OMGT Test 2 Study Guide | Operations Management Exam Review, Key Concepts & Practice
Questions
Capacity is the capability of a worker, machine, work center, plant, or organization to produce
output per time period. - ANS ✔✔True
A traditional university classroom has room for 30 students and is scheduled for use during 12
consecutive one hour periods from 8:00 a.m. to 8:00 p.m. in the spring semester. Its theoretical
capacity is therefore half of its rated capacity. - ANS ✔✔False
In general, higher conformance quality reduces capacity since the extra care taken during
production slows the output rate. - ANS ✔✔False
A firm's capacity can be limited by members of its supply chain - ANS ✔✔True
A firm is able to meet current demand. If it adopts a lead capacity strategy, then it is probably
making the assumption that demand will increase in the future. - ANS ✔✔True
Virtual supply chains have the advantage of efficiency, but this advantage is gained in a trade-off
with decreased flexibility. - ANS ✔✔False
Building rental and depreciation on capital equipment are examples of fixed costs - ANS
✔✔True
For a given fixed cost and revenue, as the variable cost rises, the break-even point also rises -
ANS ✔✔False
A business analyst identifies three possible demand levels for the new service they are
considering for the new year. In addition to the levels of demand, the analyst estimates the
likelihood of occurrence for each of these levels of demand. If he calculates the expected value
,of demand he should expect that the calculated value matches one of the three levels he
originally identified. - ANS ✔✔False
In a decision tree, outcome points are under direct control of the decision maker and show the
results of choices - ANS ✔✔False
The break-even formula (fixed cost/R-VC) does not include a provision for a price break if a
customer purchases a large quantity - ANS ✔✔True
Learning curve theory suggests that productivity will increase as people and systems learn to
perform tasks more efficiently. - ANS ✔✔True
A ninety percent learning curve is steeper than an eighty percent learning curve - ANS ✔✔False
A firm is more likely to develop the internal capacity to perform activities that are strategically
important to its success than it is to outsource those activities. - ANS ✔✔True
The Theory of Constraints would support the statement that a chain is only as strong as its
weakest link. - ANS ✔✔True
A busy toll highway that has four toll collectors for northbound traffic is an example of a single-
channel, single-phase system - ANS ✔✔False
In operations and supply chain environments that must deal with random demand, it is virtually
impossible to achieve very high capacity utilization levels and still provide acceptable customer
service - ANS ✔✔True
In waiting line theory, the number of channels refers to the number of customer waiting lines in
the system - ANS ✔✔True
,In most waiting line models, customers are assumed to arrive at random intervals, based on a
normal distribution - ANS ✔✔false
The Greek letter lambda (λ) is used to represent the service rate of a waiting line system - ANS
✔✔False
A waiting line cannot be both multiple-channel and multiple-phase - ANS ✔✔False
All waiting line formulas assume that customers are served on a first-come first-served (FCFS)
basis - ANS ✔✔True
With only a half hour for lunch I screamed into the parking lot of the nearest Golden Arches
Supper Club at 40 miles an hour. When I saw the drive through line was 15 cars deep I didn't
bother getting in line; I was off to visit the Colonel. This behavior might be described as balking -
ANS ✔✔True
Everything about two different waiting line systems is the same except one system has a
constant service time and the other has a Poisson distributed service time. Customers using the
system with the constant service time will have half the waiting time of the customers using the
system with Poisson distributed service times - ANS ✔✔True
The term time compression refers to the phenomenon that a server tends to speed up the
service process if the waiting line exceeds some critical number of customers. - ANS ✔✔False
It is more costly to create a more realistic simulation than one that is less realistic - ANS ✔✔True
In most cases, simulation models provide optimal solutions to problems just like most of the
equations presented in your textbook - ANS ✔✔False
, Monte Carlo simulation uses statistical sampling to create outcomes for a large number of trials
- ANS ✔✔True
Customers enter the stadium and purchase refreshments before they are shown to their seats
by experienced ushers. The customers are considered objects in the simulation model - ANS
✔✔True
Customers enter the stadium and purchase refreshments before they are shown to their seats
by experienced ushers. The concession stand lines are considered elements in the simulation
model - ANS ✔✔False
A customer enters a business and has the opportunity to select any one of three lines to receive
service. The service is performed by one customer service representative after which the
customer leaves the establishment. Which description of this waiting line system is appropriate?
A) single channel, single phase
B) single channel, multiple phase
C) multiple channel, single phase
D) multiple channel, multiple phase - ANS ✔✔c
A customer enters a business and joins the one line that snakes back and forth through the
lobby in order to receive service. The initial part of the service is performed by one customer
service representative, after which the customer enters a second, shorter line to complete the
service before leaving the establishment. Which description of this waiting line system is
appropriate?
