FINALTERM EXAMINATION
Fall 2009
MGT613- Production / Operations Management

Time: 120 min
Marks: 79


Question No: 1 ( Marks: 1 ) - Please choose one
Which one of the following correctly explains the quantitative forecasting technique?

► It consists mainly of numerical descriptions and resist subjective inputs of managers.
► It consists mainly of subjective inputs and resist particular numerical descriptions.
► It consists mainly of subjective inputs and resist human factor, personal opinions.
► It consists mainly of analyzing objective and hard data and resist human factor, opinion.

Question No: 2 ( Marks: 1 ) - Please choose one
Which one of the following is an outcome of MINIMAX regret?
► The best of the worst possible payoff
► The best possible payoff
► The best average payoff
► The least of the worst regret

Question No: 3 ( Marks: 1 ) - Please choose one
Given the table:
MGT 613.jpg
Which one of the following is the correct payoff under MINIMAX regret approach?

► Rs. 12,000
► Rs. 6,000
► Rs. 5,000
► Rs. 16,000

Question No: 4 ( Marks: 1 ) - Please choose one
Which one of the following refers to the volume of output at which total cost equals total revenue?
► Optimal operating rate
► Break even point
► Feasible volume
► Utilization


Question No: 5 ( Marks: 1 ) - Please choose one
ABC Corporation has planned to purchase a new machine. Total annual fixed cost is Rs. 10,000, variable cost is Rs. 5 per unit and revenue is Rs. 7 per unit. What would be the break even point?
► 833 units
► 2000 units
► 5000 units
► 1012 units

Question No: 6 ( Marks: 1 ) - Please choose one
Which one of the following designs resists modifications?
► Frozen design
► Product design
► Service design
► Robust design

Question No: 7 ( Marks: 1 ) - Please choose one
Which one of the following is the final stage of product life cycle?
► Growth
► Decline
► Maturity
► Planning


Question No: 8 ( Marks: 1 ) - Please choose one
Which one of the following refers to a team having representatives from different functional areas of the organization?

► Traditional work group
► Self-directed team
► Cross-functional team
► Self motivated team
Question No: 9 ( Marks: 1 ) - Please choose one
How many dimensions are used for determining service quality?

► Four
► Five
► Six
► Seven

Question No: 10 ( Marks: 1 ) - Please choose one
Which of the following is NOT an element of TQM?
► Continuous improvement
► Perceived quality
► Employee empowerment
► Customer focus

Question No: 11 ( Marks: 1 ) - Please choose one
Which of the following represents a specified range of values in which individual units of output must fall in order to be acceptable?

► Tolerance
► Run test
► Process capability
► Process variability

Question No: 12 ( Marks: 1 ) - Please choose one
Which of the following refers to the upper limit on the percentage of defects that a customer is willing to accept?
► Acceptable Quality Level (AQL)
► Lot Tolerance Percent Defective (LTPD)
► Average Outgoing Quality (AOQ)
► Average Outgoing Quality Limit (AOQL)



Question No: 13 ( Marks: 1 ) - Please choose one
Which of the following require intermediate plans?

► Job assignments
► Machine loading
► Subcontracting
► Layout design



Question No: 14 ( Marks: 1 ) - Please choose one
Which of the following is the costs of carrying an item in inventory for a specific period of time?

► Ordering cost
► Holding cost
► Shortage cost
► Stock out cost



Question No: 15 ( Marks: 1 ) - Please choose one
Which of the following is a schedule that specifies the timing and size of production quantities for product in the product families?

► Master production scheduling
► Aggregate plan
► Inventory management scheduling
► Master rescheduling
Question No: 16 ( Marks: 1 ) - Please choose one
Which of the following contains a listing of all the assemblies, sub-assemblies, parts and raw materials needed to produce one unit of a finished product?

► Master schedule
► Bill of materials file
► Inventory records file
► Rough – cut capacity plan



Question No: 17 ( Marks: 1 ) - Please choose one
Which of the following statements is CORRECT about master schedule?

► It is visible to all levels of management
► It include only demand from production areas
► It is notIt is notI influenced by the aggregate plan
► It is not concerned with customer order processing



Question No: 18 ( Marks: 1 ) - Please choose one
Which of the following refers to the planned amount to order in each time period?

► Gross requirements
► Net requirements
► Planned-order receipts
► Planned-order releases



Question No: 19 ( Marks: 1 ) - Please choose one
Which of the following reports compares known and expected future capacity requirements with projected capacity availability?

