OPMA 3306 Operations Management Final Exam Questions And Correct
Detailed Answers
1. In Quality Management, "Internal Failure Costs" occur when:
A.A customer returns a defective product.
B.A defect is discovered and corrected before the product is
shipped to the customer.
C. An employee is fired for a mistake.
D.The company's stock price drops.
Answer:B
Rationale: These include costs like scrap, rework, and downtime caused
by defects caught inside the facility.
2. What is the purpose of ABC Analysis?
A.To teach employees how to read.
B. To categorize inventory items based on their annual dollar
volume to prioritize control efforts.
C.To organize the warehouse alphabetically.
D.To determine the company's credit rating.
Answer:B
Rationale: Class A items are the most valuable and receive the most
attention, while Class C items are low-value and managed more loosely.
3. A Fixed-Position Layout is most appropriate for:
A.Making bread in a bakery.
B. Building a large cruise ship or a bridge.
C.An insurance company's call center.
D.A fast-food restaurant.
Answer:B
Rationale: In this layout, the product stays in one place because it is too
large to move; workers and equipment are brought to the product.
4. What is "Sustainability" in Operations Management?
A. Keeping the machines running for 24 hours.
B.Doing business in a way that meets current needs without
compromising the ability of future generations to meet theirs.
C. Ensuring the company never changes its strategy.
D. Having enough cash to pay all bills.
, Answer:B
Rationale:This includes environmental protection, social
responsibility, and economic viability (the Triple Bottom Line).
5. The Service Gap Model identifies "Gap 3" as the difference
between:
A.Customer expectations and management perceptions.
B.Service quality specifications and the actual service delivered.
C. Management perceptions and service quality specifications.
D.What the customer expected and what they perceived they
received.
Answer:B
Rationale: This is the "service performance gap,"where the actual delivery
of the service fails to meet the standards set by the company.
6. Which of the following is a Waste (Muda) in Lean
thinking?
A. Motion (unnecessary movement of people).
B.High quality.
C.Employee training.
D.Paying suppliers on time.
Answer:A
Rationale: The seven wastes include overproduction,
waiting,transportation, over-processing, inventory, motion, and
defects.
7. In Linear Programming, what is the "Objective
Function"?
A.The list of rules the company must follow.
B.The mathematical expression that describes the goal of the
problem(e.g.,maximize profit).
C.The region where all constraints overlap.
D.The person who solves the problem.
Answer:B
Rationale: The objective function defines what you are trying to
achieve numerically.
8. Total Quality Management (TQM) emphasizes:
A. Inspecting every product at the end of the line.
B.A total organizational commitment to continuous improvement and
customer satisfaction.
C. Reducing the number of products offered.
, D. Increasing the price of products to reflect their quality.
Answer:B
Rationale: TQM is a culture-wide approach, not just a set of
inspection rules.
9. What is the "Critical Ratio"?
A.The number of managers per worker.
B.(Time remaining until due date) / (Work time remaining).
C. Total Profit/Total Cost.
D.The height of a machine divided by its width.
Answer:B
Rationale: A ratio less than 1.0 means the job is behind schedule and
should be prioritized.
10. Which of the following is an example of Postponement?
A.Delaying the payment of taxes.
B. Keeping a product in a generic form and only finalizing it once a
customer order is received (e.g., mixing paint colors at the store).
C. Moving the factory to a different state next year.
D.Waiting until the end of the day to clean the floor.
Answer:B
Rationale: Postponement reduces inventory risk and allows for
greater customization without high holding costs.
11. In Queueing Theory, "Service Rate" (\(\mu \))is:
A.The number of customers arriving per hour.
B. The number of customers a server can handle per unit of time.
C. The total time a customer spends in the line.
D.The cost of providing the service.
Answer:B
Rationale: \(\mu|)represents the capacity of the server to
process customers.
12. What is "Vertical Integration"?
A.Hiring people of different heights.
B.A company expanding its business into different stages of
production along the same supply chain.
C. Moving the office to a taller building.
D.Selling products to many different industries.
Answer:B
Rationale: It can be forward (toward the customer) or backward
(toward the supoplier).
