Operations Management 1st Edition by Cachon - Test Bank

Operations Management 1st Edition by Cachon – Test Bank

 

Instant Download – Complete Test Bank With Answers

 

 

Sample Questions Are Posted Below

 

Chapter 05 Test Bank KEY

1. All flow units should have the same exit point in a production process.

 

FALSE

Attrition loss is an example of when flow units exit the process before completion. Therefore, some flow units exit the process earlier than others.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-01 Compute the demand for a resource in the presence of a product mix.

Topic: Generalized Process Flow Patterns

 

2. A bottleneck resource must have an implied utilization less than 100%.

FALSE

An implied utilization less than 100% simply means that the resource has capacity to meet demand. It has no bearing on whether or not the resource is a bottleneck.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Understand

Difficulty: 2 Medium

Gradable: automatic

Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.

Topic: How to Find the Bottleneck in a General Process Flow

 

3. The overall process yield is the sum total of the yields of all resources.

FALSE

The overall process yield is the product of the yields of all resources.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-03 Compute the yield of a process and be able to analyze a process flow with yield loss.

Topic: Attrition Losses, Yields, and Scrap Rates

 

4. When analyzing a process flow with flow unit dependent processing times, the unit of analysis should be a unit of demand.

FALSE

The unit of analysis for a flow unit becomes a minute or hour of work instead of a unit of demand when analyzing a process flow with flow unit dependent processing times.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Understand

Difficulty: 2 Medium

Gradable: automatic

Learning Objective: 05-04 Analyze a process flow with flow unit–dependent processing times.

Topic: Flow Unit–Dependent Processing Times

 

5. Rework always lowers the process capacity.

FALSE

Rework lowers the process capacity only when it involves a bottleneck resource in restoring reworked units.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Analyze

Difficulty: 3 Hard

Gradable: automatic

Learning Objective: 05-05 Analyze a process flow with rework.

Topic: Rework

 

6. Reworked units consume more time at a resource involved with rework than good units.

TRUE

Reworked units revisit a resource and therefore consume more time at that resource than good units.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-05 Analyze a process flow with rework.

Topic: Rework

 

7. Customers at an e-retailer site abandon their shopping carts without completing their purchase. This is an example of _____________.
8. attrition loss
9. attrition gain
10. attention loss
11. attention gain

Attrition loss refers to flow units leaving the process without completion.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-01 Compute the demand for a resource in the presence of a product mix.

Topic: Generalized Process Flow Patterns

 

8. A store manager at C&A notices that 20% of customers come to browse but not buy, 5% of them need assistance to complete their purchases, and 3% simply window shop. This is a _____________ situation where customers take different paths through the shopping process.

 

1. process mix
2. operation mix
3. product mix
4. market mix

A product mix refers to a combination of different flow unit types moving through a process.

 

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-01 Compute the demand for a resource in the presence of a product mix.

Topic: Generalized Process Flow Patterns

 

9. A store manager at C&A notices that not all customers who walk into the store will make a purchase. About 20% come to browse but not buy, 10% need assistance from an assistant manager, and 5% need assistance from the store manager. C&A has one greeter, two assistant managers, one store manager, and six cashiers. In setting up a demand matrix, how many rows of resource type and columns of customer type does C&A need?

 

1. 10, 3
2. 10, 4
3. 4, 4
4. 5, 5

There are four types of resources and four types of customers.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-01 Compute the demand for a resource in the presence of a product mix.

Topic: Generalized Process Flow Patterns

 

10. Not all of the 100 customers who walk into the C&A store per day will make a purchase. About 20% come to browse but not buy, 10% need assistance to complete a purchase, and 5% need assistance but leave without making a purchase. The other 65% purchase something without requiring assistance. C&A has one greeter (who greets every customer), two assistants (who deal with customers who need assistance), and two cashiers (who serve customers who purchase something). What does the demand matrix for C&A look like?

 

	Browse	Buy
Greeter	20	80
Assistant	0	10
Cashier	0	75

 

 

	Browse	Help	Buy
Greeter	20	15	80
Assistant	0	15	0
Cashier	0	15	75

 

 

C.

	Browse	Help	Buy
Greeter	20	10	65
Assistant	0	10	0
Cashier	0	10	65

 

 

	Browse	Help + Buy	Help + Leave	Buy
Greeter	20	10	5	65
Assistant	0	10	5	0
Cashier	0	10	0	65

There are four customer types and three resource types.

 

 

AACSB: Analytical Thinking

Blooms: Understand

Difficulty: 2 Medium

Gradable: automatic

Learning Objective: 05-01 Compute the demand for a resource in the presence of a product mix.

Topic: Generalized Process Flow Patterns

 

11. Not all of the 100 customers who walk into the C&A store per day will make a purchase. About 20% come to browse but not buy, 10% need assistance to complete a purchase, and 5% need assistance but leave without making a purchase. The other 65% purchase something without requiring assistance. C&A has one greeter (who greets every customer), two assistants (who deal with customers who need assistance), and two cashiers (who serve customers who purchase something). What is the total demand rate per day for the greeter?

 

1. 100
2. 20
3. 15
4. 10

Demand for greeter = 20 + 10 + 5 + 65 = 100.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Understand

Difficulty: 2 Medium

Gradable: automatic

Learning Objective: 05-01 Compute the demand for a resource in the presence of a product mix.

Topic: Generalized Process Flow Patterns

 

12. Not all of the 100 customers who walk into the C&A store per day will make a purchase. About 20% come to browse but not buy, 10% need assistance to complete a purchase, and 5% need assistance but leave without making a purchase. The other 65% purchase something without requiring assistance. C&A has one greeter (who greets every customer), two assistants (who deal with customers who need assistance), and two cashiers (who serve customers who purchase something). What is the total demand rate per day for assistants?

