OMGT FINAL EXAM - QUIZ 3
QUESTIONS AND ANSWERS
____________ is the capability of a worker, machine, work center, plant, or organization
to produce output per time period. - Correct Answers -Capacity
True or False: In general, higher conformance quality reduces capacity since the extra
care taken during production slows the output rate. - Correct Answers -False
True or False: The break-even formula does not include a provision for a price break if a
customer Purchases a large quantity. - Correct Answers -True
A bottling machine has a theoretical capacity of 100 bottles per minute. During every ten
hour shift it operates continuously but is shut down once for 30 minutes for cleaning,
inspection, and lubrication. What is its rated capacity? - Correct Answers -60 min x 10
hrs = 600 min - 30 min for cleaning = 570 min x 100 bottles per min = 5700 bottles / 600
min = 95 bottles
True or False: 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. - Correct Answers -True
Which of the following is NOT an appropriate measure of capacity?
- Number of cars assembled per month
- Thickness of laminate on a desktop
- Square yards of carpet installed per hour
- Printed pages per minute - Correct Answers -Thickness of laminate on a desktop
A lead capacity strategy has the advantage of:
- A reduced risk of overbuilding
- The ability to put off large investments as long as possible
- Greater productivity due to high utilization levels
- Assuring adequate capacity during all types of growth - Correct Answers -Assuring
adequate capacity during all types of growth
Which of the following statements about capacity strategies is NOT correct?
- A match capacity strategy tends to avoid periods of high under- or over-utilization.
- A lag capacity strategy tends to have greater productivity due to higher utilization
levels
- Lead capacity strategy can be used to preempt competitors who might be planning to
expand their own capacity
QUESTIONS AND ANSWERS
____________ is the capability of a worker, machine, work center, plant, or organization
to produce output per time period. - Correct Answers -Capacity
True or False: In general, higher conformance quality reduces capacity since the extra
care taken during production slows the output rate. - Correct Answers -False
True or False: The break-even formula does not include a provision for a price break if a
customer Purchases a large quantity. - Correct Answers -True
A bottling machine has a theoretical capacity of 100 bottles per minute. During every ten
hour shift it operates continuously but is shut down once for 30 minutes for cleaning,
inspection, and lubrication. What is its rated capacity? - Correct Answers -60 min x 10
hrs = 600 min - 30 min for cleaning = 570 min x 100 bottles per min = 5700 bottles / 600
min = 95 bottles
True or False: 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. - Correct Answers -True
Which of the following is NOT an appropriate measure of capacity?
- Number of cars assembled per month
- Thickness of laminate on a desktop
- Square yards of carpet installed per hour
- Printed pages per minute - Correct Answers -Thickness of laminate on a desktop
A lead capacity strategy has the advantage of:
- A reduced risk of overbuilding
- The ability to put off large investments as long as possible
- Greater productivity due to high utilization levels
- Assuring adequate capacity during all types of growth - Correct Answers -Assuring
adequate capacity during all types of growth
Which of the following statements about capacity strategies is NOT correct?
- A match capacity strategy tends to avoid periods of high under- or over-utilization.
- A lag capacity strategy tends to have greater productivity due to higher utilization
levels
- Lead capacity strategy can be used to preempt competitors who might be planning to
expand their own capacity
