Question 1

The theory of constraints has its origins in:

Accepted Answer

A) linear programming theory. 
B) the theory of economies of scale. 
C) material requirements planning. 
D) the theory of finite capacity planning. 
E) Goldratt and Cox's book,The Goal: A Process of Ongoing Improvement. 
A) linear programming theory. 
B) the theory of economies of scale. 
C) material requirements planning. 
D) the theory of finite capacity planning. 
E) Goldratt and Cox's book,The Goal: A Process of Ongoing Improvement. E

Question 2

One limitation of the net present value approach to investments is that investments with identical net present values may have very different cash flows.

Accepted Answer

A) True 
 B)False  True

Question 3

Net present value will be greater:

Accepted Answer

A) as a fixed set of cash receipts occurs later rather than earlier. 
B) if the future value of a cash flow is smaller. 
C) for one end-of-year receipt of $1200 than for twelve monthly receipts of $100 each. 
D) for a 4% discount rate than for a 6% discount rate. 
E) All of the above are true. 
A) as a fixed set of cash receipts occurs later rather than earlier. 
B) if the future value of a cash flow is smaller. 
C) for one end-of-year receipt of $1200 than for twelve monthly receipts of $100 each. 
D) for a 4% discount rate than for a 6% discount rate. 
E) All of the above are true. D

Question 4

The Academic Computing Center has five trainers available in its computer labs to provide training sessions to students.Assume that the design capacity of the system is 1900 students per semester and that effective capacity equals 90% of design capacity.If the number of students who actually got their orientation session is 1500,what is the efficiency of the system?

Accepted Answer

A) 1350 students 
B) 1710 students 
C) 78.9% 
D) 87.7% 
E) 90% 
A) 1350 students 
B) 1710 students 
C) 78.9% 
D) 87.7% 
E) 90%

Question 5

The basic break-even model can be modified to handle more than one product.This extension of the basic model requires:

Accepted Answer

A) price and sales volume for each product. 
B) price and variable cost for each product,and the percent of sales that each product represents. 
C) that the firm have very low fixed costs. 
D) that the ratio of variable cost to price be the same for all products. 
E) sales volume for each product. 
A) price and sales volume for each product. 
B) price and variable cost for each product,and the percent of sales that each product represents. 
C) that the firm have very low fixed costs. 
D) that the ratio of variable cost to price be the same for all products. 
E) sales volume for each product.

Question 6

A work system has five stations that have process times of 5,9,4,9,and 8.What is the throughput time of the system?

Accepted Answer

A) 4 
B) 9 
C) 18 
D) 35 
E) 7 
A) 4 
B) 9 
C) 18 
D) 35 
E) 7

Question 7

Utilization will always be lower than efficiency because:

Accepted Answer

A) effective capacity is less than design capacity. 
B) effective capacity is greater than design capacity. 
C) effective capacity equals design capacity. 
D) expected output is less than actual output. 
E) expected output is less than rated capacity. 
A) effective capacity is less than design capacity. 
B) effective capacity is greater than design capacity. 
C) effective capacity equals design capacity. 
D) expected output is less than actual output. 
E) expected output is less than rated capacity.

Question 8

Expected output is sometimes referred to as rated capacity.

Accepted Answer

A) True 
 B)False

Question 9

Identify the six tactics for matching capacity to demand.

Accepted Answer

1.Making staffing changes (increasing or

Question 10

Break-even analysis is a powerful analytical tool,but is useful only when the organization produces a single product.

Accepted Answer

A) True 
 B)False

Question 11

A factory produces 1000 units a month.If design capacity is 3000 and efficiency is 50% find utilization and effective capacity.

Accepted Answer

Output = Utilization ∗ Design Capacity g

Question 12

An assembly line has 10 stations with times of 1,2,3,4,…,10,respectively.What is the bottleneck time?

