Q&A Hero

Q: Supply chain management includes all of the following EXCEPT A.purchasing. B.inventory control. C.advertising. D.customer service.

Q: The supply chain extends from A.supplier to manufacturing. B.supplier to supplier. C.dealer to customer. D.supplier to customer.

Q: Supply chain management includes the integration of A.suppliers. B.manufacturers. C.customers. D.all of the above.

Q: Which of the following does NOT come under the process category of the operations decision framework? A.Layout of the facility B.Job design C.The type of equipment and technology D.Product or service inspection

Q: The five major decision responsibilities of operations management are A.process, quality, capacity, sourcing, and human resources. B.process, quality, human resources, logistics, and inventory. C.quality, inventory, human resources, capacity, and supply chain. D.process, capacity, quality, supply chain, and inventory.

Q: Which one of the following would NOT generally be classified under the heading of input in a university system? A.Staff B.Equipment C.Facilities D.Knowledge E.Research

Q: The three major functions of business organizations A.are mutually exclusive. B.function independently of each other. C.interface with each other. D.do not interface with each other.

Q: The three primary functions that exist in most business organizations are A.operations, accounting, and finance. B.operations, production, and finance. C.production, marketing, and human resources. D.operations, finance, and marketing.

Q: Which of the following is NOT a new challenge facing operations? A.Globalization of operations B.Responding to the voice of the customer C.Quality teams D.Environmental concerns

Q: The essence of operations management can be described by A.process, capacity, and people. B.decisions, function, and process. C.planning, control, and organization. D.integrated planning and control.

Q: Challenges facing operations and supply chain managers signify that A.more emphasis should be placed on manufacturing than on service industries. B.every operation should be externally directed to meet the customers' requirements. C.operations decisions should precede decisions in other functions in an organization. D.to be competitive, strategies for operations should have a narrow focus such as consideration of the effects of industry changes only.

Q: Inventory decisions involve A.determining what to order, how much to order, and when to order. B.tracking the flow of materials. C.managing the finished goods inventories. D.all of these.

Q: Capacity decisions A.include staffing and scheduling. B.include inventory control. C.include defining product specifications. D.are none of these.

Q: A productive process approach A.views operations as a separate organizational function. B.must provide feedback information for control of process inputs and technology. C.is of limited use in service organizations. D.disregards human and social concerns.

Q: The five decision areas in operations management are A.planning, technology, inventory, control, and services. B.process, quality, capacity, inventory, and supply chain. C.process, quality, technology, capacity, and production. D.none of these.

Q: Approximately what percentage of the American workforce works in service industries? A.20% B.40% C.80% D.90%

Q: Which of the following functions is responsible for the actual movement of goods and/or services across organizations? A.Logistics B.Operations C.Purchasing D.None of these

Q: Why is operations management a more encompassing term than production management? A.Operations management is concerned with multiple products and services. B.Operations management refers to service as well as manufacturing organizations. C.Operations management is broader including the financing and marketing functions. D.Operations management makes use of the tools of quantitative analysis and computer systems.

Q: Spend analysis includes A. looking at what the company is buying, from whom, in what quantities, and at what price. B. looking at spend data by division or facility to isolate spending patterns. C. looking for opportunities to disperse purchasing activities to more areas within the organization. D. all of the above.

Q: Using a lot-for-lot ordering strategy for the following item, what is the net requirements amount in week 3? (Note: Use a lead time of one week and the gross requirements and scheduled receipts depicted below, and assume you begin with 100 units in inventory.) Week 1 2 3 4 Gross requirements 0 100 80 15 Scheduled receipts 75 0 0 0 Projected ending inventory (100) Net requirements Planned order receipts Planned order releases A. 0 units B. 5 units C. 15 units D. 80 units

Q: A large hospital that batches orders for a variety of surgical supplies with its preferred supplier should use a A. P system. B. D system. C. Q system. D. Z system.

