OPERATION MANAGEMENT. Month March Apr May June. Forecast 52.o 43.s 44.s Actual 4o.o 45.o o

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Clifford Marshall
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1 OPERATION MANAGEMENT 1. Manager (operations) of a manufacturing factory is planning to set the production target for the month of July (2005). He uses first-order exponential smoothing technique to forecast the demand. Actual and forecasted demand for last four months (in 2005) is as follows: Month March Apr May June Forecast 52.o 43.s 44.s 47.8 Actual 4o.o 45.o o The demand forecast for the month of July (2005) would be [A] 47.9 [B] 48.6 [C] 49.3 [D] Roshni Ltd... A bulb manufacturing company has earned a reputation in the market because of the long life of its bulb filaments. This is an appropriate example of which of the following quality dimensions? [A] Features [B] Conformance [C] Serviceability [D] Durability 3. The categories of decisions that are taken by operations managers are l. Strategic decisions. ll. Tactical decisions. lll. Technical decisions. Iv. Operational decisions. [A] (I). (II) and (III) above [B] (I). (II) and (IV) above [C] (I). (III) and (IV) above

2 [D] (II). (III) and (IV) above 4. Which of the following is a function of Directing? [A] issue job assignments and instructions [B] Guide by informing correct work methods [C]Give more challenging job assignments [D]Support employees in training programs 5. Which of the following constitutes the development of new products? l. idea generation. ll. Economic evaluation. lll. Market testing. [A]Only 1 above [B] both 1: and 2 above [C] Both 1 and 3 above [D].All 1, 2 and 3 above 6. is the average of the errors made by the forecast over a period of time without considering the direction of error. [A]mean Square Error [B] Mean Forecast Error [C] Mean Absolute Deviation [D] Mean Absolute Percentage Error 7. Demand for a product X' for Jan to June is given in the table. Calculate the demand for the product using 3 month simple moving average for July in units Months Jan Feb March April May June Demand (in units)

3 [A] 127 [EI] 137 [C] 147 [D] Revathi Works Private Limited earns a profit of Rs.75,000 by selling 25,000 units. The selling price and variable cost per unit is Rs.25 and Rs.10 respectively". Then the Breakeven point occurs at [A] 12,000 units [B] 15,000 units [C] 20,000 units [D] 25,000 units 9. Which of the following is an objective function for the information provided? A trader sells chairs and tables at Rs.230 and Rs.580 each respectively", he procures them at Rs.180 and Rs.480 respectively". [A] Maximize Z = 230x x2 [E] Minimizes =1B0 x x2 [C] Minimize Z = 230 x x2 [D] MaximizeZ = 50 x x2 10. A firm achieved sales of 1000 units in the month of May when the forecast was for 900 units. The estimated sales for the month of June for a smoothing constant of 0.1 are [A] 850 units [E] 870 units [C] 890 units [D] 910 units

4 11. If a company works for 3 shifts of 8 hours each a day and setup time of each machine is one hour in each shift. The daily demand is 3,780 units. The sum of task times [T1] is 100 seconds. Then the theoretical number [NT] of machines required is [A] 2 work stations [E] 13 work stations [C] 4 work stations [D] 5 work stations 12. Which of the following is not a reason for holding finished goods as inventory? [A]Larger shipments can result in reduced incoming freight costs and material handling cost [B]Production of products as and when the customers demand them can be uneconomical [C]Quantity discounts can result from larger purchase quantities [D]Black logs in customer orders may not always be allowed 13. Which of the following constitute functions of M aster Production Schedule? l. Translate aggregate plans. ll. Evaluate alternative schedules. lll. identify material requirements. iv. Generate capacity requirements. [A] 1, 2 and 3 above [B] 1, 2 and 4 above [C] 1, 3 and 4 above [D]All 1, 2, 3 and 4 above 14. Which of the following is not an advantage of Job Specialization? [A] It results in lower production time and higher productivity by the Learning Curve Effect due to repetition