Accepted Answer

A) 18.18% of the throughput time 
B) 100% of the throughput time 
C) 550% of the throughput time 
D) 50% of the throughput time 
E) 1.82% of the throughput time 
A) 18.18% of the throughput time 
B) 100% of the throughput time 
C) 550% of the throughput time 
D) 50% of the throughput time 
E) 1.82% of the throughput time

Question 13

Net present value:

Accepted Answer

A) is gross domestic product less depreciation. 
B) is sales volume less sales and excise taxes. 
C) is profit after taxes. 
D) ignores the time value of money. 
E) is the discounted value of a series of future cash receipts. 
A) is gross domestic product less depreciation. 
B) is sales volume less sales and excise taxes. 
C) is profit after taxes. 
D) ignores the time value of money. 
E) is the discounted value of a series of future cash receipts.

Question 14

The capacity planning strategy that delays adding capacity until capacity is below demand,then adds a capacity increment so that capacity is above demand,is said to ________ demand.

Accepted Answer

The answer of The capacity planning strategy that delays adding...

Question 15

The net present value of $10,000 to be received in exactly three years is considerably greater than $10,000.

Accepted Answer

A) True 
 B)False

Question 16

________ analysis finds the point at which costs equal revenues.

Accepted Answer

The answer of ________ analysis finds the point at which...

Question 17

A new machine tool is expected to generate receipts as follows: $5,000 in year one; $3,000 in year two,nothing in the next year,and $2,000 in the fourth year.At an interest rate of 6%,what is the net present value of these receipts? Is this a better net present value than $2,500 each year over four years? Explain.

Accepted Answer

S = R × X = 300 × 3,000 × 3.46

Question 18

An executive conference center has the physical ability to handle 1,100 participants.However,conference management personnel believe that only 1,000 participants can be handled effectively for most events.The last event,although forecasted to have 1,000 participants,resulted in the attendance of only 950 participants.What are the utilization and efficiency of the conference facility?

Accepted Answer

Design Capacity = 1,100 partic

Question 19

Effective capacity is the:

Accepted Answer

A) maximum output of a system in a given period. 
B) capacity a firm expects to achieve given the current operating constraints. 
C) average output that can be achieved under ideal conditions. 
D) minimum usable capacity of a particular facility. 
E) sum of all of the organization's inputs. 
A) maximum output of a system in a given period. 
B) capacity a firm expects to achieve given the current operating constraints. 
C) average output that can be achieved under ideal conditions. 
D) minimum usable capacity of a particular facility. 
E) sum of all of the organization's inputs.

Question 20

________ is actual output as a percent of design capacity.

Accepted Answer

The answer of ________ is actual output as a percent...

Exam 8: Capacity and Constraint Management

The theory of constraints has its origins in:

One limitation of the net present value approach to investments is that investments with identical net present values may have very different cash flows.

Net present value will be greater:

The basic break-even model can be modified to handle more than one product.This extension of the basic model requires:

A work system has five stations that have process times of 5,9,4,9,and 8.What is the throughput time of the system?

Utilization will always be lower than efficiency because:

Expected output is sometimes referred to as rated capacity.

Identify the six tactics for matching capacity to demand.

Break-even analysis is a powerful analytical tool,but is useful only when the organization produces a single product.

A factory produces 1000 units a month.If design capacity is 3000 and efficiency is 50% find utilization and effective capacity.

An assembly line has 10 stations with times of 1,2,3,4,…,10,respectively.What is the bottleneck time?

Net present value:

The capacity planning strategy that delays adding capacity until capacity is below demand,then adds a capacity increment so that capacity is above demand,is said to ________ demand.

The net present value of $10,000 to be received in exactly three years is considerably greater than $10,000.

________ analysis finds the point at which costs equal revenues.

Effective capacity is the:

________ is actual output as a percent of design capacity.

Operations and Productivity

Operations Strategy in a Global Environment

Project Management

Forecasting

Design of Goods and Services

Managing Quality

Process Strategy

Location Strategies

Layout Strategies

Human Resources, job Design, and Work Measurement

Supply Chain Management

Inventory Management

Aggregate Planning and Sop

Material Requirements Planning Mrpand Erp

Short-Term Scheduling

Jit, tps, and Lean Operations

Maintenance and Reliability

Sustainability in the Supply Chain

Statistical Process Control

Supply Chain Management Analytics

Decision-Making Tools

Linear Programming

Transportation Models

Waiting-Line Models

Learning Curves

Simulation

Filters