MGT 115 Exam 4 1. Which of the following aggregate planning strategies is a "demand option"?     a. changing price     b. subcontracting     c. varying production levels     d. changing inventory levels     e. using part-time workers Q2. Which of the following attempts to manipulate product or service demand?     a. inventories     b. part-time workers     c. subcontracting     d. overtime/idle time     e. price cuts Q3. Aggregate planning for fast food restaurants is very similar to aggregate planning in manufacturing, but with much smaller units of time.     a. true     b. false Q4. Which of the following is not an advantage of level scheduling?     a. stable employment     b. lower absenteeism     c. matching production exactly with sales     d. lower turnover     e. more employee commitment Q5. Which of the following aggregate planning models is based primarily upon a manager's past experience?     a. the linear decision rule     b. simulation     c. the management coefficients model     d. the transportation method     e. graphical or charting methods Q6. Aggregate planning occurs over the medium or intermediate future of 3 to 18 months.     a. true     b. false Q7. In aggregate planning, the amount of overtime and the size of the work force are both adjustable elements of capacity.     a. true     b. false Q8. In aggregate planning, which one of the following is not a basic option for altering demand?     a. promotion     b. subcontracting     c. back ordering     d. pricing     e. All are demand options. Q9. Which choice below best describes the counterseasonal demand option?     a. producing such products as lawnmowers and sunglasses during the winter     b. developing a mix of products that smoothes out their demands     c. lowering prices when demand is slack     d. using subcontractors only when demand is excessive     e. the breaking of the aggregate plan into finer levels of detail Q10. The management coefficients model is a formal planning model built around a manager's experience and performance.     a. true     b. false Q11. A firm's demand in the next four quarters (its aggregate planning horizon) is forecast to be 80, 50, 40, and 90 units. Last quarter, the firm produced 60 units. If it uses level scheduling, the firm will.     a. hire workers to permit production of 65 units per quarter for the next four quarters     b. hire 20 workers     c. have an increase in inventory of 20 units in the next quarter     d. have a decrease in inventory of 5 units in the next quarter     e. change its workforce each quarter so that inventory does not change Q12. The planning tasks associated with staffing, production, inventory, and sub-contracting levels typically fall under     a. short-range plans     b. intermediate-range plans     c. long-range plans     d. demand options     e. strategic planning Q13. Which of the following aggregate planning strategies is known to lower employee morale?     a. yield management     b. va ...

1. MGT 115 Exam 4
1. Which of the following aggregate planning strategies is a
"demand option"?
a. changing price
b. subcontracting
c. varying production levels
d. changing inventory levels
e. using part-time workers
Q2. Which of the following attempts to manipulate product or
service demand?
a. inventories
b. part-time workers
c. subcontracting
d. overtime/idle time
e. price cuts
Q3. Aggregate planning for fast food restaurants is very similar
to aggregate planning in manufacturing, but with much smaller
units of time.
a. true
b. false
Q4. Which of the following is not an advantage of level
scheduling?
a. stable employment
b. lower absenteeism
c. matching production exactly with sales
d. lower turnover
e. more employee commitment
Q5. Which of the following aggregate planning models is based
primarily upon a manager's past experience?
a. the linear decision rule

2. b. simulation
c. the management coefficients model
d. the transportation method
e. graphical or charting methods
Q6. Aggregate planning occurs over the medium or intermediate
future of 3 to 18 months.
a. true
b. false
Q7. In aggregate planning, the amount of overtime and the size
of the work force are both adjustable elements of capacity.
a. true
b. false
Q8. In aggregate planning, which one of the following is not a
basic option for altering demand?
a. promotion
b. subcontracting
c. back ordering
d. pricing
e. All are demand options.
Q9. Which choice below best describes the counterseasonal
demand option?
a. producing such products as lawnmowers and sunglasses
during the winter
b. developing a mix of products that smoothes out their
demands
c. lowering prices when demand is slack
d. using subcontractors only when demand is excessive
e. the breaking of the aggregate plan into finer levels of
detail
Q10. The management coefficients model is a formal planning
model built around a manager's experience and performance.

