Question 1

Which of the following statements is true of offshoring?
A)It is the same as outsourcing processes to other organizations.
B)A firm often offshores processes by directly investing in its own foreign facilities.
C)A firm that uses offshoring faces less risk of intellectual property theft.
D)It occurs when a firm gains control over its value chain by performing all processes internally.

Accepted Answer

Offshoring involves a firm directly investing in its own foreign facilities or outsourcing processes to other organizations located in a different country. Therefore, option B is the correct statement.

Option A is incorrect as outsourcing can be done domestically and may not involve another country.

Option C is incorrect as offshoring can increase the risk of intellectual property theft due to working with new suppliers or partners in a foreign country.

Option D is incorrect as offshoring involves outsourcing certain processes to other countries instead of performing them internally within the firm.

Question 2

Selena, a school teacher working at NSP Elementary School, plans the activities for the sports day of the school. She prepares a list of all the planned activities to be done on that day with time allotted for each activity and decides the sequence to be followed for the activities. This information could be used to construct a(n) _____ for her plan.
A)SWOT matrix
B)inventory checklist
C)critical path
D)Six Sigma model

Accepted Answer

The sequence and time allotted for each activity suggest that Selena is creating a critical path for the sports day plan. A critical path is a project management tool that outlines the sequential activities required to complete a project within a specific timeframe. SWOT matrix, inventory checklist, and Six Sigma model do not seem relevant in this context.

Question 3

Computer-integrated manufacturing results when:
A)computer-aided design is integrated with the critical path method.
B)computer-aided design or computer-aided manufacturing software is integrated with a production unit.
C)computer-aided design or computer-aided manufacturing software system is integrated with robots.
D)computer-aided design is integrated with a cellular layout.

Accepted Answer

The answer of Computer-integrated manufacturing results when:
A)computer-aided design is integrated...

Question 4

Krest Bank has installed over 50 ATMs across the city that allow its customers to deposit cash into their bank accounts at their convenience. In this scenario, Krest Bank offers its customers a _____.
A)nondurable good
B)perishable product
C)service
D)process

Accepted Answer

Krest Bank is offering a service through their ATM machines, which allow customers to deposit cash into their bank accounts.

Question 5

Edith, the CEO of Harry's Inc., a manufacturer of men's apparel, believes in manufacturing large quantities of the company's standardized clothing line to keep the manufacturing costs low. In this scenario, Edith follows:
A)outsourcing.
B)the mass production strategy.
C)the mass customization strategy.
D)vertical integration.

Accepted Answer

Edith is following the mass production strategy, which involves manufacturing large quantities of a standardized product to reduce manufacturing costs. This strategy is often used by companies to generate economies of scale and increase efficiency in production.

Question 6

A _____ falls between the product layout and the process layout.
A)cellular layout
B)combined layout
C)fixed position layout
D)functional layout

Accepted Answer

A cellular layout groups machines and workstations into cells, based on the requirements of the product family being produced. This allows for more efficient and flexible production than a traditional product layout, but is not as customized as a process layout. Therefore, a cellular layout falls between the two.

Question 7

Which of the following statements is true of enterprise resource planning (ERP) systems?
A)They help manage activities along an entire supply chain.
B)They are inexpensive and easy to implement.
C)They require users to enter and access data in traditional ways.
D)They are the software version of the critical path method.

Accepted Answer

ERP systems help manage activities along an entire supply chain, including procurement, production, distribution, and customer service. This integration allows for better coordination and decision-making throughout the organization.

Incorrect options: 
B) ERP systems are often expensive and can be complex to implement. 
C) ERP systems often use modern technology to streamline data entry and access. 
D) The critical path method is a project management tool, not related to ERP systems.

Question 8

The tangible and intangible features of a product are sometimes called the _____.
A)customer benefit package
B)product layout
C)value chain
D)critical path

Accepted Answer

The tangible features of a product are the physical attributes such as size, color, and shape while intangible features are benefits that cannot be touched like convenience, warranty, and customer service. Collectively, these features are known as the customer benefit package. The product layout refers to the arrangement of components in a specific way to achieve the desired final form. The value chain is the series of activities and processes a company undertakes to create and deliver value to customers. The critical path refers to the sequence of activities that must be completed within a project to achieve the desired outcome.

