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OPERATIONS MANAGEMENT
END TERM EXAMINATION
Sep 09th 2015, Closed book
Max Marks: 100 Max Time: 120 minutes
⃝ READ THESE INSTRUCTIONS VERY CAREFULLY AND ABIDE BY THEM ⃝
1. Write your name & roll number on Page 1 and your roll number on all PART A
other pages.
NO. MARKS
2. This paper has 20 pages, of which 4 pages (nos. 16–19) are for rough
work only and will not be evaluated. CORRECT
3. There are 48 questions in all. Write the letter of the correct answer in INCORRECT
the boxes to the right of the questions. All answers are to be written in TOTAL (20)
this question paper itself.
4. Use a pen to answer; answers written with a pencil are not accepted. PART B
Ensure that your answer is unambiguous; any ambiguity will lead the NO. MARKS
answer to be marked incorrect.
CORRECT
5. The ability to understand the questions correctly is also being tested in
this exam. No clarification will be provided during the exam. INCORRECT
Ambiguities (if at all) in questions or options can be discussed with the TOTAL (50)
instructor later.
6. You can use a calculator, however the use of laptop, mobile phone, PART C
calculator on a smartphone and all other electronic devices is strictly NO. MARKS
prohibited during the exam.
CORRECT
7. Selected “hint” formulae are provided below only as a memory prop, but
you are expected to recollect what the notations stand for, and where INCORRECT
the formulae must be used.
TOTAL (30)
8. A z‐Table is provided at the end of this paper.
GRAND TOTAL (100)
Selected “hint” formulae
1. n = (zc s / e A)2 2. n = (zc / e )2 p (1 – p) 3. Q* = (2Dco/ch)1/2
4. Q* = [ 2Dcop/ch(p – d)]1/2 5. Qmax = Q(1–d/p)
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
PART A
A correct answer carries 1 mark, and an incorrect one, –0.5 marks, max marks = 20
1. Which of the following is the correct sequence from “customized” to
“standardized”?
A. Line flow – Batch – Continuous – Job shop – Project.
B. Continuous – Line flow – Batch – Job shop – Project. D
C. Project – Continuous – Job shop – Line flow – Batch.
D. Project – Job shop – Batch – Line flow – Continuous.
2. In a given process, the average cycle time is 6 minutes. What is the average
flow rate in this process?
A. 10 per hour.
B. 360 per hour. A
C. 0.1 per hour.
D. 12 per hour.
E. We need more data to compute the average flow rate.
3. Which of the following is included as one of the eight types of waste?
A. Too many suppliers.
B. Under‐utilized talent. B
C. Too many customers.
D. Excess knowledge.
E. None of the above.
4. The re‐order point computed in excess of the average demand during lead
time causes inventory in the organization, which, to reflect this reason for
inventory, is termed:
A. Buffer inventory.
B. Safety inventory.
B
C. Cycle inventory.
D. Pipeline inventory.
E. None of the above.
5. Normally, the evaluation of capacity takes into account scheduled
downtimes and breaks such as planned holiday shutdowns
A
A. TRUE
B. FALSE
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
6. Match the phrases on the left to the descriptions on the right by writing the
appropriate letter in the box on the right (each correct match carries 1 mark, and an
incorrect one, –0.5 marks).
EIGHT Helps us go for smaller batch sizes by reducing the time or cost of
A WASTES
changing from one batch to the next.
E
B VSM Overall equipment effectiveness (OEE) is discussed here
F
CELL If you try to insert a square peg in a round hole, it immediately
C MANUF
becomes obvious that something is wrong!
G
D HEIJUNKA The lean philosophy begins with recognizing the existence of this.
A
Group products with similar flows together & devote machines to
E SMED groups to create more streamlined flows. Useful when there is a C
variety of products with dissimilar flows.
I don’t have to remember everything, there are cards that tell me
F TPM
when, what and how much to do.
H
Proportion of total non‐valued added activities is much greater
POKA‐
G YOKE
than that of value added activities, hence focus on reducing the B
former.
Reduce unevenness in the production levels across time.
H KANBAN Sequence multiple products in small rather than large batches so D
that demand for each product is met more frequently.