Q: If mean daily demand is 20 units, lead time is 7 days, the standard deviation of demand during lead time is 12.0 units, and management has a preferred service level of 99.9% (z = 3), the reorder (R) level for the item would be A. 176.00 units. B. 56.00 units. C. 152.00 units. D. 104.00 units.

Q: Determinants of reorder levels (order point quantities) include all of the following EXCEPT A. rate of demand. B. length of lead time. C. length of the time interval between orders. D. demand and lead time variability.

Q: At the economic order quantity, A. the annual ordering cost for an item is greater than the annual holding cost. B. the annual ordering cost and annual holding cost for an item are equal. C. the annual ordering cost for an item is less than the annual holding cost. D. none of these answers are true.

Q: Which of the following is correct? A. Anticipation inventory of raw materials may be held when a firm expects raw materials shortages in the future. B. Pipeline inventory quantities are affected by mode of transportation. C. Safety stock may be held in raw materials, work-in-process, or finished goods. D. All of the above.

Q: Gantt charts are scheduling tools that represent the activities on a bar chart.

Q: A work breakdown structure is used in the scheduling activity of project management.

Q: Which of the following statements is NOT correct about Gantt charts? A. Gantt charts are extremely easy to use and are quite well understood. B. Gantt charts show not only the time required for an activity but also the time at which a particular activity takes place. C. Gantt charts show the interdependencies and relationships between activities. D. Gantt charts can also be used while scheduling service operations.

Q: The advantage(s) of the network method over the Gantt chart is (are) A.the network method is easy to use and quite widely understood. B.the network method shows precedence relationships more explicitly than Gantt charts. C.network methods are less costly to use. D.all of the above.

Q: A manufacturing company could increase the output rate of the bottleneck by running larger batches at the bottleneck (assuming another bottleneck in the plant does not interfere).

Q: A manufacturer of water filtration pumps is most likely to use which of the following? A. A prioritization rule based on the price the customer paid. B. A prioritization formula comparing time left before the job is due to the remaining processing time. C. A prioritization formula based on the first come, first served rule. D. All of the above.

Q: Describe the types of short-range, the medium-range, and the long-range capacity decisions. Feedback: See below.

Q: The primary concern with having a large positive capacity cushion is A. reduced customer satisfaction due to the high level of backorders. B. underutilization of facility capacity. C. greater likelihood of stock-outs and lost sales. D. keeping cost of running out in balance with the cost of excess capacity.

Q: Using a simple exponential smoothing model (alpha = 0.3), calculations for the most recent period generated a forecast of 25.10 units. Actual demand for that period was 31 units. What is the forecast of demand for the upcoming period? A. 26.28 B. 26.87 C. 29.23 D. None of the above are correct.

Q: Which of the following statements is NOT true about process flow analysis? A.Process flow analysis is dependent on systems thinking. B.Flowcharts are used to describe and improve the transformation process in a business. C.Process flows must always be forward, and cannot "loop back" to previous operations. D.Service blueprinting is another name for a flowchart.

Q: 17.There are key differences between service and manufacturing organizations. Which of the following is true regarding these differences? A. Most service organizations cannot inventory their services to absorb fluctuations in customer demand. B. Most manufacturing organizations easily permit simultaneous production and consumption of system output. C. Most manufacturing organizations are typically located closer to the customer, such as a central business district location, due to the simultaneity of consumption and production. D.Service organizations can easily store current capacity in the form of inventories.

Q: Which of the following is NOT an example of a high-contact service? A.Retail trade B.Personal services C.Business services D.Auto repair

Q: Which of the following is a way a bank can deal with a troubled international loan? A) The loan can be restructured generally with a lower interest rate and longer time to repay B) The loan can be sold in the secondary market C) The bank can write off all or part of the loan D) The bank can accept exit bonds in lieu of loan repayment E) All of the above are ways to deal with a troubled international loan

