Question 1

A__________matches capacity additions with demand as closely as possible.

Accepted Answer

A)   capacity lag strategy
B)   capacity straddle strategy
C)   capacity lead strategy
D)   capacity reduction strategyE) A) and B)
F) A) and C)

Question 2

Unlike a focused factory, an unfocused factory is characterized by:

Accepted Answer

A)   a few key products.
B)   particular market segments.
C)   identical people skills.
D)   dissimilar product lines.E) All of the above
F) None of the above

Question 3

In the context of strategies for expanding capacity, which of the following statements is true of one large capacity increase

Accepted Answer

A)   This strategy aims to match capacity additions with demand as closely as possible.
B)   An advantage of using this strategy is that the fixed costs of construction and operating system setup need to be incurred only once.
C)   This strategy waits until demand has increased to a point where additional capacity is necessary.
D)   When this strategy is used, there is always excess capacity and safety capacity to meet unexpected demand from large orders is provided.E) B) and C)
F) None of the above

Question 4

Nonbottleneck management principles differ from bottleneck management principles because according to nonbottleneck management principles, _____.

Accepted Answer

A)   idle time is acceptable if there is no work to do
B)   an hour lost at a nonbottleneck resource is an hour lost for the entire process or factory output
C)   large order sizes should be used to minimize setup time and maximize resource utilization
D)   the input should always exceed the capacityE) A) and B)
F) A) and C)

Question 5

Avexim Pharmaceutical Laboratories is an international group of companies that manufactures an antiepileptic prescription drug in huge volumes. The setup time for manufacturing the drug is 75 minutes, the processing time is 8 minutes, and the order size is 700 units. In this case, which of the following is the total time required to meet the given production volume

Accepted Answer

A)   968 minutes
B)   1300 minutes
C)   4275 minutes
D)   5675 minutesE) A) and D)
F) B) and C)

Question 6

A__________consists of dynamic methods to forecast demand, allocate perishable assets across market segments, decide when to overbook and by how much, and determine what price to charge different customer classes.

Accepted Answer

A)   focused factory
B)   work order
C)   revenue management system
D)   nonbottleneck work activityE) A) and D)
F) None of the above

Question 7

In a revenue management system, forecasting, allocation, overbooking, and pricing must work in unison if the objective is to:

Accepted Answer

A)   manage a nonperishable asset.
B)   meet the future demand of goods and services.
C)   determine the single price that needs to be charged to all customers.
D)   maximize the revenue generated by a perishable asset.E) A) and D)
F) A) and C)

Question 8

__________are achieved when the average unit cost of a good or service decreases as the capacity and/or volume of throughput increases.

Accepted Answer

A)   Unfocused factories
B)   Safety capacities
C)   Diseconomies of scale
D)   Economies of scaleE) B) and D)
F) B) and C)

Question 9

Scorla Corp. is an apparel manufacturing factory. Its average resource utilization per year is calculated as 70%. The average safety capacity of Scorla Corp. is _____.

Accepted Answer

A)   20%
B)   30%
C)   40%
D)   50%E) A) and B)
F) None of the above

Question 10

The traditional operations management definition of throughput is:

Accepted Answer

A)   the average number of goods or services completed per time period by a process.
B)   anything in an organization that limits it from moving toward its goal.
C)   associated with the capacity of a resource such as a machine, employee, or workstation.
D)   a physical activity in which idle capacity exists.E) A) and C)
F) A) and B)

Question 11

The earliest revenue management systems focused solely on__________.

Accepted Answer

A)   forecasting
B)   overbooking
C)   allocation
D)   pricingE) C) and D)
F) B) and C)

Question 12

Magnira Hotels is a leading chain of hotels. Its managers reserve 30% of the rooms available only to the members of its club. They also provide the rooms at subsidized prices to these members. In this scenario, which of the following components of revenue management system is most likely used by Magnira Hotels?