 

1. 100
2. 20
3. 15
4. 10

Demand for assistants = 10 + 5 = 15.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Understand

Difficulty: 2 Medium

Gradable: automatic

Learning Objective: 05-01 Compute the demand for a resource in the presence of a product mix.

Topic: Generalized Process Flow Patterns

 

13. Not all of the 100 customers who walk into the C&A store per day will make a purchase. About 20% come to browse but not buy, 10% need assistance to complete a purchase, and 5% need assistance but leave without making a purchase. The other 65% purchase something without requiring assistance. C&A has one greeter (who greets every customer), two assistants (who deal with customers who need assistance), and two cashiers (who serve customers who purchase something). What is the total demand rate per day for cashiers?

 

1. 100
2. 75
3. 65
4. 25

Demand for cashiers = 10 + 65 = 75.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Understand

Difficulty: 2 Medium

Gradable: automatic

Learning Objective: 05-01 Compute the demand for a resource in the presence of a product mix.

Topic: Generalized Process Flow Patterns

 

14. A ________ is a combination of different flow unit types moving through a process.

 

1. capacity mix
2. demand matrix
3. product matrix
4. product mix

A product mix is a combination of different flow unit types moving through a process.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-01 Compute the demand for a resource in the presence of a product mix.

Topic: Generalized Process Flow Patterns

 

15. A __________ determines how many flow units of each type are flowing through each __________.

 

1. demand matrix, process
2. demand matrix, resource
3. product mix, process
4. product mix, resource

A demand matrix determines how many flow units of each type are flowing through each resource.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-01 Compute the demand for a resource in the presence of a product mix.

Topic: Generalized Process Flow Patterns

 

16. All students register with the receptionist upon arrival at the orientation. The receptionist will assign each student to one of four groups for a campus tour. Each campus tour has its designated tour guide. In setting up a demand matrix, how many rows of resource type and columns of flow unit type does the situation have?

 

1. 5, 2
2. 2, 2
3. 5, 4
4. 2, 4

Each student will be assigned to one of the four tour groups. Therefore, there will be four types of students and five types of resources-the receptionist and tour guides 1-4.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Understand

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-01 Compute the demand for a resource in the presence of a product mix.

Topic: Generalized Process Flow Patterns

 

17. C&A makes two types of products using four machines. Product A visits machines 1, 2, and 4. Product B only visits machines 1 and 3. The demand per day is 40 units for Product A and 160 units for Product B. What does the demand matrix for C&A look like?

 

	All products
Machine 1	200
Machine 2	40
Machine 3	160
Machine 4	40

 

	Product A	Product B
Machine 1	1	1
Machine 2	1	0
Machine 3	0	1
Machine 4	1	0

 

	Product A	Product B
Machine 1	40	160
Machine 2	40	0
Machine 3	0	160
Machine 4	40	0

 

	Product A	Product B
All machines	40	160

Demand rate for Product A is 40 units per day. Demand rate for Product B is 160 units per day. Machine 1 is visited by Products A and B. Machine 2 is visited by Product A only. Machine 3 is visited by Product B only. Machine 4 is visited by Product A only.

 

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-01 Compute the demand for a resource in the presence of a product mix.

Topic: Generalized Process Flow Patterns

 

18. Which of the following statements is TRUE regarding implied utilization?
19. A resource with an implied utilization of 1.7 means that capacity exceeds demand by 1.7%.
20. A resource with an implied utilization of 1.7 means that demand exceeds capacity by 1.7%
21. A resource with an implied utilization of 1.7 means that demand exceeds capacity by 70%.
22. A resource with an implied utilization of 1.7 means that capacity exceeds demand by 70%.

Implied utilization = Total demand at the resource/Capacity at the resource. Therefore, if implied utilization is 1.7, that means demand exceeds capacity by 1.7 – 1 = 70%.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.

Topic: How to Find the Bottleneck in a General Process Flow

 

19. Which of the following statements is TRUE regarding utilization and implied utilization?
20. Utilization measures by how much demand exceeds the capacity of the resource.
21. Utilization can exceed 1.
22. Implied utilization can exceed 1.
23. Implied utilization is a measure of demand variability.

Implied utilization measures by how much demand exceeds the capacity of the resource. If it exceeds 1, then it means the process is capacity constrained.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.

Topic: How to Find the Bottleneck in a General Process Flow

 

20. _________ is constrained if the implied utilization of any resource is above 100%.
21. Capacity
22. Demand
23. Bottleneck
24. Inventory

Capacity is constrained if the implied utilization of any resource is above 100%.

 

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.

Topic: How to Find the Bottleneck in a General Process Flow

 

21. A process is ______________ constrained if the highest implied utilization of all resources is less than or equal to 100%.
22. capacity
23. demand
24. bottleneck
25. supply

Demand is constrained if the implied utilization of the resource is below 100%.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.

Topic: How to Find the Bottleneck in a General Process Flow

 

22. The steps involved in finding the bottleneck in a process with a product mix include all the following EXCEPT:
23. compute the total demand rate for each resource.
24. compute the capacity level for each resource.
25. compute the flow rate for each resource.
26. compute the implied utilization for each resource.

The bottleneck in a process with a product mix is the resource with the highest implied utilization for each process and does not involve the flow rate. Besides, flow rate should be computed in relation to each flow unit type.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.

Topic: How to Find the Bottleneck in a General Process Flow

 

23. The resource with the ____________ is the bottleneck in a process with multiple types of flow units.
24. highest capacity
25. lowest capacity
26. highest implied utilization
27. lowest implied utilization

The resource with the highest implied utilization is the bottleneck in a process with multiple types of flow units.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.

Topic: How to Find the Bottleneck in a General Process Flow

 

24. C&A makes two types of products using four machines from 9 a.m. to 5 p.m. each day. Product A visits machines 1, 2, and 4. Product B only visits machines 1 and 3. The capacity is 0.4 unit per minute at machine 1, 0.12 unit per minute at machine 2, 0.2 unit per minute at machine 3, and 0.3 unit per minute at machine 4. The demand per day is 40 units for Product A and 160 units for Product B. Which is the implied utilization for the bottleneck resource?