5 [B] lt results in simpler work instructions and easy production control because of consistence in work assignment [C] It always results in higher work satisfaction [D]There is ease in recruiting new workers because fewer skills are required 15. in which of the following work measurement Techniques. Managers generally determine reasonable standards for new common tasks, basing on the standards previously set for old Common tasks, and usually maintain a database of the standard time required for work elements with information obtained through previous studies? [A]Historical Analysis [B]Predetermined Motion Times [C] Work Sampling [D]Standard Data 16. Over the years, different approaches to job design have developed. Put these 4 approaches in chronological order. a. Ergonomics, Scientific Management, Behavioral Approach, Division of Labor. b. Scientific Management, Division of Labor, Ergonomics, Behavioral Approach. c. Division of Labor, Scientific Management, Behavioral Approach, Ergonomics. d. Division of Labor, Scientific Approach, Ergonomics, Behavioral Approach. 17. Frederick Winslow Taylor is best known for the introduction of which approach to job design? a. Scientific Management b. Behavioral Approach. Division of Labored. Ergonomics 18. In Work Measurement terms Standard Performance is defined as: a. The rate of output which qualified workers will achieve without over-exertion as an average over a working day provided they are motivated to apply themselves to their work.

6 b. The rate of output which qualified workers will achieve as an average over a working day provided they are motivated to apply themselves fully during the whole day. c. The rate of output which trained workers will achieve as an average over a working day provided they are motivated to apply themselves to their work. d. The rate of output which average workers will achieve without over-exertions an average over a working day. 19. Ergonomics is not concerned with which of the following aspects: A. Noise levels b. Illumination levels c. Working Temperature. d. Supervisory Skills 20. In Behavioural Approaches to Job Design which approach adds greater tasks and greater control over the job? a. Job Enrichment b. Job Enlargement c. Job Rotation d. Empowerment 21. The father of Scientific Management is: a. Henry Ford b. Henri Gantt c. W. Edwards Deming d. Tom Peterse. Frederick W. Taylor 22. Job rotation: a. is a programmed through which management seeks greater productivity from workers.

7 b. involves giving employees work with a greater degree of responsibility and autonomy. c. is another term for employee empowerment. d. means that staff are moved periodically from task to task in order to increase variety and interest. 23. Job Enrichment: a. Increases the amount of money employees are paid for completing a unit of work. b. involves giving employees work with a greater degree of responsibility and autonomy. c. involves allocating a wider range of similar tasks to individuals d. is a programme through which management seeks greater productivity from workers 24. Within a typical behavioural model of job design, which of the following would be considered as representing core job characteristics? a. Quality / Cost / Mutuality b. Vertical Loading / Skill Variety / Output c. Task Combination / Task Identity / Autonomy d. Task Identity / Task Significance / Autonomy 25. If all persons had identical preferences and productivity factors (ability, skill level, education, experience, e(c.), the highest paying jobs would be the most [A] Prestigious. [B] Convenient. [C] undesirable. [D] Easily learned. 26. Automated production methods are only attractive when they [A] Are undertaken in heavily unionized sectors of the economy. [B] Reduce per-unit costs.

8 [C] Replace workers. [D] Decrease labor productivity. 27. The fact that some people will work hard to earn a lot of money while others will be content with much less income indicates that [A] Worker preferences are an important source of earning g differentials. [B] Economics ranks one set of worker preferences as more desirable than another. [C] Some people can be paid less for doing hard work while others have to be paid a premium for doing a similar task. [D] Skill levels of laborers are a minor consideration in wage rate determination. 28. Which of the following is most likely to reduce the nominal market wage in a job category? [A] The job requires employees to work the night shift from 1 l P.M. to 7 AM. [B] The job is prestigious, and the work is quite interesting. [C] The job is widely viewed as dangerous. [D] The job requires employees to move from city to city quite often. 29. Wages in the United States are higher than those in India primarily because [A] The weather is better in the United States. [B]larger proportion of the labor force is unionized in the United States. [C] Less capital per employee is required in the United States. [D] The human and physical capital of American workers exceeds (hat of their Indian counterparts 30. Economic theory suggests that the standard of living of American workers would rise if A] The minimum wage was doubled. [B] Automation was outlawed. [C] Workers were forced to retire earlier.

