ADL-14-Production & Operations Management-AM3

Assignment - A

Question 1. Define production and operations management. Explain strategic, technical

and operational decisions involved in production operations management.

Question 2. What are the two basic production systems? Explain their characteristics ad
vantages and disadvantages.

Question 3. Explain with a suitable example the factors that are to be taken into account
for plant location.

Question 4. What are the principles of plant layout? Explain the different layouts used in
industries. What are the advantages of each type of layout?

Question 5. Write short notes on any three of the following:

(a) JIT production systems
(b) Network analys is
(c) Production planning and control
(d) TQM
(e) Value Engineering

Assignment - B

Question 1a) What is a sequencing problem? What are the assumptions generally made in
solvingsequencing problems?

Question 1b) There are six jobs that must go through two machines A and B in the order
A, B. Process time in hours is given below.

Job 1 Job 2 Job 3 Job 4 Job 5 Job 6

Machine- A 6 10 5 11 12 8

Machine- B 8 15 9 14 13 11

Find out the job sequence that reduces total processing time. Also find out the idling
time.

Question 2a) What is econo mic order quantity? Der ive the EOQ formula. List the
assumptions and limitations of EOQ.
Question 2b) The annual demand for an item is 25,000. The cost of placing an order is
Rs. 100/- and the inventory carrying cost is 25 percent. The unit price of the item is Rs.
10/-. Find the EOQ.

Question 3 An electric fan company manufactures both ceiling and table fans. Resource
requirements for both these two items with corresponding revenues are indicated in the
following table.

Product Labour hour per Unit Raw material per unit (kg) Profit per unit in Rupees

Table Fan 2 8 80

Ceiling
4 6 100
Fan

The company can make available 80 hours of labour and 240 kgs. of raw material. How
many table and ceiling fans are to be produced to maximize profit?

Case Study

WASHDRY COMPANY

The Washdry Co mpany manu factures several mo dels of washers and dryers. The
projected monthwise requirements over the next year for their automatic washers are:

Month 1 2 3 4 5 6

Demand 800 1030 810 900 950 1340

Month 7 8 9 10 11 12

Demand 1100 1210 600 580 890 1000

Current inventory is 100 units. The firm current capacity is 960 units per month. The
average salar y of production workers is Rs. 1200/- per month. Each production worker
accounts for 30 units per month. Overtime is paid at one and half up to 20% additional
time. Additional labour can be hired for a training cost of Rs. 250/- and existing wo rkers
can be laid off at a cost of Rs. 500/-. Any increase o r decrease in pro duction rate costs
Rs. 5000/- for tooling, set up and line charges. This does not however apply to overtime.
Inventory ho ld ing costs are Rs. 25/- per unit per month. Back order cost is Rs. 75/- per
unit short.

Question 1. Using chase or level plan determines the next year productio n p lan that
minimizes total production cost.
 Assignment - C

1. Which one of the following is not a typical question dealt with any operations
manager?
(a) How much capacity will be needed in the months ahead?
(b) What is a satisfactory location for a new facility?
(c) How to motivate emplo yees?
(d) All of the above

2. Which of the following would not be generally considered as an aspect of operations

management?
(a) Schedule work
(b) Secure financial resources
(c) Maintain quality
(d) Observe the transformation process

3. The Operations Manager decides to buy a CNC machine to improve quality of

components produced. This decision falls in which of the following category:
(a) Strategic decision
(b) Tactical decision
(c) Routine decision
(d) None of above

4. Product variety in a job shop tends to be:

(a) High
(b) Moderate
(c) Low
(d) Very low

5. Which one of the following is not generally regarded as an advantage of product

layouts?
(a) Material handling costs per unit are low
(b) Labour costs are low per unit
(c) The system is fairly flexible to changes in the design of the product
(d) Accounting, purchase and inventory control are fair ly routine

6. In an ABC classification, A items typically represent about what percentage of the

items?
(a) 15%
(b) 30%
(c) 50%
(d) 80%

7. Which of the following is to be included in a list of assumptions of the basic EOQ?

(a) Lead time does not vary
(b) There are no quantity of discounts
 (c) Demand is uniform throughout the year
(d) All of above

8. Which of the following is a true statement concerning the relationship between holding
costs and ordering costs in the basic EOQ Model?
(a) The two are always equal at EOQ
(b) Holding cost is sometimes equal to ordering cost and sometimes greater at EOQ
(c) Holding cost is sometimes equal to ordering cost and sometimes less at EOQ
(d) Holding cost is always greater than ordering cost at EOQ

9. Which one of the following is not a basic option for altering capacity?
(a) Hire and fire workers
(b) Use overtime
(c) Use subco ntracting
(d) Use backorders

10. Aggregate planners balance:

(a) Demand and inventories
(b) Capacity and costs
(c) Capacity and inventories
(d) Capacity and demand

11. In a general sense, Quality may be defined as meeting or exceeding the expectations
of the customer. Identify which one of the following is a typical customer expectation?
(a) Conformance to specification
(b) Value
(b) Support
(d) All of the above

12. The application of statistical techniques to determine whether a quantity of material

should be accepted or rejected based on inspection or test of a sample is known as:
(a) Specification rev iew
(b) Acceptance sampling
(c) Deming wheel
(d) Benchmarking

