Operations Management 2nd Edition By Gerard Cachon – Test Bank

Operations Management 2nd Edition By Gerard Cachon – Test Bank

Operations Management, 2e (Cachon)

Chapter 4   Process Improvement

1) Cost of direct labor goes up whenever labor content goes up.

Answer:  FALSE

Explanation:  Cost of direct labor goes up only if the processing time of the bottleneck activity goes up.

Difficulty: 3 Hard

Topic:  Measures of Process Efficiency

Learning Objective:  04-01 Compute the costs of direct labor, labor content, idle time, and average labor utilization.

Bloom’s:  Analyze

AACSB:  Analytical Thinking

Accessibility:  Keyboard Navigation; Screen Reader Compatible

2) Takt time matches cycle time if supply matches demand.

Answer:  TRUE

Explanation:  Takt time matches cycle time when we produce (or supply) exactly the amount to meet demand.

Difficulty: 2 Medium

Topic:  How to Choose a Staffing Level to Meet Demand

Learning Objective:  04-02 Compute the takt time of a process and translate this to a target manpower.

Bloom’s:  Understand

AACSB:  Analytical Thinking

Accessibility:  Keyboard Navigation; Screen Reader Compatible

3) Automating some activities at a nonbottleneck resource increases the amount of idle time for that resource without making the process more efficient.

Answer:  TRUE

Explanation:  Activity automation should be applied to the bottleneck resource to increase process capacity.

Difficulty: 1 Easy

Topic:  Off-Loading the Bottleneck

Learning Objective:  04-03 Find ways to improve the process efficiency by off-loading the bottleneck.

Bloom’s:  Remember

AACSB:  Analytical Thinking

Accessibility:  Keyboard Navigation; Screen Reader Compatible

4) Line balancing can only be applied to activities with a fixed sequence.

Answer:  FALSE

Explanation:  Line balancing can be applied to activities with or without a fixed sequence.

Difficulty: 2 Medium

Topic:  How to Balance a Process

Learning Objective:  04-04 Balance a process by reallocating work from one step to another.

Bloom’s:  Understand

AACSB:  Analytical Thinking

Accessibility:  Keyboard Navigation; Screen Reader Compatible

5) Specialization reduces processing times by making it easier to balance the line.

Answer:  FALSE

Explanation:  Specialization usually reduces labor utilization and makes it harder to balance the line.

Difficulty: 1 Easy

Topic:  The Pros and Cons of Specialization

Learning Objective:  04-05 Explain the benefits and limitations of specialization.

Bloom’s:  Remember

AACSB:  Analytical Thinking

Accessibility:  Keyboard Navigation; Screen Reader Compatible

6) Revenue cannot be increased with an efficiency improvement on a demand-constrained process.

Answer:  TRUE

Explanation:  Efficiency improvement on a demand-constrained process will not change flow rate and thus brings no change in revenue.

Difficulty: 1 Easy

Topic:  Understanding the Financial Impact of Process Improvements

Learning Objective:  04-06 Evaluate the financial benefits of process improvements.

Bloom’s:  Remember

AACSB:  Analytical Thinking

Accessibility:  Keyboard Navigation; Screen Reader Compatible

7) Four employees at a fast-food restaurant each perform one of the four activities in serving a customer: greet customer, take order, process order, and deliver order. The processing time for each activity is given as follows:

Assume demand is unlimited. If each employee is paid $7.50 per hour, what is the cost of direct labor associated with serving one customer?

A) $0.80

B) $7.50

C) $0.50

D) $0.125

Answer:  C

Explanation:  Flow rate = Min(1/2, 1/30, 1/60, 1/5) = 1/60 customer per second, or 1/60 × 60 (seconds/minute) × 60 (minutes/hour) = 60 customers per hour because demand is unlimited. Cost of direct labor = (4 employees × $7.50 per hour)/60 = $0.50 per customer.

Difficulty: 3 Hard

Topic:  Measures of Process Efficiency

Learning Objective:  04-01 Compute the costs of direct labor, labor content, idle time, and average labor utilization.

Bloom’s:  Analyze

AACSB:  Analytical Thinking

Accessibility:  Keyboard Navigation