A) single channel, single phase
B) single channel, multiple phase
C) multiple channel, single phase
D) multiple channel, multiple phase - ANS ✔✔B
Questions
Capacity is the capability of a worker, machine, work center, plant, or organization to produce
output per time period. - ANS ✔✔True
A traditional university classroom has room for 30 students and is scheduled for use during 12
consecutive one hour periods from 8:00 a.m. to 8:00 p.m. in the spring semester. Its theoretical
capacity is therefore half of its rated capacity. - ANS ✔✔False
In general, higher conformance quality reduces capacity since the extra care taken during
production slows the output rate. - ANS ✔✔False
A firm's capacity can be limited by members of its supply chain - ANS ✔✔True
A firm is able to meet current demand. If it adopts a lead capacity strategy, then it is probably
making the assumption that demand will increase in the future. - ANS ✔✔True
Virtual supply chains have the advantage of efficiency, but this advantage is gained in a trade-off
with decreased flexibility. - ANS ✔✔False
Building rental and depreciation on capital equipment are examples of fixed costs - ANS
✔✔True
For a given fixed cost and revenue, as the variable cost rises, the break-even point also rises -
ANS ✔✔False
A business analyst identifies three possible demand levels for the new service they are
considering for the new year. In addition to the levels of demand, the analyst estimates the
likelihood of occurrence for each of these levels of demand. If he calculates the expected value
,of demand he should expect that the calculated value matches one of the three levels he
originally identified. - ANS ✔✔False
In a decision tree, outcome points are under direct control of the decision maker and show the
results of choices - ANS ✔✔False
The break-even formula (fixed cost/R-VC) does not include a provision for a price break if a
customer purchases a large quantity - ANS ✔✔True
Learning curve theory suggests that productivity will increase as people and systems learn to
perform tasks more efficiently. - ANS ✔✔True
A ninety percent learning curve is steeper than an eighty percent learning curve - ANS ✔✔False
A firm is more likely to develop the internal capacity to perform activities that are strategically
important to its success than it is to outsource those activities. - ANS ✔✔True
The Theory of Constraints would support the statement that a chain is only as strong as its
weakest link. - ANS ✔✔True
A busy toll highway that has four toll collectors for northbound traffic is an example of a single-
channel, single-phase system - ANS ✔✔False
In operations and supply chain environments that must deal with random demand, it is virtually
impossible to achieve very high capacity utilization levels and still provide acceptable customer
service - ANS ✔✔True
In waiting line theory, the number of channels refers to the number of customer waiting lines in
the system - ANS ✔✔True
,In most waiting line models, customers are assumed to arrive at random intervals, based on a
normal distribution - ANS ✔✔false
The Greek letter lambda (λ) is used to represent the service rate of a waiting line system - ANS
✔✔False
A waiting line cannot be both multiple-channel and multiple-phase - ANS ✔✔False
All waiting line formulas assume that customers are served on a first-come first-served (FCFS)
basis - ANS ✔✔True
With only a half hour for lunch I screamed into the parking lot of the nearest Golden Arches
Supper Club at 40 miles an hour. When I saw the drive through line was 15 cars deep I didn't
bother getting in line; I was off to visit the Colonel. This behavior might be described as balking -
ANS ✔✔True
Everything about two different waiting line systems is the same except one system has a
constant service time and the other has a Poisson distributed service time. Customers using the
system with the constant service time will have half the waiting time of the customers using the
system with Poisson distributed service times - ANS ✔✔True
The term time compression refers to the phenomenon that a server tends to speed up the
service process if the waiting line exceeds some critical number of customers. - ANS ✔✔False
It is more costly to create a more realistic simulation than one that is less realistic - ANS ✔✔True
In most cases, simulation models provide optimal solutions to problems just like most of the
equations presented in your textbook - ANS ✔✔False
, Monte Carlo simulation uses statistical sampling to create outcomes for a large number of trials
- ANS ✔✔True
Customers enter the stadium and purchase refreshments before they are shown to their seats
by experienced ushers. The customers are considered objects in the simulation model - ANS
✔✔True
Customers enter the stadium and purchase refreshments before they are shown to their seats
by experienced ushers. The concession stand lines are considered elements in the simulation
model - ANS ✔✔False
A customer enters a business and has the opportunity to select any one of three lines to receive
service. The service is performed by one customer service representative after which the
customer leaves the establishment. Which description of this waiting line system is appropriate?
A) single channel, single phase
B) single channel, multiple phase
C) multiple channel, single phase
D) multiple channel, multiple phase - ANS ✔✔c
A customer enters a business and joins the one line that snakes back and forth through the
lobby in order to receive service. The initial part of the service is performed by one customer
service representative, after which the customer enters a second, shorter line to complete the
service before leaving the establishment. Which description of this waiting line system is
appropriate?
A) single channel, single phase
B) single channel, multiple phase
C) multiple channel, single phase
D) multiple channel, multiple phase - ANS ✔✔B
