COB 300 C TEST 1 QUESTIONS AND
ANSWERS
Which one of the following is NOT a major factor distinguishing service design and
development from manufacturing design and development?
The process and product must be developed at the same time.
Many service organizations can change their service offerings virtually overnight.
Many parts of the service package are often defined by the training that individuals
receive before they become part of the service organization
The service package, rather than a definable good, is the output of the development
process.
Service operations can be protected by patents; manufacturing operations cannot -
Answer-Service operations can be protected by patents; manufacturing operations
cannot
Which of the following is NOT a step in developing a manufacturing cell layout?
Grouping parts into families that follow a common sequence of steps
Identifying dominant flow patterns of parts families as a basis for location of processes
Physically grouping machines and processes into cells
Disposing of leftover machinery and outsourcing ungrouped processes
None of these - Answer-Disposing of leftover machinery and outsourcing ungrouped
processes
The weekly output of a fabrication process is shown below together with data for labor
and material inputs. Standard selling price is $120 per unit. Overhead is charged weekly
at the rate of $1,500 plus .5 times direct labor cost. Assume a 40-hour week and an
hourly wage of $16. Material cost is $10 per foot. What is the multifactor productivity
over the two-week period? (round up your final answer to 2 decimals)
1.50
1.46
1.43
1.38
None of the above - Answer-1.38
You are hired as a consultant to decide if your client should purchase a new, highly
specialized piece of equipment. The product to be produced by this equipment is
forecast to have a total worldwide demand of 15,000 units over the entire product life.
The initial investment to acquire and install the equipment is $256,000. The variable
cost to produce each unit will be $15, and the selling price for the finished product will
be $30. Which of the following best describes the situation the firm is facing?
, The company will recover its initial investment.
The company's total margin will be less than its investment
It is a good investment
The break-even is lower than the 15,000 units that are expected to sell.
All of the above are incorrect statements - Answer-The company's total margin will be
less than its investment
A system consists of two components, each of which must activate if the system is to
activate. One component has a reliability of .99. The other has a reliability of .95. The
components are independent of one another with respect to reliability. What is the
overall system reliability?
.99
.95
.94
.90
Cannot be determined with this information - Answer-.94
A manufacturer wants to identify proper warranty terms for their product. The design
engineers claim that the life time of the product follows a normal distribution with a
mean of 7 years and standard deviations of 2 years. What is the probability that the
product works between 6 to 8 years?
40%
38%
69%
35%
95% - Answer-38%
Which of the following is a partial measure of productivity?
Output/Materials
Output/(Labor + Capital + Energy)
Output/All resources used
Output/Inputs
All of these - Answer-Output/Materials
A dental clinic in Harrisonburg has 2 nurses, 2 X-ray machines and 3 dentists. The
practice operates 8- hour shifts, 5 days a week. One of the services they provide is
routine dental examinations. Upon arrival, patients must provide nurses with their
insurance document and update their medical history form. Nurse 1 is trained to use the
Dental Information System (DIS) to pull out patient information and insurance updates
and can process 6 patients per hour (she also enjoys a higher salary because of her
training). Nurse 2 does not have the required training to use DIS and can process 4
patients per hour. After checking in, patients need to go through imaging. There are 2 X-
ray machines that each has a processing rate of 3 patients per hour. Then, patients see
ANSWERS
Which one of the following is NOT a major factor distinguishing service design and
development from manufacturing design and development?
The process and product must be developed at the same time.
Many service organizations can change their service offerings virtually overnight.
Many parts of the service package are often defined by the training that individuals
receive before they become part of the service organization
The service package, rather than a definable good, is the output of the development
process.
Service operations can be protected by patents; manufacturing operations cannot -
Answer-Service operations can be protected by patents; manufacturing operations
cannot
Which of the following is NOT a step in developing a manufacturing cell layout?
Grouping parts into families that follow a common sequence of steps
Identifying dominant flow patterns of parts families as a basis for location of processes
Physically grouping machines and processes into cells
Disposing of leftover machinery and outsourcing ungrouped processes
None of these - Answer-Disposing of leftover machinery and outsourcing ungrouped
processes
The weekly output of a fabrication process is shown below together with data for labor
and material inputs. Standard selling price is $120 per unit. Overhead is charged weekly
at the rate of $1,500 plus .5 times direct labor cost. Assume a 40-hour week and an
hourly wage of $16. Material cost is $10 per foot. What is the multifactor productivity
over the two-week period? (round up your final answer to 2 decimals)
1.50
1.46
1.43
1.38
None of the above - Answer-1.38
You are hired as a consultant to decide if your client should purchase a new, highly
specialized piece of equipment. The product to be produced by this equipment is
forecast to have a total worldwide demand of 15,000 units over the entire product life.
The initial investment to acquire and install the equipment is $256,000. The variable
cost to produce each unit will be $15, and the selling price for the finished product will
be $30. Which of the following best describes the situation the firm is facing?
, The company will recover its initial investment.
The company's total margin will be less than its investment
It is a good investment
The break-even is lower than the 15,000 units that are expected to sell.
All of the above are incorrect statements - Answer-The company's total margin will be
less than its investment
A system consists of two components, each of which must activate if the system is to
activate. One component has a reliability of .99. The other has a reliability of .95. The
components are independent of one another with respect to reliability. What is the
overall system reliability?
.99
.95
.94
.90
Cannot be determined with this information - Answer-.94
A manufacturer wants to identify proper warranty terms for their product. The design
engineers claim that the life time of the product follows a normal distribution with a
mean of 7 years and standard deviations of 2 years. What is the probability that the
product works between 6 to 8 years?
40%
38%
69%
35%
95% - Answer-38%
Which of the following is a partial measure of productivity?
Output/Materials
Output/(Labor + Capital + Energy)
Output/All resources used
Output/Inputs
All of these - Answer-Output/Materials
A dental clinic in Harrisonburg has 2 nurses, 2 X-ray machines and 3 dentists. The
practice operates 8- hour shifts, 5 days a week. One of the services they provide is
routine dental examinations. Upon arrival, patients must provide nurses with their
insurance document and update their medical history form. Nurse 1 is trained to use the
Dental Information System (DIS) to pull out patient information and insurance updates
and can process 6 patients per hour (she also enjoys a higher salary because of her
training). Nurse 2 does not have the required training to use DIS and can process 4
patients per hour. After checking in, patients need to go through imaging. There are 2 X-
ray machines that each has a processing rate of 3 patients per hour. Then, patients see