 

1. 1.67
2. 1.04
3. 0.69
4. 0.28

Total demand rate for machine 1 = 40 + 160 = 200 units per day. Total demand rate for machine 2 = 40 units per day. Total demand rate for machine 3 = 160 units per day. Total demand rate for machine 4 = 40 units per day. Implied utilization for machine 1 = 200/(0.4 × 8 × 60) = 1.04. Implied utilization for machine 2 = 40/(0.12 × 8 × 60) = 0.69. Implied utilization for machine 3 = 160/(0.2 × 8 × 60) = 1.67. Implied utilization for machine 4 = 40/(0.3 × 8 × 60) = 0.28. The bottleneck is the resource with the highest implied utilization, which is machine 3.

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.

Topic: How to Find the Bottleneck in a General Process Flow

 

25. C&A makes two types of products using four machines from 9 a.m. to 5 p.m. each day. Product A visits machines 1, 2, and 4. Product B only visits machines 1 and 3. The capacity is 0.4 unit per minute at machine 1, 0.12 unit per minute at machine 2, 0.2 unit per minute at machine 3, and 0.3 unit per minute at machine 4. The demand per day is 40 units for Product A and 160 units for Product B. What is the implied utilization for machine 1?

 

1. 1.67
2. 1.04
3. 0.69
4. 0.28

Total demand rate for machine 1 = 40 + 160 = 200 units per day. Capacity for machine 1 = 0.4 unit per minute or 0.4 × 8 × 60 units per day. Implied utilization for machine 1 = 200/(0.4 × 8 × 60) = 1.04.

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.

Topic: How to Find the Bottleneck in a General Process Flow

 

26. C&A makes two types of products using four machines from 9 a.m. to 5 p.m. each day. Product A visits machines 1, 2, and 4. Product B only visits machines 1 and 3. The capacity is 0.4 unit per minute at machine 1, 0.12 unit per minute at machine 2, 0.2 unit per minute at machine 3, and 0.3 unit per minute at machine 4. The demand per day is 40 units for Product A and 160 units for Product B. Which resource is the bottleneck?

 

1. Machine 1
2. Machine 2
3. Machine 3
4. Machine 4

Total demand rate for machine 1 = 40 + 160 = 200 units per day. Total demand rate for machine 2 = 40 units per day. Total demand rate for machine 3 = 160 units per day. Total demand rate for machine 4 = 40 units per day. Implied utilization for machine 1 = 200/(0.4 × 8 × 60) = 1.04. Implied utilization for machine 2 = 40/(0.12 × 8 × 60) = 0.69. Implied utilization for machine 3 = 160/(0.2 × 8 × 60) = 1.67. Implied utilization for machine 4 = 40/(0.3 × 8 × 60) = 0.28. The bottleneck is the resource with the highest implied utilization, which is machine 3.

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.

Topic: How to Find the Bottleneck in a General Process Flow

 

27. C&A makes two types of products using four machines from 9 a.m. to 5 p.m. each day. Product A visits machines 1, 2, and 4. Product B only visits machines 1 and 3. The capacity is 0.4 unit per minute at machine 1, 0.12 unit per minute at machine 2, 0.2 unit per minute at machine 3, and 0.3 unit per minute at machine 4. The demand per day is 40 units for Product A and 160 units for Product B. Assume the relative proportion between the two product types remains constant. What is the flow rate for Product B in units per day?

 

1. 24
2. 96
3. 120
4. Cannot be determined

Because the implied utilization is 1.67 (exceeds 1), the process is capacity constrained. Flow rate for Product B = Demand rate/Implied utilization of the bottleneck = 160/1.67 = 96 units per day.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.

Topic: How to Find the Bottleneck in a General Process Flow

 

28. About 80% of customers who receive a promotion coupon will visit the store, but only 20% of those in the store will make a purchase. What is the yield of the promotion?

 

1. 80%
2. 60%
3. 20%
4. 16%

Process yield = 0.8 × 0.2 = 0.16.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-03 Compute the yield of a process and be able to analyze a process flow with yield loss.

Topic: Attrition Losses, Yields, and Scrap Rates

 

29. About 80% of customers who receive a promotion coupon will visit the store, but only 20% of those in the store will make a purchase. How many promotion coupons have to be sent in order to get 100 customers to make a purchase?
30. 1600
31. 625
32. 500
33. 125

Process yield = Number of promotion coupons = 100/0.16 = 625.

Number of coupons started to get Q coupons = Q/Process yield = 100/0.16 = 625.

 

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-03 Compute the yield of a process and be able to analyze a process flow with yield loss.

Topic: Attrition Losses, Yields, and Scrap Rates

 

30. Which of the following is an example of attrition loss?
31. All customers renew their magazine subscriptions.
32. Defective units in a manufacturing process are reworked.
33. More loan applications are received than approved.
34. The number of students at the beginning of the course is the same as that at the end.

Some loan applicants are rejected in their loan application process and are regarded as attrition losses.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-03 Compute the yield of a process and be able to analyze a process flow with yield loss.

Topic: Attrition Losses, Yields, and Scrap Rates

 

31. In a process with attrition loss, all flow units start at _________ resource but then drop out of the process at __________ points.
32. the same, different
33. a different, the same
34. the same, the same
35. a different, different

In a process with attrition loss, all flow units start at the same resource but then drop out of the process at different points.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-03 Compute the yield of a process and be able to analyze a process flow with yield loss.

Topic: Attrition Losses, Yields, and Scrap Rates

 

32. _______ defective flow units that are ________ the process.
33. Rework is, eliminated from
34. Defects are, restored in
35. Scrap is, eliminated from
36. Scrap is, restored in

Scrap is defective flow units that are eliminated from the process.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-03 Compute the yield of a process and be able to analyze a process flow with yield loss.