7. An output measure of capacity is more suitable when the process has a high
variety of jobs, and there is a lot of customization and flexibility.
B
A. TRUE
B. FALSE
8. A particular production facility’s capacity is specified as 8 drilling machines,
12 lathes and 7 milling machines. What type of capacity measure is this?
A
A. Input measure
B. Output measure
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
D. Poisson
E. _______________________ (If A – D are incorrect, write the correct
number here, and write ‘E’ in the box).
10. Work sampling is more appropriate when the nature of the job
A. is broadly defined, not very repetitive and somewhat flexible. A
B. is highly standardized and repetitive.
C. well… work sampling is equally appropriate for both the above.
11. If one wishes to determine the proportions of work time, a given worker is
‘idle’ and ‘not idle’, which of these is a more suitable method?
A. Time Study. B
B. Work Sampling.
C. Line Balancing.
D. A and B are equally suitable.
12. In a time study of a particular job, the Normal time is 58.4 seconds. The
manager decides to give an allowance factor of 12%. What is the Standard
time for this job?
A. About 57.28 seconds.
B. About 79.36 seconds. C
C. About 65.41 seconds.
D. We cannot compute standard time with just the data given, we also
need to know the rating factor.
E. _______________________ (If A – D are incorrect, write the correct
number here, and write ‘E’ in the box).
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
13. Organization ABC consumes 25 units of a particular material per day but
each time it orders, the lot size is 5200 units, as it finds that to be the most
economical in terms of total inventory costs. This practice creates
inventory in the organization, and to reflect that reason of inventory, such
inventory is termed:
C
A. Seasonal inventory.
B. Buffer inventory.
C. Cycle inventory.
D. Pipeline inventory.
E. None of the above.
PART B
A correct answer carries 2 marks, and an incorrect one, –1 mark, max marks = 50
Answer the next ten questions (Q 14 to Q 23) based on this problem. There are 3
workstations in a process of assembling a toy, which involves performing 10 tasks in the
sequence given below. The sequence of tasks cannot be changed and the strategy is to
produce to match demand. The process is scheduled to run 6 days a week and 12 hours
(without break) a day. The current demand is 800 units per week. The current allocation of
the tasks to the workstations and the time taken to perform each task in seconds is as given
in this table:
Workstation Task Duration
Tasks
(Worker) (seconds/unit)
Prepare cable 64
Knot cable 75
1
Assemble washer 38
Apply fork, threading cable end 28
Assemble brake lever and cable 22
2 Apply grip tape 55
Insert deck fasteners 39
Assemble carton 30
3 Insert toy and its manual 47
Seal carton 27
14. The current capacity of this process in units/week is:
A. About 18
B. About 259
C. About 1264 C
D. Exactly 800
E. _______________ (If A – D are incorrect, write the correct number
here, and write ‘E’ in the box).
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
15. The minimum cycle time possible in the process with the current allocation of
tasks to workstations is:
A. 116 seconds
B. 104 seconds D
C. 324 seconds
D. 205 seconds
E. ________________ (If A – D are incorrect, write the correct number
here, and write ‘E’ in the box).
16. The current takt time for the process is:
A. 205 seconds
B. 324 seconds
C. 116 seconds B
D. 104 seconds
E. ________________ (If A – D are incorrect, write the correct number
here, and write ‘E’ in the box).
17. The actual cycle time currently experienced in the process would be:
A. 324 seconds
B. 205 seconds
C. 104 seconds A
D. 116 seconds
E. ________________ (If A – D are incorrect, write the correct number
here, and write ‘E’ in the box).
18. The current utilization of labor content in the process is about:
A. 56.95%
B. 63.27%
C. 43.72% C
D. 84.16%
E. ________________ (If A – D are incorrect, write the correct number
here, and write ‘E’ in the box).
19. If the process were running at its full capacity, its labor content utilization
would be about:
A. 69.11%
B. 95.27% A
C. 100%
D. 84.16%
E. ________________ (If A – D are incorrect, write the correct number
here, and write ‘E’ in the box).
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
Now, balance the above toy manufacturing line to minimize the minimum possible cycle
time and maximize the capacity.
