Multiple Choice Questions

OPERATIONS MANAGEMENT

1. Most operation produces a mixture of both products and services which of the following business is closest
to producing ‘pure’ services?
a. IT company b. Counselor /therapist
c. Steel company d. A restaurant
Answer: b
2. Operations can be classified according to their volume and variety of production as well as the degree of
variation & visibility. Which of the following operations would be classified as high volume , low variety ?
a. A front office bank
b. A family doctor
c. A carpenter
d. A fast food restaurant
Answer: d
3. Which of the following activities is not a direct responsibility of operations management?
a. Developing an operations strategy for the operation
b. Planning & controlling the operations
c. Determining the exact mix of products and services that customers will want
d. Designing the operations products , services & process
Answer: c
4. Operations management is applicable
a)Mostly to the service sector
b)Mostly to the manufacturing sector
c) to manufacturing and service sectors
d)To services exclusively
Answer: c
5. …...............is the process of selection of path, which each part of the product will follow
a)Routing.
b)Scheduling
c) Follow-up.
d)Dispatching
Answer: a
6. If inputs decrease while output remains constant, what will happen to productivity?
a. It will increase
b. It will decrease
c. It will remain the same
d. It is impossible to tell
Answer: a
7. …..............................is concerned with deciding in advance what is to be produced, when to be produced,
where to be produced and how to be produced.
a)Production planning
b) Production control.
c) (a) and (b).
d)None of these
Answer: c

8. All of the following decisions fall within the scope of operations management EXCEPT
for
 a. Financial analysis
b. Design of products and processes
d. Location of facilities
e. Quality management
Answer: a

9. In the case of…………………. the products are produced as per the specifications of the customers
within prefixed time and cost.
a. Mass production
b. Job production
c. Both of these
d. None of these

Answer: b

10. In........................., machines and other supporting services are located according to the processing
sequence of the product
a. Project lay out
b. Product lay out
c. Combination lay out
d. None of these
Answer: b
11. The lay out in which production operation is performed in a fixed position is called………….
a. Project lay out
b. Product lay out
c. (a) and(b)
d. None of these
Answer: a
12............................decision is the systematic process of determining a geographic
site for a firm’s operations.
a. Plant ___location
b. Plant layout
c. Product lay out
d. none of these
Answer: a

13. Which of the following affect the choice of plant ___location decision?
a. Proximity to markets
b. Supply of materials
c. a and b
d. None of these
Answer: C

14. Safety stock is related to

a. Inventory control
b. Employee control
c. Strategic control
d. Quality Control
Answer: a
15. Which of the following is not an attribute to classify the services
a. Tangibility
 b. Perishability
c. Simultaneity
d. Degree of customer contact
Answer: a

16. Materials, land, energy and human and capital resources are the examples of:
a. Inputs
b. Transformation
c. Outputs
d. Productivity
Answer: a

17. A tool to measure effective use of resources and usually expressed as the ratio of output to input is
known as;

a. Production ratio
b. Productivity
c. Reliability
d. Operations ratio
Answer: b

18. Inventory carrying costs are influenced by

a. Order Quantity in Units
b. Holding carrying cost per unit
c. Demand
d. a and b only
Answer: d
19. Which of the following a unit of measurement is as specified in Six Sigma quality?
a. Defects per hundred
b. Defects per thousand
c. Defects per hundred thousand
d. Defects per million
Answer: d

20. A fixed time between orders and a variable order quantity are characteristics of a
a) continuous inventory system
b) two-bin system
c) periodic inventory system
d) MRP system
Answer: C
21. Which of the following is a part of production system?
a. Input
b. Output
c. Transformation process
d. all of these
Answer: d

22. Which one of the following is not a part of production planning and control?
a. Follow-up
 b. Financial leverage
c. Routing
d. Scheduling
Answer: b

23. Which of the following is not an objective of good plant layout?

a. To improve productivity
b. To provide safety to employees
c. To increase the number of accidents
d. to provide easy supervision
Answer: c

24. Which of the following is the objective of motion study?

a. To eliminate all non-productive and ineffective motions.
b. To develop more effective and productive patterns of movements
c. (a) and (b)
d. None