3. a. true
b. false
Q11. A firm's demand in the next four quarters (its aggregate
planning horizon) is forecast to be 80, 50, 40, and 90 units. Last
quarter, the firm produced 60 units. If it uses level scheduling,
the firm will.
a. hire workers to permit production of 65 units per quarter
for the next four quarters
b. hire 20 workers
c. have an increase in inventory of 20 units in the next
quarter
d. have a decrease in inventory of 5 units in the next quarter
e. change its workforce each quarter so that inventory does
not change
Q12. The planning tasks associated with staffing, production,
inventory, and sub-contracting levels typically fall under
a. short-range plans
b. intermediate-range plans
c. long-range plans
d. demand options
e. strategic planning
Q13. Which of the following aggregate planning strategies is
known to lower employee morale?
a. yield management
b. varying production rates through overtime or idle time
c. changing inventory levels
d. varying work force size by hiring or layoffs
e. back ordering during high demand periods
Q14. The quantity required of a dependent demand item is
computed from the demand for the final products in which the
item is used.
a. true

4. b. false
Q15. Firms may discover that, rather than adapting ERP to the
way they do business, they have to adapt the way they do
business to accommodate the ERP software.
a. true
b. false
Q16. Which of the following lot-sizing techniques results in the
lowest holding costs?
a. lot-for-lot
b. EOQ
c. part-period balancing
d. Wagner-Whitin algorithm
e. the quantity discount model
Q17. Which of the following best describes a gross material
requirements plan?
a. a schedule that shows total demand for an item, and when
it must be ordered from a supplier or when production must be
started
b. an intermediate range plan for the scheduling of families
of products
c. a chart illustrating whether capacity has been exceeded
d. a table that corrects scheduled quantities for inventory on
hand
e. a schedule showing which products are to be manufactured
and in what quantities
Q18. The master production schedule is a forecast of demand
for families of products.
a. true
b. false
Q19. Since MRP is quite detailed in nature, it has no influence
on the longer-range, less detailed aggregate planning.

5. a. true
b. false
Q20. A material requirements plan contains information with
regard to all of the following except
a. quantities and required delivery dates of all subassemblies
b. quantities and required delivery dates of final products
c. the capacity needed to provide the projected output rate
d. inventory on hand for each final product
e. inventory on hand for each subassembly
Q21. One of the tools that is particularly useful in reducing the
system nervousness in the MRP system is (are)
a. modular bills
b. time phasing
c. time fences
d. lot sizing
e. closed loop system
Q22. Planning bills of material are bills of material for "kits" of
inexpensive items such as washers, nuts, and bolts.
a. true
b. false
Q23. Each X requires 2 of component Y; each Y requires 4 of
part Z. The lead time for assembly of X is 1 week. The lead
time for the manufacture of Y is 1 week. The lead time for the
procurement of Z is 6 weeks. The cumulative lead time for X is
________ weeks.
a. 6
b. 7
c. 8
d. 10
e. cannot be determined
Q24. The Wagner-Whitin algorithm is the most widely used

6. MRP lot-sizing technique.
a. true
b. false
Q25. Material requirements plans specify
a. the quantities of the product families that need to be
produced
b. the quantity and timing of planned order releases
c. the capacity needed to provide the projected output rate
d. the costs associated with alternative plans
e. whether one should use phantom bills of materials or not
Q26. Each R requires 2 of component S and 1 of part T. The
lead time for assembly of R is 3 days. The lead time for the
manufacture of S is 5 days. The lead time for the manufacture
of T is 10 days. The cumulative lead time for R is ________
days.
a. 6
b. 9
c. 13
d. 17
e. cannot be determined
Q27. A Gantt load chart shows the loading and idle time of
several departments, machines, or facilities.
a. true
b. false
Q28. The assignment method provides an optimum, one-to-one
assignment of jobs to resources.
a. true
b. false
Q29. Sequencing (or dispatching)
a. assigns dates to specific jobs or operations steps
b. assigns jobs to work centers

7. c. specifies the order in which jobs should be done at each
center
d. assigns workers to jobs
e. assigns workers to machines
Q30. Orders are processed in the sequence in which they arrive
if (the) ________ rule sequences the jobs.
a. earliest due date
b. slack time remaining
c. first come, first served
d. critical ratio
e. Johnson's
Q31. One criterion for developing effective schedules is
minimizing completion time.
a. true
b. false
Q32. Which scheduling technique should be employed when due
dates are important for a job order?
a. forward scheduling
b. loading
c. dispatching
d. backward scheduling
e. master scheduling
Q33. The constant work-in-process (ConWIP) card aids input-
output control by limiting the amount of work in a work center.
a. true
b. false
Q34. Process-focused facilities and repetitive facilities generate
forward-looking schedules, but process-focused facilities do
this with JIT and kanban while repetitive facilities generally use
MRP.
a. true

