Test Bank for Matching Supply with Demand An Introduction to Operations Management 3rd Edition Gerard Cachon Download


Test Bank for Matching Supply with Demand An Introduction to Operations Management 3rd Edition Gerard Cachon Download



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Title: Test Bank for Matching Supply with Demand An Introduction to Operations Management 3rd Edition Gerard Cachon Download

Edition: 3rd Edition

ISBN-10: 0073525200

ISBN-13: 978-0073525204

Test Bank for Matching Supply with Demand An Introduction to Operations Management 3rd Edition Gerard Cachon ( Only Final Exam)


Operations Management: Quality and Productivity



Name ____________________________ __________________




The exam consists of 32 total questions, with Basic questions, and more challenging Advanced questions identified by an (*) at the end. Reasonable performance on the Basic questions is sufficient to pass this exam, but we encourage you to attempt the advanced questions, as time permits.


The exam is open book / open notes and you may use a calculator.  We will give points for correct answers, but will not subtract points for incorrect answers, so you should answer all questions.


In order to make your calculations as straightforward as possible, assume that, unless stated otherwise,

  • there are sufficient parts or raw materials so that the initial operation(s) are never starved;
  • processing times have negligible variability, and over time, workers neither speed up nor slow down, but work always at the processing rates given;
  • there are no machine breakdowns;
  • when there are buffers shown, they are large enough to accommodate any amount of inventory that would reside in those buffers under normal operations;
  • travel time and time to transport parts from one operation to the next is negligible;
  • all operations run with 100% yield, i.e., the operations produce no defective units; and
  • all processes are in steady state (e.g., in the middle of the day); thus, you may ignore any start-up effects.


  Exam Score   Course Grade












One Hour Loan

One Hour Loan offers customized loans. Customers call a toll free number with a specific loan request, and obtain a response within an hour. One Hour Loan’s business process includes five activities which must be conducted in the sequence described below. (The time required for each activity is shown in parenthesis):


Activity 1: Answer customer call and record key information.   (4 minutes)

Activity 2: Gather and format the information (obtain credit scores, organize customer specific needs) for analysis   (5 minutes)

Activity 3: Analyze the information: Check the credit worthiness, and decide loan amount and APR to offer. (7 minutes)

Activity 4: Perform final checks on loan offer (2 minutes)

Activity 5: Call customer back with the new loan offer and close. (4 minutes)



The whole process is conducted by three workers in a worker paced line. The assignment of tasks to workers is the following:

W1 does Activity 1.

W2 does Activities 2 and 3.

W3 does Activities 4 and 5.


  1. What is the bottleneck of the process?








  1. How much time will it take to process 100 loans? (Assume that the process starts with an empty production line)







  1. What is the utilization of worker 3? (You can assume that the process operates at capacity and you do not have to consider any empty system effects)



  1. What is the average labor utilization of the workers? Assume the process operates at its capacity and there are no empty system effects.








  1. What are the direct labor costs for one loan application? Assume a wage rate of $20 per hour.







To increase the production rate, One Hour Loan is considering two alternatives:


Alternative I: To hire a new worker to help any one (and only one) of the workers without changing the tasks performed by each worker.

Alternative II: To redesign the assignment of tasks to workers. For this, the company is evaluating to re-assign Step 2 from W2 to W1.



  1. Suppose that Alternative I is chosen. Which worker should the new employee assist?




  1. What would be the costs of direct labor of one loan application under the solution depicted above? Assume there is sufficient demand (system operates at its capacity) and there are no empty system effects.







  1. What would be the direct labor costs for Alternative II?










Comfy Shoes Inc

Comfy Shoes Inc builds shoes tailored to meet each individual customer’s needs.  Customers who visit the downtown offices of Comfy Shoes in Philadelphia can choose one or more of the following four custom-tailoring services.  Customers receive their shoes in the mail within a week of their initial visit.


Service Description Time Resource used
A. Walking Basics Take measurements for basic walking shoes. 12 min. 1 attendant
B. Walking Plus Choose specific design (e.g. material, color selection) 12 min. 1 attendant
C. Running Basics Take measurements for tailor-made running shoes 10 min. 1 attendant
D. Running Adv Consult physical therapist and obtain precise needs for running shoes.  Also choose specific design. 40 min. 1 attendant


The company offers the following packages to their customers:


  1. Package 1: Includes only Walking Basics (Service A)
  2. Package 2: Includes Walking Basics and Walking Plus (Services A and B).
  3. Package 3: Walking Basics, Walking Plus and Running Basics (Services A, B and C).
  4. Package 4: All four services (A, B, C, and D)


Customers of Comfy Shoes visit the store at a constant rate (you can ignore any effects of variability) of 20 customers per day. Of these customers, 45% buy Package 1, 10% buy Package 2, 20% buy Package 3 and 25% buy Package 4. The mix does not change over the course of the day. The store operates 12 hours a day.


  1. What is the implied utilization of the attendant in service D?








  1. Which resource has the highest implied utilization?




At the end of the spring season, Comfy Shoes anticipates an increase in the demand to 50 customers per day. A change in the mix of packages demanded is also expected: 30% of the customers ask for Package 1, 10% for Package 2, 10% for Package 3 and 50% for Package 4. The company will hire an additional attendant to help with Service A (Walking Basics)



  1. What will be the bottleneck in the process given this new demand pattern?










  1. How many customers a day will not be served? *


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