Operations Management, 5th Canadian Edition Test Bank

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Student: ___________________________________________________________________________
1. As a service business, the operations management activities of an airline company have nothing
in common with the operations management activities within a bicycle manufacturing company.
True False
2. Operations managers are responsible for managing activities and resources that produce goods
and/or provide services.
True False
3. Effectiveness refers to achieving intended goals whereas efficiency refers to minimizing cost and
time.
True False
4. Operations, marketing, and finance function independently of each other in most organizations.
True False
5. The operations function exists only in firms that are goods-oriented.
True False
6. Operations management pertains almost exclusively to the management of manufacturing
operations.
True False
7. Value-added refers to the cost of the inputs required to produce goods and services.
True False
8. As long as a product is ready in advance of when customers demand it, the timing of when a
product is manufactured does not influence the value-added.
True False
9. Storing an item earlier than the scheduled delivery date is an example of a value adding activity.
True False

10. Management information systems (MIS) are concerned with providing management with the
information it needs to effectively manage.
True False
11. Operations management involves both system design and planning/control decisions.
True False
12. System design decisions have very little impact on planning/control decisions.
True False
13. An example of an operations control decision is the choice of location.
True False
14. Scheduling jobs is a system design decision and not a planning decision.
True False
15. Design decisions are usually strategic and long term, while planning decisions are tactical and
medium term.
True False
16. Managing inventory levels is considered a planning/control operations decision area.
True False
17. A basic difference between manufacturing and service organizations is that services are action-
oriented and manufacturing is goods-oriented.
True False
18. Service involves a much higher degree of customer contact than the production of goods.
True False
19. Service often requires a higher labour content, whereas the production of goods is more capital
intensive.
True False
20. Measurement of productivity in service is more straightforward than in goods production due to
the high degree of uniformity of inputs.
True False

21. Models are simplified representations of something and thus ignore important aspects of a
situation.
True False
22. Quantitative techniques are often quick and practical techniques for many decisions.
True False
23. A systems approach emphasizes interrelationships among subsystems, but its main theme is that
the whole is greater than the sum of its individual parts.
True False
24. Queuing techniques are useful for analyzing situations in which waiting lines form.
True False
25. It is essential to use the systems approach when something is being designed, redesigned,
implemented, improved, or otherwise changed.
True False
26. A systems approach is to concentrate on efficiency within a subsystem and thereby achieve
overall efficiency.
True False
27. Many operations management decisions can be described as trade-offs.
True False
28. The Pareto phenomenon is one of the most important and pervasive concepts that can be applied
at all levels of management.
True False
29. Operations managers, who usually use quantitative approaches, have no responsibility to make
ethical decisions.
True False
30. Prior to the Industrial Revolution, goods were produced primarily by craftsmen or their
apprentices using custom made parts.
True False
31. Frederick Taylor is often referred to as the "father of scientific management".
True False

32. The Human Relations Movement, which emphasized the importance of the human element in job
design, was replaced by the more technical aspects of Scientific Management.
True False
33. The moving assembly line introduced by Henry Ford is an example of the development of mass
production based on large volumes of standardized goods produced using low or semi-skilled
workers and highly specialized equipment.
True False
34. The impact of globalization for manufacturing companies has been reduced reliance on long
international supply chains because of the increasing cost to ship components and finished goods
to foreign markets.
True False
35. Operations management encompasses all of the following EXCEPT:
A. buying materials.
B. capacity planning.
C. scheduling.
D. motivating employees and training.
E. preparing financial statements.
36. Which of the following is a reason for studying operations management?
A. A large percentage of a company's expenses occur in the operations management activities
that are at the core of all business organizations.
B. Activities in all of the other areas of business organizations, such as accounting and marketing
are interrelated with operations management activities.
C. Many management jobs are in operations management-related areas, such as production
planning, inventory management, and more.
D. All of the choices are reasons.
E. None of the choices are correct.
37. The three primary functions that exist in most business organizations are:
A. manufacturing, production, and operations.
B. operations, marketing, and finance.
C. operations, accounting, and marketing.
D. operations, production, and finance.
E. none of the choices are correct.

38. The three major functions of business organizations:
A. perform different but related activities.
B. are related indirectly only.
C. must work together, but not very closely.
D. function independently of each other.
E. perform similar and related activities.
39. Which of the following is not a type of service operations?
A. Retail trade
B. Transportation and warehousing
C. Fabrication of metals
D. Banking
E. Hotels and restaurants
40. Measurements taken at various points in the transformation process for control purposes are
called:
A. plans.
B. directions.
C. controls.
D. feedback.
E. proposals.
41. Measuring process outputs at various points in order to compare outputs to previously
established standards to determine if corrective action is needed is called:
A. planning and directing.
B. directing and conversion.
C. feedback and control.
D. controlling and leading.
E. leading and transformation.
42. Value-added refers to:
A. the cost of inputs.
B. the price of outputs.
C. the difference between cost of inputs and what customers are willing to pay.
D. the extra profit obtained from increased productivity.
E. all of the choices are correct.