Q: A broker has purchased stock in Sony Corporation and has asked to Citibank act as a custodian of this stock. Citibank has issued a negotiable instrument representing ownership interest in the stock. These negotiable instruments are denominated in dollars and not in yen. This is an example of a(n): A) Eurrocommercial paper (ECP) B) Depository receipt (DR) C) Note Issuance Facility D) Currency Swap E) None of the above

Q: Suppose Bank of America provides a 5 year credit guarantee for Dillards Department Stores. Dillards Department Stores periodically issues short term notes with due dates 90 days after they are issued in the international market. Bank of American has most likely provided a(n): A) Eurrocommercial paper (ECP) B) Depository receipt (DR) C) Note Issuance Facility D) Currency Swap E) None of the above

Q: A multinational company issues short-term credit through Londons financial district. They are most likely using: A) Eurrocommercial paper (ECP) B) Depository receipt (DR) C) Note Issuance Facility D) Currency Swap E) None of the above

Q: Which of the following is a reason for the growth of the currency swap market in recent years? A) It has helped thousands of businesses and governments hedge currency risk B) It has provided central banks with a new instrument to trade C) It has helped shape money and credit conditions in various countries D) It has helped strengthen home nations economies E) All of the above are reasons for the growth of the currency swap market in recent years

Q: Suppose a U.S. bank borrows money in London while a British company borrows money in New York. At the end of the loan period the U.S. company needs pounds to repay their loan and the British company needs dollars to repay their loan. Which of the following might be a good tool for these companies to reduce their currency risk? A) Currency futures contract B) Currency option contract C) Interest rate futures contract D) Interest rate swap contract E) Currency swap contract

Q: Suppose Citibank holds assets denominated in euros of 120 million and liabilities denominated in euros of 180 million. They also have euro purchases of 40 million and euro sales of 70 million. When would Citibank experience a loss in the currency market? A) When the euro declines in value relative to the dollar B) When the dollar increases in value relative to the euro C) When the yen increases in value D) When the euro increases in value relative to the dollar E) None of the above

Q: Suppose Citibank holds assets denominated in euros of 120 million and liabilities denominated in euros of 180 million. They also have euro purchases of 40 million and euro sales of 70 million. What is Citibanks net exposure to currency risk? A) +120 million euros B) -90 million euros C) +90 million euros D) -60 million euros E) +60 million euros

Q: Suppose Bank of America holds assets denominated in yen of 150 million and liabilities denominated in yen of 90 million. They also have yen purchases of 70 million and yen sales of 50 million. When would Bank of America experience a loss in the currency market? A) When the yen declines in value relative to U.S. dollars B) When the yen increases in value relative to U.S. dollars C) When U.S. dollar declines in value relative to the yen D) When the euro declines in value E) None of the above

Q: Suppose Bank of America holds assets denominated in yen of 150 million and liabilities denominated in yen of 90 million. They also have yen purchases of 70 million and yen sales of 50 million. What is Bank of Americas net exposure to currency risk? A) +150 million yen B) +60 million yen C) +80 million yen D) -80 million yen E) -60 million yen

Q: Suppose South Korea limits the amount of deposits made in South Korea that can be used to make loans in other countries. This would be in support of which reason for regulating international banks? A) Protecting the safety of depositor funds B) Promoting stable growth in money and credit C) Providing foreign currency controls D) Protecting domestic financial institutions E) Restricting the outflow of scarce capital

Q: Suppose India restricts entry into India by foreign banks until the end of the decade. This would be in support of which reason for regulating international banks? A) Protecting the safety of depositor funds B) Promoting stable growth in money and credit C) Providing foreign currency controls D) Protecting domestic financial institutions E) Restricting the outflow of scarce capital

Q: Suppose Brazil decides to restrict the export of the real by international banks so that the real does not leave the country and reduce currency reserves for repayment of Brazilian debt. This would be in support of which reason for regulating international banks? A) Protecting the safety of depositor funds B) Promoting stable growth in money and credit C) Providing foreign currency controls D) Protecting domestic financial institutions E) Restricting the outflow of scarce capital