13. A control chart typically does NOT show which of the following values:
(a) Central line
(b) Outer line
(c) Upper co ntrol limit
(d) Lower control limit

14. Acceptance sampling is used for all but which one of these:
(a) Inco ming raw material
(b) Work-in-process
 (c) Finish goods
(d) Incoming purchased parts

15. All of the following are true statements about using Johnson's rule except:
(a) Idle time on second machine is min imized
(b) The sequence of jobs at the two workstations should be identical
(c) Capacity utilization is minimized
(d) Jobs must have known processing time

16. Which of the following is an example of dependent demand:

(a) Pick up truck
(b) Refrigerators
(c) Hotel rooms sold
(d) Hospital bed sheets

17. The Key inputs to a MRP include:

(a) Engineering drawing of the product
(b) Product structure file
(c) Inventory records
(d) Both b and c

18. The work measurement method that is NOT usually used for setting standards for
repetitive well defined job is:

(a) The elemental standard data approach

(b) The work sampling method
(c) None of (a) &
(b)
(d) Both (a) & (b)

19. If inputs decrease while out put remains constant, what will happen to productivity?
(a) It will increase
(b) It will decrease
(c) It is impossible to tell
(d) It will remain same

20. Which one of the following is not a characteristic of a project?

(a) Uniqueness
(b) Defined goal
(c) Interdependencies of tasks
(d) Continuity

21. Which of the following is not a characteristic of service provider operations?

(a) Intang ible
(b) Perishable products
 (c) Labo ur intensive
(d) Low custo mer contact

22. Decisions that tends to focus on the entire organization, cutting across departments,
and have long-term consequences are called:
(a) Departmental
(b) Tactical
(c) Strategic
(d) Operational

23. __________ are the fundamental activities that organizations use to do work and
achieve their goal.
(a) Processes
(b) Operations
(c) Methods
(d) Procedures

24. Long-term capacity planning deals with what of the following factors:
( a ) Invest in new facilities
(b) Work force size
(c) Inventories
(d) Overtime budgets

25. When production volume is low and customization is high a _____ layout is
indicative.
(a) Flexib le flow
(b) Line flow
(c) Fixed position
(d) Cycle time

26. There are four major phases in a project life cycle. Which of the following is not a
phase?
(a) Termination
(b) Executio n
(c) Planning
(d) Maturity

27. The operations area's input to the aggregate plan includes:

(a) Demand forecasts
(b) Cost data
(c) Work force capacities
(d) Product design changes

28. An appliance manufacturer initiates a production plan that gets translated into an
operational plan is called:
(a) Business plan
 (b) Staffing plan
(c) Master prod uction schedule
(d) Work force schedule

29. Safety stock inventories protects against uncert ainties in:

(a) Demand
(b) Lead time
(c) Supply
(d) All of the above

30. The existence of lea rning curve is suggested by:

(a) A reduction in the price of a pro duct as the product reaches the maturity stage of its
life cycle
(b) A reduction in product costs due to lower raw material costs
(c) A reduction of unit cost as cu mu lative product volume increases
(d) None of the above

31. All of the following are true of time study EXCEPT:

(a) Time study offers the ability to set standards for new jobs before production begins
(b) Time study is not appropriate for non routine jobs
(c) Time study is appropriate only when the person conducting the time study is exper
ienced in selecting wo rk elements
(d) Time study can provide a satisfactory tool for setting equitable time standards

32. Which of the following is not a method of determining time standards:

(a) Time study
(b) Historical experiences
(c) Predetermined time standards
(d) Flow diagrams

33. The critical path of a network is the:

(a) Shortest time path thro ugh the netwo rk
(b) Path with the fewest activities
(c) Path with the most activities
(d) Longest time path through the network

34. Which of the following is a limitation of PERT and CPM:

(a) Graphical displays using networks help to quickly perceive relationships among
project activities
(b) They are app licable to a wide variety of pro jects and industries
(c) There is inherent danger of too much emphasis being placed on the critical path
(d) They are useful in monitoring not only schedules, but costs as well

35. A rout e sheet:

(a) Is an instruction to make a given quantity of a particular item
 (b) Shows in schematic form how a product is assembled
(c) Lists the operations necessar y to produce a component
(d) Is a corr ectio n/modification of an engineer ing drawing or bill of mater ials

36. Which of the following automatically places parts into a warehouse:

(a) ASRS
(b) AGV
(c) FMS
(d) CAD

37. The transportation method:

(a) Uses both qualitative and quantitative factors
(b) Performs a cost volume analysis
(c) Determines the best pattern of shipments fro m several points of supply to several
points of demand

(d) Finds location of a distribution center that minimizes distribution costs

38. Generally the goal of assembly line balancing is to:

(a) Minimize imbalance between machines or persons while meeting a required out put
from the line
(b) Maximize the number of workstations
(c) Is to determine the maximum time that an item remains at a work station
(d) Minimize the eff iciency of the line

39. Method analysis focuses on:

(a) The design of the machines used to perform a task
(b) How a task is accomplished
(c) The raw materials that are consumed in per for ming a task
(d) Reducing the number of steps required to perform a task

40. In process-oriented and fixed-position layouts, it is important to minimize the costs

of:
(a) Raw mater ial
(b) Material handling
(c) Special purpose machinery
(d) Skilled labour

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