Operations Management Second Edition 2014 McGraw-Hill Education (Asia)

Chapter 1
Introduction to Operations Management
Multiple Choice
1. A nation's ability to compete with other nations impacts a business' strategy in the area of:
A) Marketing
B) Finance
C) Operations
D) Distribution
E) All of the above
2. Operations management involves continuous decision-making; hopefully most decisions made will
be:
A) redundant
B) minor in nature
C) smart
D) quantitative
E) none of the above
3. A 'product package' consists of:
A) the exterior wrapping
B) the shipping container
C) a combination of goods and services
D) goods if a manufacturing organization
E) customer relations if a service organization
4. Business organizations consist of three major functions which:
A) overlap
B) are mutually exclusive
C) exist independently of each other
D) function independently of each other
E) do not interface with each other
5. Which of the following is not a type of operations?
A) goods production
B) storage/transportation
C) entertainment
D) communication
E) all the above involve operations
6. Technology choices seldom affect:
A) costs.
B) productivity.
C) union activity.
D) quality.
E) flexibility.
7. Measurements taken at various points in the transformation process for control purposes are called:
A) plans
B) directions
C) controls
D) feedback
E) budgets

Chapter 1 Introduction to Operations Management

8. Budgeting, analysis of investment proposals, and provision of funds are activities associated with
the______ function.
A) operation
B) marketing
C) purchasing
D) finance
E) internal audit
9. Which one of the following would not generally be classified under the heading of transformation?
A) cutting
B) teaching
C) staffing
D) farming
E) packing
10. Manufacturing work sent to other countries is called:
A) downsized
B) outsourced
C) internationalization
D) vertical integration
E) entrepreneurialship
11. Product design and process selection are examples of decisions that are:
A) financial
B) tactical
C) system design
D) system operation
E) forecasting
12. The responsibilities of the operations manager are:
A) planning, organizing, staffing, procuring, and reviewing
B) planning, organizing, staffing, directing, and controlling
C) forecasting, designing, planning, organizing, and controlling
D) forecasting, designing, operating, procuring, and reviewing
E) designing and operating
13 Knowledge skills usually don't include:
A) process knowledge
B) accounting skills
C) communication skills
D) global knowledge
E) all of the above
14. Which of the following is not true about systems approach?
A) A systems viewpoint is almost always beneficial in decision making.
B) A systems approach emphasizes interrelationships among subsystems.
C) A systems approach concentrates on efficiency within subsystems.
D) A systems approach is essential whenever something is being redesigned or improved.
E) All of the above are true.
51. What is credited with gains in industrial productivity, increased standards of living and affordable
products?

Operations Management Second Edition 2014 McGraw-Hill Education (Asia)

Chapter 1 Introduction to Operations Management

A) personal computers
B) the internet
C) mass transportation
D) assembly lines
E) multi-level marketing
15. Production systems with customized outputs typically have relatively:
A) high volumes of output
B) low unit costs
C) high amount of specialized equipment
D) fast work movement
E) skilled workers
16. Which is not a significant difference between manufacturing and service operations?
A) cost per unit
B) uniformity of output
C) labor content of jobs
D) customer contact
E) measurement of productivity
17. Which of the following is not a characteristic of service operations?
A) intangible output
B) high customer contact
C) high labor content
D) easy measurement of productivity
E) low uniformity of output
18. Which of the following is a recent trend in business?
A) pollution control
B) total quality management
C) supply chain management
D) competition from foreign manufacturers
E) technological change
19. Farming is an example of:
A) an obsolete activity
B) a virtual organization
C) non-manufactured goods
D) a growth industry
E) customized manufacturing
20 Dealing with the fact that certain aspects of any management situation are more important than
others is called:
A) analysis of tradeoffs
B) sensitivity analysis
C) recognition of priorities
D) analysis of variance
E) decision table
21. The fact that a few improvements in a few key areas of operations will have more impact than
many improvements in many other areas is consistent with the:
A) Irwin phenomenon
B) Pareto phenomenon
C) Priority phenomenon

Operations Management Second Edition 2014 McGraw-Hill Education (Asia)

Chapter 1 Introduction to Operations Management

D) Tellier phenomenon
E) Adam Smith phenomenon
22. The process of comparing outputs to previously established standards to determine if corrective
action is needed is called:
A) planning
B) directing
C) controlling
D) budgeting
E) disciplining
23. Which of the following does not relate to system design?
A) altering the system capacity
B) location of facilities
C) inventory management
D) selection and acquisition of equipment
E) physical arrangement of departments
24. Which of the following is not emphasized in a lean production system?
A) falling prices
B) high quality
C) worker involvement
D) continual improvement
E) customer satisfaction
25. Some companies attempt to maximize the revenue they receive from fixed operating capacity by
influencing demands through price manipulation. This is called
A) Illegal.
B) Price-fixing.
C) Volume analysis.
D) Revenue management.
E) Outsourcing.
26. Which of the following is not an ongoing trend in manufacturing competition?
A) globalization
B) quality improvement
C) flexibility and agility
D) mass production for economies of scale
E) technological advances
27. Which of the following is not a benefit of using models in decision making?
A)They provide a standardized format for analyzing a problem.
B) They serve as a consistent tool for evaluation.
C) They are easy to use and less expensive than dealing with the actual situation.
D) All of the above are benefits.
E) None of the above is a benefit.

