Question 1

Which approach to capacity management may be hard to sustain if the labor market is tight?

Accepted Answer

Using seasonal workforce may become hard to sustain during a tight labor market because there may be a shortage of available workers during peak seasons. This could lead to increased competition for workers, which may result in higher wages and fewer available workers.

Question 2

Which approach to capacity management would only be effective if the overall demand across all the products is relatively stable?

Accepted Answer

The answer of Which approach to capacity management would only...

Question 3

Pricing decisions based only on revenue considerations often result in

Accepted Answer

Pricing decisions based solely on revenue considerations may neglect other important factors such as cost, competition, and consumer demand, leading to a decrease in overall profitability. Optimal pricing strategies take into account various aspects of the market and the business, balancing revenue maximization with profit maximization.

Question 4

The promotion and pricing decisions made by marketing and sales typically have the objective of

Accepted Answer

The objective of marketing and sales is to maximize revenue, which can be achieved through promotions that increase sales and pricing strategies that maximize the amount customers are willing to pay. Maximizing profitability may be a secondary objective, but it is ultimately the revenue generated that leads to long-term profitability. Minimizing profitability or revenue would not be a desirable objective for a business.

Question 5

Which approach to capacity management would use a part-time workforce to increase capacity flexibility by enabling the firm to have more people at work during peak periods?

Accepted Answer

The answer of Which approach to capacity management would use...

Question 6

Which approach to capacity management makes use of overtime,which is varied to match the variation in demand?

Accepted Answer

The approach that makes use of overtime, varied to match the variation in demand, is known as time flexibility from the workforce. This involves shifting the workload among employees by utilizing overtime, which helps to meet the demand without adding permanent resources or capacity. This approach is the best choice as it helps to manage capacity efficiently and minimize costs.

Question 7

One key to successful collaboration when the supply chain is performing aggregate planning is

Accepted Answer

When performing aggregate planning in the supply chain, determining how profits will be allocated to different members of the chain is a key factor in ensuring successful collaboration. This incentivizes all members of the chain to work together towards achieving common goals and objectives. Allocating losses or labor to different members may create tension and potential conflict, while allocating customers is outside of the control of the supply chain members. Therefore, the best choice is B - determining how profits will be allocated.

Question 8

Which approach to capacity management makes use of spare plant capacity that exists in the form of hours when the plant is not operational?

Accepted Answer

Time flexibility from workforce involves managing capacity by utilizing spare plant capacity during hours when the plant is not operational, often by adjusting workforce schedules to match demand without the need for physical expansion or external resources.

Question 9

The capacity management approach where a firm purchases peak production from another firm so that internal production remains level and can be done cheaply is

Accepted Answer

The capacity management approach described in the question refers to the use of subcontracting, where a firm purchases peak production from another firm in order to maintain level internal production and reduce costs. The other options listed - time flexibility from workforce, the use of seasonal workforce, and the use of dual facilities-dedicated and flexible - may also be used in capacity management, but are not specifically related to the approach described in the question.

Question 10

Which approach to capacity management would require that the workforce be multi-skilled and easily adapt to being moved from line to line?

Accepted Answer

Designing product flexibility into the production processes would require a multi-skilled workforce that can easily adapt to being moved from line to line to accommodate changes in product demand. The other options do not necessarily require a multi-skilled workforce. Time flexibility from the workforce may refer to flexible work hours, while the use of seasonal workforce and dual facilities may not require constant movement of personnel.

Question 11

Which approach to capacity management would use production machinery that can be changed easily from producing one product to another?

Accepted Answer

Designing product flexibility into the production processes would allow for easy switching between different products on the same machinery, reducing the need for additional capacity or resources.

Question 12

Which approach to capacity management would schedule the workforce so that the available capacity better matches demand?

Accepted Answer

Time flexibility from workforce allows for adjusting work hours and shifts to better align workforce capacity with fluctuating demand.

Question 13

When planning,the goal of all firms in the supply chain should be to maximize supply chain profits because

Accepted Answer

Maximizing supply chain profits means that each member of the chain is performing efficiently and effectively. This results in more profit for the entire supply chain, which can be divided among the members of the chain. Therefore, choice B is correct. Choice A is incorrect because maximizing supply chain profits does not leave them less profit to divide. Choice C is incorrect as paying taxes is not the goal of firms in the supply chain. Choice D is incorrect because increasing charitable giving is not the main goal of firms in the supply chain.

Question 14

The capacity management approach where a firm has production lines whose production rate can easily be varied to match demand is

Accepted Answer

Designing product flexibility into the production processes allows for the production lines to easily vary their production rate to match demand, as different products may require different production rates. This approach is often more effective than relying on a flexible workforce, seasonal workforce, or subcontracting.

Question 15

The key to which capacity management approach would involve having both volume (fluctuating demand from a manufacturer)and variety flexibility (demand from several manufacturers)to be sustainable?

Accepted Answer

The answer of The key to which capacity management approach...

Question 16

When most of the products a firm produces have the same peak demand season,in order to meet predictable variability with inventory,it must

Accepted Answer

Building inventory of high demand or predictable demand products is the best choice as it ensures that the products are available during peak demand season. This can be done by forecasting demand and producing enough inventory to meet the demand. Using common components or subcontracting may not always be effective as the products may have different specifications and requirements. A seasonal workforce may also not be feasible or cost-effective.

Question 17

The capacity management approach where a firm builds facilities to produce a relatively stable output of products over time in a very efficient manner and facilities to produce a widely varying volume and variety of products,but at a higher unit cost is

Accepted Answer

The use of dual facilities - dedicated and flexible - allows a firm to balance the efficiency of producing a stable output of products with the ability to accommodate varying volume and variety of products when necessary. This approach enables the firm to optimize its capacity utilization and minimize costs while still being able to respond to changes in demand.

Question 18

The pricing and promotion decisions are often made by

Accepted Answer

Pricing and promotion decisions are typically within the purview of the marketing and sales departments, as they directly relate to market positioning, customer engagement, and revenue generation.

Question 19

Which of the following is an approach that firms can use when managing inventory to meet predictable demand variability?

Accepted Answer

Using common components across multiple products allows for better management of inventory because it reduces the number of unique parts needed for each product, which in turn simplifies the supply chain and makes it easier to manage inventory levels. This approach can help to meet predictable demand variability because it allows for greater flexibility in production and reduces the risk of stockouts or excess inventory. The other choices listed (A, B, and C) are not directly related to managing inventory to meet demand variability.

Question 20

Supply chains can influence demand by using

Accepted Answer

Supply chains can influence demand by using pricing and other promotions such as discounts or free shipping. This can encourage customers to make purchases and increase demand for the product. Additionally, supply chains can also offer promotional bundles or deals that make the product more attractive to customers. Production capacity and inventory can also impact demand, but they do not directly influence it in the way that pricing and promotions do. Therefore, the best choice is B.

Quiz 9: Sales and Operations Planning: Planning Supply and Demand