OPS MGMT Multiple Choice Questions Exam Set
Question 1 The reorder point in a continuous review system is ________. Answer the sum of the safety stock level and the average demand during lead time the safety stock level the sum of the economic order quantity and average demand during lead time the sum of the safety stock level and the economic order quantity Question 2 Which of the following is a characteristic of competitive clustering? Answer an organization groups several outlets near each other several organizations are located closely together there is a risk of cannibalization of sales outlets are sometimes located near to market generators Question 3 The Anderson Palmer Hospital would like to reduce the cost of its inventory by calculating the optimal order size for hypodermic needles. On average, the hospital uses 200 needles per month. The purchasing staff has calculated that the EOQ for needles is 160 needles. If they proceed to purchase in EOQ quantities, how many orders per year will be placed? Answer About 15 orders per year About 18 orders per year About 20 orders per year About 30 orders per year Question 4 A textbook retailer wants to locate a facility which is most convenient to their student customers. Five universities have been identified and located on a grid map as shown on the table below. Enrollment at each university is represented by the value inside each circle on the map. Using a cross-median method, the optimal location for the retailer is a ________ Answer single point line segment between two points rectangle formed by four points none of the above Question 5 The Anderson Palmer Hospital would like to reduce the cost of its inventory by calculating the optimal order size for hypodermic needles. On average, the hospital uses 80 needles per month, the cost of placing an order is $14, and holding cost is estimated to be $1.20 per needle per year. Using the EOQ formula, the optimal order size is ______ Answer About 40 needles About 60 needles About 130 needles About 150 needles Question 6 A textbook retailer wants to locate a facility which is most convenient to their student customers. Five universities have been identified and located on a grid map as shown on the table below. Enrollment at each university is represented by the value inside each circle on the map. Using a cross-median method, the optimal location for the retailer is on the map ________ Answer at coordinates x=1, y=3 at coordinates x=2, y=2 at coordinates x=3, y=2 anywhere between (x=2, y=2) and (x=3, y=2) Question 7 The local distributor for Macho Heavy Beer is reconsidering its inventory policy now that only kegs will be sold. The sales forecast for next year is 1,200 kegs. The cost to store a keg of Macho in a refrigerated warehouse is approximately $4 per year. Placing an order with the factory costs about $5. Recommend an EOQ for Macho Heavy Beer. Answer About 45 kegs About 55 kegs About 65 kegs About 75 kegs Question 8 Which of the following distance metrics would provide the most accurate travel time for auto travel in Broward County Answer Euclidian metric Metropolitan metric Network arc Longitudinal arc Question 9 In a single location, single service business, all of the following are typical success factors EXCEPT ________ Answer building a preferred position among local customers allowing for capacity expansion on site developing standardized processes with sophisticated control systems adding peripheral services Question 10 Which of the following is true in relation to following EOQ graph? Answer Curve J represents the annual ordering cost, and curve K represents the annual holding cost. Curve K represents the annual ordering cost, and curve J represents the annual holding cost. Curve J represents the total annual cost, and curve K represents the annual ordering cost. Curve L represents the annual ordering cost, and curve K represents the annual holding cost. Question 11 All of the following are common conflicts between franchisers and franchisees EXCEPT ________. Answer when franchisee facilities should be upgraded how far a franchiser should go in saturating a single market area with outlets which employees should be promoted to management how fees should be established and profits distributed Question 12 A textbook retailer wants to locate a facility which is most convenient to their student customers. Five universities have been identified and located on a grid map as shown on the table below. Enrollment at each university is represented by the value inside each circle on the map. Using a cross-median method, the optimal location for the retailer is on the map ________ Answer at coordinates x=2, y=4 at coordinates x=2, y=2 anywhere between (x=2, y=2) and (x=2, y=3) anywhere between (x=2, y=2) and (x=2, y=4) Question 13 A textbook retailer wants to locate a facility which is most convenient to their student customers. Five universities have been identified and located on a grid map as shown on the table below. Enrollment at each university is represented by the value inside each circle on the map. Using a cross-median method, the optimal location for the retailer is a ________ Answer single point line segment between two points rectangle formed by four points none of the above Question 14 If a cereal manufacturer were to sell its globally-branded cereals that were developed in its home country, but customize the formula and supply chain for each country in which it operates, the manufacturer's international operations strategy would be best described as __________. Answer multiplex global multidomestic transnational Question 15 The local distributor for Macho Heavy Beer is reconsidering its inventory policy now that only kegs will be sold. The sales forecast for next year is 1200 kegs. The cost to store a keg of Macho in a refrigerated warehouse is approximately $4 per year. Placing an order with the factory costs about $6. If orders are placed in pallets of 50 kegs, the brewery is willing to give the local distributor a discount on the wholesale price of each keg. Macho beer must determine the exact discount amount before deciding whether or not to take the discount. Answer True False