OM Chapter 13

9. Which of the following is least likely to be found in service organizations? a. Intermediate levels in aggregate planning b. Bills of labor (BOL) c. Bills of resources and forecasting d. Dependent demand

10. Aggregate planning: a. is not driven by forecasts. b. includes detailed staff schedules. c. defines budget and associated resource requirements. d. is used to develop detailed short-term plans and establish shop floor control.

11. The words "product family," "budget allocation," and "long-term" fit best with which level of the generic framework for resource planning? a. Aggregate planning-Level 1 b. Disaggregation-Level 2 c. Execution-Level 3 d. Shop floor controlling-Level 4

12. If forecast demand exceeds the total factory or supply capacity, managers might simply decide not to meet forecast demand. This decision would most likely be made at which planning level? a. Aggregate planning-Level 1 b. Disaggregation-Level 2 c. Execution-Level 3 d. Shop floor controlling-Level 4

13. Assigning people to tasks, setting priorities for jobs, and scheduling equipment fits best with which level of the generic framework for resource planning? a. Aggregate planning-Level 1 b. Disaggregation-Level 2 c. Execution-Level 3 d. Market forecasting-Level 4

14. Setting order sizes and schedules for individual subassemblies and resources by week or day fits best with which level of the generic framework for resource planning? a. Aggregate planning-Level 1 b. Disaggregation-Level 2 c. Execution-Level 3 d. Shop floor controlling-Level 4

15. Which of the following is an aggregate planning decision option? a. Staff schedules b. Disaggregation c. Shop floor control d. Market forecasts

16. Promotion of weekly discount airfares by an airline would be an example of _____. a. demand management b. production-rate changes c. inventory changes d. facility, equipment, and transportation changes

17. Which of the following is NOT an aggregate planning decision option? a. Promotion and advertising b. Subcontracting c. Layoffs d. Staff schedules

18. Which aggregate planning strategy generally would result in the least amount of inventory? a. Level production strategy b. Chase demand strategy c. Fixed-order-quantity rule d. Lot-for-lot (LFL) rule

19. Which aggregate planning strategy sets production rate equal to the demand? a. Level production strategy b. Chase demand strategy c. Lot-for-lot (LFL) rule d. Periodic-order-quantity (POQ) rule

20. Which of the following is NOT TRUE regarding aggregate planning? a. Large number of alternatives can be developed. b. Good solutions using spreadsheets can be found by trial-and-error method. c. Seasonal fluctuations in demand can be accommodated. d. Costs are sunk and irrelevant.

21. A _____ is a statement of how many finished items are to be produced and when they are to be produced. a. capacity requirements plan (CRP) b. master production schedule (MPS) c. material requirements plan (MRP) d. shop floor control

22. All of the following statements are true regarding dependent demand EXCEPT: a. it is one of the underlying concepts of materials requirements planning (MRP). b. its concept can be understood by examining the bill of materials. c. it can be calculated only by forecasting. d. it is directly related to the demands of other stock-keeping units (SKUs).

23. _____ are the total demand for an item derived from all of its parents. a. Explosions b. Gross requirements c. Scheduled receipts d. Planned order receipts

24. Time buckets: a. are the same as planning horizons. b. can be set at a day for longer-term planning. c. are usually one week in length. d. are computed based on gross requirements.

25. Lot-for-lot (LFL): a. minimizes purchase or setup costs. b. maximizes the amount of inventory that need to be carried. c. ignores the cost associated with purchase orders. d. masks the true nature of dependent demand.

26. In the disaggregation framework, the direct inputs to material requirements planning (MRP) include all of the following EXCEPT: a. master production schedule (MPS). b. transaction files. c. bills of materials (BOM). d. capacity requirements plan (CRP).

27. The primary output of a materials requirements planning (MRP) system is a time-phased report that gives all of the following EXCEPT: a. the facilities managers a detailed schedule for acquiring additional factory space. b. the accounting and financial functions production information that drives cash flow, budgets, and financial needs. c. the production managers a detailed schedule for manufacturing the product and controlling manufacturing inventories. d. the purchasing department a schedule for obtaining raw material and purchased items.

28. An inventory item can be: a. only a parent. b. only a component. c. both a parent and a component. d. either a parent or a component, but not both.

29. Which lot sizing rule bases the order quantity on a standard-size container or pallet load? a. Lot-for-lot (LFL) rule b. Fixed-order quantity (FOQ) rule c. Periodic-order quantity (POQ) rule d. Gross requirements (GR) rule

30. Which lot sizing rule is best when inventory carrying costs are high and setup/order costs are low? a. Lot-for-lot (LFL) b. Fixed-order quantity (FOQ) c. Periodic-order quantity (POQ) d. Gross requirements (GR)

31. Which lot sizing rule uses the economic order quantity (EOQ) calculation? a. Both lot-for-lot (LFL) and periodic-order quantity (POQ) rules b. Only fixed-order quantity (FOQ) rule c. Only periodic-order quantity (POQ) rule d. Both fixed-order quantity (FOQ) and periodic-order quantity (POQ) rules

32. Which is the most comprehensive solution for a firm if a load report shows not enough capacity is available? a. Revise the bill of materials (BOM) and increase capacity. b. Change the action bucket. c. Change the master production schedule (MPS) and add capacity. d. Rerun materials requirements planning (MRP).

33. Capacity requirements are computed by multiplying the number of units scheduled for production at a work center by: a. the setup time and then subtracting the unit resource requirements. b. the setup time and then adding the unit resource requirements. c. the unit resource requirements and then adding in the setup time. d. the unit resource requirements and then subtracting the setup time.

34. A(n) _____ is a process of determining the amount of labor and machines required to accomplish the tasks of production on a more detailed level. a. action schedule (AS) b. master production schedule (MPS) c. material requirements plan (MRP) d. capacity requirements plan (CRP)

35. If a work center load report indicates insufficient capacity, options for correcting the problem include all of the following EXCEPT: a. revising the bill of materials. b. changing the master product schedule. c. subcontracting. d. transferring personnel between work centers.