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Om Chapter 3 - 240925 - 151014

Chapter 3 OM

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Jaira Din Fabia Soriano
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12 views40 pages

Om Chapter 3 - 240925 - 151014

Chapter 3 OM

Uploaded by

Jaira Din Fabia Soriano
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Multiple Choice (20 items)

1. What is the primary goal of


operations management?
a. Maximize profits
b. Match supply to demand
c. Minimize costs
d. Maximize production

2. Forecasting provides
information primarily on:
a. Past performance
b. Competitor behavior
c. Future demand
d. Employee performance
3. For businesses where
customer orders make up most
of the anticipated demand: a.
Extensive forecasting is required
b. Planning is straightforward,
and little forecasting is needed
c. Forecasts are unnecessary
d. Long-term forecasts are
crucial

4. Two important aspects of


forecasts are: a. Accuracy and
clarity
b. Demand level and forecast
error
c. Profitability and supply chain
efficiency
d. Timing and cost-effectiveness

5. Short-term forecasts are


especially useful for:
a. Strategic planning
b. New product development
c. Day-to-day operations
d. Capacity expansion

6. Long-range forecasts are


primarily used for:
a. Daily operational scheduling
b. Budgeting employee salaries
c. Strategic planning and new
product introduction
d. Order fulfillment

7. Which department uses


forecasts to make decisions
about hiring and layoffs? a.
Marketing
b. Human Resources
c. Finance
d. Accounting
8. Which of the following is not a
use of forecasting in finance? a.
Profit projections
b. Equipment replacement needs
c. Timing of borrowing
d. Outplacement counseling

9. What is an important
component of yield management
related to forecasting? a.
Forecasting trends
b. Matching capacity with
demand
c. Optimizing pricing models
d. Planning for product
innovation

10. What type of forecast is most


useful in determining if there is
profit potential for a new
product? a. Short-term forecast
b. Long-range forecast
c. Weekly demand forecast
d. Real-time forecast

11. Which of the following


assumptions is common to all
forecasting techniques?
a. The past cannot predict the
future
b. The same underlying causal
system will continue
c. Forecast errors can be
eliminated
d. Demand is always constant

12. Forecast accuracy generally


decreases when: a. Forecasting
is done manually
b. Time horizon increases
c. Sophisticated models are used
d. Forecasts are written down

13. What is an important


consequence of flexible
organizations in terms of
forecasting?

a. They can use longer


forecasting horizons
b. They need more accurate
long-range forecasts
c. They benefit from more
accurate short-range forecasts
d. They require no forecasts

14. What should be stated along


with forecast accuracy? a. Profit
margins
b. Degree of uncertainty
c. Sales estimates
d. Future trends
15. Collaborative planning and
forecasting with supply chain
partners can: a. Decrease the
need for data analysis
b. Increase the likelihood of
inaccurate forecasts
c. Help reduce shortages and
excesses
d. Slow down decision-making

16. The first step in the


forecasting process is: a.
Monitoring the forecast
b. Selecting a forecasting
technique
c. Determining the purpose of the
forecast
d. Analyzing the data

17. Why should a forecast be in


writing? a. To guarantee perfect
accuracy
b. To ensure that everyone uses
the same information
c. To fulfill legal requirements
d. To reduce production costs
18. Forecasts for groups of items
tend to be:

a. Less accurate than for


individual items
b. More accurate due to the
canceling effect of errors
c. Completely error-free
d. Prone to larger errors

19. What is the main advantage


of using simple forecasting
techniques?
a. They are more accurate than
sophisticated models
b. Users find them easier to
understand and use
c. They eliminate the need for
monitoring forecasts
d. They do not require any
historical data
20. A reliable forecast should:

a. Work inconsistently
b. Be overly complicated
c. Be accurate and work
consistently
d. Be based solely on historical
data

Here are the answers to the 20


multiple-choice questions
provided:

Multiple Choice Answers


1. b. Match supply to demand

2. c. Future demand
3. b. Planning is straightforward,
and little forecasting is needed

4. b. Demand level and forecast


error

5. c. Day-to-day operations

6. c. Strategic planning and new


product introduction

7. b. Human Resources
8. d. Outplacement counseling

9. b. Matching capacity with


demand
10. b. Long-range forecast

11. b. The same underlying


causal system will continue

12. b. Time horizon increases

13. c. They benefit from more


accurate short-range forecasts

14. b. Degree of uncertainty


15. c. Help reduce shortages and
excesses
16. c. Determining the purpose of
the forecast

17. b. To ensure that everyone


uses the same information

18. b. More accurate due to the


canceling effect of errors

19. b. Users find them easier to


understand and use

20. c. Be accurate and work


consistently
True or False Questions

1. Forecasting is an exact
science that always produces
accurate results.
False

2. The primary goal of operations


management is to maximize
profits.
False

3. Forecasts can be used to


predict various business
variables, including demand,
costs, and revenues.
True

4. Short-term forecasts are less


accurate than long-term
forecasts.
False
5. A consensus forecast among
different departments is often
easy to achieve.
False

6. Forecasts are only useful for


planning inventory levels.
False

7. The reliability of a forecast


refers to how consistently it
produces accurate results.
True

8. Long-range forecasts are


primarily used for daily
operational tasks.
False
9. Collaborative planning and
forecasting can help reduce
shortages and excesses in the
supply chain.
True
10. Forecasts should always be
communicated in writing to
ensure all parties use the same
information.
True

11. Forecast accuracy decreases


as the time horizon of the
forecast increases.
True

12. Forecasts for groups of items


are usually less accurate than
forecasts for individual items.
False

13. The first step in the


forecasting process is to obtain
and analyze appropriate data.
False

14. Forecasts can help


managers
anticipate future demand and
make informed decisions.
True

15. Forecasting techniques


should be complicated to ensure
accuracy.
False

16. Accurate forecasts can help


in yield management by
matching capacity with demand.
True

17. Forecasting is only relevant


for the operations department of
a business.
False
18. Forecast errors should be
monitored to improve future
forecasting efforts.
True
19. The accuracy of a forecast is
not important as long as the
forecast is made.
False

20. Forecasting requires a blend


of science, intuition, experience,
and sometimes luck.
True

Enumeration Questions

1. List the two aspects of


forecasts that are important.

1. Expected level of demand


2. Degree of accuracy (forecast
error)

3. Identify the six basic steps in


the forecasting process.
1. Determine the purpose of the
forecast
2. Establish a time horizon
3. Obtain, clean, and analyze
appropriate data
4. Select a forecasting technique
5. Make the forecast
6. Monitor the forecast errors

4. List four features common to


all forecasts.

1. Assume the same underlying


causal system will continue
2. Not perfect; actual results
usually differ from predictions
3. Group forecasts tend to be
more accurate than individual
forecasts
4. Accuracy decreases as the
time horizon increases
5. Enumerate the elements of a
good forecast.

1. Timely
2. Accurate
3. Reliable
4. Meaningful units
5. In writing
6. Simple to understand and use
7. Cost-effective

6. List areas of an organization


affected by forecasts.

1. Operations
2. Marketing
3. Human Resources
4. Accounting
5. Finance
6. MIS
7. Product or Services Design

7. Name two sources from which


anticipated demand is derived.

1. Actual customer orders


2. Forecasts
9. List four factors that can affect
forecast accuracy.
1. Ability of forecasters to model
demand
2. Random variation
3. Unforeseen events
4. Changes in external factors
(e.g., weather, taxes

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