COB 300 OPERATIONS EXAM #2
QUESTIONS WITH COMPLETE
SOLUTIONS
capability index - Answer-used to assess the ability of a process to meet specifications;
to be deemed capable this must be of at least 1.00 though this means the process is
barely capable; want to aim for at least 1.33
process capability index, Cp - Answer-Specification width/process width OR (upper
specification - lower specification)/6sigma
process capability, Cpk - Answer-used if process is not centered; (upper specification -
process mean)/3sigma AND (process mean - lower specification)/3sigma
reliability - Answer-ability of a product, service, part, or system to perform its intended
function under a prescribed set of conditions; is a probability
independent events - Answer-events whose occurrence or nonoccurrence does not
influence each other
probability rules - Answer-Rule 1: If two or more events are independent and success is
defined as the probability that all of the events occur, then the probability of success is
equal
Rule 2: If two events are independent and success is defined as the probability that at
least one of the events will occur, the probability of success is equal to the probability of
either one plus 1.00 minus that probability multiplied by the other probability
Rule 3: If two or more events are involved and success is defined as the probability that
at least one of them occurs, the probability of success is 1-P (all fail)
redundancy - Answer-the use of backup components to increase reliability
mean time between failures (MTBF) - Answer-the average length of time between
failures of a product or component
z - Answer-(T - mean wear-out time)/standard deviation of wear-out time
availability - Answer-fraction of time a piece of equipment is expected to be available for
operation; = MTBF/MTBF + MTR where MTR=mean time to repair, including waiting
time
capacity - Answer-the upper limit or ceiling on the load that an operating unit can handle
design capacity - Answer-maximum designed service capacity or output rate
, effective capacity - Answer-design capacity minus personal and other allowances
efficiency - Answer-(actual output/effective capacity) x 100%
capacity utilization - Answer-(actual output/design capacity) x 100%
capacity cushion - Answer-extra capacity used to offset demand uncertainty
steps in capacity planning process - Answer-estimate future capacity requirements,
evaluate existing capacity and facilities and identify gaps, identify alternatives for
meeting requirements, conduct financial analyses of each alternative, assess key
qualitative issues for each alternative, select the alternative to pursue that will be best in
the long term, implement the selected alternative, and monitor results
bottleneck operation - Answer-operation in a sequence of operations whose capacity is
lower than that of the other operations
economies of scale - Answer-if the output rate is less than the optimal level, increasing
the output rate results in decreasing average unit costs
diseconomies of scale - Answer-if the output rate is more than the optimal level,
increasing the output rate results in increasing average unit costs
constraint - Answer-something that limits the performance of a process or system in
achieving its goals
break-even point - Answer-volume of output at which total cost and total revenue are
equal
indifference point - Answer-quantity that would make two alternatives equivalent
cash flow - Answer-difference between cash received from sales and other source, and
cash outflow for labor, material, overhead, and taxes
present value - Answer-sum, in current value, of all future cash flows of an investment
proposal
aggregate planning - Answer-intermediate-range capacity planning, usually covering 2
to 12 months; goal is to achieve a production plan that will effectively utilize the
organization's resources to match expected demand
sales and operations planning - Answer-intermediate-range decisions to balance supply
and demand, integrating financial and operations planning
QUESTIONS WITH COMPLETE
SOLUTIONS
capability index - Answer-used to assess the ability of a process to meet specifications;
to be deemed capable this must be of at least 1.00 though this means the process is
barely capable; want to aim for at least 1.33
process capability index, Cp - Answer-Specification width/process width OR (upper
specification - lower specification)/6sigma
process capability, Cpk - Answer-used if process is not centered; (upper specification -
process mean)/3sigma AND (process mean - lower specification)/3sigma
reliability - Answer-ability of a product, service, part, or system to perform its intended
function under a prescribed set of conditions; is a probability
independent events - Answer-events whose occurrence or nonoccurrence does not
influence each other
probability rules - Answer-Rule 1: If two or more events are independent and success is
defined as the probability that all of the events occur, then the probability of success is
equal
Rule 2: If two events are independent and success is defined as the probability that at
least one of the events will occur, the probability of success is equal to the probability of
either one plus 1.00 minus that probability multiplied by the other probability
Rule 3: If two or more events are involved and success is defined as the probability that
at least one of them occurs, the probability of success is 1-P (all fail)
redundancy - Answer-the use of backup components to increase reliability
mean time between failures (MTBF) - Answer-the average length of time between
failures of a product or component
z - Answer-(T - mean wear-out time)/standard deviation of wear-out time
availability - Answer-fraction of time a piece of equipment is expected to be available for
operation; = MTBF/MTBF + MTR where MTR=mean time to repair, including waiting
time
capacity - Answer-the upper limit or ceiling on the load that an operating unit can handle
design capacity - Answer-maximum designed service capacity or output rate
, effective capacity - Answer-design capacity minus personal and other allowances
efficiency - Answer-(actual output/effective capacity) x 100%
capacity utilization - Answer-(actual output/design capacity) x 100%
capacity cushion - Answer-extra capacity used to offset demand uncertainty
steps in capacity planning process - Answer-estimate future capacity requirements,
evaluate existing capacity and facilities and identify gaps, identify alternatives for
meeting requirements, conduct financial analyses of each alternative, assess key
qualitative issues for each alternative, select the alternative to pursue that will be best in
the long term, implement the selected alternative, and monitor results
bottleneck operation - Answer-operation in a sequence of operations whose capacity is
lower than that of the other operations
economies of scale - Answer-if the output rate is less than the optimal level, increasing
the output rate results in decreasing average unit costs
diseconomies of scale - Answer-if the output rate is more than the optimal level,
increasing the output rate results in increasing average unit costs
constraint - Answer-something that limits the performance of a process or system in
achieving its goals
break-even point - Answer-volume of output at which total cost and total revenue are
equal
indifference point - Answer-quantity that would make two alternatives equivalent
cash flow - Answer-difference between cash received from sales and other source, and
cash outflow for labor, material, overhead, and taxes
present value - Answer-sum, in current value, of all future cash flows of an investment
proposal
aggregate planning - Answer-intermediate-range capacity planning, usually covering 2
to 12 months; goal is to achieve a production plan that will effectively utilize the
organization's resources to match expected demand
sales and operations planning - Answer-intermediate-range decisions to balance supply
and demand, integrating financial and operations planning
