OSCM 373 Exam 3 Review Quiz UPDATED ACTUAL QUESTIONS AND CORRECT
ANSWERS
What is the primary objective of Economic Order B) Minimize total ordering and holding costs
Quantity (EOQ)? A) Maximize revenue B) Minimize total
ordering and holding costs C) Reduce lead time D)
Increase safety stock
EOQ assumes which of the following? A) Variable B) Constant demand
demand B) Constant demand C) Seasonal demand D)
Random shortages
In the EOQ model, increasing ordering cost will B) Increase EOQ
generally: A) Lower EOQ B) Increase EOQ C) Not affect
EOQ D) Eliminate safety stock
Reorder point is primarily determined by: A) Demand A) Demand during lead time
during lead time B) Annual demand only C) Holding cost
D) Order quantity
Safety stock is maintained primarily to: A) Reduce setup B) Prevent stockouts
costs B) Prevent stockouts C) Lower demand D) Increase
defects
Higher desired service levels generally require: A) Less B) More safety stock
safety stock B) More safety stock C) Lower demand D)
Lower lead time
A Type I error in control charts means: A) Missing a real B) False alarm
problem B) False alarm C) Perfect control D) Higher
capability
A Type II error in process control means: A) False alarm B) Missing assignable variation
B) Missing assignable variation C) Better quality D) Zero
defects
Double-checking finished work is what cost of quality? A) B) Appraisal
Prevention B) Appraisal C) Internal failure D) External
failure
Training workers to avoid defects is a: A) Prevention cost A) Prevention cost
B) Appraisal cost C) External failure cost D) Internal
failure cost
, Increasing process capability is best achieved by: A) C) Reducing variability
Raising mean B) Increasing variability C) Reducing
variability D) Widening specs
If process variability decreases, capability generally: A) B) Increases
Decreases B) Increases C) Stays constant D) Becomes
zero
Control limits are based on: A) Customer specs B) B) Process variation
Process variation C) Product price D) Demand levels
Specification limits are set by: A) The process B) B) Customers/design
Customers/design C) Random sampling D) Control charts
Lean focuses primarily on eliminating: A) Capacity B) B) Waste
Waste C) Demand D) Quality
Which is NOT one of the classic wastes? A) Waiting B) C) Modular variety
Overproduction C) Modular variety D) Defects
Kanban is primarily used for: A) Forecasting B) Pull B) Pull production control
production control C) Financial control D) Layout analysis
Increasing kanban inefficiency factor generally: A) Lowers B) Increases containers needed
containers needed B) Increases containers needed C) No
effect D) Eliminates buffers
Converting internal setup to external setup helps reduce: B) Setup time
A) Demand B) Setup time C) Defects D) Transportation
SMED is associated with: A) Forecasting B) Setup B) Setup reduction
reduction C) Inventory valuation D) Scheduling
customers
Takt time is based on: A) Available production time and A) Available production time and demand
demand B) Only cycle time C) EOQ D) Safety stock
If cycle time exceeds takt time: A) Demand may not be A) Demand may not be met
met B) Inventory disappears C) Quality improves D)
Variability ends
Factor-rating location decisions use: A) Weighted scores A) Weighted scores
B) Regression only C) EOQ D) Queuing
ANSWERS
What is the primary objective of Economic Order B) Minimize total ordering and holding costs
Quantity (EOQ)? A) Maximize revenue B) Minimize total
ordering and holding costs C) Reduce lead time D)
Increase safety stock
EOQ assumes which of the following? A) Variable B) Constant demand
demand B) Constant demand C) Seasonal demand D)
Random shortages
In the EOQ model, increasing ordering cost will B) Increase EOQ
generally: A) Lower EOQ B) Increase EOQ C) Not affect
EOQ D) Eliminate safety stock
Reorder point is primarily determined by: A) Demand A) Demand during lead time
during lead time B) Annual demand only C) Holding cost
D) Order quantity
Safety stock is maintained primarily to: A) Reduce setup B) Prevent stockouts
costs B) Prevent stockouts C) Lower demand D) Increase
defects
Higher desired service levels generally require: A) Less B) More safety stock
safety stock B) More safety stock C) Lower demand D)
Lower lead time
A Type I error in control charts means: A) Missing a real B) False alarm
problem B) False alarm C) Perfect control D) Higher
capability
A Type II error in process control means: A) False alarm B) Missing assignable variation
B) Missing assignable variation C) Better quality D) Zero
defects
Double-checking finished work is what cost of quality? A) B) Appraisal
Prevention B) Appraisal C) Internal failure D) External
failure
Training workers to avoid defects is a: A) Prevention cost A) Prevention cost
B) Appraisal cost C) External failure cost D) Internal
failure cost
, Increasing process capability is best achieved by: A) C) Reducing variability
Raising mean B) Increasing variability C) Reducing
variability D) Widening specs
If process variability decreases, capability generally: A) B) Increases
Decreases B) Increases C) Stays constant D) Becomes
zero
Control limits are based on: A) Customer specs B) B) Process variation
Process variation C) Product price D) Demand levels
Specification limits are set by: A) The process B) B) Customers/design
Customers/design C) Random sampling D) Control charts
Lean focuses primarily on eliminating: A) Capacity B) B) Waste
Waste C) Demand D) Quality
Which is NOT one of the classic wastes? A) Waiting B) C) Modular variety
Overproduction C) Modular variety D) Defects
Kanban is primarily used for: A) Forecasting B) Pull B) Pull production control
production control C) Financial control D) Layout analysis
Increasing kanban inefficiency factor generally: A) Lowers B) Increases containers needed
containers needed B) Increases containers needed C) No
effect D) Eliminates buffers
Converting internal setup to external setup helps reduce: B) Setup time
A) Demand B) Setup time C) Defects D) Transportation
SMED is associated with: A) Forecasting B) Setup B) Setup reduction
reduction C) Inventory valuation D) Scheduling
customers
Takt time is based on: A) Available production time and A) Available production time and demand
demand B) Only cycle time C) EOQ D) Safety stock
If cycle time exceeds takt time: A) Demand may not be A) Demand may not be met
met B) Inventory disappears C) Quality improves D)
Variability ends
Factor-rating location decisions use: A) Weighted scores A) Weighted scores
B) Regression only C) EOQ D) Queuing