Q: Suppose banks operating in Venezuela have to meet the same legal reserve requirements as domestic banks. This would be in support of which reason for regulating international banks? A) Protecting the safety of depositor funds B) Promoting stable growth in money and credit C) Providing foreign currency controls D) Protecting domestic financial institutions E) Restricting the outflow of scarce capital

Q: If Denmark requires that all foreign banks operating in Denmark have at least ten percent capital, what reason for regulating international banks is this most likely in support of? A) Protecting the safety of depositor funds B) Promoting stable growth in money and credit C) Providing foreign currency controls D) Protecting domestic financial institutions E) Restricting the outflow of scarce capital

Q: The State Bank of Nebraska owns a company that has more than half of its income from activities associated with exporting goods and services from the U.S. This company offers export insurance, transportation and warehousing in Europe, trade financing and other services. What type of company does the State Bank of Nebraska own? A) A Representative Office B) An Agency Office C) A Branch Office D) A Subsidiary E) An Export Trading Company

Q: The State Bank of Virginia owns 55% of the shares of the Bank of Budapest. What type of arrangement is this? A) A Representative Office B) An Agency Office C) A Branch Office D) A Subsidiary E) An Export Trading Company

Q: The Second National Bank of Guthrie has opened an office in Chile. This office offers a full line of services and is not a separate legal entity from the Second National Bank of Guthrie. What type of office did the Second National Bank of Guthrie open in Chile? A) A Representative Office B) An Agency Office C) A Branch Office D) A Subsidiary E) An Export Trading Company

Q: The Third State Bank of Laramie has opened an office in Morocco. This office does not take deposits but makes commitments to make loans, issues letters of credit and provides technical assistance to companies in Morocco. What type of office did the Third State Bank of Laramie open in Morocco? A) A Representative Office B) An Agency Office C) A Branch Office D) A Subsidiary E) An Export Trading Company

Q: The First National Bank of Summerville has opened an office in Turkey. This is a limited service office that can market services of the home office to Turkey and can identify Turkish customers but does not take deposits or book loans. What type of office did the First National Bank of Summerville open in Turkey? A) A Representative Office B) An Agency Office C) A Branch Office D) A Subsidiary E) An Export Trading Company

Q: The biggest problem for international banks at the beginning of the 21st century is: A) The internet B) Interest rate risk C) Foreign exchange risk D) Nonperforming loans E) None of the above

Q: The market for banking in China exhibits all of the following except: A) Limited domestic competition B) Lack of expertise C) A large percentage of troubled loans D) A general lack of access from outside the country E) A growing economy

Q: The primary source for international bank statistics is: A) The FDIC B) The OCC C) The BIS D) The World Bank E) The United Nations

Q: As the text suggests all of the following areas of the world have significant opportunities for foreign banks except: A) Asia B) China C) Russia D) Japan E) South Korea

Q: The Goudge Grilling Company has just ordered a shipment of grills from Frankfurt. Payment for the grills must be in euros when the grills are delivered. Euros have changed in value in the last 30 days. They have gone from $1.42 to $1.40. If this trend continues which of the following currency contracts can help the Goudge Grilling Company hedge their currency risk? A) Put currency option B) Short currency futures contract C) Long currency futures contract D) Currency swap contract E) None of the above

Q: The Hagard Mercantile Company has made a $30 million investment in a mill in Germany and fears a substantial decline in the mark's current spot rate from $0.63 to $0.56 lowering the value of the company's investment in the mill. Which of the following currency contracts can help Hagard solve this problem? A) Call currency option B) Put currency option C) Long currency futures contract D) Currency swap contract E) None of the above

Q: Which of the following is a risk evaluation system in international lending today? A) The Seat of the Pants Method B) The Discrimination Method C) The Delphi Method D) The State-Risk Indicator Method E) None of the above

Q: Which of the following is one of the customer services supplied by banks in international markets? A) Underwriting notes and bond issues in the U.S. bond market B) Helping customer market their products in the domestic market C) Helping customers hedge against foreign currency risk D) Making loans to domestic customers E) All of the above are customer services offered by banks in the international market