Operations Management Second Edition 2014 McGraw-Hill Education (Asia)

Chapter 1 Introduction to Operations Management

Chapter 2
Competitiveness, Strategy and Productivity
Multiple Choice
35. Competitiveness doesnt include:
A) Productivity
B) Effectiveness
C) Profitability
D) Operations Strategy
E) Operations Management
36. Product design and choice of location are examples of _______ decisions.
A) strategic
B) tactical
C) operational
D) customer focused
E) design
37. Scheduling personnel is an example of an operations management:
A) mission implementation
B) operational decision
C) organizational strategy
D) functional strategy
E) tactical decision
38. Productivity is expressed as:
A) output plus input
B) output minus input
C) output times input
D) output divided by input
E) input divided by output
39. Which of the following is not a factor that affects productivity?
A) computer viruses
B) design of the workspace
C) use of the Internet
D) standardizing process
E) wireless cellular phones
40. Which of these factors affects productivity?
A) methods and technology
B) workers
C) management
D) a and b only
E) all of the above
41. Which of the following is not a key step toward improving productivity?
A) developing productivity measures for all operations
B) improving the bottleneck operations
C) establishing reasonable goals for improvement
D) considering incentives to reward workers
E) converting bond debt to stock ownership

Operations Management Second Edition 2014 McGraw-Hill Education (Asia)

Chapter 1 Introduction to Operations Management

42. For an organization to grow their market share, they must:

A) advertise using multi-media
B) lower their prices
C) meet minimum standards of acceptability for their products or services
D) establish an internet website
E) broaden their mission statement
43. The ratio of good output to quantity of raw material input is called
A) non-defective productivity
B) process yield
C) worker quality measurement
D) total quality productivity
E) quantity/quality ratio
44. The fundamental purpose for the existence of any organization is described by its:
A) policies
B) procedures
C) corporate charter
D) mission statement
E) bylaws
45. A productivity increase in one operation that doesnt improve overall productivity of the business
isnt
A) effective
B) efficient
C) politically justified
D) productive
E) financially justified
46. Value added can be calculated by:
A) average productivity gains over time
B) inputs divided by the outputs
C) outputs divided by the inputs
D) input plus output divided by two
E) outputs minus inputs
47. Which of the following is true?
A) Corporate strategy is shaped by functional strategies.
B) Corporate mission is shaped by corporate strategy.
C) Functional strategies are shaped by corporate strategy.
D) External conditions are shaped by corporate mission.
E) Corporate mission is shaped by functional strategies.
48. Distinctive competencies in organizations generally relate to:
A) price
B) quality
C) time
D) flexibility
E) all of the above
49. Which of the following is not considered to be a cure for poor competitiveness?
A) remove communications barriers within organizations
B) minimize attention to the operations function
C) put less emphasis on short-term financial results
Operations Management Second Edition 2014 McGraw-Hill Education (Asia)

Chapter 1 Introduction to Operations Management

D) recognize labor as a valuable asset and act to develop it

E) improve quality
50. Time-based approaches of business organizations focus on reducing the time to accomplish certain
necessary activities. Time reductions seldom apply to:
A) product/service design time
B) processing time
C) delivery time
D) response time for complaints
E) internal audits
51. The external elements of SWOT analysis are:
A) strengths and weaknesses
B) strengths and threats
C) opportunities and threats
D) weaknesses and opportunities
E) strengths and opportunities
53. Which of the following is not a reason for poor performance of our organization in the
marketplace?
A) placing too much emphasis on product/service design and too little on process design
B) failing to take into account customer wants and needs
C) putting too much emphasis on short-term financial performance
D) taking advantage of strengths/opportunities, and recognizing competitive threats
E) none of the above
55. Which of the following is not a key factor of competitiveness?
A) price
B) product differentiation
C) flexibility
D) after-sale service
E) size of organization
58. An operation that processes less than a previous operation is called a:
A) bottleneck
B) multi-factor constraint
C) parallel operation
D) turnabout process
E) tactical operation

Operations Management Second Edition 2014 McGraw-Hill Education (Asia)