► Performance control report
► Exception report
► Load report
► Planned order report



Question No: 20 ( Marks: 1 ) - Please choose one
Big JIT includes all of the following EXCEPT:

► Vendor relations
► Scheduling materials
► Technology management
► Human relations



Question No: 21 ( Marks: 1 ) - Please choose one
Which should be one of the selection criteria if two potential suppliers can deliver a part with the same quality and prices?

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► Size of the firm
► A coin flip
► External evaluation
► Flexibility of the firm



Question No: 22 ( Marks: 1 ) - Please choose one
Scheduling is a function of which of the following?

► Volume of systems’ output
► Nature of systems’ output
► Timing of systems’ output
► Value of systems’ output



Question No: 23 ( Marks: 1 ) - Please choose one
Which of the following refers to an area where a person works with special equipment on a specialized job?

► Workshop
► Work area
► Workplace
► Workstation



Question No: 24 ( Marks: 1 ) - Please choose one
Which of the following refers to the total time needed to complete a group of jobs from the beginning of the first job to the completion of the last job?

► Job lateness
► Job flow time
► Makespan
► Slack time



Question No: 25 ( Marks: 1 ) - Please choose one
Which of the following is TRUE about a project activity?

► It is a unique, one-time activity
►It is static in nature
► It is often simple to outline
► It is a set of unrelated tasks



Question No: 26 ( Marks: 1 ) - Please choose one
Which of the following relates to an organizational structure based on teams formed specifically for projects?

► Project matrix structure
► Project structure
► Functional structure
► Balanced matrix structure



Question No: 27 ( Marks: 1 ) - Please choose on
Which of the following is NOT a limitation of PERT?

► Omission of critical activities
► Correct precedence relationships
► Sole reliance on critical path
► Inclusion of a fudge factor



Question No: 28 ( Marks: 1 ) - Please choose one
With reference to Network activities, what does the term ‘LS’ stand for?

► Late Start
► Long Start
► Lazy Start
► Low Start



Question No: 29 ( Marks: 1 ) - Please choose one
With reference to Network activities, what does the term ‘LF’ stand for?

► Late Finish
► Long Finish
► Lazy Finish
► Low Finish



Question No: 30 ( Marks: 1 ) - Please choose one
Forecasting for groups tend to be more accurate than forecasting for individual items because:

► A group is composed of a number of items
► A group exhibits a uniform behavior
► A group cancels the forecasting errors among items
► A group behavior is relatively less uncertain



Question No: 31 ( Marks: 1 ) - Please choose one
Which one of the following is a possible disadvantage of a moving average forecast?

► The method is unable to forecast the demand accurately
► The method is easy to compute and easy to understand
► All the values in the average are weighted equally
► The most recent values are given the more weightage


Question No: 32 ( Marks: 1 ) - Please choose one
Which of the following determinants of effective capacity is taken into account by operations manager at macro level?
► Supply chain
► Process factors
► Product and service factors
► Operational factors



Question No: 33 ( Marks: 1 ) - Please choose one
Which of the following is true about the design process?
► Concurrent design has proven to be the more effective method for design
► The design process involves four basic steps, if followed in sequential order, ensure success
► Only representatives from design department should work together on the design
► It is better to separate marketing, engineering, and production personnel from each other in a design process

Question No: 34 ( Marks: 1 ) - Please choose one
Which of the following initiated "Just-In-Time" inventory management system?
► Germany
► United States
► United Kingdom
► Japan



Question No: 35 ( Marks: 1 ) - Please choose one
In the environment where material flow is complex and demand is highly variable, which of the following system will NOT be feasible?

► Material Requirement Planning (MRP)
► Just-In-Time Production Systems
► Manufacturing requirement planning (MRPII)
► Enterprise Resource planning (ERP)

Question No: 36 ( Marks: 1 ) - Please choose one
Which of the following elements of supply chain prevent organization from bull-whip effect?
► Predicting quantity and timing of demand
► Incorporating customer’s wants in manufacturing
► Controlling quality and scheduling work
► Determining what customers want

Question No: 37 ( Marks: 1 ) - Please choose one
Difference between length of a path and critical path gives which of the following values?

► Critical activities
► Slack activities
► Activity on node
► Activity on arrow

Question No: 38 ( Marks: 1 ) - Please choose one
During the period of high unemployment or when low-skilled labor is acceptable, which of the following strategy would be cost effective?

