This document provides answers to exam questions for BAM 421 Operations Management Unit 3. It addresses topics like job enrichment, job design, outsourcing, supply chain management, inventory models, forecasting, and aggregate planning. Sample questions covered include defining job enrichment, calculating economic order quantity, differences between aggregate and master production scheduling, and aggregate planning strategies.

1. BAM 421 UNIT 3 EXAMINATION ANSWERS
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BAM 421 Unit 3 Examination Answers
BAM 421 Operations Management Unit 3 Exam
1. The behavioral approach to job design that involves giving the worker a larger portion of the
total task is job _______________.
2. enlargement
3. enrichment
4. enhancement
5. rotation
6. involvement
2. When a worker has a say in the work methods that he/she wishes to utilize, his/her job is
characterized by _______________.
3. skill variety
4. job identity
5. job significance
6. feedback
7. autonomy
3. Which of the following terms implies an increase in responsibility and control in the vertical
direction?
4. job rotation
5. job enrichment
6. job re-design

2. 7. job enlargement
8. job satisfaction
4. Which of the following statements describes job rotation?
5. The job contains a larger number of similar tasks.
6. The job includes some planning and control necessary for job accomplishment.
7. The operator works on different shifts on a regular basis.
8. The operator’s schedule is flexible.
9. The operator is allowed to move, for example, from one type of CNC machine to the other.
5. The difference between job enrichment and job enlargement is that ______________.
6. enlarged jobs involve vertical expansion while enriched jobs involve horizontal expansion
7. enriched jobs enable an employee to do a number of boring jobs instead of just one
8. job enlargement is more psychologically satisfying than job enrichment
9. job enrichment is suitable for all employees, whereas job enlargement is not
10. enriched jobs involve vertical expansion while enlarged jobs involve horizontal expansion
6. Suppose that the allowance factor for a job is 0.10 and the normal time is 5 hours. What is
the standard time?
7. 4.5 hours
8. 4.9 hours
9. 5.1 hours
10. 5.6 hours
11. 50.0 hours
12. A job characterized by _______________ allows a worker to use his/her dexterity, physical
strength and skills to do his/her work.
13. feedback
14. skill variety
15. job identity
16. job significance
17. autonomy
8. Outsourcing ______________.
9. transfers traditional internal activities to outside vendors
10. utilizes the efficiency which comes with specialization

3. 11. lets the outsourcing firm focus on its key success factors
12. None of the above are true of outsourcing.
13. All of the above are true of outsourcing.
9. The transfer of some of what are traditional internal activities and resources of a firm to
outside vendors is ______________.
10. a standard use of the make or buy decision
11. not allowed by the ethics code of the Supply Management Institute
12. offshoring
13. outsourcing
14. keiretsu
10. The Institute for Supply Management ________________.
11. establishes laws and regulations for supply management
12. is an agency of the United Nations charged with promoting ethical conduct globally
13. publishes the principles and standards for ethical supply management conduct
14. prohibits backward integration into developing economies
15. All of the above are true.
11. In supply-chain management, ethical issues ______________.
12. are particularly important because of the enormous opportunities for abuse
13. may be guided by company rules and codes of conduct
14. become more complex the more global the supply chain
15. may be guided by the principles and standards of the Institute for Supply Management
16. All of the above are true.
12. Which one of the following is not a supply-chain strategy?
13. negotiation with many suppliers
14. vertical integration
15. keiretsu
16. short-term relationships with few suppliers
17. virtual companies

4. 13. A disadvantage of the “few suppliers” strategy is _______________.
14. the risk of not being ready for technological change
15. the lack of cost savings for customers and suppliers
16. possible violations of the Sherman Antitrust Act
17. the high cost of changing partners
18. All of the above are disadvantages of the “few suppliers” strategy.
14. In the basic EOQ model, if the cost of placing an order doubles, and all other values remain
constant, the EOQ will _______________.
15. increase by about 41%
16. increase by 100%
17. increase by 200%
18. increase, but more data is needed to say by how much
19. either increase or decrease
15. In the basic EOQ model, if D=6000 per year, S=$100 andH=$5 per unit per month, then the
economic order quantity is approximately _______________.
16. 24
17. 100
18. 141
19. 490
20. 600
16. The two most basic inventory questions answered by the typical inventory model are
_______________.
17. timing and cost of orders
18. quantity and cost of orders
19. timing and quantity of orders
20. order quantity and service level
21. ordering cost and carrying cost
17. Among the advantages of cycle counting is that it ______________.
18. makes the annual physical inventory more acceptable to management
19. does not require the detailed records necessary when annual physical inventory is used
20. does not require highly trained people

5. 21. allows more rapid identification of errors and consequent remedial action than is possible
with annual physical inventory
22. does not need to be performed for less expensive items
18. Which of the following is an element of inventory holding costs?
19. housing costs
20. material handling costs
21. investment costs
22. pilferage, scrap and obsolescence
23. All of the above are elements of inventory holding cost.
19. Most inventory models attempt to minimize _______________.
20. the likelihood of a stockout
21. the number of items ordered
22. total inventory based costs
23. the number of orders placed
24. the safety stock
20. Top executives tend to focus their attention on which type of forecasts?
21. short-range
22. medium-range
23. long-range
24. weather
25. the forecast for the next day’s absentee levels
21. Which of the following would most likely fall under the scope of only an operations manager?
22. research and development
23. new product plans
24. capital investments
25. facility location and expansion
26. setting inventory levels
22. Disaggregation _______________.

6. 23. breaks the aggregate plan into greater detail
24. transforms the master production schedule into an aggregate plan
25. calculates the optimal price points for yield management
26. converts product schedules and labor assignments to a facility-wide plan
27. is an assumption required for the use of the transportation model in aggregate planning
23. Aggregate planning would entail which of the following production aspects at BMW for a 12
month period?
24. number of cars with a hi-fi stereo system to produce
25. number of two-door vs. four-door cars to produce
26. number of green cars to produce
27. total number of cars to produce
28. b, c, and d are correct.
24. What directly results from disaggregation of an aggregate plan?
25. a master production schedule
26. priority scheduling
27. a transportation matrix
28. a capacity-demand matrix
29. detailed work schedules
25. Dependence on an external source of supply is found in which of the following aggregate
planning strategies?
26. varying production rates through overtime or idle time
27. subcontracting
28. using part-time workers
29. back-ordering during high demand periods
30. hiring and laying off