Question 1

Firms that have demands that fluctuate significantly depending on the season may temporarily hold large inventories in order to smooth out their production schedules.

Accepted Answer

Firms with seasonal demand often hold large inventories to prevent production disruptions during high demand periods. This helps them maintain stable production schedules and keep their customers satisfied.

Question 2

Immediate predecessors are activities in a project that are independent of any other project activities,and thus have no effect on when these other activities are performed.

Accepted Answer

Immediate predecessors are activities that must be completed directly before a subsequent activity can begin, indicating a dependency rather than independence.

Question 3

Manufacturing firms always find it desirable to hold large inventories of raw materials,components and parts,work-in-process,and finished goods.The goal is to always have these items available for immediate needs.

Accepted Answer

Holding large inventories can be costly due to storage, insurance, and potential obsolescence. Firms often aim to optimize inventory levels to balance availability with cost efficiency.

Question 4

The assembly line is a production process in which the product moves from one station to another in a fixed sequence,with the machinery and workers at each station performing specialized tasks.

Accepted Answer

The statement describes the assembly line production process, which involves a fixed sequence of stations where workers and machinery perform specialized tasks on the product.

Question 5

The Critical Path Method may illustrate several different paths that must be completed in order to complete the entire project.

Accepted Answer

The Critical Path Method (CPM) is a project management technique that identifies the sequence of activities that must be completed on time in order to complete the project on schedule. The CPM may reveal multiple critical paths, each representing a sequence of activities that must be completed in order to finish the project within the required time frame. Therefore, statement A is correct.

Question 6

The Critical Path Method focuses on controlling inventory levels during the production process to ensure that enough parts and materials are available to support production.

Accepted Answer

The Critical Path Method is a project management tool that is used to schedule activities and ensure that the project is completed on time. It does not focus on inventory control during production.

Question 7

Gantt charts are used to illustrate the mix of product lines a firm includes in its overall product mix.

Accepted Answer

Gantt charts are typically used in project management to illustrate the duration of tasks and their dependencies. They are not typically used to illustrate product lines in a firm's overall product mix.

Question 8

Although workers in less wealthy nations earn lower wages than Canadian workers,they also may have less education and experience,resulting in much lower productivity.

Accepted Answer

This statement is true. Lower wages in less wealthy nations are often a reflection of lower productivity due to factors such as lower education and experience levels among workers.

Question 9

A continuous flow process is most useful when a firm produces a variety of products in small batches and wants to switch quickly from the production of one good to another.

Accepted Answer

A continuous flow process is designed for large-scale production of a standardized product, where the production process runs continuously without interruption. It is not suited for switching quickly from one product to another or producing small batches, which would require frequent retooling and reconfiguration of the production line. A better option for producing a variety of products in small batches would be a flexible manufacturing system or a job shop.

Question 10

The funds tied up in holding large inventories may have more profitable uses elsewhere in an organization.

Accepted Answer

Holding large inventories ties up funds that could be used for other purposes such as investing in research and development, expanding the business or paying off debt. By reducing inventory levels, companies can free up cash and invest it in areas that can generate higher returns. Therefore, the statement is true.

Question 11

A project is usually inexpensive and involves the production of a standardized product in high volumes.

Accepted Answer

A project is a temporary endeavor that is unique in nature and involves a set of activities that are aimed at achieving a specific goal. It is not necessarily standardized or produced in high volumes, and its cost can vary greatly depending on its scope and complexity.

Question 12

One weakness of the Critical Path Method is that it doesn't provide a way to determine the sequence in which the activities involved in a project must be performed.

Accepted Answer

The statement is incorrect. The Critical Path Method does provide a way to determine the sequence in which the activities involved in a project must be performed. In fact, determining the sequence of activities is one of the key steps in creating a Critical Path Method schedule.

Question 13

The selection of the best type of process for a given type of production is influenced by the volume of production and the degree to which the output is standardized.

Accepted Answer

The volume of production and degree of standardization are important factors in selecting the most suitable production process.

Question 14

Inventory consists of the stocks of finished items,works-in-process,parts,materials,or other resources held by an organization.

Accepted Answer

This statement is true. Inventory refers to the assets held by an organization that are intended for sale or for use in production or service delivery. It can include finished products, as well as raw materials, work-in-progress, and other resources. Proper inventory management is important for efficient operations and customer satisfaction.

Question 15

A main difference between a continuous flow process activity and a project would include the fact that a project is usually very complex and the good or service is produced in very low volumes,whereas a continuous flow process activity is generally more standardized and the good or service is usually produced in high volumes.

Accepted Answer

This statement accurately describes a main difference between continuous flow process activity and a project. Projects typically involve a unique or complex set of activities, whereas continuous flow process activities involve standardized or repeatable processes to produce goods or services in high volumes.

Question 16

The Critical Path Method is a project management tool that illustrates the relationships among the activities involved in completing a project and enables managers to identify those activities that are most likely to create delays in the completion of the overall project.

Accepted Answer

The statement accurately describes the Critical Path Method.

Question 17

In a critical path network,those activities that aren't on the critical path typically have some slack,meaning that a delay in their completion is unlikely to create a delay in the completion of the overall project-as long as the delay isn't too great.

Accepted Answer

This statement is true. Activities that are not on the critical path have slack time and can be delayed without affecting the overall completion of the project as long as the delay is within the amount of slack available.

Question 18

A major reason Canadian businesses outsource operational activities overseas is to take advantage of the low cost of labour and other resources.

Accepted Answer

Canadian businesses often outsource operational activities overseas to reduce their costs by taking advantage of the lower cost of labour and resources in other countries.

Question 19

The critical path in a project is the sequence of activities expected to take the longest to complete.Any delay in an activity on the critical path is likely to create a delay in completing the project.

Accepted Answer

This statement accurately describes the nature and importance of the critical path in project management. Any delay in an activity on the critical path can cause a delay in the completion of the entire project.

Question 20

Wages earned by workers in the nation of Ruritania are only a third as high as the wages paid to Canadian workers.This clearly means that Canadian firms that outsource production to Ruritania will enjoy much lower costs of production.

Accepted Answer

While lower wages in Ruritania might reduce labor costs, the overall cost of production also depends on other factors such as productivity, quality of infrastructure, transportation costs, tariffs, and the cost of materials, which might offset the lower labor costs.

Quiz 16: Operations Management: Putting It All Together