus-many location for production facilities for components and raw materials some of the most important considerations are: fixed costs, minimum efficient scale and its comparison to demand, and the value-to-weight ratio.

Accepted Answer

These are indeed important considerations when deciding between one central production facility versus multiple facilities for components and raw materials.

Question 2

The three major considerations for deciding the location of production facilities for products are: does the product serve the needs of all customers around the world, proximity to market and proximity to suppliers, and the effect on product's image being produced in that location.

Accepted Answer

These are indeed the three major considerations for deciding the location of production facilities for products.

Question 3

A major advantage of making components and raw materials in-house is that the firm is not required to honor protections of intellectual property.

Accepted Answer

Making components and raw materials in-house does not exempt a company from honoring intellectual property protections. In fact, if the components or materials being produced infringe on someone else's intellectual property, the company could face legal consequences.

Question 4

When a firm has been making goods and services in-house, and then decides to buy these goods and services from suppliers is referred to as offshoring.

Accepted Answer

Offshoring refers to the relocation of a business process from one country to another. When a firm decides to buy goods and services from suppliers instead of making them in-house, it is referred to as outsourcing.

Question 5

A supply chain encompasses all the activities associated with the flow and transformation of goods and services from raw material to the end user.

Accepted Answer

A supply chain includes all the steps involved in getting a product from its initial creation to its end use, including sourcing raw materials, manufacturing, distributing, and delivering to consumers.

Question 6

One advantage of global procurement is that the firm can maximize its flexibility by allocating its orders among suppliers in a dynamic way and the firm has access to more suppliers that can generally provide lower costs than domestic suppliers.

Accepted Answer

Global procurement allows a company to have access to a wider pool of suppliers, which can lead to more competitive pricing and greater flexibility in terms of supplier selection and allocation of orders.

Question 7

Steps in the production process are called _____.
A)production stages
B)production facilities
C)raw materials
D)components
E)factors of production

Accepted Answer

Steps in the production process are commonly referred to as production stages. While production facilities, raw materials, components, and factors of production are all necessary components of the production process, they do not necessarily describe the steps or stages involved in producing a product or service.

Question 8

The production systems of Honda Motor Company, the Boeing Company, and Toshiba Corporation, would be called _____ systems.
A)production
B)manufacturing
C)service
D)component
E)raw

Accepted Answer

The given companies are involved in the creation of physical goods, which falls under manufacturing. Therefore, their production systems would be classified as manufacturing systems.

Question 9

Boeing buying from thousands of suppliers in more than 100 countries, but only having production facilities in the U.S. is an example of global procurement and domestic production.

Accepted Answer

Boeing's procurement strategy is global as it involves sourcing materials from various suppliers in different countries. However, their production facilities are only located in the United States, which means they focus on domestic production.

Question 10

A production system in which services dominate the value of the product is known as a(n)_____ system.
A)production
B)manufacturing
C)service
D)component
E)raw

Accepted Answer

A service system is one in which the value of the product is driven more by the services provided rather than the physical tangible product itself. Examples of service systems include hospitality and healthcare industries.

Question 11

The practice of producing components and raw materials in-house AND purchasing them from suppliers is referred to as a supply-chain malfunction.

Accepted Answer

The practice of producing components and raw materials in-house AND purchasing them from suppliers is actually referred to as a dual-sourcing supply chain strategy, not a malfunction.

Question 12

A production system is a system that businesses use to create the goods and services or to produce the products.

Accepted Answer

A production system is a system implemented by businesses to create goods and services or products.

Question 13

In the production system model, all of the following would be considered inputs EXCEPT _____.
A)labor
B)machines and equipment
C)the finished product
D)raw materials
E)factors of production

Accepted Answer

The finished product is not an input in the production system model, but rather the output or end result of the production process. Inputs are the resources or factors of production that are required to produce the finished product, such as labor, machines and equipment, and raw materials.

Question 14

When the demand is equal or lower than the minimum efficient scale, multiple production facility locations are preferred.

Accepted Answer

When the demand is equal or lower than the minimum efficient scale, it is more efficient to have a single production facility location rather than multiple locations. This is because having multiple facilities would result in excess capacity and higher costs per unit produced, reducing overall efficiency.

Question 15

Software packages designed to integrate the majority of a firm's business processes, execute all transactions related to the firm's business processes being integrated, store each piece of data only once in an enterprise-wide database, allow access to data and information in real time, and operate in a client-server environment, traditional or web-based are called enterprise resource planning systems.

Accepted Answer

Enterprise resource planning systems are designed to integrate and automate a variety of business processes and operate within a client-server environment while maintaining a centralized database.

Question 16

The activities in operations management can be grouped into four business functions: procurement, production, logistics, and research and development.

Accepted Answer

This is true. Operations management involves managing these four functions in order to efficiently and effectively produce goods and/or services for a company. Procurement involves acquiring the necessary materials and resources for production, production involves actually creating the product, logistics involves managing the flow of goods and services from production to the consumer, and research and development involves innovating and improving upon current products and processes.

Question 17

The property of ERP systems to handle the accounting standards of multiple countries is called the multi-currency property.

Accepted Answer

The ability to handle the accounting standards of multiple countries is referred to as multi-language or multi-legislation capability, not multi-currency. Multi-currency refers to the ability to handle transactions in various currencies.

Question 18

Goods and services that integrate a product are called _____.
A)production process
B)production facilities
C)raw materials
D)components
E)factors of production

Accepted Answer

The term "components" refers to the individual parts or materials that make up a product or service, which would include any goods or services that are integrated into the final product. The other options do not accurately describe goods or services that are integrated into a product.

Question 19

The production system of a hair and nail salon would be called a manufacturing system.

Accepted Answer

The production system of a hair and nail salon would not be called a manufacturing system as it involves providing services rather than creating products through a manufacturing process.

Question 20

In operations management, the acquisition of goods and services is referred to as logistics.

Accepted Answer

In operations management, the acquisition of goods and services is referred to as procurement, not logistics. Logistics involves the management of the flow of goods, services, and information from the point of origin to the point of consumption.

Quiz 13: Global Operations and Supply-Chain Management