Production and Operations Management Online MCQ Set 8

QN01. A strategy which aims to produce a perfect product which will suit everybody is called:

  1. Marketing orientation.
  2. Production orientation.
  3. Product orientation.
  4. Perfection orientation.
Answer

(C)Product orientation.

QN02. Someone who is responsible for finding out what individual customers need, and explaining how the firm's products meet those needs, is a ______________.

  1. Brand manager
  2. Salesperson
  3. Sales manager
  4. Market research manager
Answer

(B)Salesperson

QN03. Which of the following best describes strategic planning?

  1. Time horizon: Long-term
    Level of detail: Summarised
    Source: Mainly internal
  2. Level of detail: Summarised
    Source: Mainly external
    Degree of certainty: Certain
  3. Time horizon: Long-term
    Level of detail: Summarised
    Degree of certainty: Uncertain
  4. Time horizon: Long-term
    Level of detail: Highly detailed
    Source: Mainly external
Answer

(C)Time horizon: Long-term
Level of detail: Summarised
Degree of certainty: Uncertain

QN04. Psychologists use the term_________________ to describe the way that individuals absorb information.

  1. Cognitive style
  2. Intelligence Quotient
  3. Human Computer Interaction
  4. Data Processing
Answer

(ACognitive style

QN05. In a business continuity plan which of the following notification directories is the MOST important?

  1. Equipment and supply vendors
  2. Insurance company agents
  3. Contract personnel services
  4. A prioritized contact list
Answer

(D)A prioritized contact list

QN06. An expansionist capacity strategy is NOT indicated when:

  1. A preemptive marketing strategy is used.
  2. Expansion will lead to economies of scale.
  3. Expansion is made in large increments.
  4. Capacity expansion is consistently ahead of demand.
Answer

(B)Expansion will lead to economies of scale.

QN07. Costs that continue even if no units are produced are called

  1. Variable costs.
  2. Mixed costs.
  3. Marginal costs.
  4. Fixed costs.
Answer

(D)Fixed costs.

QN08. Which of the following actions would be best if a firm faced highly seasonal demand for a perishable product?

  1. Hire and fire employees as demand fluctuates.
  2. Build up inventory when demand is low.
  3. Add warehouse and production building space to accommodate the highest period of demand.
  4. Offer a product with a complementary demand pattern.
Answer

(D)Offer a product with a complementary demand pattern.

QN09. Which of the following is not a measure of utilisation?

  1. Uptime in a factory
  2. Number of hours available for production
  3. Room occupancy level in hotels
  4. Load factor for aircraft
Answer

(B)Number of hours available for production

QN10. A strategy which aims to produce the maximum amount of goods at the lowest possible price is called:

  1. Production orientation.
  2. Selling orientation.
  3. Societal marketing.
  4. Cost orientation.
Answer

(A)Production orientation.

QN11. Someone who has responsibility for marketing decisions concerning a group of products is:

  1. A marketing manager
  2. A brand manager.
  3. A sales manager.
  4. A product manager.
Answer

(D)A product manager.

QN12. The paradigm that leads to more complex products at ever-increasing prices is ______________.

  1. Product orientation
  2. Production orientation
  3. Marketing orientation
  4. Sales orientation
Answer

(A)Product orientation

QN13. Which of the following best describes the decision making required in dealing with customer enquiries?

  1. Unstructured, strategic
  2. Unstructured, operational
  3. Structured, strategic
  4. Structured, operational
Answer

(B)Unstructured, operational

QN14. Two systems are described as_________________ if a change in the outputs of one causes a substantial change in the state of the other.

  1. Highly decoupled
  2. Highly coupled
  3. Black boxes
  4. Sub-systems
Answer

(B)Highly coupled

QN15. Chang and Chang observe that the competition is increasing the size of its warehouses. They have decided to do the same. They are following a _______________________ strategy.

  1. Theory of Constraints
  2. Follow the leader
  3. Expansionist
  4. Wait-and-see
Answer

(B)Follow the leader

QN16. A facility with a design capacity of 1,000 units, an actual average of 800 units, and effective capacity of 850 units has a utilization of ______________ .

  1. 85%
  2. 80%
  3. 125%
  4. 94%
Answer

(B)80%

QN17. Yield management is not especially useful where:

  1. The service/product can be stored
  2. Capacity is relatively fixed
  3. The service cannot be sold in advance
  4. The market can be fairly clearly segmented
Answer

(A)The service/product can be stored

QN18. Which of the following is true?

  1. Value is always lower than price.
  2. Value is what consumers are prepared to pay.
  3. Cost is always lower than price.
  4. Price is always lower than value.
Answer

(B)Value is what consumers are prepared to pay.

QN19. A specific satisfier for a need is called a______________.

  1. Product
  2. Demand
  3. Want
  4. Market
Answer

(C)Want

QN20. Structured decisions are also called_________________ decisions.

