Solutions
In the fixed order interval model, what does the formula M = D(R +
L) calculate?
A. Order point
B. Order-up-to level
C. Review interval
D. Lead time Correct Answer - B. Order-up-to level
Producers of goods and producers of services both acquire and
manage inputs throughout a transformation process that creates a
final output.
A. True
B. False Correct Answer - A. True
*Producers of goods and producers of services both transform
inputs, including people, capital, material, and energy, into a good or
service. Producers manage the operations for producing a final
product.
Service providers do not produce products because they are not
part of the manufacturing sector.
A. True
B. False Correct Answer - B. False
*The final output for both producers of goods and producers of
services represents a good or service, both of which are considered
products.
Operations in the service and manufacturing sectors operate
independently from each other when creating a value chain that
ultimately brings products to customers.
A. True
B. False Correct Answer - B. False
,*The service sector depends on the manufacturing sector in many
ways, and their value chain is tightly linked.
The management of inventory is more important to producers of
goods than producers of services.
A. True
B. False Correct Answer - B. False
*Managing inventory is important to both producers of goods and
producers of services. The both rely on it in different ways.
Why have IBM, Ford, and Bank of America recently cut hundreds of
thousands of white-collar workers?
A. To be able to merge with another company
B. To dramatically cut costs
C. To be able to respond quicker to opportunities
D. To comply with government regulations Correct Answer - C.
To be able to respond quicker to opportunities
*Correct. Large companies have realized that a large workforce can
prevent them from responding quickly to change.
In an effort to obtain its ISO standard certification, XYZ Consulting
has arranged its structure so that its consultants specialize in
specific areas of activity such as strategic planning, product
development and supply chain management.
XYZ's organizational structure would be classified as which of the
following?
A. Product
B. Centralized
C. Process
D. Functional Correct Answer - C. Process
*XYZ has organized its consultants around the processes they serve.
Organizational structures designed by process cross functional lines.
, NAFTA should promote trade in products for which the signatory
countries have relative advantages.
A. True
B. False Correct Answer - A. True
*One of the purposes of a free trade agreement, such as NAFTA, is to
reduce tariffs and trade restrictions to promote trade between these
countries on products for which each has a relative advantage.
Job markets have shifted between countries for manufacturing,
technology, engineering, and management jobs over the past
decades.
Which of the following has been a driving force in the global job
market?
A. Free trade agreements
B. Market domination by multinational firms
C. Labor costs
D. Movement of production facilities Correct Answer - C. Labor
costs
Which statement about services providers and goods producers is
true?
A. Physical elements are a concern for goods manufacturers but not
service providers.
B. Both service providers and goods manufacturers have finished
goods inventories.
C. Some service providers operate like manufacturers because they
sell a finished good.
D. Inventory management is a concern for goods manufacturers but
not service providers. Correct Answer - C. Some service
providers operate like manufacturers because they sell a finished
good.
Which statement best explains the value of operations
management?