1. Operations Management can be best described as:

1. The business function that is responsible for managing and coordinating the resources needed to create valuable goods and services for customers by transforming inputs into outputs
2. The business function that is concerned with management of the financial planning of the supply chain
3. Function that is concerned with the effective management of employees, job market trends, and budgetary expenditures
4. The business function that is responsible for integrating consumer research and analysis into all company goals

2. Companies go global to

1. Take advantage of favorable costs, new business trends and technologies, and reliable sources of supply
2. Avoid paying taxes
3. Avoid having to compete on the domestic stage
4. Be better able to compete on cost and not on quality, speed, or flexibility

3. An analyst is unable to assign probabilities to the economic conditions that affect demand for the companys product. This situation is referred to as:

1. Decision-making under risk.
2. Decision-making under certainty.
3. Decision-making under uncertainty.
4. None of these answers is correct.

4. If the units produced by a factory decreased by 10% and the labor productivity increased by 25%, then the labor hours __________.

1. Decreased by 15%
2. Decreased by 26%
3. Decreased by 28%
4. Decreased by 35%

5. Deming advocated continuous process improvement to reduce variability and achieve conformance to design specifications. However, for this process to be successful, which of the following is true?

1. Both employees and management have to participate
2. Management alone has to take responsibility for the process
3. Employees alone have to be responsible for the process
4. Research engineers and consultants should implement the process

6. Which of the following quality tools display major causes of poor quality on a graph?

1. Process flow chart
2. Scatter diagram
3. Fishbone diagram
4. Histogram

7. A production process consists of the following four stages with the average percentage of good quality at each stage as shown.

Stage	Average Percentage of Good Quality
1	0.98
2	0.97
3	0.96
4	0.92

What is the daily production yield for the company if daily input is 100 units?

1. 119 units
2. 108 units
3. 106 units
4. 104 units

8. Which of the following services can be measured and monitored with control charts?

1. Airlines
2. Hotels
3. Banks
4. All these answer choices are correct.

9. Which of the following is not a dimension of quality for a manufactured good?

1. Performance
2. Reliability
3. Courtesy
4. Durability

10. The basic purpose of control charts include(s)

1. Establishing control limits for a process
2. Both establishing control limits for a process and monitoring the process to indicate when it is out of control are basic purposes
3. Monitoring the process to indicate when it is out of control
4. None of these answer choices is correct

Free-Response Questions

1. Snacktown, a food service firm, is calculating its monthly productivity report. Use the following information to answer the questions asked.

Units produced 10,000

Labor rate $10

Labor hours 1,000

Cost of materials $2000

Cost of energy $500

1. Calculate labor productivity.
2. Calculate energy productivity.
3. Calculate total factor productivity.

2. Reingold Manufacturing manufactures radiators. The company produces 200 units per day and averages 90% good quality resulting in 10% defective items. Fifty percent of the defective units are reworked prior to shipment to Moderns distribution center. Direct cost per unit direct is $70, and rework cost is $10.

1. Determine the companys daily product yield.
2. Compute the daily product cost for the company.

3. A soft drink filling machine is set up to fill bottles with 12 ounces of soft drink. The standard deviation () is known to be 0.4 ounce. The quality control department periodically selects samples of 16 bottles, and then measures their contents. The means of six of those samples, measured in ounces, were 11.8, 12.2, 11.9, 11.9, 12.1, and 11.8.

1. Use the information to construct a 3-Sigma X-bar chart to determine the upper and lower control limits.
2. State whether or not the process is in control.

4. A small parts manufacturer has just engineered a new product for the automotive industry. In order to produce the part the company can expand existing facilities, acquire a competitor, or subcontract production. The company believes the product will either experience high market demand or low market demand. The following payoff table describes the companys decision situation.

	States of Nature
Decision Alternatives	High Demand (0.6)	Low Demand (0.4)
Expand Facilities	$2,000,000	$1,250,000
Acquire Competitor	$750,000	$500,000
Subcontract Production	$250,000	$25,000

Determine the optimal decision to produce the part, based on the following:

1. The maximax decision criterion?
2. The maximin decision criterion?
3. The minimax regret decision criterion?
4. The Hurwicz criterion, with a coefficient of optimism of .3?
5. The La Place or the equal likelihood decision criterion?

I need help with this review sheet!