20. The minimum possible cycle time (in seconds) in the balanced line is.
A. 116
B. 143
C. 139 B
D. 120
E. ________________ (If A – D are incorrect, write the correct number
here, and write ‘E’ in the box).
21. The capacity (units/week) in the balanced line is about.
A. 2234
B. 1864
C. 2160 D
D. 1813
E. ________________ (If A – D are incorrect, write the correct number
here, and write ‘E’ in the box).
22. If the demand were to increase to 2592 units / week, the takt time would
become (in seconds)
A. 120
B. 130 C
C. 100
D. 125
E. ________________ (If A – D are incorrect, write the correct number
here, and write ‘E’ in the box).
23. To meet the increased demand of 2592 units/week, the theoretical minimum
number of workstations would be:
A. 3
B. 4 C
C. 5
D. 6
E. ________________ (If A – D are incorrect, write the correct number
here, and write ‘E’ in the box).
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
24. A manufacturer of waist belts computed his average aggregate inventory
value of a particular belt (denoted SKU3401) for the year 2014‐15 to be Rs.
78,000. Of this SKU, his total sales was Rs. 7.80 lakhs, while the COGS was
Rs. 6.24 lakhs in the same period. If there are 52 weeks in a year, the
“weeks of supply” and the “annual inventory turns” for the SKU are
respectively,
D
A. 5.2, 8.
B. 6.5, 10.
C. 5.2, 10.
D. 6.5, 8.
E. __________ (If A – D are incorrect, write the correct numbers here, and
write ‘E’ in the box).
25. A ball manufacturing factory, devoted to making cricket balls, currently
operates with a 40% cushion, to meet the demand of 10800 units per
month. A highly reliable forecast says that the demand will be 30% more
than the current one. Since the new demand will have a low average
variability, the factory wishes to meet it with a cushion of 10%. How should
the factory change its current capacity?
B
A. Increase it by 4000 units
B. Decrease it by 2400 units
C. Increase it by 3000 units
D. Decrease it by 1800 units
E. _______________________________ (If A – D are incorrect, write the
correct numbers here, and write ‘E’ in the box).
26. In a large bank, a steady flow of customers visits during the morning hours
(10 am – 1 pm). It is seen that on average, a customer spends 25 minutes
inside the bank. There are 37.5 customers on average inside the bank at any
given time during this period. What is the average cycle time of customers
exiting (entering) the bank, during this period?
B
A. 120 seconds
B. 40 seconds
C. 80 seconds
D. 300 seconds
E. None of the above
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
Answer the next five questions (Q 27 – 31) based on this problem.
Aarti Sharma, along with her son Shiv and her daughters Shilpa and Sandhya, are making
parathas for a large party at her brother’s home. The entire dough, adequate for the party,
is kneaded at one shot and then split into little dough balls for rolling. The filling, consisting
of a mixture of cooked vegetables and spices, is also ready.
The process now begins, in which the parathas are produced one by one. Sandhya (should
be Aarti) first rolls a dough ball into a little disc and passes it on to Shiv for inserting the
filling and folding. After that, Shilpa dips it again in the flour, rolls it carefully to a fairly large
size, and places it next to Sandhya. Sandhya smears the necessary amount of ghee, cooks
the paratha on a nearby stove and then places the cooked paratha on nearby tray for
serving, completing the process.
Aarti, Shiv, Shilpa, and Sandhya spend an average of 32, 36, 30 and 40 seconds on their
respective activities. As the parathas are being produced, guests are also consuming them
at an average of 0.8 per minute. To ensure that they are served as hot and fresh as possible,
the team of four produces the parathas at the same average rate.
27. What is the capacity of this paratha production process (in parathas/hour)?
A. 48
B. 96
C. 90
D. 120
E. None of the above
28. Given the current demand, is there a bottleneck in the process and if yes,
which one is it?