8. b. false
Q35. If an assignment problem consists of 5 workers and 4
projects,
a. one worker will not get a project assignment
b. one project will be assigned two workers
c. the fifth worker will split time among the four projects
d. one project will not get a worker assigned
e. The problem cannot be solved by assignment method.
Q36. Three jobs are to be assigned to three machines. Cost for
each job-machine combination appears in the table below.
Perform the first two steps of the assignment method (subtract
the smallest number in each row and subtract the smallest
number in each column; then cover with straight lines). At this
point in the problem-solving process
a. the row for Job 1 contains the values 5, 6, and 0
b. calculations are complete, and the problem is ready for an
optimal set of assignments
c. the column for Machine B indicates that it should be
retired
d. Job 1 should be performed on Machine B
e. Job 1 should be performed on Machine A
Q37. The theory of constraints has its origins in
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
Q38. Which of the following statements regarding scheduling at
Delta Airlines is false?
a. About one flight in twenty is disrupted by weather events.
b. Schedule changes at one airport have a ripple effect that

9. may have impacts in many others.
c. Delta's high-tech computer and communications system is
located in Atlanta.
d. Delta's rapid rescheduling uses mathematical scheduling
models.
e. Delta's rapid rescheduling promotes air safety and limits
traveler inconvenience, but has not resulted in money savings
for Delta.
Q39. Reducing distance is a common JIT goal, both inside and
outside facilities. Outside, it manifests itself in attempts to get
suppliers closer to facilities; inside, it is a common layout
tactic.
a. true
b. false
Q40. Which one of the following scenarios represents the use of
a kanban to reduce inventories?
a. A supervisor tells the operators to stay busy and start
producing parts for next month.
b. A "supplier" work center signals the downstream
workstation that a batch has been completed.
c. A supervisor signals to several work centers that the
production rate should be changed.
d. A "customer" work center signals to the "supplier"
workstation that more parts are needed.
e. An operator asks the next station's operator to help him fix
his machine.
Q41. If setup times and costs can be reduced enough, the JIT
ideal of "Lot Size = 1" can be achieved.
a. true
b. false
Q42. The list of 5S's, although it looks like a housekeeping
directive, supports lean production by

10. a. identifying non-value items and removing them, in the
"sort/segregate" item
b. reducing wasted motion, in the "standardize" item
c. increasing variability through standardized procedures, in
the "standardize" item
d. eliminating wasted motion through ergonomic studies, in
the "support" item
e. building good safety practices, in the "shine/sweep" item
Q43. A manufacturer took the following actions to reduce
inventory. Which of these is generally not accepted as a JIT
action?
a. It used a pull system to move inventory.
b. It produced in ever smaller lots.
c. It required deliveries directly to the point of use.
d. It picked the supplier that offered the lowest price based
on quantity discounts.
e. It worked to reduce the company's in-transit inventory.
Q44. Transportation is an element of the Seven Wastes because
a. all movement of material between plants is waste
b. movement of equipment or people that adds no value is
waste
c. the transportation method of linear programming reduces
travel requirements
d. moving material between plants, between work centers,
and handling more than once is waste
e. transportation of any kind is a waste
Q45. Hidden problems are generally uncovered during the
process of reducing inventory.
a. true
b. false
Q46. With level schedules, a few large batches, rather than
frequent small batches, are processed.

11. a. true
b. false
Q47. A firm wants to develop a level material use schedule
based on the following data. What should be the setup cost?
a. $0.45
b. $4.50
c. $45
d. $450
e. $500
Q48. The first step in reducing setup times is the separation of
setup into preparation activities and actual setup, so that as
much work as possible can be done while the machine or
process is operating.
a. true
b. false
Q49. JIT systems carry inventory just in case something goes
wrong.
a. true
b. false
Q50. Inventory has only one positive aspect, which is
availability; inventory has several negatives, including
increased material handling, obsolescence, and damage.
a. true
b. false