Question 9

Which of the following is a benefit of holding large inventories?
A)Absence of holding costs due to tax exemption
B)Decreased risk of losses due to depreciation
C)Availability of abundant funds
D)Reduced ordering costs

Accepted Answer

Holding large inventories can result in reduced ordering costs, as fewer orders need to be made. However, it is important to note that this benefit needs to be balanced against the potential drawbacks of holding large inventories, such as increased storage and carrying costs. The other options listed in the question (tax exemption, decreased risk of losses due to depreciation, availability of abundant funds) are not typically considered benefits of holding large inventories.

Question 10

Effectiveness means producing products that:
A)are cheap.
B)are mass-produced.
C)create value.
D)create interest.

Accepted Answer

Effectiveness means producing products that create value, not necessarily products that are cheap or mass-produced. Creating interest is also important, but it is not the primary goal of effectiveness.

Question 11

Love Your Feet Inc., a shoe manufacturing company, tries to acquire a certification from the International Organization for Standardization. It ensures the authorities that it continually improves its environmental performance and implements a systematic approach to setting environmental targets and to achieving those targets. In this scenario, which of the following certifications is Love Your Feet trying to acquire?
A)ISO 9000
B)ISO 13485
C)ISO 14001
D)ISO 22000

Accepted Answer

Love Your Feet Inc. is trying to acquire ISO 14001 certification, which is specifically designed for organizations looking to manage their environmental responsibilities in a systematic manner. ISO 9000 is a quality management system standard, ISO 13485 is a medical device quality management systems standard, and ISO 22000 is a food safety management system standard, none of which directly addresses environmental performance.

Question 12

Thermos Inc. recently acquired robots to make thermometers in its factory. Teresa, the CEO of Thermos, instructs her employees to use software to program the robots to manufacture thermometers as efficiently as possible. In this scenario, which of the following software is Thermos Inc. planning to use?
A)Computer-aided manufacturing software
B)Computer-aided design software
C)Computer-aided processing software
D)Computer-aided engineering software

Accepted Answer

Computer-aided manufacturing software is designed to program and control manufacturing processes using computers and robots. In this scenario, Thermos Inc. has acquired robots to manufacture thermometers and wants to use software to make the process efficient. Hence, they will use computer-aided manufacturing software. The other options (B, C, and D) are not relevant to the given scenario.

Question 13

A _____ is used for goods that must be produced at a specific site or that are so large and bulky that it isn't feasible to move them from station to station.
A)process layout
B)product layout
C)fixed position layout
D)cellular layout

Accepted Answer

Fixed position layout is used for goods that must be produced at a specific site or that are so large and bulky that it isn't feasible to move them from station to station. In this layout, the product stays in one place and the workers and equipment move around it to complete the production process.

Question 14

In operations management, _____ means using resources to create value by providing customers with goods and services that offer a better relationship between price and perceived benefits.
A)effectiveness
B)efficiency
C)throughput
D)productivity

Accepted Answer

Effectiveness refers to the ability to meet customer needs by providing products and services that offer a better relationship between price and perceived benefits, thus adding value to the customer. Efficiency, on the other hand, refers to the optimal use of resources to maximize output and minimize waste. Throughput is the rate at which a system produces its output, while productivity refers to the output per unit of input. Therefore, the best choice for the given question is effectiveness.

Question 15

In today's highly competitive global markets, operations managers:
A)realize that a product that offers better features attracts more customers than one that has a lower price.
B)recognize that achieving efficiency is more important than achieving effectiveness.
C)focus primarily on keeping costs low so as to make a profit while keeping prices competitive.
D)focus solely on the benefits of products, while completely ignoring the costs of manufacturing those products.

Accepted Answer

The answer of In today's highly competitive global markets, operations...