Topic: Attrition Losses, Yields, and Scrap Rates

 

33. The ________ of a resource measures the percentage of _______ units that are processed at this resource.
34. yield, defective
35. yield, non-defective

 

1. capacity, defective
2. capacity, non-defective

The yield of a resource measures the percentage of nondefective units that are processed at this resource.

 

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-03 Compute the yield of a process and be able to analyze a process flow with yield loss.

Topic: Attrition Losses, Yields, and Scrap Rates

 

34. Which of the following statements about the yield of a process is FALSE?
35. A process can have a yield of 100%.
36. A process with attrition loss has a lower yield than one without attrition loss.
37. A process without attrition loss will have a yield of 100%.
38. A process can have a yield that exceeds 100%.

The yield of a process is the percentage of units processed correctly. It cannot exceed 100%.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-03 Compute the yield of a process and be able to analyze a process flow with yield loss.

Topic: Attrition Losses, Yields, and Scrap Rates

 

35. A three-step process is used to make a product. The yield of step 1 is 90%; of step 2, 70%; and of step 3 is 50%. What is the yield of the overall process?

 

1. 70%
2. 40%
3. 31.5%
4. Cannot be determined

The yield of the overall process = 0.9 × 0.7 × 0.5 = 0.315.

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-03 Compute the yield of a process and be able to analyze a process flow with yield loss.

Topic: Attrition Losses, Yields, and Scrap Rates

 

36. A three-step process is used to make a product. The yield of step 1 is 50%; of step 2, 80%; and of step 3, 20%. How many units would the process have to process to get 100 units of good outputs?
37. 125
38. 200
39. 167
40. 1250

Process yield = 0.5 × 0.8 × 0.2 = 8%. Number of units = 100/0.08 = 1250.

 

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-03 Compute the yield of a process and be able to analyze a process flow with yield loss.

Topic: Attrition Losses, Yields, and Scrap Rates

 

37. A three-step process is used to make a product. The yield of step 1 is 80%; of step 2, 40%; and of step 3, 50%. Step 1 takes 2 minutes per unit. Step 2 takes 4 minutes per unit. Step 3 takes 5 minutes. Where in the process is the bottleneck and what is its implied utilization?
38. Step 3, 0.2
39. Step 3, 10
40. Step 2, 0.25
41. Step 2, 20

To have one good unit at step 3, demand at step 3 is 1/50% = 2; demand at step 2 is 2/40% = 5; demand at step 1 is 5/80% = 6.25. Capacity at step 1 is ½, step 2 is ¼, step 3 is 1/5. Implied utilization at step 1 is 6.25/0.5 = 12.5, step 2 is 5/0.25 = 20, step 3 is 2/0.2 = 10. The highest implied utilization is at step 2.

 

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.

Topic: Attrition Losses, Yields, and Scrap Rates

 

38. A three-step process is used to make a product. The yield of step 1 is 80%; of step 2, 40%; and of step 3, 50%. Step 1 takes 2 minutes per unit. Step 2 takes 4 minutes per unit. Step 3 takes 5 minutes. How many good units can the process produce per hour?
39. 0.05
40. 0.1
41. 3
42. 6

To have one good unit at step 3, demand at step 3 is 1/50% =2; demand at step 2 is 2/40% = 5; demand at step 1 is 5/80% = 6.25. Capacity at step 1 is 1/2; at step 2, 1/4; and at step 3, 1/5. Implied utilization at step 1 is 6.25/0.5 = 12.5; at step 2, 5/0.25 = 20; and at step 3, 2/0.2 = 10. The highest implied utilization is 20. The capacity of the process in good units per hour = 1/20 × 60 = 3 units per hour.

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-03 Compute the yield of a process and be able to analyze a process flow with yield loss.

Topic: Attrition Losses, Yields, and Scrap Rates

 

39. When analyzing a process flow with flow unit dependent processing time, the flow unit is changed from using ___________ to ______________.
40. a minute of work, a unit of demand
41. a unit of demand, a minute of work
42. a unit of resource, a unit of demand
43. a unit of demand, a unit of resource

When analyzing a process flow with flow unit dependent processing time, the flow unit is changed from using a unit of demand to a minute of work.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-04 Analyze a process flow with flow unit–dependent processing times.

Topic: Flow Unit–Dependent Processing Times

 

40. A work load matrix has _________ as columns and _________ as rows.
41. resource types, load types
42. work types, load types
43. work types, flow unit types
44. flow unit types, resource types

A work load matrix has flow unit types as columns and resource types as rows.

 

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-04 Analyze a process flow with flow unit–dependent processing times.

Topic: Flow Unit–Dependent Processing Times

 

41. A work load matrix captures the _________ that each flow unit type requires for each resource.

 

1. amount of work

 

1. amount of demand

 

1. amount of revenue

 

1. amount of supply

A work load matrix captures the amount of work that each flow unit type requires for each resource.

 

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-04 Analyze a process flow with flow unit–dependent processing times.

Topic: Flow Unit–Dependent Processing Times

 

42. Which of the following statements is TRUE regarding a process flow with flow unit dependent processing time?
43. It is a process where the processing times at a given resource are the same across the products/customers in the product mix.
44. It is a process where a unit of demand is used as a flow unit.
45. It is a process where the bottleneck is the resource with the highest implied utilization.
46. It is a process where the bottleneck is the resource with the highest workload.

The bottleneck in a process flow with flow unit dependent processing time is the resource with the highest implied utilization.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-04 Analyze a process flow with flow unit–dependent processing times.

Topic: Flow Unit–Dependent Processing Times

 

43. Which of the following statements is FALSE regarding the workload matrix?
44. It has the same number of columns and rows as the demand matrix.
45. The total amount of work requested at a resource is computed by adding up the workloads for that resource across all customer types.
46. It captures the time available at each resource.
47. It has flow unit types as columns and resource types as rows.

