In the A-B-C system, the typical percentage of the number of items in inventory for A items is about:
In the A-B-C classification system, which account for 15% of the total dollar-volume for a majority of the inventory items would be classified as:
A items plus B items
B items plus C items
In the A-B-C classification system, items which account for 60% of the total dollar-volume for few inventory items would be classified as:
The EOQ model is most relevant for which one of the following?
ordering items with dependent demand
determination of safety stock
ordering perishable items
determining fixed interval order quantities
determining fixed order quantities
Which is not a true assumption in the EOQ model?
production rate is constant
lead time doesn't vary
no more than 3 items are involved
usage rate is constant
no quantity discounts
A cycle count program will usually require that 'A' items be counted:
once a week
more frequently than annually
In the basic EOQ model, if annual demand doubles, the effect on the EOQ is:
it is four times the previous amount
it is half its previous amount
it is about 70% of its previous amount
it increases by about 40%
In the basic EOQ model, if lead time increases from 5 to 10 days, the EOQ will:
increase, but not double
decrease by a factor of 2
remain the same
none of the above
In the basic EOQ model, an annual demand of 40 units, an ordering cost of $5, and a holding cost of $1 per unit per year will result in an EOQ of:
square root of 200
none of these
In the basic EOQ model, if D=60 per month, S=$12, and H=$10 per unit per month, EOQ is:
In the basic EOQ model, if annual demand is 50, carrying cost is $2, and ordering cost is $15, EOQ is approximately:
If average demand for an inventory item is 200 units per day, lead time is 3 days, and safety stock is 100 units, the reorder point is:
If no variations in demand or lead time exist, the ROP will equal:
expected usage during the lead time
the service level
the EOQ plus safety stock
Which one of the following isa implied by a "lead time" service level of 95%?
Approximately 95% of the demand during lead time will be satisfied
Approximately 95% of inventory will be used during lead time
The probability is 95% that demand during the lead time will exactly equal the amount on hand at the beginning of lea time
The probability is 95% that demand during lead time will not exceed the amount on hand at the beginning of lead time.
Which one of the following is implied by an "annual" service level of 95%?
Approximately 95% of demand during lead time will be satisfied
The probability is 95% that demand will exceed supply during lead time
The probability is 95% that demand will equal supply during lead time
The probability is 95% that demand will not exceed supply during lead time
None of the above
Daily usage is exactly 60 gallons per day. Lead time is normally distributed with a mean of 10 days and a standard deviation of 2 days. What is the standard deviation of demand during lead time?
60 x 2
60 times the square root of 2
60 times the square root of 10
60 x 10
Lead time is exactly 20 days long. Daily demand is normally distributed with a mean of 10 gallons per day and a standard deviation of 2 gallons. What is the standard deviation of demand during lead time?
20 x 2
20 x 10
2 times the square root of 20
2 times the square root of 10
Which of these products would be most apt to involve the use of a single-period model?
In a single-period model, if shortage and excess costs are equal, then the optimum service level is:
In a single-period model, if shortage cost is four times excess cost, then the optimum service level is percent.
In the single-period model, if excess cost is double shortage cost, the approximate stockout risk, assuming an optimum service level, is percent.
If, in a single-period inventory situation, the probabilities of demand being 1, 2, 3, or 4 units are .3, .3, .2, and .2, respectively. If two units are stocked, what is the probability of selling both of them?
If average demand for an item is 20 units per day, safety stock is 50 units, and lead time is four days, the ROP will be:
Suppose that usage of cooking oil at Harry's Fish Fry is normally distributed with an average of 15 gallons/day and a standard deviation of two gallons/day. Harry has just fired the manager and taken over operating the restaurant himself. Harry has asked you to help him decide how to reorder cooking oil in order to achieve a service level which is seven times the risk of stockout (7/8). Lead time is eight days. Assume that cooking oil can be ordered as needed.
A bakery's use of corn sweetener is normally distributed with a mean of 80 gallons per day and a standard deviation of four gallons per day. Lead time for delivery of the corn sweetener is normal with a mean of six days and a standard deviation of two days. If the manager wants a service level of 99 percent, what reorder point should be used?
A manufacturer is contemplating a switch from buying to producing a certain item. Setup cost would be the same as ordering cost. The production rate would be about double the usage rate.
Compared to the EOQ, the economic production quantity would be approximately:
Compared to the EOQ, the maximum inventory would be approximately:
The manager of the Quick Stop Corner Convenience Store (which never closes) sells four cases of Stein beer each day. Order costs are $8.00 per order, and Stein beer costs $.80 per six-pack (each case of Stein beer contains four six-packs). Orders arrive three days from the time they are placed. Daily holding costs are equal to five percent of the cost of the beer.
At what point should he reorder Stein beer?
0 cases remaining
4 cases remaining
12 cases remaining
16 cases remaining
20 cases remaining
If he were to order 16 cases of Stein beer at a time, what would be the length of an order cycle?
If he were to order 16 cases of Stein beer at a time, what would be the average inventory level?
If he were to order 16 cases of Stein beer at a time, what would be the daily total inventory costs, EXCLUDING the cost of the beer?
What is the economic order quantity for Stein beer?
A design engineer wants to construct a sample mean chart for controlling the service life of a halogen headlamp his company produces. He knows from numerous previous samples that this service life is normally distributed with a mean of 500 hours and a standard deviation of 20 hours. On three recent production batches, he tested service life on random samples of four headlamps, with these results:
Sample Service Life (hours)
1 195 500 505 500
2 525 515 505 515
3 470 480 460 470
90. What is the sample mean service life for sample 2?
What is the mean of the sampling distribution of sample means when service life is in control?
