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OTM QUESTIONS AND ANSWERS 100% VERIFIED
Following are a set of slogans used for advertising. What customer utility dimensions does each emphasize?
A. We make lenses individually to the requirements of your eyes
B. Have your hamburger in 1 minute or less — or have it free
C. We match any price in town
D. Our dealer network gives service, where ever in the country you may be
E. The safest cars on the road - ANSWER A. Fit
B. Time
C. Price
D. Location
E. Performance
There are four hotels competing with otherwise very similar products on the dimensions of price ($ per night) and amenities (measured by the number of *s awarded by customer reviews).
Which of these hotels are on the efficient frontier?
A $200 3star
B $250 4star
C $300 5star
D $80 2star - ANSWER The only hotel that is Pareto dominated is hotel A - all other are on the efficient frontier. Hotel A is Pareto dominated by hotel B, as B is both cheaper and better.
Which of the following items would be considered an input in the operations of a
doctor's office?
- Examination table
- Nurse
- Needle
- Stethoscope - ANSWER The only item in the list that is a material used in the doctor's office operations is a needle. The rest of the items would be considered resources.
Which of the following inefficiencies in the operations of a grocery store arises due to lack of flexibility?
- Waste of fruits and vegetables
- Delay in receiving the delivery from the central warehouse
- Customer arrivals in lumps
- Employee work schedules set a week in advance Correct - ANSWER 4. Employee work schedules set a week in advance
In SWOT analysis, the emergence of a brand new market for the products they produce would fall into which category? - ANSWER Opportunities
From the perspective of process analysis, which of the following could be appropriate flow units for a hardware store?
- Number of workers
- Number of cash registers
- Number of customers
- Correct Number of suppliers - ANSWER 3. Number of customers
day? Assume that the park is opened 365 days in a year. - ANSWER Flow rate = 3,200,000 visitors/365 days = 8,767.1233 visitors/dayFlow time = 20 hours / 24 hours/day = 0.8333 daysInventory = 8,767.1233 × 0.8333 = 7,306 visitors per day
You are sitting in a restaurant and the waiter brings you the food you ordered a while ago. If you think about you being the flow unit in the process of the restaurant, which step of this process will be downstream relative to your current position in the process?
- Waiting to order
- Being seated at a table
- Paying the bill
- Reviewing the menu - ANSWER 3. Paying the bill
What is the relationship between the processing time at a resource and its capacity?
- They are the same.
- They are reciprocals of each other.
- They are multiples of each other.
- They are not related. - ANSWER 2. They are reciprocals of each other.
CT = 1/PT
You observe a bank and notice that a customer leaves the bank about every five minutes. These five minutes between customers are
- the capacity of the process.
- the processing time of the last resource.
- the cycle time.
- the lead time. - ANSWER 3. the cycle time.
If inventory is measured in kilograms, then when applying Little's Law the flow rate can be measured in ___
- Units per kilogram
- Minutes per kilogram
- Kilograms per second
- Kilograms per kilometer - ANSWER 3. Kilograms per second
Which of the following questions would be asked in a process analysis of a college admissions office?
- When was the college founded?
- How long does it take the office to process an application?
- How much is the yearly tuition at the college?
- How long does it take an average student to complete a degree program at the college? - ANSWER 2. How long does it take the office to process an application?
A large bakery is designing a new production process for its packaged bread, which it supplies to a number of grocery chains. The baking of the bread takes 15 minutes.
How big must an oven be so that this firm can make 4000 units of bread per hour, assuming a production rate defined as the number of units baked at one time? - ANSWER 4,000 units / (15 minutes / 60 minutes) = 1,000 units
Which of the following is true about takt time and cycle time?
- Takt time only depends upon demand and not capacity. Cycle time does depend upon capacity.
- Takt time depends only on capacity and not demand. Cycle time depends upon demand.
- Takt time and cycle time depend only on capacity.
product, and that all activities are always done in the following sequence.
Resource 1 has a processing time of 7 minutes per unit.
Resource 2 has a processing time of 4 minutes per unit.
Resource 3 has a processing time of 6 minutes per unit.
All three resources are staffed by one worker and each worker gets paid $13 per hour.
