MGMT 480 CHAPTER 10 MULTICHOICE – Flashcards
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1. Average safety capacity (%) is computed as a. Average resource utilization (%) 100% b. 100% average resource utilization (%) c. [maximum safety capacity (%) + minimum safety capacity (%)]/2 d. 100% maximum resource utilization (%)
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B
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Safety capacity is intended for all of the following except a. power outages b. equipment breakdowns c. seasonal demand d. material shortages
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C
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The long-term capacity expansion strategy that can be called a capacity straddle strategy is a. One large capacity increase b. Small capacity increases that match demand c. Small capacity increases that lead demand d. Small capacity increases that lag demand
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B
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Safety capacity or a capacity cushion is a. needed for processes with little demand variability b. provided for anticipated events c. generally higher in a job shop d. not appropriate for service organizations
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C
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C&M Machining is developing plans for a dedicated production line and needs to determine how many drill presses will be needed. Engineering estimates are that one drill press will be able to process 120 parts per hour. Daily demand is 2,400 parts. C&M operates one 8-hour shift per day. How many drill presses are needed to meet the capacity requirements? a. 2 drills b. 3 drills c. 4 drills d. 5 drills
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B
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In service organizations, capacity is more often viewed as ____. a. The maximum rate of output per unit time b. Units of resource availability c. The ability to meet any customer demand d. The amount of overtime scheduled
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B
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Which of the following is a short-term capacity decision? a. Expanding the size and number of beds in a hospital b. Amount of warehouse space to rent for a new promotional item c. Closing down a distribution center d. Changing the cooking technology in a chain of fast-food restaurants
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B
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When the average unit cost of a good or service decreases as the capacity and/or volume of throughput increases, it is called ____. a. Economies of scale b. Diseconomies of scale c. Cost cushioning d. A nonphysical constraint
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A
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A focused factory is least likely to focus on a. A few key products b. A specific technology c. A certain process design and capability d. A seasonal demand good
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D
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Safety capacity is most closely related to a. Bottlenecks b. Economies of scale c. Unanticipated events d. Focused factory
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C
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Safety capacity or a capacity cushion is a. Needed for processes with little demand variability b. Generally higher in a job shop c. Not appropriate for service organizations d. Provided for anticipated events
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B
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Which of the following is not a key consideration in long-term capacity strategy? a. Equipment sharing b. Initial investment in facilities and equipment c. Annual cost of operating and maintaining facilities and equipment d. Opportunity loss incurred from lost sales and reduced market share
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A
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The capacity expansion approach that provides the most safety capacity is a. One large capacity increase b. Small capacity increases that match demand c. Small capacity increases that lead demand d. Small capacity increases that lag demand
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C
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A firm will encounter short periods of over- and under-utilization with which of the following capacity expansion approaches? a. One large capacity increase b. Small capacity increases that match demand c. Small capacity increases that lead demand d. Small capacity increases that lag demand
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B
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A capacity straddle strategy is related to a. One large capacity increase b. Small capacity increases that match average demand c. Small capacity increases that lead demand d. Small capacity increases that lag demand
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B
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All the following are means to adjust short-term capacity except a. Add peripheral goods and/or services b. Add or share equipment c. Sell unused capacity d. Change labor skill mix
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A
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All the following are means to manage capacity by shifting and stimulating demand except a. Vary price of goods or services b. Add peripheral goods and/or services c. Provide reservations d. Shift work to slack periods
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D
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According to the Theory of Constraints, ____ is the amount of money generated per time period through actual sales. a. Throughput b. Non-Bottleneck (NBN) work activity c. Non-physical constraint d. Utilization
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A
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Which of the following is not correct relating to bottleneck resources? a. Should be scheduled first b. An hour lost is an hour lost for the entire process or factory output c. Use large order sizes d. Should plan safety capacity
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D
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For a non-bottleneck activity, a. Utilization must be near 100% b. An hour lost has no effect on total process or factory output c. Use large order sizes to minimize setups d. Work-in-process buffer inventory should be placed in front of non-bottlenecks
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B
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An entity in which idle capacity exists is called a ____. a. Bottleneck work activity b. Physical constraint c. Non-bottleneck work activity d. Nonphysical constraint
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C
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A doctor's office would charge no-show patients $30 if they did not cancel their appointment 24 hours ahead of the appointment because a. insurance will pay the no-show fee anyway. b. the appointment time and associated revenue is perishable, and the doctor may lose revenue. c. the doctor's office does a poor job of forecasting demand. d. the no-show price of $30 can be added to medical fees for reimbursement.
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B
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Referring to a Revenue Management System (RMS), which of the following is not a component? a. Marketing b. Forecasting c. Pricing d. Allocating
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A
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Revenue Management Systems (RMS) a. are batched daily b. rely solely on overbooking c. are cost minimization models d. are time-dependent
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D
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An organization that would typically use a revenue management system is a. Computer manufacturer b. Fast food restaurant c. Car rental company d. Package delivery service
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C
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Chapter 10 describes how a clogged court system tried to solve the bottleneck problem regarding the processing of tens of thousands of foreclosures by a. hiring extra retired judges to process foreclosures. b. shifting civil and criminal court work to slack periods so foreclosures could be processed. c. increase the price of court filing fees to influence demand. d. apply the Theory of Constraints to this court system.
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A
