Test Bank – Matching Supply with Demand: Introduction to Operations Management (5th Edition) | Cachon & Terwiesch | ISBN 9781260716276

TEST BANK

MATCHING SUPPLY WITH DEMAND: AN INTRODUCTION TO
OPERATIONS MANAGEMENT

5TH EDITION

CHAPTER NO. 01: INTRODUCTION

1) A central premise in economics is that prices adjust to match supply with demand.
⊚ true
⊚ false
ANS: true


2) Managers view excess demand as resulting in lost revenue.
⊚ true
⊚ false
ANS: true


3) Managers view excess supply as a positive condition.
⊚ true
⊚ false
ANS: false


4) When the COVID-19 pandemic hit the United States and the rest of the world, it created
massive demand for health care professionals while creating a huge shortage of the supply of
personal protective equipment.
⊚ true
⊚ false
ANS: true

,5) The Airbus 380, the largest passenger airliner in 2007, shows how a company appropriately
aligned supply with demand.
⊚ true
⊚ false
ANS: false


6) Firms that understand how to better match supply with demand will achieve a sustainable
form of competitive advantage over their rivals.
⊚ true
⊚ false
ANS: true


7) The ability to match supply with demand is generally not difficult for firms to do well.
⊚ true
⊚ false
ANS: false


8) Even a small improvement in a firm’s operations can significantly enhance its profitability.
⊚ true
⊚ false
ANS: true


9) A qualitative model is a mathematical procedure or equation that takes inputs (such as a
demand forecast, a processing rate) and outputs a number that either instructs a manager on
what to do or informs a manager about a relevant performance measure.
⊚ true
⊚ false
ANS: false

,10) Operations management tools can be applied to ensure that resources are used as efficiently
as possible.
⊚ true
⊚ false
ANS: true


11) Operations management tools can be used to redesign or restructure business operations so
that a firm can improve performance along multiple dimensions simultaneously.
⊚ true
⊚ false
ANS: true


12) The first use of operations management is to ensure that use of organizational resources is
minimized on all key operational dimensions.
⊚ true
⊚ false
ANS: false


13) The second use of operations management is to find the optimal balance between competing
business objectives in order to enhance profitability.
⊚ true
⊚ false
ANS: true


14) The third use of operations management tools is to fundamentally question the design of the
current system itself.
⊚ true
⊚ false
ANS: true

, 15) A qualitative strategy refers to a guiding principle for increasing operational flexibility and
enhancing customer service.
⊚ true
⊚ false
ANS: true


16) A central premise in economics is to match __________ and __________.
A) strategy; structure
B) costs; profits
C) supply; demand
D) efficiency; effectiveness
E) processes; outcomes
ANS: C


17) From the perspective of managers, excess demand is viewed as being associated with
A) loss of revenue.
B) increased revenue.
C) increased profits.
D) reduced productivity.
E) increase efficiency.


ANS: A
18) From the perspective of managers, excess supply is viewed as being associated with
A) loss of revenue.
B) wasted resources.
C) increased profits.
D) reduced productivity.
E) increased efficiency.
ANS: B