What is the average labor utilization? - ANSWER Labor Utilization = 17 labor content/ capacity = 80.95%
Consider a process consisting of three resources. Assume there exists unlimited demand for the product, and that all activities are always performed in the following sequence.
Resource 1 has a processing time of 7 minutes per unit.
Resource 2 has a processing time of 4 minutes per unit.
Resource 3 has a processing time of 6 minutes per unit.
All three resources have one worker and each worker is paid $13 hourly.
Assume the demand rate is 20 units/hour. What is the takt time? - ANSWER Takt Time = 1/Demand rate = 1/(20 customers/60 minutes) = 3.00 minutes
Consider a process containing three resources. Assume that there is unlimited demand for the product and that the activities are always performed in the following sequence.
Resource 1 requires 7 minutes to process one unit. Resource 2 requires 4 minutes to process a unit. Resource 3 requires 6 minutes for the processing of one unit.
All three resources are supported by one worker, with each worker being paid $13 an hour.
Assume that demand rate is 20 units/hour. What is the target manpower? - ANSWER Target manpower = 17 Labor content/3.00 minutes Takt time = 5.
Consider a process comprising three resources. Suppose there is infinite demand for the product and that the activities are always executed in the order listed below.
Resource 1 takes 7 minutes per unit to process.
Resource 2 takes 4 minutes to process one unit of a product.
Resource 3 takes 6 minutes to process one unit of a product.
All three resources are manned by one worker, and each worker is paid $13 per hour.
If one more worker could be added, to which resource would the additional resources be allocated? Determine the process capacity. - SOLUTION Add the worker to resource
- Resource 3 is the new bottleneck with capacity 60 min/hr / 6 min per unit = 10.0 units per hour.
As the number of an attrition losses in a process increases, what happens to the yield?
- The yield increases.
- The yield is the same.
- The yield is lower.
- Cannot be determined from the information provided. - ANSWER 3. The yield is lower.
Some of the resources have partial yields: 20 percent of material is discarded after the Acid step and 35 percent of the material is discarded after the separation step. The
- Cannot tell from the information provided. - ANSWER 3. Average inventory will be higher because larger batches take longer to complete.
Which of the following is most likely to be a concern if batches are very large?
- Flow rate will be too large.
- Utilization will be too high
- Inventory will be too large.
- Too much time will be wasted on changing products. ANSWER 3. Inventory will be too large.
A company is increasing the percentage value-added time in the operation. Its value-added time and its flow rate remain unchanged. What will happen to its inventory turns? (Recall from chapter 2 that inventory turns are computed as flow rate divided by inventory.)
- Inventory turns will go up.
- Inventory turns will stay constant.
- Inventory turns will go down.
- Cannot determine from the given information - ANSWER 1. Inventory turns will go up.
If the percentage value add time is going up and their value add time remains constant, their flow time has to go down. And that means, holding flow rate constant, that the inventory turns have to go up (the inventory level goes down).
The information turnaround time is driven primarily by
- number of workers.
- the IT system.
- the inventory in the process.
- the amount of waste in the process. - ANSWER 3. the inventory in the process.
Pulling the andon cord can lead to a loss of output. In TPS, an employee should pull the Andon cord
- whenever a problem occurs.
- whenever the employee sees the cost of stopping the line as lower than the costs of not stopping it.
- whenever he or she needs to go on a break.
- at no time. - ANSWER 1. whenever a problem occurs.
Which car company is most often associated with the term lean operations?
- General Motors
- Ford
- Toyota
- Honda - ANSWER 3. Toyota
Failsafing refers to - ANSWER building safeguards into a process to prevent problems
What are the two pillars of the Toyota Production System?
- Just-in-time and waste reduction
- Waste reduction and built-in quality
- Built-in quality and just-in-time
- Process improvement and waste reduction - ANSWER 3. Built-in quality and just-in-time
If the demand rate increases, the takt time - ANSWER Decreases
If the capability of a process is a six-sigma, its process capability index is- ANSWER 2
Within the Toyota Production System great importance is given to continually making things better. Which one of the following options would not be considered in typical approaches used within the Toyota Production System?