Accepted Answer

A)   Investment
B)   Allocation
C)   Capacity expansion
D)   Capacity sharingE) B) and C)
F) A) and B)

Question 13

Greyon Spinning Mills Inc. owns 600 spinning machines. Out of these, only 500 are used in a given year. Given this information, the utilization of spinning machines at Greyon Spinning Mills Inc. is _____.

Accepted Answer

A)   0.75
B)   0.83
C)   1
D)   1.2E) A) and B)
F) A) and C)

Question 14

A _____ is a strategy for expanding capacity that waits until demand has increased to a point where additional capacity is necessary.

Accepted Answer

A)   capacity lag strategy
B)   capacity lead strategy
C)   capacity reduction strategy
D)   capacity match strategyE) None of the above
F) B) and C)

Exam 10: Capacity Management

Greyon Spinning Mills Inc. owns 600 spinning machines. Out of these, only 500 are used in a given year. Given this information, the utilization of spinning machines at Greyon Spinning Mills Inc. is _____.

Correct Answer
verified

A__________matches capacity additions with demand as closely as possible.

Correct Answer
verified

In a revenue management system, forecasting, allocation, overbooking, and pricing must work in unison if the objective is to:

Correct Answer
verified

Correct Answer
verified

A _____ is a strategy for expanding capacity that waits until demand has increased to a point where additional capacity is necessary.

Correct Answer
verified

The traditional operations management definition of throughput is:

Correct Answer
verified

Nonbottleneck management principles differ from bottleneck management principles because according to nonbottleneck management principles, _____.

Correct Answer
verified

In the context of strategies for expanding capacity, which of the following statements is true of one large capacity increase

Correct Answer
verified

A__________consists of dynamic methods to forecast demand, allocate perishable assets across market segments, decide when to overbook and by how much, and determine what price to charge different customer classes.

Correct Answer
verified

__________are achieved when the average unit cost of a good or service decreases as the capacity and/or volume of throughput increases.

Correct Answer
verified

The earliest revenue management systems focused solely on__________.

Correct Answer
verified

Correct Answer
verified

Unlike a focused factory, an unfocused factory is characterized by:

Correct Answer
verified

Scorla Corp. is an apparel manufacturing factory. Its average resource utilization per year is calculated as 70%. The average safety capacity of Scorla Corp. is _____.

Correct Answer
verified

Exam 10: Capacity Management

Greyon Spinning Mills Inc. owns 600 spinning machines. Out of these, only 500 are used in a given year. Given this information, the utilization of spinning machines at Greyon Spinning Mills Inc. is _____.

Correct AnswerverifiedShow Answer

A__________matches capacity additions with demand as closely as possible.

Correct AnswerverifiedShow Answer

In a revenue management system, forecasting, allocation, overbooking, and pricing must work in unison if the objective is to:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A _____ is a strategy for expanding capacity that waits until demand has increased to a point where additional capacity is necessary.

Correct AnswerverifiedShow Answer

The traditional operations management definition of throughput is:

Correct AnswerverifiedShow Answer

Nonbottleneck management principles differ from bottleneck management principles because according to nonbottleneck management principles, _____.

Correct AnswerverifiedShow Answer

In the context of strategies for expanding capacity, which of the following statements is true of one large capacity increase

Correct AnswerverifiedShow Answer

A__________consists of dynamic methods to forecast demand, allocate perishable assets across market segments, decide when to overbook and by how much, and determine what price to charge different customer classes.

Correct AnswerverifiedShow Answer

__________are achieved when the average unit cost of a good or service decreases as the capacity and/or volume of throughput increases.

Correct AnswerverifiedShow Answer

The earliest revenue management systems focused solely on__________.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Unlike a focused factory, an unfocused factory is characterized by:

Correct AnswerverifiedShow Answer

Scorla Corp. is an apparel manufacturing factory. Its average resource utilization per year is calculated as 70%. The average safety capacity of Scorla Corp. is _____.

Correct AnswerverifiedShow Answer

Correct Answer
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