C720 Operations and Supply Chain Management Practice Questions - Set 5 - 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 producing a single product on a large scale with a standardized process is most likely using which type of layout?

a) Job shop layout

b) Fixed-position layout

c) Product-oriented layout

d) Process-oriented layout

Question 2: In supply chain management, the term "reverse logistics" refers to:

a) Shipping products directly to consumers

b) Returning defective products for repair or recycling

c) Managing inbound raw materials

d) Transporting goods from distribution centers to retail stores

Question 3: A firm sets its reorder point by taking into account average demand during lead time and a buffer for unexpected demand. This buffer is known as:

a) Replacement inventory

b) Work-in-process (WIP)

c) Safety stock

d) Perpetual stock

Question 4: The process of taking individual parts or products and aggregating them into larger family groups for planning purposes is known as:

a) Product-oriented grouping

b) Process layout planning

c) Aggregate planning

d) Scheduling

Question 5: Which forecasting method uses trial markets to gather data and estimate future demand for a new product?

a) Delphi Technique

b) Test markets

c) Exponential smoothing

d) Moving average

Question 6: When a supplier and manufacturer agree to share the financial gains and losses of a partnership, this arrangement is called:

a) Quantity discount model

b) Safety stock model

c) Revenue sharing

d) Cost control

Question 7: Which technique is used in quality management to ensure that customer requirements are incorporated into product design?

a) Fishbone diagram

b) Statistical Process Control (SPC)

c) Quality function deployment (QFD)

d) Value stream mapping

Question 8: In supply chain terms, the sequence of suppliers that provide inputs for a product's final assembly is known as the:

a) First-tier supplier network

b) Downstream flow

c) Production chain

d) Bill of materials (BOM)

Question 9: Which of the following inventory types includes items that are still undergoing processing but are not yet complete?

a) Finished goods

b) Safety stock

c) Raw materials

d) Work-in-process (WIP)

Question 10: What inventory management technique requires a continuous physical count of stock to ensure accuracy, suitable for high-value items?

a) Periodic inventory system

b) Perpetual inventory system

c) Economic Order Quantity (EOQ)

d) Just-in-time (JIT)

Question 11: A manufacturer that aims to produce large volumes of a single product efficiently would benefit most from which production process?

a) Continuous flow

b) Batch processing

c) Job shop

d) Fixed-position layout

Question 12: Which type of forecasting method is often used for new products with no prior data available?

a) Simple moving average

b) Time series analysis

c) Qualitative forecasting

d) Exponential smoothing

Question 13: Which layout type is designed to group equipment by similar function, suitable for producing varied, low-volume products?

a) Product-oriented layout

b) Process-oriented layout

c) Assembly line

d) Fixed-position layout

Question 14: The primary objective of implementing a Kanban system is to:

a) Ensure continuous product improvement

b) Increase overall production volume

c) Control work-in-process inventory levels

d) Automate production scheduling

Question 15: A company operating in an industry where quick delivery and high product customization are essential would benefit most from a:

a) Lean supply chain

b) Push supply chain

c) Agile supply chain

d) Vendor Managed Inventory (VMI) system

Question 16: A company experiences a higher demand than usual due to an unexpected event. This type of demand is known as:

a) Peak demand

b) Seasonal demand

c) Unexpected demand

d) Chase demand

Question 17: In Six Sigma, the DMAIC process includes a stage specifically focused on implementing solutions to improve process performance. This stage is called:

a) Define

b) Measure

c) Analyze

d) Improve

Question 18: A fishbone diagram is primarily used to:

a) Organize work-in-process inventory

b) Analyze production schedules

c) Identify potential causes of a quality issue

d) Measure cycle time in production

Question 19: A firm with an emphasis on reducing setup and processing times to improve efficiency in its production processes is likely using which approach?

a) Statistical Process Control (SPC)

b) Continuous improvement

c) Lean manufacturing

d) Theory of Constraints (TOC)

Question 20: The primary purpose of implementing a push system is to:

a) Produce goods based on forecasted demand

b) Reduce inventory to the bare minimum

c) Respond to real-time customer orders

d) Minimize holding costs

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