25. Dispatch provides official authorization for

a. Movement of materials to different work stations,
b. Movement of tools and fixtures necessary for each operation,
c. beginning of work on each operation,
d. all of these
Answer: d

26. . Which of the following is not an objective of operation management?

a) To improve product quality b)To reduce cost of production
c) Material cost control d)Trading on equity
Answer: d

27. Which one of the following layout type is also called line layout?
a. Fixed Position layout
b. Process layout
c. Product layout
d. Cellular layout
Answer: c

28. The concept of Agile organization refers to:

a. Flexibility
b. Quality
c. Quick response
d. Profitability
Answer: c

29. . Product design and choice of ___location are examples of _______ decisions.
a. strategic
 b. Tactical
c. Operational
d. customer focused
e. design
Answer: a

30. The disadvantage of product layout is

a. High initial investment for the specialized facilities
b. Skilled labour to operate machines
c. Production time is longer, requiring more goods in inventory
d. High cost of inspection
Answer: a

31. Work study comprises following main techniques

a. Method study and work measurement
b. Method study and time study
c. Time study and work measurement
d. Method study and job evaluation
Answer: a

32. Product layout is best suited where

(A) One type of product is produced

(B) Product is standardized
(C) Product is manufactured in large quantities
(D) All of the above
Answer: d

33. Product layout is used for

(A) Job production

(B) Batch production
(C) Mass production
(D) Any one of these

Answer: C

34. Work study is concerned with

(A) Improving present method and finding standard time
(B) Motivation of workers
(C) Improving production capability
(D) Improving production planning and control
Answer: A

35. ABC analysis deals with

 (A) Analysis of process chart
(B) Flow of material
(C) Ordering schedule of job
(D) Controlling inventory costs money
Answer: D

36. Which of the following layouts is suited to job production?

(A) Process layout
(B) Product layout
(C) Fixed position layout
(D) Plant layout
Answer: C

37. Inventory control in production, planning and control aims at

(A) Achieving optimization
(B) Ensuring against market fluctuations
(C) Acceptable customer service at low capital investment in inventory
(D) Discounts allowed in bulk purchase
Answer: C

38. The allowed time for a job equals standard time plus
(A) Policy allowance
(B) Interference allowance
(C) Process allowance
(D) Learning allowance
Answer: A

39. A-B-C analysis

(A) Is a basic technique of materials management

(B) Is meant for relative inventory control
(C) Does not depend upon the unit cost of the item but on its annual consumption
(D) All of the above
Answer: D

40. In manufacturing management, the term 'Dispatching' is used to describe

(A) Dispatch of sales order

(B) Dispatch of factory mail
(C) Dispatch of finished product of the user
(D) Dispatch of work orders through shop floor
Answer: D

41. The unit cost in case of batch production is __________as compared to jobbing production.
 (A) Same
(B) Low
(C) High
(D) None of these
Answer: B

42. Performance rating is equal to

(A) Observed performance + normal performance

(B) Observed performance - normal performance
(C) Observed performance × normal performance
(D) None of the above
Answer: D

43. The production cost per unit can be reduced by

(A) Producing more with increased inputs

(B) Producing more with the same inputs
(C) Eliminating idle time
(D) Minimizing resource waste
Answer: B

44. What does symbol 'O' imply in work study?

(A) Operation
(B) Inspection
(C) Transport
(D) Delay/temporary storage
Answer: A

45. The type of layout used for manufacturing steam turbines, is

(A) Product layout

(B) Process layout
(C) Fixed position layout
(D) Any one of these
Answer: C

46. What does symbol 'D' imply in work study?

(A) Inspection
(B) Transport
(C) Delay/temporary storage
(D) Permanent storage
Answer: C
47. Routing prescribes the
(A) Flow of material in the plant
(B) Proper utilization of man power
(C) Proper utilization of machines
(D) Inspection of final product
Answer: A

48. The objective of time study is to determine the time required to complete a job by
(A) Fast worker
(B) Average worker
(C) Slow worker
(D) New entrant
Answer: B

49. Choose the wrong statement Time study is used to

(A) Determine overhead expenses
(B) Provide a basis for setting piece prices or incentive wages
(C) Determine standard costs
(D) Determine the capability of an operator to handle the number of machines
Answer: A