Detailed Answers
1. In Quality Management, "Internal Failure Costs" occur when:
A.A customer returns a defective product.
B.A defect is discovered and corrected before the product is
shipped to the customer.
C. An employee is fired for a mistake.
D.The company's stock price drops.
Answer:B
Rationale: These include costs like scrap, rework, and downtime caused
by defects caught inside the facility.
2. What is the purpose of ABC Analysis?
A.To teach employees how to read.
B. To categorize inventory items based on their annual dollar
volume to prioritize control efforts.
C.To organize the warehouse alphabetically.
D.To determine the company's credit rating.
Answer:B
Rationale: Class A items are the most valuable and receive the most
attention, while Class C items are low-value and managed more loosely.
3. A Fixed-Position Layout is most appropriate for:
A.Making bread in a bakery.
B. Building a large cruise ship or a bridge.
C.An insurance company's call center.
D.A fast-food restaurant.
Answer:B
Rationale: In this layout, the product stays in one place because it is too
large to move; workers and equipment are brought to the product.
4. What is "Sustainability" in Operations Management?
A. Keeping the machines running for 24 hours.
B.Doing business in a way that meets current needs without
compromising the ability of future generations to meet theirs.
C. Ensuring the company never changes its strategy.
D. Having enough cash to pay all bills.
, Answer:B
Rationale:This includes environmental protection, social
responsibility, and economic viability (the Triple Bottom Line).
5. The Service Gap Model identifies "Gap 3" as the difference
between:
A.Customer expectations and management perceptions.
B.Service quality specifications and the actual service delivered.
C. Management perceptions and service quality specifications.
D.What the customer expected and what they perceived they
received.
Answer:B
Rationale: This is the "service performance gap,"where the actual delivery
of the service fails to meet the standards set by the company.
6. Which of the following is a Waste (Muda) in Lean
thinking?
A. Motion (unnecessary movement of people).
B.High quality.
C.Employee training.
D.Paying suppliers on time.
Answer:A
Rationale: The seven wastes include overproduction,
waiting,transportation, over-processing, inventory, motion, and
defects.
7. In Linear Programming, what is the "Objective
Function"?
A.The list of rules the company must follow.
B.The mathematical expression that describes the goal of the
problem(e.g.,maximize profit).
C.The region where all constraints overlap.
D.The person who solves the problem.
Answer:B
Rationale: The objective function defines what you are trying to
achieve numerically.
8. Total Quality Management (TQM) emphasizes:
A. Inspecting every product at the end of the line.
B.A total organizational commitment to continuous improvement and
customer satisfaction.
C. Reducing the number of products offered.
, D. Increasing the price of products to reflect their quality.
Answer:B
Rationale: TQM is a culture-wide approach, not just a set of
inspection rules.
9. What is the "Critical Ratio"?
A.The number of managers per worker.
B.(Time remaining until due date) / (Work time remaining).
C. Total Profit/Total Cost.
D.The height of a machine divided by its width.
Answer:B
Rationale: A ratio less than 1.0 means the job is behind schedule and
should be prioritized.
10. Which of the following is an example of Postponement?
A.Delaying the payment of taxes.
B. Keeping a product in a generic form and only finalizing it once a
customer order is received (e.g., mixing paint colors at the store).
C. Moving the factory to a different state next year.
D.Waiting until the end of the day to clean the floor.
Answer:B
Rationale: Postponement reduces inventory risk and allows for
greater customization without high holding costs.
11. In Queueing Theory, "Service Rate" (\(\mu \))is:
A.The number of customers arriving per hour.
B. The number of customers a server can handle per unit of time.
C. The total time a customer spends in the line.
D.The cost of providing the service.
Answer:B
Rationale: \(\mu|)represents the capacity of the server to
process customers.
12. What is "Vertical Integration"?
A.Hiring people of different heights.
B.A company expanding its business into different stages of
production along the same supply chain.
C. Moving the office to a taller building.
D.Selling products to many different industries.
Answer:B
Rationale: It can be forward (toward the customer) or backward
(toward the supoplier).