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43. Economic analysis of investment proposals, and provision of funds are activities associated with
the:
A. operation function.
B. marketing function.
C. purchasing function.
D. finance function.
E. industrial engineering function.
44. The marketing function's main concern is with:
A. producing goods or providing services.
B. assessing customer wants and needs.
C. procuring materials, supplies, and equipment.
D. performing economic analysis of investment proposals.
E. securing monetary resources.
45. Planning decisions are usually __________ and __________ term.
A. strategic; long
B. tactical; medium
C. forecasting; short
D. strategic; short
E. tactical; long
46. Which of the following does not relate to system design?
A. Long term capacity
B. Location of facilities
C. Inventory management
D. Process design
E. Departmental layout
47. Tactical planning and control activities involve making decisions about all of the following
EXCEPT:
A. location of facilities.
B. scheduling.
C. material requirements planning.
D. project management.
E. inventory management.

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48. System capacity and location of facilities are examples of:
A. financial decisions.
B. tactical decisions.
C. systems design decisions.
D. operational planning decisions.
E. forecasting decisions.
49. The responsibilities of operations managers classified as planning activities include:
A. inventory, production pace, quality, and costs.
B. organizing departments, subcontracting, supplier contracts, and staffing.
C. forecasting, planning, organizing, and directing.
D. scheduling, job assignments, purchasing, and logistics.
E. capacity, location, layout, and mix of products.
50. Which of the following responsibilities of operations managers is considered a directing activity
rather than a planning or control activity?
A. selecting production equipment
B. product mix decisions
C. scheduling workers
D. inventory management
E. layout of production facilities
51. Of the following, which aspect of the evolution of operations management is affiliated with
Japanese manufacturing companies?
A. total quality management
B. scientific management
C. the human relations movement.
D. the industrial revolution.
E. craft production
52. Which is not a significant difference between manufacturing and service operations?
A. Cost per unit
B. Uniformity of output.
C. Labour content of jobs.
D. Amount of customer contact.
E. Measurement of productivity.

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53. Which of the following is not a characteristic of service operations?
A. Intangible output.
B. High customer contact.
C. High labour content.
D. Easy measurement of productivity.
E. Low uniformity of output.
54. The responsibilities of operations managers classified as controlling activities are:
A. inventory, production pace, quality, and costs.
B. organizing departments, subcontracting, supplier contracts, and staffing.
C. forecasting, planning, organizing, and directing.
D. scheduling, job assignments, purchasing, and logistics.
E. capacity, location, layout, and mix of products.
55. Which of the following is not a general approach to decision-making?
A. Establishing priorities
B. Subjective approach
C. Analysis of trade-offs
D. Systems approach
E. Quantitative approaches
56. Which of the following is not a characteristic of models used to support decision making?
A. They provide a simplified representation of a design problem.
B. They ignore unimportant details, concentrating on the most important aspects of a situation.
C. They may be based on mathematical representations or graphical schematics.
D. They provide abstract representations of a design problem.
E. They are limited to representations of objective quantitative factors.
57. Which of the following is not true about the systems approach?
A. It recognizes the importance of taking into account the impact on all parts of the system.
B. It emphasizes interrelationships among subsystems.
C. It concentrates on efficiency within subsystems.
D. It becomes essential whenever something is being redesigned or improved.
E. The objectives of the whole take precedence over those of any one part.

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58. Which is not a quantitative technique to problem solving?
A. Linear programming
B. Queuing techniques
C. Statistical techniques
D. Heuristic approach
E. All of the choices are quantitative approaches.
59. Dealing with the fact that certain aspects of any management situation are more important than
others is called:
A. analysis of trade-offs.
B. sensitivity analysis.
C. establishing priorities.
D. analysis of variance.
E. decision analysis.
60. The fact that improvements in a few key areas of operations will have more impact than many
improvements in less significant areas is referred to as the ___________.
A. forecasting approach
B. Pareto phenomenon
C. productivity challenge
D. analysis of trade-offs
E. ethical dilemma
61. Which of the following developments related to the historical evolution of operations management
is the oldest?
A. The human relations movement advocated by Mayo, Maslow, and Hertzberg.
B. The introduction of the moving assembly line by Henry Ford.
C. Scientific management principles espoused by Frederick Taylor.
D. The principle of division of labour documented in Adam Smith's book The Wealth of Nations.
E. The influence of Japanese management practices.
62. Which of the following is not properly matched?
A. Mathematical model for inventory management-Elton Mayo
B. Division of labour-Adam Smith
C. Scientific Management-F. W. Taylor
D. Motion study-Frank and Lillian Gilbreth
E. Moving assembly line-Henry Ford

