C720 Operations and Supply Chain Management Practice Questions - Set 3 - Part 3

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 41: The Theory of Constraints (TOC) primarily seeks to:

a) Identify and resolve bottlenecks in production

b) Increase inventory turnover

c) Enhance customer satisfaction through quality improvements

d) Reduce the cost of raw materials

Question 42: A company is deciding on the capacity required to meet future demand. Which strategy would involve adding capacity only after it has reached full utilization?

a) Lead strategy

b) Lag strategy

c) Adjustment strategy

d) Match strategy

Question 43: The “Define” stage in the DMAIC process involves:

a) Identifying the problem or improvement opportunity

b) Measuring current performance

c) Analyzing root causes

d) Implementing improvements

Question 44: A company operates in a competitive industry where short lead times and fast delivery are key differentiators. This company is likely focusing on:

a) Economies of scale

b) Competitive advantage

c) Cost minimization

d) Capacity utilization

Question 45: A manager uses a scatter plot to analyze the relationship between two variables in a production process. What might they be looking for?

a) The most common defects in a process

b) A trend or correlation between variables

c) The distribution of errors by frequency

d) The specific cause of bottlenecks

Question 46: When choosing a location for a new facility, a company considers factors like tax incentives, labor costs, and proximity to suppliers. These are examples of:

a) Qualitative factors

b) Environmental factors

c) Quantitative factors

d) Sustainability factors

Question 47: In a JIT system, production is scheduled based on:

a) Long-term forecasts

b) Inventory levels

c) Actual customer orders

d) Supplier delivery schedules

Question 48: Which type of layout is best for producing large, immovable products like airplanes or ships?

a) Product-oriented layout

b) Process-oriented layout

c) Fixed-position layout

d) Job shop layout

Question 49: A business maintains extra inventory as a buffer to protect against delays in supply. This inventory is known as:

a) Work-in-process (WIP)

b) Safety stock

c) Pipeline inventory

d) Raw materials inventory

Question 50: A clothing manufacturer wants to minimize holding costs and reduce waste by producing only the amount needed for immediate orders. This strategy is best described as:

a) Economic Order Quantity (EOQ)

b) Push system

c) Pull system

d) Safety stock system

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