9 [D] Technological improvements increased output per Worker-hour. 31. The earnings of all employees in a competitive economy would be equal if A. all individuals were homogeneous. B. all jobs were equally attractive. C. workers were perfectly mobile among jobs. D. all of the above are true. 32. When employment discrimination results from the personal prejudices of employers, economic theory suggests that a. it is costless for employers to discriminate against groups they do not like. b. the wages of employees who are discriminated against will actually rise. c. an employer who discriminates will experience higher costs. d. disc1'imination by an employer will reduce production costs since the employer can pay lower wages. 33. In a market economy, which of the following is most important if one is going to achieve high Earnings? a. hard work b. provision of goods and/or services that others value highly c. having a graduate degree in a field like history or sociology d. membership in a labor union 33. Both buyers and sellers are protected by market competition. Competition is the great regulator that protects consumers against high product prices (relative to costs) and productive workers against low wages. These statements are A. essentially true. B. false: competition protects consumers but cannot protect workers. C. false: competition protects workers but cannot protect consumers.

10 D. true. When consumer protection organizations are active and labor unions are powerful; otherwise it is false 34. Which of the following is not a key activity of an operations manager? a. Understanding the needs of customer b. Continually learning c. Managing cash flows d. Exploiting technology to produce goods and services 35. Which one of the following best represents a pure service? a. Bank loans b. Computer diagnosis and repair c. Attending a play d. Fast food restaurant 36. Which one of the following best represents a pure good? a. Salt b. Fast food c. Attending a play d. Vehicle repair 37. Which of the following is not true regarding the differences between goods and services? a. Demand for services is easier to forecast b. Customers participate in many services c. Services cannot be stored as physical inventory d. Patents do not protect services

11 38. Service organizations generally a. Locate in close proximity to the customer b. Rely on physical inventory c. Take advantage of patents d. Can delegate human behaviour and marketing skills 39. The following terms - interchangeability of parts, division of labour, highly repetitive tasks - best focus on. a. Quality b. Cost and efficiency c. Quality d. Time 40. Which of the following is generally related to service operations? a. Tangible product b. Need for flexible capacity c. Separation of production from consumption d. Large amount of inventory 41. A service encounter includes a. Face-to-face interaction b. Customers and a building c. Customers and advertising d. All of the above 42. Which function typically employs more people than any other functional area? a. Information Systems

12 b. Operations c. Marketing d. Finance 43. A measure of the success of an operation in producing outputs that satisfy customers is a. Efficiency b. Effectiveness c. Quality d. Profitability 44. A measure of the success of an operation in converting inputs to outputs is a. Efficiency b. Effectiveness c. Quality d. Profitability 45. The inputs to a transformation process include all of the following except a. Materials b. People c. Assembly d. Information 46. Characteristics of services include which of the following? a. Close proximity to the customer b. Simultaneous production and consumption c. Inability to inventory

13 d. All of the above 47. Which of the following would not be an operations activity in a fast-food restaurant? a. Advertising new salad dishes b. Purchasing tomatoes c. Planning the layout of the serving areas d. Cooking hamburgers and fries 48. is an example of a pure good. a. Restaurant b. Dentist c. Coal mining d. Education 49. Which term defines the process of project compliance with policies and procedures? A. Quality control B. Quality assurances C. Quality audits D. Quality control management 50. Which process does QA provide and umbrella for? A. Continuous process improvement B. Quality assurance C. Project management plan D. Quality baseline

14 51. Which of the processes includes all activities of the performing organization that determines policies and responsibilities of a project? A. Performance quality control B. Project quality management C. Performance plan management D. Quality control management 52. Which of the following are negative possibilities if quality requirements are not met? A. Overworking team members and poor product quality B. Customer complaints and late product C. Poor quality D. Termination 53: Which of these terms apply to identifying quality standards and how to satisfy them? A. Quality projections B. Quality management C. Quality planning D. Quality overview 54. Which of the following definitions apply to the cost of quality? A. Left over product B. Total cost of all project efforts C. Customer satisfaction D. Redoing entire project 55. EOQ model is based on the assumption that unit price is fixed. True