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1 Key
1. As a service business, the operations management activities of an airline company have
nothing in common with the operations management activities within a bicycle manufacturing
company.
FALSE
Accessibility: Keyboard Navigation
Difficulty: Medium
Learning Objective: 01-01 Define the term operations management and identify operations management jobs.
Stevenson - Chapter 01 #1
Topic: 01-01 Introduction
2. Operations managers are responsible for managing activities and resources that produce
goods and/or provide services.
TRUE
Accessibility: Keyboard Navigation
Difficulty: Easy
Learning Objective: 01-01 Define the term operations management and identify operations management jobs.
Stevenson - Chapter 01 #2
Topic: 01-01 Introduction
3. Effectiveness refers to achieving intended goals whereas efficiency refers to minimizing cost
and time.
TRUE
Accessibility: Keyboard Navigation
Difficulty: Medium
Learning Objective: 01-01 Define the term operations management and identify operations management jobs.
Stevenson - Chapter 01 #3
Topic: 01-01 Introduction
4. Operations, marketing, and finance function independently of each other in most
organizations.
FALSE
Accessibility: Keyboard Navigation
Difficulty: Medium
Learning Objective: 01-02 Identify the three major functional areas of organizations and describe how they interrelate.
Stevenson - Chapter 01 #4
Topic: 01-04 Functions within Organizations
5. The operations function exists only in firms that are goods-oriented.
FALSE
Accessibility: Keyboard Navigation
Difficulty: Easy
Learning Objective: 01-02 Identify the three major functional areas of organizations and describe how they interrelate.
Stevenson - Chapter 01 #5
Topic: 01-04 Functions within Organizations

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6. Operations management pertains almost exclusively to the management of manufacturing
operations.
FALSE
Accessibility: Keyboard Navigation
Difficulty: Easy
Learning Objective: 01-01 Define the term operations management and identify operations management jobs.
Stevenson - Chapter 01 #6
Topic: 01-01 Introduction
7. Value-added refers to the cost of the inputs required to produce goods and services.
FALSE
Accessibility: Keyboard Navigation
Difficulty: Medium
Learning Objective: 01-02 Identify the three major functional areas of organizations and describe how they interrelate.
Stevenson - Chapter 01 #7
Topic: 01-05 Operations
8. As long as a product is ready in advance of when customers demand it, the timing of when a
product is manufactured does not influence the value-added.
FALSE
Accessibility: Keyboard Navigation
Difficulty: Medium
Learning Objective: 01-02 Identify the three major functional areas of organizations and describe how they interrelate.
Stevenson - Chapter 01 #8
Topic: 01-05 Operations
9. Storing an item earlier than the scheduled delivery date is an example of a value adding
activity.
FALSE
Accessibility: Keyboard Navigation
Difficulty: Medium
Learning Objective: 01-02 Identify the three major functional areas of organizations and describe how they interrelate.
Stevenson - Chapter 01 #9
Topic: 01-05 Operations
10. Management information systems (MIS) are concerned with providing management with the
information it needs to effectively manage.
TRUE
Accessibility: Keyboard Navigation
Difficulty: Easy
Learning Objective: 01-02 Identify the three major functional areas of organizations and describe how they interrelate.
Stevenson - Chapter 01 #10
Topic: 01-08 Other Functions

