C720 Operations and Supply Chain Management Practice Questions - Set 2 - Part 1

Test your knowledge of Operations and Supply Chain Management concepts with these practice questions. Each question includes detailed explanations to help you understand the correct answers.

Question 1: A company wants to maintain high product quality standards by preventing defects from occurring in the first place. Which approach would be most suitable for achieving this goal?

a) Six Sigma

b) Lean production

c) Poka-yoke

d) Vendor Managed Inventory (VMI)

Question 2: A manufacturing firm produces a large volume of standardized products with no variation, like paper and fuel. Which type of production process is best suited for this scenario?

a) Job shop

b) Batch flow

c) Continuous flow

d) Assembly line

Question 3: In quality management, which tool helps break down a problem to identify potential causes by sorting them into categories such as materials, methods, and environment?

a) Fishbone diagram

b) Pareto chart

c) Control chart

d) Scatter plot

Question 4: A company uses data points to plot and track process output against upper and lower limits in real time to detect variability. This is known as:

a) Pareto analysis

b) Run chart

c) Control chart

d) Scatter diagram

Question 5: In inventory management, which strategy involves keeping a predetermined quantity of extra stock to protect against unforeseen demand spikes?

a) Just-in-time (JIT)

b) Safety stock

c) Perpetual inventory

d) Economic Order Quantity (EOQ)

Question 6: When should qualitative forecasting methods, such as the Delphi Technique, be used?

a) When there is abundant historical data

b) For new products with no historical demand data

c) When quantitative forecasting methods fail

d) For products with predictable seasonal trends

Question 7: A company measures the average value of its inventory to determine how many days it can sustain sales without replenishment. This measure is known as:

a) Run-out time

b) Days of supply

c) Lead time

d) Cycle time

Question 8: A business aims to use statistical methods to monitor production quality and ensure product consistency. Which method would best support this goal?

a) Process layout

b) Kanban

c) Statistical Process Control (SPC)

d) Lean management

Question 9: Which capacity strategy involves increasing production capability only after demand has fully exceeded the current capacity?

a) Lead strategy

b) Lag strategy

c) Adjustment strategy

d) Match strategy

Question 10: When an organization maintains several facilities, each responsible for producing and supplying products to a specific geographic area, it is following a:

a) Product facility strategy

b) Regional facility strategy

c) Global facility strategy

d) Strategic alliance

Question 11: A company that designs its supply chain to focus on speed and flexibility to respond quickly to unpredictable demand changes is likely using a:

a) Lean supply chain

b) Agile supply chain

c) Push supply chain

d) Vendor Managed Inventory (VMI)

Question 12: Which of the following would be most appropriate for an organization to use when demand is stable, lead times are predictable, and costs must be minimized?

a) Lean supply chain

b) Agile supply chain

c) Vendor Managed Inventory (VMI)

d) Reverse logistics

Question 13: The most critical aspect of Total Quality Management (TQM) is a strong emphasis on:

a) Customer focus

b) Cost reduction

c) Production speed

d) Supplier alignment

Question 14: A company that operates with high safety standards and reduces pollution to ensure a positive impact on society is practicing:

a) Corporate responsibility

b) Lean production

c) Sustainability

d) Vendor Managed Inventory (VMI)

Question 15: A retailer experiences high sales peaks during certain times of the year, such as holiday seasons. What type of demand is this?

a) Peak demand

b) Chase demand

c) Seasonal demand

d) Unexpected demand

Question 16: To ensure flexibility and rapid adjustments to meet customer needs, a company uses production methods that rely on cross-trained employees and versatile equipment. This is characteristic of:

a) Agile production

b) Lean production

c) Continuous flow

d) Vendor Managed Inventory (VMI)

Question 17: Which inventory system requires regular physical counts to determine exact inventory levels and is typically used by smaller businesses?

a) Perpetual inventory system

b) Periodic inventory system

c) Vendor Managed Inventory (VMI)

d) Safety stock system

Question 18: Which of the following describes a strategy in which companies add capacity gradually to align with incremental changes in demand?

a) Lead strategy

b) Lag strategy

c) Adjustment strategy

d) Match strategy

Question 19: A company decides to use a continuous flow layout to produce high-volume items with no product variation. Which product is most suitable for this process?

a) Custom furniture

b) Canned beverages

c) Medical devices

d) Smartphones

Question 20: Which approach involves incorporating customer expectations into the design and production processes to ensure product satisfaction?

a) Kanban

b) Total Quality Management (TQM)

c) Quality function deployment (QFD)

d) Vendor Managed Inventory (VMI)

Need Guaranteed Results?

Don't want to study? Our exam support service guarantees you'll pass your OA on the first attempt. Pay only after you pass!

Get Exam Support