Q: A full-service facility operated by a bank away from its home office but offering many of the same services as the home office is known as a(n): A) Branch office B) Agency office C) Subsidiary D) Representative office E) None of the above

Q: Banks have been heavily involved in selling their services across national boundaries since: A) The industry's very beginnings B) The 1950s C) The 1980s D) The turn of the century E) None of the above

Q: A foreign currency contract where one party trades currencies with another and trades it back at the end of the contract is called a(n): A) Currency option contract B) Currency forward contract C) Currency swap contract D) Currency futures contract E) None of the above

Q: A foreign currency contract that give the holder of the contract the right to sell a foreign currency is called a(n): A) Call currency option B) Put currency option C) Long hedge currency futures contract D) Short hedge currency futures contract E) None of the above

Q: A foreign currency contract that gives the holder of the contract the right to purchase a foreign currency is called a(n): A) Call currency option B) Put currency option C) Long hedge currency futures contract D) Short hedge currency futures contract E) None of the above

Q: A foreign currency contract that obligates the holder of the contract to make delivery of a foreign currency some time in the future is called a(n): A) Call currency option B) Put currency option C) Long hedge currency futures contract D) Short hedge currency futures contract E) None of the above

Q: A foreign currency contract that obligates the holder of the contract to take delivery of a foreign currency some time in the future is called a(n): A) Call currency option B) Put currency option C) Long hedge currency futures contract D) Short hedge currency futures contract E) None of the above

Q: Under current U.S. law the Federal Reserve Board must be notified a minimum of __________ days in advance if a foreign bank wishes to close any of its U.S. offices. A) 30 B) 60 C) 90 D) 180 E) None of the above

Q: Which U.S. federal law required branches and agency offices of foreign banks to secure federal licenses for their U.S. operations for the first time? A) The International Banking Act B) International Lending and Supervision Act C) Bank Holding Company Act D) International Bank Supervision and Examination Procedures Act E) None of the above.

Q: Often used to protect a nation against loss of its foreign currency reserves, which might damage its prospects for repaying international loans and purchasing goods and services abroad, are: A) Export loan rate restrictions B) Foreign exchange reserves C) Minimum capitalization requirements for domestic banks D) Examination and supervision regulations for local branch offices E) None of the above.

Q: A call currency option: A) Obligates the holder to purchase currency or currency futures contracts at a fixed price any time before the option expires. B) Gives the holder the right to purchase currency or currency futures contracts at a fixed price any time before the option expires. C) Obligates the holder to sell currency or currency futures contracts at a fixed price any time before the option expires. D) Gives the holder the right to sell currency or currency futures contracts at a fixed price any time before the option expires. E) None of the above.

Q: The Foreign Bank Supervision Enhancement Act of 1991 places the responsibility for supervising U.S. branches of foreign banks with the: A) Office of the Comptroller of the Currency. B) Federal Reserve Board. C) Federal Deposit Insurance Corporation. D) Secretary of Commerce. E) None of the above.

Q: The key components of the International Banking Act (IBA) of 1978 include which of the following: A) Required foreign banks to follow the same branching laws as U.S. banks. B) Required legal reserves against deposits accepted at U.S. branch or agency offices of foreign banks with consolidated assets of $1 billion or more. C) Required U.S. branches of foreign banks to obtain deposit insurance. D) All of the above. E) A and B only.

Q: International banking regulations that do not apply to most domestic banking activity include: A) Foreign exchange controls. B) Restricting the outflow of scarce capital. C) Protecting domestic financial institutions and markets from foreign competition. D) All of the above. E) B and C only.

Q: International banking activities are regulated for many of the same reasons that shape domestic banking regulation. These common reasons for regulation include: A) Restricting bank risk exposure. B) Limiting non-banking business activity. C) Promoting stable growth in money and credit. D) Specifying minimum amounts of owners' equity capital. E) All of the above.