Question 1

E,the efficiency,is a proportional factor used to convert units of throughput to standard time.

Accepted Answer

Efficiency (E) is indeed a proportional factor used to convert units of throughput to standard time. It is typically expressed as a decimal ranging from 0 to 1, or as a percentage ranging from 0% to 100%.

Question 2

PMC (productivities at maximum capacity) makes an excellent predictive measure of demand.

Accepted Answer

PMC is a measure of the maximum productivity that can be achieved under ideal conditions, it does not necessarily correlate with actual demand, which can be affected by a variety of factors such as market trends, competition, and consumer behavior. Other metrics such as historical sales data and market research may provide more accurate predictions of demand.

Question 3

Actual capacity is the greatest throughput rate that can be achieved with the existing configuration of resources and the accepted product or service mix plans.

Accepted Answer

Actual capacity represents the maximum output that can be achieved with the current resources and production plan, taking into account the product or service mix. This means that it considers both the available resources and the demand for different products or services, as well as any constraints or bottlenecks that may affect the overall capacity. Therefore, actual capacity is a realistic measure of a company's production capabilities, as opposed to theoretical or ideal capacity, which assumes perfect conditions and no constraints.

Question 4

Operations capacity describes how many units can be supplied per unit of time.

Accepted Answer

Operations capacity is a measure of the maximum output that can be produced by a system, process or organization in a given period of time. It is usually expressed in units per hour, day, week, or month. Therefore, operations capacity is a measure of how many units can be supplied per unit of time.

Question 5

Backorders can be used to postpone satisfying demand when there is no inventory available.

Accepted Answer

Backorders occur when a customer places an order for a product that is currently out of stock. The order is then placed on hold until the product becomes available again. This allows the company to delay fulfilling the order until there is inventory available.

Question 6

Unexplained fluctuations in capacity are unpleasant but profitable.

Accepted Answer

Unexplained fluctuations in capacity can lead to inefficiencies, increased costs, and customer dissatisfaction, which are generally not profitable for businesses.

Question 7

Shutting down the production system for 2 hours of an 8-hour day does not effect the measure U,which remains at 100 percent.

Accepted Answer

Shutting down the production system for 2 hours of an 8-hour day would result in a decrease in productivity, which would lower the measure U. Therefore, the statement is false.

Question 8

Two aspects of capacity requirements planning (CRP) are long-term planning and short-term tactical issues.Breakeven points and optimal allocation of resources exemplify the strategic thinking that characterizes long-term concepts.

Accepted Answer

Capacity requirements planning involves both long-term planning and short-term tactical issues. Long-term planning involves strategic thinking, such as breakeven points and optimal allocation of resources. Short-term tactical issues involve the day-to-day management of capacity utilization.

Question 9

The ability to contain or store inventory is a well-received measure of capacity.

Accepted Answer

The statement is true. The ability to contain or store inventory is an important factor in measuring capacity, especially for businesses involved in manufacturing or retail.

Question 10

When market demand falls below maximum supply capacity,an inventory buildup can be used to help meet that demand if backordering is prohibited.

Accepted Answer

When market demand falls below maximum supply capacity, it typically results in excess inventory, not a need to use inventory buildup to meet demand, since supply already exceeds demand.

Question 11

Robert Galvin,former chairman of Motorola,challenged the company to develop peak capability for quality production.

Accepted Answer

This statement is true. Robert Galvin did challenge Motorola to develop peak capability for quality production.

Question 12

Cnp stands for the cost of not having capacity to meet demands that are less than the average demand.

Accepted Answer

CNP typically stands for "Cost of Not Producing" or "Cost of New Production," and it refers to the costs associated with not being able to meet demand or the costs involved in creating additional capacity to meet demand. It does not specifically refer to the cost of not having capacity to meet demands that are less than the average demand.

Question 13

The two kinds of capacity situations (extra- and under-) have a trade-off relationship.

Accepted Answer

When there is extra capacity, it comes at a cost of unused resources and expenses. On the other hand, when there is under-capacity, it may lead to lost opportunities and dissatisfied customers. Therefore, there is a trade-off relationship between the two.

Question 14

Capacity as measured by maximum output volume per unit of time (or max throughput rate) comes closest to capturing the P/OM concept.

Accepted Answer

Capacity refers to the maximum output volume that a system, process, or operation can produce per unit of time. This measure is often used in production and operations management to evaluate the efficiency and effectiveness of a system's performance. Therefore, it is closely related to the P/OM concept, which refers to the interplay between production and operations management functions.

Question 15

Cp is the symbol used in the text to indicate the amount of extra investment required to install peak capacity to meet peak demand when it occurs.

Accepted Answer

The statement accurately describes the meaning of "Cp" as used in the text.

Question 16

A Weibull-type distribution,which reflects the high initial mortality of certain products (such as lightbulbs),looks like a normal unimodal distribution.

Accepted Answer

A Weibull-type distribution is not unimodal like a normal distribution. It has a higher probability of early failures, causing it to be skewed towards the left.

Question 17

Skillful management can decrease actual capacity.

Accepted Answer

Skillful management typically aims to optimize and increase actual capacity, not decrease it, by improving efficiency and productivity.

Question 18

The use of robots is a wise choice for nuclear experimentation.

Accepted Answer

The use of robots in nuclear experimentation can minimize the exposure of humans to radiation and reduce the risk of accidents. Robots can also work in environments that are hazardous or inaccessible to humans, making them a wise choice for nuclear experimentation.

Question 19

Motorola set for itself a difficult quality goal of 3.4 defects per million parts.This is the numerical equivalent of six-sigma limits.

Accepted Answer

Motorola is credited with developing the Six Sigma quality improvement process and famously set a goal of achieving 3.4 defects per million parts in their manufacturing processes. This numeric target is equivalent to six-sigma limits.

Question 20

E is the efficiency with which utilization U can be employed to make different kinds of products.

Accepted Answer

Efficiency (E) typically refers to how well energy, time, or resources are used to achieve a goal, whereas utilization (U) often refers to the extent to which equipment, facilities, or labor are being used. The statement incorrectly defines E in terms of U for making different kinds of products, which is not a standard definition of efficiency.

Quiz 10: Supply Chain Capacity Planning