Question 1

Aggregate Planning assumes that the facility decisions are made and cannot be changed for a given product.

Accepted Answer

A) True 
 B)False

Question 2

The most popular type of facility used by Fortune 500 companies is:

Accepted Answer

A)  Product-focused
B)  Process-focused
C)  Market-focused
D)  Price-focused
E)  General-purposeF) D) and E)
G) C) and D) A

Question 3

Which of the following statements regarding capacity is incorrect?

Accepted Answer

A)  Capacity can be measured in several units such as hours of output,number of units produced,number of customers served,etc.
B)  Effective capacity is generally less than the theoretical capacity.
C)  Capacity is the maximum output that could be produced over a period.
D)  It does not make sense to define the term 'maximum capacity' of a process.
E)  None of the aboveF) All of the above
G) A) and C)

Question 4

One option for altering the pattern of demand through aggregate planning is:

Accepted Answer

A)  Hiring employees
B)  Using overtime
C)  Carrying inventory
D)  Subcontracting
E)  PricingF) A) and E)
G) C) and D)

Question 5

Facilities decisions:

Accepted Answer

A)  Are medium-range capacity decisions
B)  Should consider the five crucial questions independently
C)  Constrain all other capacity decisions
D)  Require planning for one year onlyE) C) and D)
F) All of the above C

Question 6

A wait-and-see facility approach uses a positive capacity cushion.

Accepted Answer

A) True 
 B)False

Question 7

Aggregate Planning,Facilities Planning,and Scheduling form a hierarchy of decisions extending from long-range to medium-range to short-range,respectively,concerning the capacity of operations.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following accurately describes a chase strategy?

Accepted Answer

A)  The firm produces the same amount each day over the planning period and deals with the variations in demand with inventory or overtime.
B)  The firm produces at the same level for several months,and then adjusts production to another level and produces at that level for several more months.
C)  The firm produces exactly what is needed each month.
D)  All of the above could describe the strategy depending on the organization.
E)  None of the above accurately describes it.F) C) and E)
G) A) and D)

Question 9

Demand management variables include:

Accepted Answer

A)  Pricing,inventory,and advertising
B)  Reservations,pricing,and advertising
C)  Subcontracting,advertising,and pricing
D)  Inventory,reservations,and pricingE) C) and D)
F) A) and B) B

Question 10

One way of leveling the demand during the off-peak season is by employing a differential pricing strategy.

Accepted Answer

A) True 
 B)False

Question 11

Supply management variables include:

Accepted Answer

A)  Inventory,subcontracting,and cooperative arrangements
B)  Complementary offerings,inventory,and overtime
C)  Subcontracting,hiring,and reservations
D)  b and c
E)  a and cF) C) and E)
G) B) and E)

Question 12

It is possible in the short term for a firm to operate above 100% utilization.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is NOT true about aggregate planning in service organizations?

Accepted Answer

A)  A time horizon of 12 months,on average,is used
B)  The possibility of changing both supply and demand variables
C)  A variety of management objectives
D)  Requires inventory and capacity tradeoff
E)  Facilities are fixedF) A) and E)
G) A) and D)

Question 14

Aggregate planning differs from scheduling in that:

Accepted Answer

A)  The former refers to the long-range and the latter refers to the short-range.
B)  The former is concerned with allocating available resources and the latter with the acquisition of resources.
C)  The former refers to the long-range and the latter refers to the medium-range.
D)  The former is concerned with the acquisition of resources and the latter with allocating available resources.E) None of the above
F) C) and D)

Question 15

Which of the following departments is NOT affected directly by the facilities decision?

Accepted Answer

A)  Operations
B)  Marketing
C)  Finance
D)  None of the aboveE) All of the above
F) A) and B)

Question 16

Aggregate planning costs do NOT include:

Accepted Answer

A)  Hiring and layoff costs
B)  Overtime and undertime costs
C)  Part-time labor costs
D)  Subcontracting costs
E)  Inventory ordering costsF) A) and E)
G) A) and B)

Question 17

The aggregate planning problem:

Accepted Answer

A)  Is narrow in nature
B)  Only affects marketing and production
C)  Is solved using either (but not both) demand management variables or supply management variables
D)  Needs to consider multiple tradeoffs such as customer service level,inventory levels,labor force stability,and costsE) A) and B)
F) C) and D)

Question 18

Capacity Utilization = Actual Output/Capacity x 100%.

Accepted Answer

A) True 
 B)False

Question 19

Why can justifying capacity expansion with economies of scale be dangerous?

Accepted Answer

A)  It is far too specific to use as a basis for capacity decisions
B)  Because volume,capacity,and process considerations are looked at individually
C)  Because the common notion that unit costs will decline for larger facilities due to size is not necessarily accurate
D)  It requires consideration of quality,dependability,and flexibilityE) A) and D)
F) A) and C)

Question 20

In aggregate planning:

Accepted Answer

A)  The concern is over the long-time range.
B)  Output levels are set in the face of certain demand.
C)  "Aggregate" implies that planning is done for a single overall measure of output or at most a few products.
D)  Decisions should not consider overtime,hiring,firing,subcontracting,and inventory levels together.E) A) and B)
F) A) and D)

Exam 12: Capacity Planning

Aggregate Planning assumes that the facility decisions are made and cannot be changed for a given product.

Correct AnswerverifiedShow Answer

The most popular type of facility used by Fortune 500 companies is:

Correct AnswerverifiedA

Which of the following statements regarding capacity is incorrect?

Correct AnswerverifiedShow Answer

One option for altering the pattern of demand through aggregate planning is:

Correct AnswerverifiedShow Answer

Facilities decisions:

Correct AnswerverifiedC

A wait-and-see facility approach uses a positive capacity cushion.

Correct AnswerverifiedShow Answer

Aggregate Planning,Facilities Planning,and Scheduling form a hierarchy of decisions extending from long-range to medium-range to short-range,respectively,concerning the capacity of operations.

Correct AnswerverifiedShow Answer

Which of the following accurately describes a chase strategy?

Correct AnswerverifiedShow Answer

Demand management variables include:

Correct AnswerverifiedB

One way of leveling the demand during the off-peak season is by employing a differential pricing strategy.

Correct AnswerverifiedShow Answer

Supply management variables include:

Correct AnswerverifiedShow Answer

It is possible in the short term for a firm to operate above 100% utilization.

Correct AnswerverifiedShow Answer

Which of the following is NOT true about aggregate planning in service organizations?

Correct AnswerverifiedShow Answer

Aggregate planning differs from scheduling in that:

Correct AnswerverifiedShow Answer

Which of the following departments is NOT affected directly by the facilities decision?

Correct AnswerverifiedShow Answer

Aggregate planning costs do NOT include:

Correct AnswerverifiedShow Answer

The aggregate planning problem:

Correct AnswerverifiedShow Answer

Capacity Utilization = Actual Output/Capacity x 100%.

Correct AnswerverifiedShow Answer

Why can justifying capacity expansion with economies of scale be dangerous?

Correct AnswerverifiedShow Answer

In aggregate planning:

Correct AnswerverifiedShow Answer

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B

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