QUIZ 5

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University of Texas, Permian Basin *

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Management

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Feb 20, 2024

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QUIZ 5 CAPACITY MANAGEMENT. 1. Excellent Balls Inc., a soccer ball manufacturing company, adheres to a policy of manufacturing soccer balls only when the demand is greater than the amount of goods already manufactured. In this scenario, Excellent Balls Inc. most likely uses a ________ to expand its capacity. a. capacity reduction strategy b. capacity straddle strategy c. capacity lag strategy -correct d. capacity lead strategy 2. Which statement is the most accurate regarding setup time? a. It is the most insignificant part of total system capacity. b. It is independent of order size for manufacturing work orders. -correct c. It varies with the volume of work orders. d. It is usually the same for manufacturing and service-providing applications. 3. The consumer loan division of a major bank wants to determine the size of the staff it would need to process up to 200 loan applications per day. It estimates that each loan officer can process a loan application in approximately 20 minutes and works seven hours each day. How many loan officers would be needed to handle that volume of business? a. 6 loan officers b. 10 loan officers -correct c. 12 loan officers d. 8 loan officers 4. Heavenly Mana Laboratories is a group of companies with a worldwide reach, manufacturing considerable quantities of a migraine-suppressing prescription drug. The setup time for manufacturing the drug is 275 minutes, the processing time is 8 minutes, and the order size is 500 units. Given this information, choose the correct amount of total time necessary to meet the provided production volume? a. 5675 minutes b. 4000 minutes c. 275 minutes d. 4275 minutes -correct

QUIZ 5 CAPACITY MANAGEMENT. 5. Consider strategies for expanding capacity. Suppose you were to employ a single, large capacity increase. Which statement is the most accurate regarding this strategy? a. This strategy aims to match capacity additions with demand as closely as possible. b. This strategy waits until demand has increased to a point where additional capacity is necessary. c. An advantage of using this strategy is that the fixed costs of construction and operating system setup need to be incurred only once. -correct d. When this strategy is used, there is always excess capacity and safety capacity to meet unexpected demand from large orders is provided. 6. Gregarious Tux has an excess of equipment for manufacturing tuxedos during times of regular demand, so they can be prepared for abrupt demand surges. They also have a reserve of produced goods in the event of a material shortage. In this scenario, what are the excess equipment and produced goods examples of? a. A physical constraint b. The capacity cushion. -correct c. Capacity straddle d. Overbooking 7. A dentistry practice charges patients $30 who don’t cancel their appointment at least 24 hours before their scheduled appointment and subsequently do not show up. With this information in mind, choose the appropriate system or strategy that could manage the practice’s idle service capacity risk. a. A push system b. A capacity straddle strategy c. A capacity lag strategy d. A revenue management system -correct

QUIZ 5 CAPACITY MANAGEMENT. 8. We know the following data for Albert's fabricating production area: • Number of machines = 5 • Number of working days in year = 340 • Processing time per unit = 60 minutes What is the annual capacity with a single eight-hour shift? a. 9,600 units/year b. 13,600 units/year -correct c. 31,800 units/year d. 22,100 units/year 9. A hotel hosts a banquet for conferences in a large ballroom with tables of eight. Servers must get the meals from the kitchen, bring them out to the tables, and then place the meals on the tables. It takes four minutes to get the meals and bring them out to the tables, and then 15 seconds to serve each guest. If 20 servers are available, how many tables can be served in 20 minutes? Note: You can use the Service Capacity Excel template to answer the questions. a. 36.15 tables b. 66.67 tables -correct c. 10.96 tables d. 20.00 tables

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QUIZ 5 CAPACITY MANAGEMENT. 10. A hotel hosts a banquet for conferences in a large ballroom with tables of eight. Servers must get the meals from the kitchen, bring them out to the tables, and then place the meals on the tables. It takes four minutes to get the meals and bring them out to the tables, and then 15 seconds to serve each guest. The hotel wants to be able to serve 140 tables in 20 minutes. How many servers are needed? Note: You can use the Service Capacity Excel template to answer the questions. a. 42 servers -correct b. 12 servers c. 31 servers d. 55 servers

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