Liberty University BUSI 411 Operations Management Final
Exam 2. Questions & Answers (Graded A)
NB: EVERY ANSWER IS CORRECT
Question 1
Which of the following is a key question in capacity planning?
Answer When do we need the capacity?
:
Question 2
Utilization is defined as the ratio of:
Answer Actual output to design capacity.
:
Question 3
Given the following information, what would utilization be?
Effective capacity = 20 units per day
Design capacity = 60 units per day
Actual output = 15 units per day
Answer: 25%
Question 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:
Answer: 500.
Question 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?
Answer: 2,000
, Question 6
An operations strategy for process selection should recognize that:
Answer: Flexibility is not always the best choice.
Question 7
Computer-aided manufacturing refers to the use of computers in:
Answer: Process control.
Question 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:
Distances (meters)
From/To I II III
I - 10 20
II - 10
III -
Flows (loads per week)
From/To X Y Z
X - 60 90
Y 40 - 160
Z 110 140 -
What is the distance (in meters) from area III to area I in this new facility?
Answer: 20
Question 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:
Time(secs Immediate
Task ) Predecessor
a 34 none
b 20 a
c 10 b
Exam 2. Questions & Answers (Graded A)
NB: EVERY ANSWER IS CORRECT
Question 1
Which of the following is a key question in capacity planning?
Answer When do we need the capacity?
:
Question 2
Utilization is defined as the ratio of:
Answer Actual output to design capacity.
:
Question 3
Given the following information, what would utilization be?
Effective capacity = 20 units per day
Design capacity = 60 units per day
Actual output = 15 units per day
Answer: 25%
Question 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:
Answer: 500.
Question 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?
Answer: 2,000
, Question 6
An operations strategy for process selection should recognize that:
Answer: Flexibility is not always the best choice.
Question 7
Computer-aided manufacturing refers to the use of computers in:
Answer: Process control.
Question 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:
Distances (meters)
From/To I II III
I - 10 20
II - 10
III -
Flows (loads per week)
From/To X Y Z
X - 60 90
Y 40 - 160
Z 110 140 -
What is the distance (in meters) from area III to area I in this new facility?
Answer: 20
Question 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:
Time(secs Immediate
Task ) Predecessor
a 34 none
b 20 a
c 10 b