The workload matrix does not contain information about the time available at each resource.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-04 Analyze a process flow with flow unit–dependent processing times.

Topic: Flow Unit–Dependent Processing Times

 

44. Two types of customers are served by a two-step process. Each resource is staffed by one employee. Customer A spends two minutes at resource X and five minutes at resource Y. Customer B spends five minutes at resource X and two minutes at resource Y. The demand rate per hour is 10 customer A and 15 customer B. Which of the following is the workload matrix for this situation?

	All customers
Resource X	95
Resource Y	80

 

 

	Customer A	Customer B
Resource X	2	5
Resource Y	5	2

 

 

	Customer A	Customer B
Resource X	20	75
Resource Y	50	30

 

 

	Customer A	Customer B
All resources	70	105

Workload for customer A at resource X = 10 × 2; Workload for customer A at resource Y = 10 × 5; Workload for customer B at resource X = 15 × 5; Workload for customer B at resource Y = 15 × 2.

 

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-04 Analyze a process flow with flow unit–dependent processing times.

Topic: Flow Unit–Dependent Processing Times

 

45. Two types of customers are served by a two-step process. Each resource is staffed by one employee. Customer A spends two minutes at resource X and five minutes at resource Y. Customer B spends five minutes at resource X and two minutes at resource Y. The demand rate per hour is 10 customer A and 15 customer B. What is the workload for resource X across all customer types?
46. 70 minutes per hour
47. 80 minutes per hour
48. 95 minutes per hour
49. 105 minutes per hour

Workload for resource X = (10 × 2) + (15 × 5) = 95 minutes per hour.

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-04 Analyze a process flow with flow unit–dependent processing times.

Topic: Flow Unit–Dependent Processing Times

 

46. Two types of customers are served by a two-step process. Each resource is staffed by one employee. Customer A spends two minutes at resource X and five minutes at resource Y. Customer B spends five minutes at resource X and two minutes at resource Y. The demand rate per hour is 10 customer A and 15 customer B. What is the workload for resource Y across all customer types?
47. 70 minutes per hour
48. 80 minutes per hour
49. 95 minutes per hour
50. 105 minutes per hour

Workload for resource Y = (10 × 5) + (15 × 2) = 80 minutes per hour.

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-04 Analyze a process flow with flow unit–dependent processing times.

Topic: Flow Unit–Dependent Processing Times

 

47. Two types of customers are served by a two-step process. Each resource is staffed by one employee. Customer A spends two minutes at resource X and five minutes at resource Y. Customer B spends five minutes at resource X and two minutes at resource Y. The demand rate per hour is 10 customer A and 15 customer B. Where in the process is the bottleneck and what is its implied utilization?
48. Resource X, 1.58
49. Resource X, 1.33
50. Resource Y, 1.33
51. Resource Y, 1.58

Workload for resource X = (10 × 2) + (15 × 5) = 95 minutes per hour; Implied utilization for resource X = 95/60 = 1.58. Workload for resource Y = (10 × 5) + (15 × 2) = 80 minutes per hour; Implied utilization for resource Y = 80/60 = 1.33. Resource X has the higher implied utilization and therefore is the bottleneck.

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-04 Analyze a process flow with flow unit–dependent processing times.

Topic: Flow Unit–Dependent Processing Times

 

48. Two types of customers are served by a two-step process. Each resource is staffed by one employee. Customer A spends two minutes at resource X and five minutes at resource Y. Customer B spends five minutes at resource X and two minutes at resource Y. The demand rate per hour is 10 customer A and 15 customer B. What is the flow rate for customer A holding the mix of A and B constant?

 

1. Cannot be determined
2. 6.3 customers per hour
3. 7.5 customers per hour
4. 9.5 customers per hour

Workload for resource X = (10 × 2) + (15 × 5) = 95 minutes per hour; Implied utilization for resource X = 95/60 = 1.58. Workload for resource Y = (10 × 5) + (15 × 2) = 80 minutes per hour; Implied utilization for resource Y = 80/60 = 1.33. Resource X has the higher implied utilization of 1.58, which is greater than 1. The process is capacity constrained. Flow rate for customer A = 10/1.58 = 6.3 customers per hour.

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-04 Analyze a process flow with flow unit–dependent processing times.

Topic: Flow Unit–Dependent Processing Times

 

49. Two types of customers are served by a two-step process. Each resource is staffed by one employee. Customer A spends two minutes at resource X and five minutes at resource Y. Customer B spends five minutes at resource X and two minutes at resource Y. The demand rate per hour is 10 customer A and 15 customer B. What is the flow rate for customer B holding the mix of A and B constant?

 

1. Cannot be determined
2. 6.3 customers per hour
3. 9.5 customers per hour
4. 11.25 customers per hour

Workload for resource X = (10 × 2) + (15 × 5) = 95 minutes per hour; Implied utilization for resource X = 95/60 = 1.58. Workload for resource Y = (10 × 5) + (15 × 2) = 80 minutes per hour; Implied utilization for resource Y = 80/60 = 1.33. Resource X has the higher implied utilization of 1.58, which is greater than 1. The process is capacity constrained. Flow rate for customer B = 15/1.58 = 9.5 customers per hour.

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-04 Analyze a process flow with flow unit–dependent processing times.

Topic: Flow Unit–Dependent Processing Times

 

50. Rework is a ___________ of activities that have to be completed by a ____________ flow unit in order to be restored to a good flow unit.
51. reduction, defective
52. reduction, nondefective
53. repetition, defective
54. repetition, nondefective

Rework is to repeat activities that have to be completed by a defective flow unit in order to be restored to a good flow unit.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-05 Analyze a process flow with rework.

Topic: Rework

 

51. Which of the following process flow diagrams does not represent a process with rework?

 

B.

 

 

C.

 

 

D.

 

Rework is represented as a loop showing resources that it has revisited.

 

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-05 Analyze a process flow with rework.

