Operations Management Study Set 5

Statistics

Quiz 5 :

Strategic Capacity Planning for Products and Services

Quiz 5 :

Strategic Capacity Planning for Products and Services

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The expected monetary value approach is most appropriate when the decision maker is risk neutral.
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True False
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True

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In reaching a decision, the alternative with the lowest cost should be ranked number 1.
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True False
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False

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Among decision environments, risk implies that certain parameters have probabilistic outcomes.
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True False
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True

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A weakness of the maximin approach is that it loses some information.
True False
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Increasing productivity and also quality will result in increased effective capacity.
True False
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The expected value of perfect information is inversely related to losses predicted.
True False
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If the unit cost to buy something is less than the variable cost to make it, the decision to make or buy is based solely on the fixed costs.
True False
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The maximax approach is a pessimistic strategy.
True False
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Decision trees, with their predetermined analysis of a situation, are really not useful in making health care decisions since every person is unique.
True False
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The Laplace criterion treats states of nature as being equally likely.
True False
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Among decision environments, uncertainty implies that states of nature have wide-ranging probabilities associated with them.
True False
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Stating capacity in dollar amounts generally results in a consistent measure of capacity regardless of the actual units of measure.
True False
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Design capacity refers to the maximum output rate that can be achieved under ideal conditions.
True False
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In decision theory, states of nature refer to possible future conditions.
True False
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The term capacity refers to the maximum quantity an operating unit can process over a given period of time.
True False
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The maximin approach involves choosing the alternative with the highest payoff.
True False
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Bounded rationality refers to the limits imposed on decision making because of costs, human abilities, time, technology, and/or availability of information.
True False
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Expected monetary value gives the long-run average payoff if a large number of identical decisions could be made.
True False
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Capacity decisions are usually one-time decisions; once they have been made, we know the limits of our operations.
True False
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The maximin approach involves choosing the alternative that has the "best worst" payoff.
True False
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