Question 16

Kidzo Inc., a toy car company, has several groups in its manufacturing unit dedicated to do different tasks. For example, it has a group that makes toy car wheels, another group that takes care of the contour of cars, and a separate group that assembles all the parts together. In this scenario, Kidzo uses a _____.
A)cellular layout
B)process layout
C)product layout
D)combined layout

Accepted Answer

The answer of Kidzo Inc., a toy car company, has...

Question 17

Abraham, a lead engineer at Softos Inc., wants to test his building designs for flaws and optimize them before submitting them to his clients. Which of the following software is most likely to be used by Abraham for this purpose?
A)Computer-aided design software
B)Computer-aided engineering software
C)Computer-aided manufacturing software
D)Computer-aided processing software

Accepted Answer

Computer-aided engineering software is specifically designed for testing and optimizing designs for flaws before they are produced. Computer-aided design software is used for creating the initial designs, computer-aided manufacturing software is used for automating production processes, and computer-aided processing software is a general term that could refer to any software used for processing data or information. Therefore, B is the most appropriate choice for Abraham's needs.

Question 18

Dazzling Inc., a cosmetics manufacturing company, introduces a new moisturizer at a premium price. Despite this, it is able to generate a large amount of sales and profit from the new product as customers love its anti-ageing and anti-tanning features and do not mind spending more to buy the product. The customers believe that the product is worth its price. In this scenario, Dazzling has incorporated _____ in its business.
A)effectiveness
B)efficiency
C)undifferentiated marketing
D)vertical integration

Accepted Answer

Dazzling has incorporated effectiveness in its business by introducing a new moisturizer that is highly effective and meets the needs of its customers. It has been able to generate sales and profit at a premium price because customers believe the product is worth its price.

Question 19

Identify a benefit of holding larger inventories.
A)Less holding costs
B)Less risk
C)Abundance of funds
D)Smoother production schedules

Accepted Answer

Holding larger inventories can help maintain more stable production schedules as there is less likelihood of running out of raw materials or goods in progress. This can lead to more efficient use of resources and potentially reduce the risk of production disruptions. However, holding larger inventories also comes with increased holding costs and ties up funds in inventory that could be used elsewhere.

Question 20

_____ is an approach to quality improvement characterized by very ambitious quality goals, extensive training of employees, and a long-term commitment to working on quality-related issues.
A)Six Sigma
B)Pareto analysis
C)Just-in-time production
D)Lean production

Accepted Answer

The approach described with very ambitious quality goals, extensive training of employees, and a long-term commitment is characteristic of Six Sigma. Six Sigma is a data-driven approach to quality improvement that seeks to eliminate defects and minimize variability in processes. It involves defining, measuring, analyzing, improving, and controlling processes to achieve high levels of quality.

Quiz 17: Operations Management: Putting It All Together

Which of the following statements is true of offshoring?

Computer-integrated manufacturing results when:

Krest Bank has installed over 50 ATMs across the city that allow its customers to deposit cash into their bank accounts at their convenience. In this scenario, Krest Bank offers its customers a _____.

Edith, the CEO of Harry's Inc., a manufacturer of men's apparel, believes in manufacturing large quantities of the company's standardized clothing line to keep the manufacturing costs low. In this scenario, Edith follows:

A _____ falls between the product layout and the process layout.

Which of the following statements is true of enterprise resource planning (ERP) systems?

The tangible and intangible features of a product are sometimes called the _____.

Which of the following is a benefit of holding large inventories?

Effectiveness means producing products that:

A _____ is used for goods that must be produced at a specific site or that are so large and bulky that it isn't feasible to move them from station to station.

In operations management, _____ means using resources to create value by providing customers with goods and services that offer a better relationship between price and perceived benefits.

In today's highly competitive global markets, operations managers:

Abraham, a lead engineer at Softos Inc., wants to test his building designs for flaws and optimize them before submitting them to his clients. Which of the following software is most likely to be used by Abraham for this purpose?

Identify a benefit of holding larger inventories.

_____ is an approach to quality improvement characterized by very ambitious quality goals, extensive training of employees, and a long-term commitment to working on quality-related issues.