Topic: Rework

 

52. Which of the following statements concerning rework is TRUE?
53. Rework does not involve performing an extra set of activities.
54. Rework does not involve inventories.
55. Rework can never return a process yield to 100%.
56. Rework increases the demand rate for a particular resource.

Rework revisits a particular resource and thus increases the demand rate for that resource.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-05 Analyze a process flow with rework.

Topic: Rework

 

53. Which of the following statements concerning rework is TRUE?

 

1. Rework involves only bottleneck resources.
2. Rework does not affect overall process capacity.
3. Rework leads a lower overall process yield than scrap.

 

1. Rework leads to a higher overall process yield than scrap.

Rework attempts to restore the overall process yield to 1. Scrap, on the other hand, simply exits the process according to the yield at a particular resource.

 

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-05 Analyze a process flow with rework.

Topic: Rework

 

54. Students who failed a course last semester are retaking it this semester. This is an example of ____________.
55. attrition loss
56. rework
57. compliance
58. process reengineering

Rework refers to a repetition of activities or an extra set of activities that have to be completed by a defective unit in order to be restored to a good flow unit.

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-05 Analyze a process flow with rework.

Topic: Rework

 

55. _________ refers to a ________ of activities or an extra set of activities that have to be completed by a defective unit in order to be restored to a good flow unit.
56. Rework, removal
57. Reduce, removal
58. Rework, repetition
59. Reduce, repetition

Rework refers to a repetition of activities or an extra set of activities that have to be completed by a defective unit in order to be restored to a good flow unit.

 

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-05 Analyze a process flow with rework.

Topic: Rework

 

56. A four-step process is used to make a product. The first resource takes 8 minutes per unit, the second takes 7 minutes per unit, the third takes 2 minutes per unit, and the fourth takes 10 minutes per unit. 20% of all units have to be reworked. For that, they have to revisit the third and fourth resources. Each resource is staffed by one worker. Rework takes the same processing times as the first pass and always fixes the problem. Where is the bottleneck?

 

1. Resource 1
2. Resource 2
3. Resource 3
4. Resource 4

Workload for resource 1 = (0.8 × 8) + (0.2 × 8) = 8 minutes per unit; Workload for resource 2 = (0.8 × 7) + (0.2 × 7) = 7 minutes per unit; Workload for resource 3 = (0.8 × 2) + [0.2 × (2 + 2)] = 2.4 minutes per unit; Workload for resource 4 = (0.8 × 10) + [0.2 × (10 + 10)] = 12 minutes per unit. Each resource has one worker who can provide one minute of work each minute. The implied utilization for resource 1 is 8; for resource 2, 7; for resource 3, 2.4; and for resource 4, 12. The highest implied utilization is 12 at resource 4.

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-05 Analyze a process flow with rework.

Topic: Rework

 

57. A four-step process is used to make a product. The first resource takes 8 minutes per unit, the second takes 7 minutes per unit, the third takes 2 minutes per unit, and the fourth takes 10 minutes per unit. 20% of all units have to be reworked. For that, they have to revisit the third and fourth resources. Each resource is staffed by one worker. Rework takes the same processing times as the first pass and always fixes the problem. What is the capacity of the process in units per minute?

 

1. 0.08

 

1. 0.125

 

1. 0.143

 

1. 0.417

Workload for resource 1 = (0.8 × 8) + (0.2 × 8) = 8 minutes per unit; Workload for resource 2 = (0.8 × 7) + (0.2 × 7) = 7 minutes per unit; Workload for resource 3 = (0.8 × 2) + [0.2 × (2 + 2)] = 2.4 minutes per unit; Workload for resource 4 = (0.8 × 10) + [0.2 × (10 + 10)] = 12 minutes per unit. Each resource has one worker who can provide one minute of work each minute. The implied utilization for resource 1 is 8; for resource 2, 7; for resource 3, 2.4; and for resource 4, 12. The highest implied utilization is 12. Capacity = 1/12 = 0.08 unit per minute.

 

AACSB: Analytical Thinking

Blooms: Remember

Difficulty: 1 Easy

Gradable: automatic

Learning Objective: 05-05 Analyze a process flow with rework.

Topic: Rework

 

58. The salesforce of Small Travel Company (STC) is selling cultural immersion programs to U.S. college students that allow them to spend 3 months in Europe.

 

STC advertises in various college newspapers, as well as via social media. Potential customers fill out an online application form expressing their interest in more information about this experience. The form also includes their phone number for follow-up discussion, which sometimes, but not always, leads to the customer purchasing the package (more details below).

 

On 60 consecutive days in the winter, STC’s employees work hard to sell these programs to elite university students. The goal of the company is to sell, on average, two packages per day, leading to a total of 120 sold packages. The sales process works in four steps:

 

1. One salesperson reaches out to the potential customer by phone in order to put together a full profile of the customer, including skills and location preferences (Germany, Italy, France, etc.). The call takes on average 20 minutes. After the call, each profile is forwarded to a language teacher.
2. The language teacher looks at the student’s profile and also organizes a quick follow-up call. This takes, on average, 40 minutes per profile. The teacher rejects 60% of the profiles as the student would not have the language skills to benefit from an STC trip. From the remaining 40% of the profiles, half tell the teacher that they are no longer interested in participating. The teacher then forwards the remaining profiles to the STC accountant.
3. STC’s accountant then contacts the student to make a 10% down payment. This takes about 20 minutes per customer.
4. Finally, the teacher’s assistant contacts the customer to confirm the trip and start working on a travel schedule. At this point, an average of one-third of the students decide that they will not participate in the trip (in which case, STC and the student agree to give the 10% down payment to a charitable cause). This takes on average 50 minutes per student.

All employees work 8 hours per day.

 

How many students does STC have to contact each day through its call center to fill, on average, its target of 120 students per season (2 students per day)?