► Chase demand strategy
► Level capacity strategy
► Proactive strategy
► Mixed or hybrid strategies



Question No: 39 ( Marks: 3 )
What are the salient features of six sigma quality management?
ANS: following are the 4 salient features of sigma quality management
1. Selecting and training appropriate people.
2. Providing strong leadership.
3. Selecting projects likely to succeed.
4. Defining performance merits.


Question No: 40 ( Marks: 3 )
How would you illustrate the problems that you may encounter in scheduling the service operations?
ANS: there are many problem of scheduling like flight schedules, reservation system, and control costumer services, scheduling the workforce etc.


Question No: 41 ( Marks: 5 )
What would happen if customer’s expected quality and perceived quality do not match? Explain by giving an example.
Differences between Expected and Perceived Quality
ANS: Customers expect certain things from certain companies so that is called costumer expected quality. Everyone has perception of service quality
The perceived quality is the quality after the perceptions of costumer.

Question No: 42 ( Marks: 5 )
What is the importance of Material Requirement Planning (MRP)? Why companies should invest in the implementation of MRP system? (3+2)
A material requirement planning is a computer based information system that translates master schedule requirements for end items into time-phased requirements for raw materials, components, subassemblies.
Company should invest to improve the implementation of MRP SYSTEM because it is very important tool for the future planning of material needs. By MRP systems a company can improve its costumer services and reduce its cost. Also companies can controlinventories, improved scheduling, and Productive relationships with suppliers.

Question No: 43 ( Marks: 5
Differentiate Big vs Little Just-In-Time System. Which one of the both answers the most pressing questions that an organization faces? 4+1

1. Big JIT: it has broad focus in, vendor relations, materials and inventory management, technology management, human relations
2. Little JIT: it has narrow focus Internal to organization, Scheduling materials, and Scheduling services of production.
By JIT systems organization can achieve a balanced smooth flow of production, it will flexible their system with reduction in wastes and lead time.


Question No: 44 ( Marks: 10 )
How would you compare a TV set (a product) and TV repair (a service) in terms of at least five dimensions of quality?


I will compare it with the following dimensions of quality.
1. Performance: as we know the performance of new TV set if very good with high quality but when it is repaired its performance and quality is reduced because of repairing services.
2. Aesthetics: it is the appearance of TV set. As new TV set is looking very nice from every angle but when it is repaired its looking is affected by poor services.
3. Special Features: a TV set has many extra features in it. But when it is repaired most of its features will be disabled due to repairing process. For example some times its sound will be change some times its colors or buttons not working.
4. Conformance - how well product/service conforms to customer’s expectations
5. Reliability - consistency of performance
6. Durability - useful life of the product/service
7. Perceived Quality: is the quality which will be accepted after repairing services of TV. While a new TV has its expected quality.
8. Serviceability: this is the service after sale. When you buy a new TV set, you will get a warranty for that TV. And also some changeable service. But when it is repaired for one time then its warrant as well as guarantee will be finished and there is no service ability for that repaired TV.


Question No: 45 ( Marks: 10 )
Long waiting lines and long waiting times force customers to balk or renege. What mathematical and non-mathematical ways and techniques management should take in order to avoid such kind of problems?

ANS: Some times there are long lines of people in offices for example for interviews, customer’s centers, banks etc. it is due to the poor management system and poor.
But there are some mathematical as well as non mathematical methods due to those methods we can control these long waiting lines problems.

Queuing theory:
This is a Mathematical method use for the analysis of waiting lines.
Its main goal is to minimize the sum of two costs Customer waiting costs and
Service capacity costs.
Its main points about waiting lines are as following.
Waiting lines are non-value added occurrences implications of waiting lines.
To provide space for waiting it will cost.
There is a threat of Loss of business due to long waiting lines.
Because of these problems most of costumer will leave.
Customers always refuse to wait.
Overcrowding can disrupt other business operations.
Long waiting lines reduces in customer satisfaction.

By queuing analysis organizations minimizes these types of threats and can manage their business in a very pleasant way.

Some of Non Mathematical Approaches are the following which are also used to reduce long waiting lines problems.

1. There should be Magazines or newspapers in waiting rooms for people who are waiting because of this they will not become bore.
2. Also if there is Radio or a television set so the waiting costumers be wait easily.
3. In-flight movies.
4. By Filling out forms we can reduce waiting times of people.
5. Derive benefits from waiting
6. By Placing impulse items near checkout so people will see and analyze it for some time.
7. Reduce perceived waiting time
8. If there is advertisement of other goods or services in waiting place, people will study that so they can wait easily.