Operations Management (MB241) : January 2004

Question Paper
Operations Management (MB241) : January 2004
Section A : Basic Concepts (30 Marks)
• This section consists of questions with serial number 1 - 30.
• Answer all questions.
• Each question carries one mark.
1. Which of the following issues falls under the purview of Operational Decision?
a. Problems of production and process design
b. Identification of manpower requirement
c. Assigning jobs to persons
d. Vendor identification
e. Capacity determination.
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2. Intel has established itself as a technology leader, coming out with new microprocessors at breakneck
speed. Which of the following competitive weapons is most likely being made use of by Intel
effectively?
a. Production flexibility
b. Quick delivery
c. Quality
d. Short product cycle
e. Product variety.
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3. Which of the following is not true about Linear Programming?
a. It is used to allocate scarce resources to strategic alternatives when the costs of various resources
are linear functions of their quantities
b. It is applicable to problems which have multiple objectives
c. It is applicable when there are alternative courses of action to solve the problem
d. The decision variables are flexible enough to take any non-negative values within a range
e. The achievement of the objective function is restricted by a set of binding factors or constraints.
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4. Maintenance of a computerized parts classification and coding system is usually required in which of
the following production systems?
a. Product Focussed
b. Process Focussed
c. Discrete Unit Manufacturing
d. Process Manufacturing
e. Cellular Manufacturing.
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5. Hybrid layout is commonly used to manufacture which of the following products?
a. Aircraft
b. Car
c. Television
d. Paper
e. Beer.
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6. Which of the following is not correct with respect to Computer Search used in aggregate planning?
a. It is a set of directions that systematically guides a computer in evaluating alternative aggregate
plans
b. The possible combinations of workforce levels and output rates for each period in the planning
horizon are explored by the computer
c. A very systematic search is done with the help of inbuilt specific rules
d. It may not yield the optimal plan sometimes, as all the possible plans are not examined
e. The cost functions should be constant and linear.
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7. Which of the following is not a correct assumption of the Economic Order Quantity (EOQ) model
developed by F.W. Harris?
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a. Economies of scale are involved in the purchase of materials
b. Lead-time for material delivery is known with certainty and remains constant
c. The cost of executing an order is fixed and is independent of the quantity ordered
d. Demand for a product is constant and uniform throughout the period
e. Partial execution of the purchase orders is not possible.
8. The doctor in charge of the surgical department wants the purchase manager to procure some surgical
scissors as early as possible. For this purpose, he has submitted a document containing a clear
specification of required materials, quantity required and probable date of requirement. This document
is referred to as
a. Purchase order
b. Purchase requisition
c. Request for proposal
d. Request for quotation
e. Request for comments.
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9. Which of the following is not a disadvantage of Job Specialization?
a. Lower flexibility
b. Lower work satisfaction
c. Reduced scope for workers' improvement
d. Complicated work instructions and difficulty in production control
e. Higher chances of workers getting local muscular fatigue.
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10. Which of the following work measurement techniques is usually adopted in service organizations like
schools and hospitals?
a. Time Study
b. Standard Data
c. Work Sampling
d. Historical Analysis
e. Employee self-timing.
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11. Spot welding of automobile bodies is an example of which of the following robotic applications?
a. Materials handling
b. Processing operations
c. Assembly
d. Inspection
e. Both (a) and (c) above.
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12. The formal business planning process addresses which of the following plan(s)?
a. Long-range plan
b. Intermediate-range plan
c. Operations plan
d. Both (a) and (b) above
e. All (a), (b) and (c) above.
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13. Fixed-sequence robots are most useful for which of the following production systems?
a. Product focussed
b. Process focussed
c. Job-shop
d. Intermittent system
e. Production system which uses Functional layout.
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14. Operations control functions are carried out by
a. Top-level managers
b. Middle-level managers
c. Manufacturing line workers
d. Staff supervisors
e. Both (c) and (d) above.
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15. Which of the following is built into many ERP packages to provide advanced materials and capacity
planning facilities so as to take care of order-winners and qualifiers in a specific situation?
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a. Materials Requirement Planning
b. Manufacturing Resource Planning
c. Intelligent Resource Planning
d. Information Process Reengineering
e. Business Process Reengineering.
16. Which of the following is false in relation to Demand Chain?
a. The focus is mostly on the end-user
b. The players in today’s emerging Demand Chains are the same as those in traditional supply
chains
c. Responsibilities are assumed by the Demand Chain as a whole
d. In a Demand Chain, products don’t necessarily originate from manufacturers
e. Consumers always buy from retailers.