- improvements are made using the scientific method
- improvements are made at the lowest possible level in the organization
- improvements depend on identifying the root causes of problems
- improvements are made by adding quality inspectors to the process - ANSWER 4. improvements are made by adding quality inspectors to the process
Which of the following statements about Pareto diagrams is correct?
- The Pareto diagram shows the possible root causes of a problem along with the number of defect occurrences
- The Pareto diagram shows the process capability index over time
- The Pareto diagram shows the mean of a random sample at various points in time
- The Pareto diagram shows the graphical form of binary outcome variables - ANSWER
- The Pareto diagram represents the possible causes of a problem together with the number of defect occurrences
According to Juran's quality cost framework, the cost of scrapping defective products found during production would be an example of: - ANSWER Internal Failure Costs
scrapping defective products in the factory means that the defects have been discovered in-house, so this is an example of internal failure costs
Which of the following statements is not true concerning customer complaints and service recovery?
- a firm should try to break the customer silence regarding service problems
- customers who complain about a problem are less likely to remain with the service than customers who have a problem and do not complain
- front line employees must be trained and empowered to deal with service complaints
- for an average business, the majority of dissatisfied customers will not bother to complain - ANSWER 2. customers that have a problem and complain are less likely to stay with the service than customers that have a problem but do not complain
Which of the basic quality tools below would be most useful for tracking the change in product defect rates over time? - ANSWER Run chart
Which of the following definitions describes a robust process?
- A process is robust if it can tolerate variation in input and environmental variables without producing a defect.
- A process is robust if it has a lot of automation built in.
- A process is robust if it uses control charts.
- A process is robust if its process capability index is larger than 1. -ANSWER 1. A process is robust if it can resist variation in input and environmental variables and not generate a defect.
You begin a summer job serving ice cream at the shore. The manager notices that since you started the job, the average portion size given to customers has gone up substantially. This is a result of assignable cause variation. - ANSWER True
Assignable cause variation is the variation that occurs because of a specific change in input or in environmental variables.
A tire company producing bikes would want their tires to have exactly a particular width for the cyclocross category. Suppose it wants them to be within a range of 22.8 mm to 23.4 mm. Also assume standard deviation is 0.19 mm and the average is 23.1 mm.
What would the Cp index for this process be? - ANSWER.
4.08306 - ANSWER 3.
no more than.001 defect probability means that the probability in each tail must be no more than.
finding the probability of.005 in the standard normal table, we find Z = -3.
now, use the Z formula to solve for σ: -3.29 = (22.8 - 23)/σ → -3.29σ = -0.2 → σ =.
You are thinking about the things that can go wrong on your trip home over the Thanksgiving break. You have booked a flight with US-Scareways. You know that in 21 percent of the cases the company has canceled the flight you were on. Should such a thing occur, there would be no other air travel option home for you. As a backup, your friend Walter has offered you a ride back. However, you know that Walter only has a seat in his car for you with 72 percent probability.
What's the likelihood that you will make it home for the holidays? ANSWER There are two variables each with two outcomes so we have 2 × 2 = 4 possible scenarios. For you not to make it home two things have to go wrong (a) the airline has to cancel the flight - 21% and (b) Walter's car is full - 28%.
Thus, you will not make it home with a probability of 0.28 × 0.21 = 0.0588. You will make it home with a probability of 0.9412.
You work for a small, student-run company that sends out merchandise with university branding to alumni worldwide. Each day, you sample 50 shipments ready to go out to the alumni and check for correctness. On average, over all days, 5 percent of the shipments have mistakes. What is the upper control limit for a p-chart?
5. 0.142466 - ANSWER 5. 0.
SD = using p hat formula
UCL = P⎯⎯⎯ + 3 × Estimated standard deviation = 0.05 + 3 × 0.03082207 = 0.
For 40 days in the summer you work for a small student-run company that sends university-branded merchandise to alumni around the world. Each day, you randomly sample 50 shipments ready to go to the alumni and check them for correctness. Over all the days, the average per cent of incorrect shipments is 5 percent. What is the center line for a p-chart?
- None of these - ANSWER 3. 0.
