1. Deciding how much to invest in the prevention of defects can be analyzed using:

EVPI.

A. net present value.

B. weighted factor analysis.

C. return on quality.

D. break-even analysis.

Answer: return on quality.

2. Six sigma programs involve both __________ and __________ components.

A. probabilistic; deterministic

B. logistical; managerial

C. statistical; probabilistic

D. managerial; technical

E. local; global

Answer: managerial; technical

3. Costs of inspectors, testing, test equipment, and labs are examples of:

A. internal failure costs.

B. external failure costs.

C. appraisal costs.

D. prevention costs.

E. replacement costs.

Answer: appraisal costs.

4. When an organization comes to the realization that there are quality problems in products that are already in service, ethical approaches include:

(I) divulging the information to the public at large.

(II) recalling, if possible, affected products.

(III) handling complaints on an individual rather than a systemic basis.

A. I and III

B. I and II

C. II and III

D. I, II, and III

E. Neither I, II, nor III

Answer: I and III

5. Which of the following is not an element of TQM?

A. continuous improvement

B. competitive benchmarking

C. employee empowerment

D. team approach

E. quality management as a specialized function within the firm

Answer: quality management as a specialized function within the firm

6. The process capability index (Cpk) may mislead if:

(I) the process is not stable.

(II) the process output is not normally distributed.

(III) the process is not centered.

A. I and II

B. I and III

C. II and III

D. II only

E. I, II, and III

Answer: I, II, and III

7. 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)

1 495 500 505 500

2 525 515 505 515

3 470 480 460 470

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?

A. sample 1

B. sample 2

C. sample 3

D. both samples 2 and 3

E. all samples are in control

Answer: both samples 2 and 3

8. The following data occurs chronologically from left to right:

15.2 19.7 16.0 11.1 14.8 14.5

The number of runs above and below the sample median is:

A. 2.

B. 3.

C. 4.

D. 5.

E. none of these.

Answer: 2.

9. 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?

A. 3.33

B. 1.67

C. 5.00

D. 2.50

E. 1.33

Answer: 1.67

10. Consider the following information:

Observations 1 2 3 4 5 6

Num. of defects 10 18 13 15 9 12

The number of runs above and below the sample median is:

A. 3.

B. 4.

C. 5.

D. 6.

E. none of these.

Answer: 5

11. One area in which aggregate planning decisions are made is:

A. job sequencing

B. customer order quantities

C. inventory levels

D. location

E. layout

Answer: inventory levels

12. In a service setting, the aggregate plan results in a time-phased projection of __________ requirements.

A. customer

B. staff

C. inventory

D. subcontracting

E. outsourcing

Answer: staff

13.Which of the following is an input to aggregate planning?

A. ending inventory

B. demand forecasts for each period

C. customer levels

D. setup costs

E. quantity discounts

Answer: quantity discounts

14. The main disadvantage(s) of informal techniques used for aggregate planning is(are):

A. they are expensive to do.

B. they may not result in the best plan.

C. they take a long time to do.

D. they require the use of a computer.

E. the lack of formal education of the planners.

Answer: they may not result in the best plan.

15. When the opportunity cost of lost revenue is relatively high, _________ become(s) relatively more attractive.

A. layoffs

B. back orders

C. excess capacity

D. disaggregation

E. minimal inventory

Answer: excess capacity

16. In a master schedule, the planning horizon is often separated into a series of time periods called:

A. pegging.

B. lead times.

C. stacked lead times.

D. time buckets.

E. firm, fixed, and frozen.

Answer: time buckets.

17. Bunny Helpers, Inc., has just received an order for 100 Deluxe Easter Baskets, which must be ready for delivery at the start of week 6. An MRP planner has prepared the following table showing product structure, lead times (orders are lot-for-lot), and quantities on hand:

Deluxe Easter Basket BOM Lead Time On-Hand

Deluxe Easter Basket 1 week 10

Dark Chocolate Truffles (2 per) 2 weeks 30

Carved Chocolate Eggs (4 per) 1 week 50

Each Deluxe Basket contains two dark chocolate truffles and four carved chocolate eggs.

When should an order for carved chocolate eggs be released?

A. at the start of week 2

B. at the start of week 3

C. at the start of week 4

D. at the start of week 5

E. at the start of week 6

Answer: at the start of week 4

18. Bunny Helpers, Inc., has just received an order for 100 Deluxe Easter Baskets, which must be ready for delivery at the start of week 6. An MRP planner has prepared the following table showing product structure, lead times (orders are lot-for-lot), and quantities on hand:

Deluxe Easter Basket BOM Lead Time On-Hand

Deluxe Easter Basket 1 week 10

Dark Chocolate Truffles (2 per) 2 weeks 30

Carved Chocolate Eggs (4 per) 1 week 50

Each Deluxe Basket contains two dark chocolate truffles and four carved chocolate eggs.

What is the net requirement for dark chocolate truffles to fill this order?

A. 100

B. 140

C. 150

D. 180

E. 200

Answer: 150

19. Which is true of a net-change system?

A. It is a batch-type system which is updated periodically.

B. It is usually run at the beginning of each month.

C. The production plan is modified to reflect changes as they occur

D. It is used to authorize the execution of planned orders.

E. It indicates the amount and timing of future changes.

Answer: The production plan is modified to reflect changes as they occur

20. Successful implementation of an effective MRP system depends upon: (1) the recognition of the difference between independent and dependent demand, and (2):

A. computers.

B. development of the EOQ model.

C. inventory control systems.

D. blanket purchase orders.

E. the Internet.

Answer: computers.

21. Business organizations that achieve good quality benefit in a variety of ways, including a positive reputation for quality, increased customer loyalty, and lower production costs.

A. True

B. False

Answer: A. True

22. Statistical process control is the measurement of rejects in the final product.

A. True

B. False

Answer: True

23. Aggregate planners typically use mathematical techniques such as linear programming for planning.

A. True

B. False

Answer: True

24. Lumpy demand for components results primarily from the periodic scheduling of batch production.

A. True

B. False

Answer: True

25. A bill of materials contains a listing of all the assemblies, parts, and materials needed to produce one unit of an end item.

A. True

B. False

Answer: True

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