 

1. 5 students/day
2. 15 students/day
3. 35 students/day
4. 120 students/day

Step 1 passes 100%. Step 2 passes 20%. Step 3 passes 100%. Step 4 passes 67%. Starting with step 4, 1/0.667 = 1.5 (rounded). For step 3, 1.5/1 = 1.5. For step 2, 1.5/0.2 = 7.5. For step 1, 7.5/1 = 7.5. To get 1 customer through the process takes 7.5 starts. To get 2 good units per day, 7.5 × 2 = 15.

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

Blooms: Apply

Difficulty: 3 Hard

Learning Objective: 05-03 Compute the yield of a process and be able to analyze a process flow with yield loss.

Topic: Attrition Losses, Yields, and Scrap Rates

 

59. The salesforce of Small Travel Company (STC) is selling cultural immersion programs to U.S. college students that allow them to spend 3 months in Europe.

 

STC advertises in various college newspapers, as well as via social media. Potential customers fill out an online application form expressing their interest in more information about this experience. The form also includes their phone number for follow-up discussion, which sometimes, but not always, leads to the customer purchasing the package (more details below).

 

On 60 consecutive days in the winter, STC’s employees work hard to sell these programs to elite university students. The goal of the company is to sell, on average, two packages per day, leading to a total of 120 sold packages. The sales process works in four steps:

 

1. One salesperson reaches out to the potential customer by phone in order to put together a full profile of the customer, including skills and location preferences (Germany, Italy, France, etc.). The call takes on average 20 minutes. After the call, each profile is forwarded to a language teacher.
2. The language teacher looks at the student’s profile and also organizes a quick follow-up call. This takes, on average, 40 minutes per profile. The teacher rejects 60% of the profiles as the student would not have the language skills to benefit from an STC trip. From the remaining 40% of the profiles, half tell the teacher that they are no longer interested in participating. The teacher then forwards the remaining profiles to the STC accountant.
3. STC’s accountant then contacts the student to make a 10% down payment. This takes about 20 minutes per customer.
4. Finally, the teacher’s assistant contacts the customer to confirm the trip and start working on a travel schedule. At this point, an average of one-third of the students decide that they will not participate in the trip (in which case, STC and the student agree to give the 10% down payment to a charitable cause). This takes on average 50 minutes per student.

All employees work 8 hours per day.

 

Which resource is the bottleneck?

 

1. The salesperson
2. The language teacher
3. The accountant
4. The teacher’s assistant

Calculation of implied utilization

Resource

Yield

Demand

Capacity

Implied utilization

Salesperson

1.00

(7.5/1

×

2

)

=

15

1/20

×

60

×

8

=

24

students per day

15/24

=

0.625

Language teacher

0.20

(1.5/0.2

)×

2

=

15

1/40

×

60

×

8

=

12

students per day

15/12

=

1.25

Accountant

1.00

(1.5/1

×

2

)

=

3

1/20

×

60

×

8

=

24

students per day

3/24

=

0.125

Teacher’s assistant

0.67

(1/0.67

×

2

)

=

3

1/50

×

60

×

8

=

9.6

students per day

3/9.6

=

0.3125

Yield is based on “1 good output.” Since the goal is “2 good outputs” per day, demand has been doubled. Demand is calculated in reverse order, starting with teacher’s assistant and finishing with salesperson.

 

AACSB: Reflective Thinking

Blooms: Apply

Difficulty: 3 Hard

Learning Objective: 05-03 Compute the yield of a process and be able to analyze a process flow with yield loss.

Topic: Attrition Losses, Yields, and Scrap Rates

 

60. Consider the following four-step assembly operation with quality problems. All resources are staffed by one employee.

 

1. The first resource has a processing time of 5 minutes per unit.
2. The second resource has a processing time of 6 minutes per unit.
3. The third resource has a processing time of 3 minutes per unit. With a 30% probability, the flow unit coming out of the third resource has to be reworked. In that case, the operations at the first, second, and third resources are repeated. You can assume that (a) rework always succeeds (i.e., a unit going through the rework loop will always work after the third resource) and (b) the processing times for units in rework are the same as for regular units.
4. The fourth resource has a processing time of 4 minutes per unit.

Which resource in the process is the bottleneck?

 

1. The first resource
2. The second resource
3. The third resource
4. The fourth resource

 

		Good				Rework				Total per unit						IU per minute
	Resource 1	0.7	×	5		0.3	×	[5 + 5]		3.5	+	3	=	6.5		6.5/1	=	6.5
WL =	Resource 2	0.7	×	6		0.3	×	[6 + 6]		4.2	+	3.6	=	7.8		7.8/1	=	7.8
	Resource 3	0.7	×	3		0.3	×	[3 + 3]		2.1	+	2.7	=	4.8		4.8/1	=	4.8
	Resource 4	1.00	×	4						4						4/1	=	4

The second resource is the bottleneck since it has the highest implied utilization.

 

AACSB: Reflective Thinking

Blooms: Analyze

Difficulty: 3 Hard

Learning Objective: 05-05 Analyze a process flow with rework.

Topic: Rework

 

61. Consider the following four-step assembly operation with quality problems. All resources are staffed by one employee.

1. The first resource has a processing time of 5 minutes per unit.
2. The second resource has a processing time of 6 minutes per unit.
3. The third resource has a processing time of 3 minutes per unit. With a 30% probability, the flow unit coming out of the third resource has to be reworked. In that case, the operations at the first, second, and third resources are repeated. You can assume that (a) rework always succeeds (i.e., a unit going through the rework loop will always work after the third resource) and (b) the processing times for units in rework are the same as for regular units.
4. The fourth resource has a processing time of 4 minutes per unit. What is the capacity of the process (in units per hour)?

What is the capacity of the process (in units per hour)?

