OMGT Final Exam Danny Ellis Study Guide | Operations & Supply Chain Management Review,
Key Concepts & Practice Questions
Business process is a structured set of activities designed to produce a specific output (T/F) -
ANS ✔✔True
Business process management consist of the following steps except....
E. Monitor
A. Design
B. Execute
C. Optimize
D. Bottleneck identification - ANS ✔✔Bottleneck identification
Which of the following is NOT a benefit of using business process management
increased vaue-added time
reduced waste
Increased productivity
Improved process consistency - ANS ✔✔increased vaue-added time
Productivity is expressed as____________ - ANS ✔✔output divided by input
A car wash services 200 customers in a 4 hour span on a lovely Saturday afternoon. The car
wash employs 5 washers at $6 per hour. An appropriate measure of productivity is: - ANS
✔✔1.7 cars/$
When an organization compares products, services, and processes against those of
organizations known to be leaders in one or more aspect of their operations, they are engaging
in ___________. - ANS ✔✔benchmarking
,Continuous flow is more efficient but less flexible than job shop because___________ - ANS
✔✔continuous flow produces products in extreme high volume
_____________ products involve no customization but _____________ products are completely
customized driven by actual customer orders. - ANS ✔✔make to stock make to order
Which of the following refers to a production environment where a product can be made from
common components after receipt of a customer's order
engineer to order
make to stock
make to order
assemble to order - ANS ✔✔assemble to order
The maximum level of output of a system in a certain time period under ideal conditions is the
________ - ANS ✔✔theorectical capacity
If the maximum output level of a piece of equipment is at a rate of 400 units per hour and the
actual output during an hour is 350 units., which of the following is the capacity utilization rate?
- ANS ✔✔87.5%
Assume a fixed cost for a process of $120,000. The variable cost to produce each unit of product
is $35 and the selling price for the finished product is $50. Which of the following is the number
of units that has to be produced and sold to break-even? - ANS ✔✔8,000
A company is considering producing a product for a new market. The fixed costs required for
manufacturing and delivering the product is $50,000. Labor and material costs are estimated to
be approximately $25.00 per product. If the product is sold for $35.00 each, the firm's break-
even volume would be - ANS ✔✔5,000 Units
, Jimbo Elrod has obtained fixed and variable cost information for four potential locations for his
professional wrestling school and summarized it in tabular form below. All values are in dollars.
Jimbo plans to charge the same amount for tuition regardless of where he decides to establish
his school. If he believes that 700 students will matriculate each year, which location will result
in the lowest total cost?
Site
Fixed Cost
Variable Cost
A
10,000
24
B
12,000
20
C
14,000
18
D
16,000
17 - ANS ✔✔Location B
Jimbo Elrod has obtained fixed and variable cost information for four potential locations for his
professional wrestling school and summarized it in tabular form below. All values are in dollars.
What is the break-even point (BEP) for location D if Jimbo decides to charge $21 per student?
Site
Fixed Cost
Key Concepts & Practice Questions
Business process is a structured set of activities designed to produce a specific output (T/F) -
ANS ✔✔True
Business process management consist of the following steps except....
E. Monitor
A. Design
B. Execute
C. Optimize
D. Bottleneck identification - ANS ✔✔Bottleneck identification
Which of the following is NOT a benefit of using business process management
increased vaue-added time
reduced waste
Increased productivity
Improved process consistency - ANS ✔✔increased vaue-added time
Productivity is expressed as____________ - ANS ✔✔output divided by input
A car wash services 200 customers in a 4 hour span on a lovely Saturday afternoon. The car
wash employs 5 washers at $6 per hour. An appropriate measure of productivity is: - ANS
✔✔1.7 cars/$
When an organization compares products, services, and processes against those of
organizations known to be leaders in one or more aspect of their operations, they are engaging
in ___________. - ANS ✔✔benchmarking
,Continuous flow is more efficient but less flexible than job shop because___________ - ANS
✔✔continuous flow produces products in extreme high volume
_____________ products involve no customization but _____________ products are completely
customized driven by actual customer orders. - ANS ✔✔make to stock make to order
Which of the following refers to a production environment where a product can be made from
common components after receipt of a customer's order
engineer to order
make to stock
make to order
assemble to order - ANS ✔✔assemble to order
The maximum level of output of a system in a certain time period under ideal conditions is the
________ - ANS ✔✔theorectical capacity
If the maximum output level of a piece of equipment is at a rate of 400 units per hour and the
actual output during an hour is 350 units., which of the following is the capacity utilization rate?
- ANS ✔✔87.5%
Assume a fixed cost for a process of $120,000. The variable cost to produce each unit of product
is $35 and the selling price for the finished product is $50. Which of the following is the number
of units that has to be produced and sold to break-even? - ANS ✔✔8,000
A company is considering producing a product for a new market. The fixed costs required for
manufacturing and delivering the product is $50,000. Labor and material costs are estimated to
be approximately $25.00 per product. If the product is sold for $35.00 each, the firm's break-
even volume would be - ANS ✔✔5,000 Units
, Jimbo Elrod has obtained fixed and variable cost information for four potential locations for his
professional wrestling school and summarized it in tabular form below. All values are in dollars.
Jimbo plans to charge the same amount for tuition regardless of where he decides to establish
his school. If he believes that 700 students will matriculate each year, which location will result
in the lowest total cost?
Site
Fixed Cost
Variable Cost
A
10,000
24
B
12,000
20
C
14,000
18
D
16,000
17 - ANS ✔✔Location B
Jimbo Elrod has obtained fixed and variable cost information for four potential locations for his
professional wrestling school and summarized it in tabular form below. All values are in dollars.
What is the break-even point (BEP) for location D if Jimbo decides to charge $21 per student?
Site
Fixed Cost