50. In inventory control, the economic order quantity is the

(A) Optimum lot size
(B) Highest level of inventory
(C) Lot corresponding to break-even point
(D) Capability of a plant to produce
Answer: A

51. Zero defects in manufacturing is

a. is a relevant goal only in electronic assembly
b. is readily achievable in all areas
c. is the goal of TQM
d. is an unobtainable and misleading idea

Answer: C

52. A ____________ encompasses all activities associated with the flow and transformation of
Goods from the raw material stage, through to the end user, as well as the associated information
Flows.
A. production line
B. supply chain
C. marketing channel
D. warehouse
Answer: B

53. Which of the following statements is true of LEAN?

A. Lean principles focus on advanced statistical methods
B. Lean principles are separate body of knowledge
C. Lean principles have been developed over a lengthy period of time.
D. Lean principles include reducing waste.

Answer: D

54. Lean production involves

A. Elimination of cost only
B. Improvement of quality only
C. Improvement of speed only
D. Elimination of all types of waste

Answer: D

55. A successful TQM program incorporates all of the following except

A. continuous improvement
B. employment involvement
C. benchmarking
D. centralized decision making authority

Answer: D

56. Which one of the following would not generally be considered an aspect of operations
management?
A. Work methods
B. Secure financial resources
C. Maintain quality
D. Product or service design
Answer: B

57. In a SC,Material flows in one direction while _________from in both direction

A. Process
B. Information
C. Product
D. Semifinished Goods

Answer: B

58. TQM refers to

a. total quantity management
b. total quality management
c. total quality marketing
d. total quotient management
Answer: b
 59. When suppliers, distributors, and customers collaborate with each other to improve the
performance of the entire system, they are participating in a ________
a) channel of distribution
b) value delivery network
c) supply chain
d) supply and demand chain

Answer: b

60. Logistics is an integral part of supply chain management. Which explanation best represents outbound
logistics?

A. The management of material resources entering an organisation from its suppliers and other partners
B. A supply chain that emphasises distribution of a product to passive customers
C. The management of resources supplied from an organisation to its customers and intermediaries
D. An emphasis on using the supply chain to deliver value to customers who are actively involved in product
and service specification
Answer: C

61. "Quality is defined by the customer" is

A. An unrealistic definition of quality

B. A user-based definition of quality
C. A manufacturing-based definition of quality
D. A product-based definition of quality
Answer: B

62. Which one of the following does not fall under qualitative forecasting method?

A. Market research
B. Life cycle analogy
C. Moving average methods
D. Delphi method

Answer: C

63. What is the measure of forecast error which calculates the average forecast error over n time periods known
as?

A. Mean-square error
B. Mean absolute deviation
C. Mean error
D. Mean absolute percentage error

Answer: C
64. The profit of an enterprise can be increased by

i. Reducing total costs of production

ii. Increasing sales value
iii. Increasing capital cost
iv. Increasing manpower
v. Which of the above are true?

Options:
A. Only i
B. i & ii
C. i, ii & iii
D. All of the above
Answer: B

65. If all the processing equipment and machines are arranged according to the sequence of operations of a
product the layout is known as

A. Product layout
B. Process layout
C. Fixed position layout
D. Combination layout

Answer: A

66. The following type of layout is preferred to manufacture a standard product in large quantity

A. Product layout
B. Process layout
C. Fixed position layout
D. Combination layout
Answer: A

67. The following type of layout is preferred for low volume production of non-standard products

A. Product layout
B. Process layout
C. Fixed position layout
D. Combination layout
Answer: B

68. In ship manufacturing, the type of layout preferred is

A. Product layout
B. Process layout
C. Fixed position layout
D. Combination layout
Answer: C
69. Which of the following explain the need for facility ___location selection?
(a) When the existing business unit has outgrown its original facilities and expansion is
not possible.
(b) When a business is newly started.
(c) When the lease expires and the landlord does not renew the lease.
(d) All of these.
Answer: d

70. Which of the following is a type of plant layout in which machines and equipment are arranged according to
their function?
a) Cellular layout
b) Process layout
c) Fixed position layout
d) Combined layout
Answer: b