A. Yes, there is a bottleneck and it is Aarti.
B. Yes, there is a bottleneck and it is Shilpa.
C. Yes, there is a bottleneck and it is Sandhya.
D. Yes, there is a bottleneck and it is Shiv.
E. No, there is no bottleneck in the process.
29. This process is currently
A. Supply constrained.
B. Demand constrained.
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
30. The average cycle time when the production is happening will be (in
seconds):
A. 75
B. 80
C. 40
D. 30
E. None of the above.
31. To make this process produce faster than the maximum rate it currently can,
you are permitted to train only one of the four persons to improve their
speed. Which one will you choose?
A. Aarti
B. Shilpa
C. Sandhya
D. Shiv
E. This process cannot be made faster by increasing the speed of only one
of the four.
32. In the morning on August 14th, the inventory position of a particular SKU of
toothbrush at a retail store is 56 units. Two orders to replenish this SKU of
20 and 12 units were placed by the store, 8 days and 3 days back
respectively. They have not yet arrived to the store. The store also has two
pending orders for 6 units and 4 units respectively of this SKU from nearby
clinics that it is yet to fulfill. The on‐hand inventory of this SKU in the
morning on August 14th is: D
A. 14 units.
B. 78 units.
C. 98 units.
D. 34 units.
E. ________ (If A – D are incorrect, write the correct number here, and
write ‘E’ in the box).
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
33. An original equipment manufacturer (OEM) purchases a particular SKU of
LEDs from a vendor, who makes them according to the OEM’s requirement.
The OEM’s inventory of this LED follows all the EOQ model’s assumptions,
except that the vendor supplies the LEDs at a rate of 3000 units per day with
a lead time of 3 days. The order quantity is 15000 units, the order point is
2250 units, the ordering cost is Rs. 150 per order and replenishment begins
at the instant the inventory level reaches zero. Given this, the maximum
and average inventory levels of this SKU with the OEM will respectively be: D
A. We cannot answer this without knowing the holding costs.
B. 18750, 9375 LEDs.
C. 15000, 7500 LEDs.
D. 11250, 5625 LEDs.
E. _______________ (If A – D are incorrect, write the correct numbers here,
and write ‘E’ in the box).
Answer the next five questions (Q 34 to Q 38) based on this. The demand during lead time
for a particular SKU of hard disks follows this distribution
E. _______________ (If A – D are incorrect, write the correct numbers here,
and write ‘E’ in the box).
35. What is the minimum re‐order point for an 80% service level?
A. 40.
B. 50.
C. 60. C
D. 70.
E. _______________ (If A – D are incorrect, write the correct numbers here,
and write ‘E’ in the box).
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
36. If the re‐order point is fixed as 75, then what is the safety stock?
A. 25.
B. 30.
C. 35. B
D. 40.
E. Given the above demand distribution, it is not possible to fix the re‐order
point as 75.
37. The re‐order point that corresponds to a safety stock of 20 units is:
A. 100.
B. 75.
C. 65. C
D. 30.
E. _______________ (If A – D are incorrect, write the correct number here,
and write ‘E’ in the box).
38. A safety stock of 30 units will provide us a service level of:
A. 75%.
B. 90%.
C. 80% D
D. 95%
E. _______________ (If A – D are incorrect, write the correct number here,
and write ‘E’ in the box).
PART C
A correct answer carries 3 marks, and an incorrect one, –1.5 marks, max marks = 30
39. At the end of the first iteration in an iterative work sampling study that had
4 activities in its list, it was found that the proportions of time spent by the
workers on these activities were 0.31, 0.12, 0.28 and 0.29 respectively. In
the first iteration, 38 observations have been taken, where each
observation constitutes one unit of the sample. The study desires to
achieve a 90% confidence level that the observed proportions are within 5%
of the true mean. What is the estimated minimum number of observations
remaining, at the beginning the second iteration? C
A. About 375.
B. About 90.
C. About 194.
D. About 15.
E. _______________________ (If A – D are incorrect, write the correct
number here, and write ‘E’ in the box).
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
40. In a time study of a particular job, the average time observed is 92.6
seconds with a standard deviation of 32.1 seconds. What is the minimum
sample size needed to be at least 98% confident that this value of average
time is within 10% of the true value?
A. About 66. A
B. About 392.
C. About 261.
D. About 16.
E. _______________________ (If A – D are incorrect, write the correct
number here, and write ‘E’ in the box).
