Deck 6: Processes and Technology

Question 1

Continuous production is characterized by very high volumes of commodity products.

Answer 1

True

Question 2

Process planning determines how a manufactured good is produced or a service is provided.

Answer 2

True

Question 3

Mass production is characterized by high volumes of a customized product for a mass market.

Answer 3

False

Question 4

Customers are rarely involved in a project that takes an extended period of time to complete.

Question 5

Batch production is also known as a job shop because it creates more jobs than any of the other process choices.

Question 6

Mass production is characterized by the use of specialized equipment and workers with limited skills.

Question 7

A firm's process strategy defines the extent of customer involvement in providing a service.

Question 8

The organization's overall approach for producing goods and providing services is its process strategy.

Question 9

Supplier reliability is often an important consideration in outsourcing decisions.

Question 10

Outsourcing occurs when a company cannot or will not make all the parts that go into a product.

Question 11

Producing a high volume of a single product is a characteristic of batch production.

Question 12

Breakeven analysis examines the cost tradeoffs associated with demand volume when selecting a process.

Question 13

Companies that control the production of virtually all of the parts that go into a product are said to be horizontally integrated.

Question 14

Planning, analyzing, and improving processes is the function of operations management.

Question 15

Process design specifies what tasks need to be done and how they are to be coordinated among functions, people, and organizations.

Question 16

A process is a group of unrelated tasks with specific inputs and outputs.

Question 17

Mass production is often associated with assembly lines.

Question 18

Supplier speed is rarely an important consideration in outsourcing decisions.

Question 19

Most of the operations in batch production involve assembly rather than fabrication.

Question 20

One-of-a-kind production of a product based on a customer's unique specifications is a called a project.

Question 21

If a firm can sell a product for $40each, then what is the volume needed to breakeven if the fixed cost of production is $125,000 and labor and material costs are $30. per item?

A) 125,000
B) 12,500
C) 4,167
D) 3,250

Question 22

A firm's process strategy defines all of the following except its

A) capital intensity.
B) process flexibility.
C) vertical integration.
D) process selection.

Question 23

As process selection moves up the diagonal from project to continuous production

A) demand volume increases.
B) product variety increases.
C) capital intensity decreases.
D) flexibility increases.

Question 24

One disadvantage of mass production is its

A) efficiency.
B) speed of production.
C) low per-unit costs.
D) lack of responsiveness.

Question 25

Which of the following is not an advantage of batch production?

A) frequent changes in product mix
B) flexibility
C) customization of output
D) quality reputation

Question 26

Process innovation reflects the total redesign of a process for a breakthrough improvement.

Question 27

A company is considering producing a product for a new market. The fixed cost required for manufacturing and delivering the product is $50,000. Labor and material costs are estimated to be approximately $25 per product. If the product is sold for $35.00 each, the firm's breakeven volume would be

A) 50,000 units
B) 5,000 units
C) 2,500 units
D) 500 units

Question 28

A process flowchart is a useful tool for analyzing a process because it often highlights nonproductive activities.

Question 29

Variable demand and small-to-moderate quantities produced to-order are characteristics usually associated with

A) mass production.
B) continuous production.
C) projects.
D) batch production.

Question 30

A company is evaluating which of two alternatives should be used to produce a product that will sell for $35 per unit. The following cost information describes the two alternatives. The breakeven volume for Process A is

A) 50,000 units.
B) 62,500 units.
C) 30,000 units.
D) 20,000 units.

Question 31

Disadvantages of batch production include all of the following except

A) high per-unit costs.
B) frequent changes in product mix.
C) flexibility.
D) scheduling problems.

Question 32

Vertical integration is the degree to which a firm produces the parts that go into its products.

Question 33

The extent to which the firm will produce the inputs and control the outputs of each stage of the production process is known as

A) vertical integration.
B) process flexibility.
C) process planning.
D) capital intensity.

Question 34

Complex scheduling problems are most likely to occur with which process type?

A) mass production
B) batch production
C) continuous production
D) None of these answer choices is correct.

Question 35

Most of the operations in batch production involve

A) fabrication.
B) assembly.
C) continuous processing.
D) outsourcing.

Question 36

A print shop is an example of which of the following process choices?

A) project
B) batch production
C) continuous production
D) mass production

Question 37

Steel, paper, paints, and chemicals are examples of products that use

A) batch production.
B) repetitive production.
C) continuous production.
D) mass production.

Question 38

The ease of adjusting resources in response to changes in demand defines a firm's

A) vertical integration.
B) process flexibility.
C) customer involvement.
D) capital intensity.

Question 39

Which of the following is not a characteristic of mass production?

A) made-to-stock
B) stable demand
C) high product variety
D) high product volume

Question 40

Mass production systems tend to employ

A) specialized equipment and limited labor skills.
B) specialized equipment and specialized labor skills.
C) general purpose equipment and limited labor skills.
D) general purpose equipment and specialized labor skills.

Question 41

A company is evaluating which of two alternatives should be used to produce a product that will sell for $35 per unit. The following cost information describes the two alternatives For what level of volume (output) would the firm prefer Process A to Process B?

A) for all volume levels greater than 75,000
B) for all volume levels greater than 97,500
C) for all volume levels greater than 117,500
D) for all volume levels greater than 125,000

Question 42

A company is evaluating which of two alternatives should be used to produce a product that will sell for $35 per unit. The following cost information describes the two alternatives If total demand (volume) is 120,000 units, then the company should

A) select Process A with a profit of $940,000 to maximize profit
B) select Process B with a profit of $450,000 to maximize profit
C) select Process A with a profit of $700,000 to maximize profit
D) select Process B with a profit of $690,000 to maximize profit

Question 43

List some noneconomic factors that can influence a firm's outsourcing decision.

Question 44

A company is evaluating which of two alternatives should be used to produce a product that will sell for $35 per unit. The following cost information describes the two alternatives. The break-even volume for Process B is

A) 50,000 units.
B) 62,500 units.
C) 30,000 units.
D) 20,000 units.

Question 45

The first step in building a flowchart is to

A) define process boundaries.
B) map out the process
C) determine objectives
D) None of these answer choices is correct.

Question 46

A company is considering producing an item that can be sold for $37.50 per unit. If the fixed costs for setting up production are $225,000 and the variable cost per unit for the item is $35 then the breakeven volume for this item is

A) 6,000 units.
B) 6,429 units.
C) 72,500 units.
D) 90,000 units.

Question 47

A company is evaluating which of two alternatives should be used to produce a product that will sell for $35 per unit. The following cost information describes the two alternatives If total demand (volume) is 150,000 units, then the company should

A) select Process A with a profit of $1,300,000 to maximize profit
B) select Process B with a profit of $750,000 to maximize profit
C) select Process A with a profit of $1,000,000 to maximize profit
D) select Process B with a profit of $1,050,000 to maximize profit

Question 48

What is a process strategy and how does it affect the firm?