What is the standard deviation of the sampling distribution of sample means for whenever service life is in control?
If he uses upper and lower control limits of 520 and 480 hours, what is his risk (alpha) of concluding service life is out of control when it is actually under control (Type I error)?
If he uses upper and lower control limits of 520 and 480 hours, on what sample(s) (if any) does service life appear to be out of control?
both samples 2 and 3
all samples are in control
The Chair of the Operations Management Department at Quality University wants to construct a p-chart for determining whether the four faculty teaching the basic P/OM course are under control with regard to the number of students who fail the course. Accordingly, he sampled 100 final grades from last year for each instructor, with the following results:
Instructor Number of Failures
Prof. A 13
Prof. B 0
Prof. C 11
Prof. D 16
What is the sample proportion of failures (p) for Prof. D?
What is the estimate of the mean proportion of failures for these instructors?
What is the estimate of the standard deviation of the sampling distribution for an instructor's sample proportion of failures?
What are the .95 (5% risk of Type I error) upper and lower control limits for the p-chart?
.95 and .05
.13 and .07
.1588 and .0412
.16 and .04
.1774 and .0226
Using .95 control limits, (5% risk of Type I error), which instructor(s), if any, should he conclude is (are) out of control?
both Prof. B and Prof. D
A Quality Analyst wants to construct a control chart for determining whether four machines, all producing the same product, are under control with regard to a particular quality attribute. Accordingly, she inspected 1,000 units of output from each machine in random samples, with the following results:
Machine Total Defectives
What is the sample proportion of defectives for machine #1?
A stint for use is coronary surgery requires a special coating. Specifications for this coating call for it to be at least 0.05 millimeters but no more than 0.15 millimeters.
Suppose the criterion for evaluating this process is that the appropriate capability index must be at least 1.3.
With a long-run process mean of 0.09 and a standard deviation of 0.015, is this process capable?
Studies on a bottle-filling machine indicates it fills bottles to a mean of 16 ounces with a standard deviation of 0.10 ounces. What is the process specification, assuming the Cpk index of 1?
16.0 ounces plus or minus 0.30 ounces
Studies on a machine that molds plastic water pipe indicate that when it is injecting 1-inch diameter pipe, the process standard deviation is 0.05 inches. The one-inch pipe has a specification of 1-inch plus or minus 0.10 inch. What is the process capability index (Cpk) if the long-run process mean is 1 inch?
The specification limit for a product is 8 cm and 10 cm. A process that produces the product has a mean of
9.5 cm and a standard deviation of 0.2 cm. What is the process capability, Cpk?
The specifications for a product are 6 mm ± 0.1 mm. The process is known to operate at a mean of 6.05 with a standard deviation of 0.01 mm. What is the Cpk for this process?
138. A process results in a few defects occurring in each unit of output. Long-run, these defects should be monitored with___________________.
When a process is in control, it results in there being, on average, 16 defects per unit of output. C-chart limits of 8 and 24 would lead to a ________________ chance of a Type I error.
When a process is in control, it results in there being, on average, 16 defects per unit of output. C-chart limits of 4 and 28 would lead to a chance of a Type I error.
A tool that is not used for quality management is ________________.
The four dimensions of quality that are sometimes used to determine fitness for use of a product are
performance, special features, durability, and service after sale
performance, special features, conformance, and reliability
special features, conformance, reliability, and durability
performance, conformance, reliability, and durability
special features, conformance, durability, and service after sale
A tool that depicts process variation graphically is a(n) .
Which isn't a cost of quality?
Extended Service Contracts
Lost production time, scrap, and rework are examples of
internal failure costs
external failure costs
Warranty service, processing of complaints, and costs of litigation are examples of
Costs of inspectors, testing, test equipment, and labs are examples of
Loss of business, liability, productivity and costs are consequences of
Quality planning and administration, quality training, and quality control procedures are examples of
ISO 9000 standards do not have a requirement for
A quality circle is
responsible for quality
total quality control
an inspection stamp found on meat
a voluntary group of employees
ISO 9000 currently requires of a certified organization
A minimum of four supervisory levels
The quality control improvement tool which distinguishes between the "important few" and the "trivial many" is
TQM stands for:
Taguchie Quality Methods
Tactical Quality Measurements
The Quality Matrix
Total Quality Management
Total Quantity Measurement
Which of the following is an element of TQM?
all of the above
85. Management behaviors supporting an organizational culture that encourages continuous improvement include which of the following?
(I) develop a vision statement for the organization
(II) develop a reward system that promotes the philosophy
(III) institute continuous training programs
(IV) make decisions that adhere to the philosophy
I, II, and IV
I, II, III, and IV
I and III
II, III, and IV
II and IV
The tool that is useful in the collection and organization of data is:
a control chart
a Pareto chart
a check sheet
a flow chart
A quality improvement technique that involves the sharing of thoughts and ideas in a way that encourages unrestrained collective thinking is:
In order for TQM to be successful, it is essential that most of the organization be
members of quality circles
trained in error detection techniques
in agreement with the philosophy and its goals
The typical difference between "quality circles" and "continuous improvement teams" is
Quality circles work on product design only
Continuous improvement teams work on product and process design
Continuous improvement teams use only engineers while quality circles use just the workers doing the work
the amount of employee empowerment
There is no difference-they are just the same
Which of the following is not a goal of process improvement?
increasing customer satisfaction
achieving higher quality
identifying the cause of a problem
All are the goals