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11. Operations management involves both system design and planning/control decisions.
TRUE
Accessibility: Keyboard Navigation
Difficulty: Easy
Learning Objective: 01-03 Describe the scope of operations management and provide an overview of this book including differentiating between design
and planning/control decisions.
Stevenson - Chapter 01 #11
Topic: 01-09 The Scope of Operations Management
12. System design decisions have very little impact on planning/control decisions.
FALSE
Accessibility: Keyboard Navigation
Difficulty: Medium
Learning Objective: 01-03 Describe the scope of operations management and provide an overview of this book including differentiating between design
and planning/control decisions.
Stevenson - Chapter 01 #12
Topic: 01-09 The Scope of Operations Management
13. An example of an operations control decision is the choice of location.
FALSE
Accessibility: Keyboard Navigation
Difficulty: Hard
Learning Objective: 01-03 Describe the scope of operations management and provide an overview of this book including differentiating between design
and planning/control decisions.
Stevenson - Chapter 01 #13
Topic: 01-09 The Scope of Operations Management
14. Scheduling jobs is a system design decision and not a planning decision.
FALSE
Accessibility: Keyboard Navigation
Difficulty: Medium
Learning Objective: 01-03 Describe the scope of operations management and provide an overview of this book including differentiating between design
and planning/control decisions.
Stevenson - Chapter 01 #14
Topic: 01-09 The Scope of Operations Management
15. Design decisions are usually strategic and long term, while planning decisions are tactical and
medium term.
TRUE
Accessibility: Keyboard Navigation
Difficulty: Medium
Learning Objective: 01-03 Describe the scope of operations management and provide an overview of this book including differentiating between design
and planning/control decisions.
Stevenson - Chapter 01 #15
Topic: 01-09 The Scope of Operations Management
16. Managing inventory levels is considered a planning/control operations decision area.
TRUE
Accessibility: Keyboard Navigation

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Difficulty: Easy
Learning Objective: 01-03 Describe the scope of operations management and provide an overview of this book including differentiating between design
and planning/control decisions.
Stevenson - Chapter 01 #16
Topic: 01-09 The Scope of Operations Management
17. A basic difference between manufacturing and service organizations is that services are
action-oriented and manufacturing is goods-oriented.
TRUE
Accessibility: Keyboard Navigation
Difficulty: Easy
Learning Objective: 01-04 Compare goods and services.
Stevenson - Chapter 01 #17
Topic: 01-10 Differentiating Production of Goods and Services
18. Service involves a much higher degree of customer contact than the production of goods.
TRUE
Accessibility: Keyboard Navigation
Difficulty: Easy
Learning Objective: 01-04 Compare goods and services.
Stevenson - Chapter 01 #18
Topic: 01-10 Differentiating Production of Goods and Services
19. Service often requires a higher labour content, whereas the production of goods is more
capital intensive.
TRUE
Accessibility: Keyboard Navigation
Difficulty: Medium
Learning Objective: 01-04 Compare goods and services.
Stevenson - Chapter 01 #19
Topic: 01-10 Differentiating Production of Goods and Services
20. Measurement of productivity in service is more straightforward than in goods production due to
the high degree of uniformity of inputs.
FALSE
Accessibility: Keyboard Navigation
Difficulty: Medium
Learning Objective: 01-04 Compare goods and services.
Stevenson - Chapter 01 #20
Topic: 01-10 Differentiating Production of Goods and Services
21. Models are simplified representations of something and thus ignore important aspects of a
situation.
FALSE
Accessibility: Keyboard Navigation
Difficulty: Medium
Learning Objective: 01-06 Describe the key aspects of operations management decision making.
Stevenson - Chapter 01 #21
Topic: 01-13 Models

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22. Quantitative techniques are often quick and practical techniques for many decisions.
FALSE
Accessibility: Keyboard Navigation
Difficulty: Medium
Learning Objective: 01-06 Describe the key aspects of operations management decision making.
Stevenson - Chapter 01 #22
Topic: 01-14 Quantitative Techniques
23. A systems approach emphasizes interrelationships among subsystems, but its main theme is
that the whole is greater than the sum of its individual parts.
TRUE
Accessibility: Keyboard Navigation
Difficulty: Medium
Learning Objective: 01-06 Describe the key aspects of operations management decision making.
Stevenson - Chapter 01 #23
Topic: 01-16 The Systems Approach
24. Queuing techniques are useful for analyzing situations in which waiting lines form.
TRUE
Accessibility: Keyboard Navigation
Difficulty: Easy
Learning Objective: 01-06 Describe the key aspects of operations management decision making.
Stevenson - Chapter 01 #24
Topic: 01-14 Quantitative Techniques
25. It is essential to use the systems approach when something is being designed, redesigned,
implemented, improved, or otherwise changed.
TRUE
Accessibility: Keyboard Navigation
Difficulty: Easy
Learning Objective: 01-06 Describe the key aspects of operations management decision making.
Stevenson - Chapter 01 #25
Topic: 01-16 The Systems Approach
26. A systems approach is to concentrate on efficiency within a subsystem and thereby achieve
overall efficiency.
FALSE
Accessibility: Keyboard Navigation
Difficulty: Medium
Learning Objective: 01-06 Describe the key aspects of operations management decision making.
Stevenson - Chapter 01 #26
Topic: 01-16 The Systems Approach
27. Many operations management decisions can be described as trade-offs.
TRUE
Accessibility: Keyboard Navigation
Difficulty: Medium
Learning Objective: 01-06 Describe the key aspects of operations management decision making.

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