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17. The value of Critical Ratio of an activity which is on schedule is
a. -1
b. 0
c. 1
d. More than 1
e. Between 0 and 1.
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18. Which of the following action(s) enhance(s) equipment maintenance in JIT manufacturing systems?
I. Organizations should design their equipment as simply as possible, reduce the variety of
machines, and standardize replacement parts.
II. Organizations should collect information about the frequency and causes of equipment
failure and use this knowledge to allocate maintenance resources efficiently.
III. Organizations can rebuild equipment by replacing parts one by one, rather than all at once.
a. Only (I) above
b. Only (II) above
c. Only (III) above
d. Both (I) and (II) above
e. All (I), (II) and (III) above.
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19. The cost of undetected faults with respect to quality inspection includes
a. Customer complaint
b. Stock out cost
c. Product replacement cost
d. Ordering cost
e. Both (a) and (c) above.
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20. A tractor manufacturing company uses infrared imaging to examine the problem areas identified
without dismantling the machine, so that the extent of damage can be determined before stopping the
machine. This is an example of
a. Remedial Maintenance
b. Predictive Maintenance
c. Centralized Maintenance
d. Decentralized Maintenance
e. Contract Maintenance.
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21. Which of the following statements is false regarding Program Evaluation and Review Technique
(PERT)?
a. It provides a graphical display of a project that helps the users understand the relationships
among the activities
b. It is applicable to any type of single project planning activity in any type of industry
c. It is ideal for planning projects in which activity times are known
d. It cannot handle situations in which two or more projects have to be planned together to share
the available resources
e. It is an ideal technique for strategic-level planning.
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22. Global organizations can obtain economies of scale by virtue of <
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I. Bargaining power.
II. Large production.
III. Skills and expertise of salespersons.
IV. Heterogeneity of products.
a. Only (I) above
b. Only (II) above
c. Both (I) and (IV) above
d. (I), (II) and (III) above
e. (II), (III) and (IV) above.
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23. Which of the following is/are example (s) of ordering cost with respect to inventories?
a. Warehouse rental
b. Setup cost if produced in-house
c. Postage
d. Both (a) and (b) above
e. Both (b) and (c) above.
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24. Which of the following is not true regarding JIT Purchasing?
a. There is usually a single source of supply for a given part in nearby geographical area with a
long-term contract
b. Purchasing is carried out in small lots, with frequent deliveries
c. Suppliers can be innovative in design specifications
d. A certain percentage of rejects from a supplier is acceptable
e. There is less formal paperwork.
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25. Maximum managers spend most of their time working on the unimportant many problems than
working on the important few problems. The remedy to this universal problem can be solved most
effectively using
a. Value analysis
b. Job analysis
c. ABC analysis
d. Make-or-Buy analysis
e. Break-even analysis.
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26. The stores manager wants to report to the senior management that in the past four months, the supply
of inventory materials had been very irregular. Which of the following types of output report related
to Materials Requirement Planning should be submitted by the stores manager to have the
management’s attention for ensuring a regular supply of materials in right quantities?
a. Change Report
b. Control Report
c. Planning Report
d. Authorized Order Release
e. Both (a) and (c) above.
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27. Which of the following priority scheduling rules is based on the assumption that the jobs that consume
more processing time are more valuable for the organization?
a. Earliest due date
b. Shortest processing time
c. Longest processing time
d. First in, first serve
e. Last in, first serve.
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28. Which of the following quality functions is measured as the Mean Time Between Failures (MTBF)?
a. Reliability
b. Serviceability
c. Perceived quality
d. Aesthetics
e. Features.
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29. Which of the following gives rise to a truly virtual corporation that allows contact with any customer <
or supplier at any time?
a. SCM
b. ESCM
c. CAD
d. CAM
e. CIM.
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30. Lakhan Company Limited wants to forecast the demand of its lawnmowers for the month of July.
Actual and forecasted demand for last five months is as follows:
(in units)
The mean absolute percentage error (MAPE) of the above data is
a. 12.98 %
b. 13.98 %
c. 14.98 %
d. 15.98 %
e. 16.98 %.
Month Feb Mar Apr May Jun
Forecast 110 120 145 155 180
Actual 80 106 133 162 170
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END OF SECTION A