  1. Strategic
  2. Programmable
  3. Read-intensive
  4. Non-programmable
Answer

(B)Programmable

QN21. Inputs come from and outputs are transferred to the_________________ of a system.

  1. Environment
  2. Sub-system
  3. Comparator
  4. Effector
Answer

(A)Environment

QN22. When evaluating alternative capacity decisions, qualitative concerns exclude:

  1. Cash flow.
  2. Uncertainties about demand.
  3. Competitive reaction.
  4. Technology change.
Answer

(A)Cash flow.

QN23. When demand exceeds capacity, a firm should

  1. Lower prices.
  2. Add workers.
  3. Temporarily lay-off workers.
  4. Advertise.
Answer

(B)Add workers.

QN24. The marketing concept should be central to business strategy because:

  1. Business strategy is aimed at customers.
  2. Companies have a moral responsibility to care for their customers.
  3. Marketing enables firms to persuade their customers to buy things they do not really need.
  4. Customers will only spend money with firms that look after their needs.
Answer

(D)Customers will only spend money with firms that look after their needs.

QN25. One way to decouple the production system and the sales system is:

  1. To introduce a feedback loop
  2. To treat the systems as black boxes
  3. To decrease sales
  4. To introduce an inventory
Answer

(D)To introduce an inventory

QN26. Long-term capacity planning deals with which of the following factors?

  1. Overtime budgets
  2. Workforce size
  3. Inventories
  4. Investment in new facilities
Answer

(D)Investment in new facilities

QN27. Efficiency is given by

  1. Actual output divided by design capacity.
  2. Capacity divided by utilization.
  3. Effective capacity divided by actual output.
  4. Actual output divided by effective capacity.
Answer

(D)Actual output divided by effective capacity.

QN28. The most aggressive and risky approach to capacity planning is

  1. Capacity lags with incremental expansion.
  2. Leading demand with one-step expansion.
  3. Leading demand with incremental expansion.
  4. Attempts to have an average capacity that straddles demand with incremental expansion.
Answer

(B)Leading demand with one-step expansion.

QN29. Demand is created when:

  1. A need is identified.
  2. A significant group of people want to buy something.
  3. People who can afford something want to buy it.
  4. Marketers persuade people to want something.
Answer

(C)People who can afford something want to buy it.

QN30. Input measures of capacity are preferred when there is/are:

  1. Service processes.
  2. High-volume processes.
  3. Flexible flow processes.
  4. Low customization.
Answer

(A)Service processes.

QN31. In general, a less capital-intensive industry such as a hotel chain would do well with a utilization rate of:

  1. Approximately 18%.
  2. 30-40%.
  3. 60-70%.
  4. 100%.
Answer

(C)60-70%.

QN32. A facility with a design capacity of 1,000 units, an actual average of 800 units, and effective capacity of 850 units has an efficiency of ______________.

  1. 80%
  2. 50%
  3. 85%
  4. 94%
Answer

(D)94%

QN33. The first steps of capacity planning and control do not include:

  1. Identifying the alternative capacity plans?
  2. Measuring aggregate demand and capacity?
  3. Studying the effect of queueing theory
  4. Choosing the most appropriate capacity plan?
Answer

(C)Studying the effect of queueing theory

QN34. Someone who controls media purchases and deals with advertising agencies is ____________________.

  1. An advertising manager
  2. A brand manager
  3. A public relations manager
  4. A sales manager
Answer

(A)An advertising manager

QN35. A measure of the reserve capacity a process has to handle in unexpected increases in demand is the:

  1. Capacity utilization rate.
  2. Capacity cushion.
  3. Capacity bottleneck.
  4. Capacity constraint limit.
Answer

(B)Capacity cushion.

QN36. The maximum output of a system in a given period is called the

  1. Efficiency.
  2. Effective capacity.
  3. Design capacity.
  4. Break-even point.
Answer

(C)Design capacity.

QN37. The multiple product case of determining breakeven in dollars

  1. Weights the variable cost of each product.
  2. Weights the selling price of each product.
  3. Weights the fixed cost attributable to each product.
  4. Weights the contribution of each product.
Answer

(D)Weights the contribution of each product.

QN38. The basic break-even model

  1. Demonstrates that the break-even point increases as output volume increases.
  2. Demonstrates that fixed costs remain constant as output volume increases.
  3. Demonstrates that total revenue is fixed as output volume increases.
  4. Demonstrates that per unit variable costs vary as output volume increases.
Answer

(B)Demonstrates that fixed costs remain constant as output volume increases.

QN39. Which of the following provides the best definition of 'information'?

  1. Computer hardware
  2. Data processed for a purpose
  3. Computer software
  4. Transaction Data
Answer

(B)Data processed for a purpose

QN40. Which of the following decision is least likely to be supported by a management information system?

  1. Company reorganisation
  2. Analysis of performance
  3. Allocating budgets
  4. Dealing with customer enquiries
Answer

(A)Company reorganisation

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