BUSI 411 Exam 2, Operations Management (QUESTIONS AND ANSWERS)

1. Which of the following is a key question in capacity planning? 2. Utilization is defined as the ratio of: 3. Given the following information, what would utilization be? 4. An alternative will have fixed costs of $10,000 per month, variable costs of $50 per unit, and revenue of $70 per unit. The break-even point volume is: 5. A Virginia county is considering whether to pay $50,000 per year to lease a prisoner transfer facility in a prime location near Washington, D.C. They estimate it will cost $50 per prisoner to process the paperwork at this new location. The county is paid a $75 commission for each new prisoner they process. How many prisoners would they have to process annually to break even at this new location? 6. An operations strategy for process selection should recognize that: 7. Computer-aided manufacturing refers to the use of computers in: 8. A company needs to locate three departments (X, Y, and Z) in the three areas (I, II, and III) of a new facility. They want to minimize interdepartmental transportation costs, which are expected to be $.50 per load per meter moved. An analyst has prepared the following distances and flow matrices: 9. QRS Corp. is designing a product layout for a new product. They plan to use this production line 10 hours a day in order to meet forecasted demand of 900 units per day. The following table describes the tasks necessary to produce this product: 10. What is it about job shops that make them appropriate for products in the introductory phase of their life cycle? 11. Which of the following most closely describes job enlargement? 12. A methods and measurements analyst for Digital Devices needs to develop a time standard for the task of assembling a computer mouse. In a preliminary study, she observed one of her workers perform this task six times with the following results: 13. The symbols for operation, storage, transportation, inspection, and delay would usually be found on which type of chart? 14. A methods and measurements analyst for Timepiece, Inc., needs to develop a time standard for the task of attaching a watch to a wristband. In a preliminary study, he observed one of his workers perform this task five times, with the following results: 15. A methods and measurement analyst wants to develop a time standard for a certain task. In a preliminary study, he observed one worker perform the task six times with an average observed time of 20 seconds and a standard deviation of two seconds. 16. Nearness to raw materials would be most important to a: 17. A manufacturing firm is considering two locations for a plant to produce a new product. The two locations have fixed and variable costs as follows: 18. Location choice I has monthly fixed costs of $100,000 and per-unit variable costs of $10. What would its total cost be at a monthly volume of 250 units? 19. A hardware distributor has regional warehouses at the locations shown below. The company wants to locate a new central distribution center to serve this warehouse network. 20. The center of gravity method is used to _______ travel time or shipping costs. 21. Capacity planning requires an analysis of needs: what kind, how much, and when. 22. The goal of line balancing is to assign tasks to workstations in such a way that the workstations have approximately equal time requirements. 23. Predetermined time standards use historical data from a company's own files. 24. Web-based, retail businesses should be located near the customer to reduce their long distance phone charges. 25. The fact that most types of firms are located in every section of the country suggests that in many cases, location decisions are not overly important; one location typically is as good as another.