15 False Statement is wrong 56. Obsolescence cost is :- A. Due stock on hand B. Due stock on hand, part no. / Name 57. Set-up cost comprises of :- A. Idle time cost B. work-order cost C. work order cost, idle time cost 58. Quantity discounts reduce:- A. Procurement cost B. Marginal cost C. Total cost 59. The document which is prepared by the engineering department is :- A. Above statement is wrong B. There is no bill required C. Bill of material 60. Which of the following is not the external factor influencing materials planning? A. corporate objective B. planning objective

16 61. Down time means. A. Time required by equipment to become none of use B. time required by equipment to become not ok C. Time required by equipment to become OK 62. Security deposit means :- A. Amount as reserve-part kept by scarp contractor for final adjustment B. Amount as received-part kept by scarp contractor for first adjustment C. Amount reserve-part was not kept by scarp contractor 63. Identifying technical, financial, managerial and quality assurance capability of the vendors and thereby generate data to serve basis for preliminary source selection is:- A. Source of investigation stage B. only Investigation stage C. Both above D. None of these 64. specification is usually flexible and can be altered during consultation with different manufacturers of the equipment. A. Material B. wood Equipment C. Equipment D. All of the above 65. Issues to top up supply to pre-fixed levels of items are:- A. Legal issues B. Imprest issues

17 C. Financial issues 66. Requests for price increase are received on account of the following reasons :- A. Increase in cost of raw materials and bought out parts B. Changes in tax structure C. Added work content D. Increase in cost of raw materials and bought out parts, Changes in tax structure, Added work content 67. Select the Blank Stock held by company represents. A. House B. Money C. Measurements D. All of above 68. Method suitable for items which is either of purely Seasonal is. A. Sometimes buying B. Weekly buying C. Seasonal buying 69. The buying which is received in staggered lots, each lot at times may equal EOQ is :- A. Contract buying B. contract selling C. Both 70. Supplier's request for price increase should be analyzed patiently by the buyer. A curt 'no' or 'negative' reply spoils relationships. A. True

18 B. False 71. In instantaneous replenishment system, production rate is. A. Minimum B. Little bit C. Infinite 72. In MRP-1, manufacturing cycle of finished product is. A. Long B. short C. Medium 73. Materials department is service department. A. True B. False 74. Value analysis is necessary when company's profits soars. A. True B. False 75. Following special schemes are announced by Indian Government Under which import can be permitted at zero duty or at less duty:- A. Export promotion capital goods scheme B. Diamond & Jewellary promotion scheme C. Import by 100% export oriented units D. Export promotion capital goods scheme, Diamond & Jewellary promotion scheme, Import by 100% export oriented units

19 1-d 2-d 3-b 4-a 5-d 6-c 7-c 8-c 9-d 10-d 11-d 12-c 13-d 14-c 15-d 16-c 17-a 18-d 19-a 20-d 21-d 22-d 23-b 24-a 25-c 26-b 27-a 28-b 29-d 30-d 31-c 32-b 33-a 34-c 35-a 36-a 37-a 38-a 39-b 40-b 41-d 42-b 43-b 44-c 45-c 46-d 47-a 48-c 49-c 50-a 51-b 52-a 53-c 54-b 55-a 56-b 57-c 58-a 59-c 60-a 61-c 62-a 63-a 64-c 65-b 66-d 67-b 68-c 69-a 70-a 71-c 72-a 73-a 74-b 75-d

7. Family is one of the factors that influence consumer behavior. A. social B. personal C. business D. cultural

7. Family is one of the factors that influence consumer behavior. A. social B. personal C. business D. cultural 1. is never simple, yet understanding it is the essential task of marketing management. A. Consumption pioneering B. Brand personality C. Understanding the difference between primary and secondary data