Answer the next three questions (Q 41 to 43) based on this sweets manufacturer’s
problem. A sweets manufacturer has shortlisted four locations U, X and Y for her new
facility and is assessing them on three distinct criteria – Water supply (W), Electricity supply
(E) and Drainage (D). While performing a TOPSIS, she has arrived at the following weighted
standardized decision matrix:
U X Y
W 1.35 3.25 8.95
E 3.36 6.08 1.13
D 5.78 1.42 3.49
41. Of the vectors given below, which one best represents the distances of the
respective locations from the negative ideal solution?
A. (8.1, 2.4, 6.8).
B. (3.1, 2.5, 4.2). C
C. (4.9, 5.3, 7.9).
D. (7.9, 4.1, 2.3).
E. _______________________ (If A – D are incorrect, write the correct
numbers here, and write ‘E’ in the box).
42. Of the vectors given below, which one best represents the distances of the
respective locations from the ideal solution?
A. (8.1, 7.2, 5.5).
B. (5.1, 2.9, 4.9). A
C. (4.9, 5.1, 5.1).
D. (7.2, 4.6, 1.0).
E. _______________________ (If A – D are incorrect, write the correct
numbers here, and write ‘E’ in the box).
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
43. Which is the best alternative obtained by applying TOPSIS?
A. U C
B. X
C. Y
44. After doing an ABC classification of 6400 SKUs, a drone manufacturer found
that the class that had to be monitored least closely had 15 times as many
SKUs as the one that had to be monitored most closely, and the remaining
class had 1280 SKUs. If the total money value of inventory is Rs. 105 crore,
in which the highest valued class represents 3 times and 15 times as much
value as the other two classes, what is the average value per SKU in classes
A, B and C respectively in Rs. lakhs? A
A. About 23.43, 1.95 and 0.10.
B. About 18.12, 5.34 and 0.05.
C. About 12.51, 8.76 and 0.18.
D. About 0.18, 5.26 and 19.29.
E. _____________________________ (If A – D are incorrect, write the
correct number here, and write ‘E’ in the box).
45. At a particular CNC machine, parts arrive for processing at a rate of 180 per
hour and the machine’s capacity for processing is 220 parts per hour. At the
beginning of day 1, there were no parts at the machine. If the machine
operates for 3 days of 24 hours each, at 80% of its capacity, the inventory of
parts at the machine at the end of this period would be (about):
A. 364. B
B. 288.
C. 212.
D. 426.
E. ______ (If A – D are incorrect, write the correct number here, and write
‘E’ in the box).
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
Answer the next three questions (Q 46 to 48) based on this: Two types of sports shorts X
and Y are to be produced in a batch process. The table gives their estimated annual
demand, production lot sizes, setup times and unit processing times. A particular
workstation can be operated 344 days a year, 10 hours a day. A capacity cushion of at least
15% is desirable to account for variation and unforeseen interruptions. It is also not
permitted to make multiple batches of a given product consecutively and share a single set‐
up time across them.
Unit proc Set up time Lot Estimated
Product
time (min) (min) Size demand (/yr)
A 10 80 696 34,800
B 12 70 590 29,500
46. The capacity of one workstation in minutes per year is:
A. 175200
B. 175440
C. 30960 D
D. 206400
E. ________________________ (If A – D are incorrect, write the correct
number here, and write ‘E’ in the box).
47. The estimated total capacity demanded by the two products, in minutes per
year, is:
A. 702000
B. 709500 B
C. 698120
D. 1120000
E. _______________________ (If A – D are incorrect, write the correct
number here, and write ‘E’ in the box).
48. The minimum number of workstations necessary to meet the demand is:
A. 5
B. 228
C. 8 A
D. 243
E. _______________________ (If A – D are incorrect, write the correct
number here, and write ‘E’ in the box).
END OF QUESTION PAPER
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
FOR ROUGH WORK
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
FOR ROUGH WORK
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
FOR ROUGH WORK
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
FOR ROUGH WORK
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XLRI XAVIER SCHOOL OF MANAGEMENT OPERATIONS MANAGEMENT 1 TERM 1 (BM 15-17) JUL – SEP 2015
z Table
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