 

 

6. 6.00
7. 7.70
8. 8.90
9. 20.10

 

		Good				Rework				Total per unit						IU per minute
	Resource 1	0.7	×	5		0.3	×	[5 + 5]		3.5	+	3	=	6.5		6.5/1	=	6.5
WL =	Resource 2	0.7	×	6		0.3	×	[6 + 6]		4.2	+	3.6	=	7.8		7.8/1	=	7.8
	Resource 3	0.7	×	3		0.3	×	[3 + 3]		2.1	+	2.7	=	4.8		4.8/1	=	4.8
	Resource 4	1.00	×	4						4						4/1	=	4

The second resource is the bottleneck since it has the highest implied utilization.

The capacity is 1/7.8 = 0.1282 unit per minute, × 60 = 7.7 units per hour.

 

AACSB: Reflective Thinking

Blooms: Analyze

Difficulty: 3 Hard

Learning Objective: 05-05 Analyze a process flow with rework.

Topic: Rework

 

62. Consider a process that has multiple flow units with different demand rates and different paths through the process flow diagram. Consider the following statements:

 

1. The resource with the largest total demand rate is the bottleneck.
2. The implied utilization can never be bigger than 100%.

III. The resource that has the highest implied utilization is the bottleneck.

 

Which of the following choices identifies the correct statement(s)?

 

1. III only
2. I and II
3. I and III
4. None of these are correct

Implied utilization can be higher than 100%. Total demand and capacity at the resource must be taken into account in determining where the bottleneck is located. The resource with the highest implied utilization is the bottleneck.

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.

Topic: How to Find the Bottleneck in a General Process Flow

 

63. GV is a small accounting firm supporting wealthy individuals in their preparation of annual income tax statements. Every December, GV sends out a short survey to its customers, asking for the information required for preparing tax statements. Based on 50 years of experience, GV categorizes its cases into the following two groups:

 

• Group 1 (new customers): 20 percent of cases
• Group 2 (repeat customers): 80 percent of cases

This year, there are 35 income tax statements arriving each week.

In order to prepare the income tax statement, GV has three resources, or employees. The following activities are carried out by employees:

 

• An administrative support person processes every tax statement.
• A senior accountant (the owner of GV) processes only tax statements for new customers.
• A junior accountant processes tax statements for repeat customers.

The administrative support person can process 40 statements per week. The senior accountant can process 10 statements per week. The junior accountant can process 30 statements per week; these statements can be completed more quickly given past information on file about the clients.

 

What is the implied utilization for the junior accountant?

 

33. 33.3%
34. 66.7%
35. 83.3%
36. 93.3%

Implied utilization is Total demand at the resource/Capacity at the resource. Demand for the junior accountant is 80% of the 35 statements arriving weekly, or 28 statements. The capacity is 30 statements per week. IU = 28/30 = 93.3%.

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

Blooms: Apply

Difficulty: 3 Hard

Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.

Topic: How to Find the Bottleneck in a General Process Flow

 

64. GV is a small accounting firm supporting wealthy individuals in their preparation of annual income tax statements. Every December, GV sends out a short survey to its customers, asking for the information required for preparing tax statements. Based on 50 years of experience, GV categorizes its cases into the following two groups:

 

• Group 1 (new customers): 20 percent of cases
• Group 2 (repeat customers): 80 percent of cases

This year, there are 35 income tax statements arriving each week.

In order to prepare the income tax statement, GV has three resources, or employees. The following activities are carried out by employees:

• An administrative support person processes every tax statement.
• A senior accountant (the owner of GV) processes only tax statements for new customers.
• A junior accountant processes tax statements for repeat customers.

The administrative support person can process 40 statements per week. The senior accountant can process 10 statements per week. The junior accountant can process 30 statements per week; these statements can be completed more quickly given past information on file about the clients.

Which resource is the bottleneck?

 

1. The administrative support person
2. The senior accountant
3. The junior accountant
4. There is no bottleneck

The bottleneck is the resource with the highest implied utilization. Administrative support person IU = 35/40 = 87.5%. Senior accountant IU = 7/10 = 70%. Junior accountant IU = 35/40 = 93.3%. Therefore, the junior accountant is the bottleneck resource.

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.

Topic: How to Find the Bottleneck in a General Process Flow

 

65. Which of the following statements about the concepts of “labor utilization” and “implied utilization” is correct?
66. Labor utilization is above 100% if the process is capacity constrained.
67. Labor utilization is above 100% if the process is demand constrained.
68. Labor utilization is always the same as implied utilization.
69. If the process is capacity constrained, then implied utilization is bigger than the labor utilization.
70. If the process is demand constrained, then implied utilization is bigger than the labor utilization.
71. None of these are correct.

Labor utilization cannot be above 100%. Implied utilization can exceed 100%, as it includes additional information about how much demand exceeds capacity of the resource. In a capacity-constrained process, implied utilization will be bigger than utilization.

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

Blooms: Remember

Difficulty: 1 Easy

Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.

Topic: How to Find the Bottleneck in a General Process Flow

 

Chapter 05 Test Bank Summary

 

Category	# of Questions
AACSB: Analytical Thinking	57
AACSB: Reflective Thinking	8
Accessibility: Keyboard Navigation	44
Blooms: Analyze	3
Blooms: Apply	3
Blooms: Remember	52
Blooms: Understand	7
Difficulty: 1 Easy	53
Difficulty: 2 Medium	6
Difficulty: 3 Hard	6
Gradable: automatic	57
Learning Objective: 05-01 Compute the demand for a resource in the presence of a product mix.	12
Learning Objective: 05-02 Find the bottleneck in a general process flow by computing implied utilization levels.	16
Learning Objective: 05-03 Compute the yield of a process and be able to analyze a process flow with yield loss.	13
Learning Objective: 05-04 Analyze a process flow with flow unit–dependent processing times.	12
Learning Objective: 05-05 Analyze a process flow with rework.	12
Topic: Attrition Losses, Yields, and Scrap Rates	14
Topic: Flow Unit–Dependent Processing Times	12
Topic: Generalized Process Flow Patterns	12
Topic: How to Find the Bottleneck in a General Process Flow	15
Topic: Rework	12