National University of Computer and Emerging Sciences

FAST School of Management Fall 2020 Islamabad Campus

Serial No:
MG320 Operations
Sessional-1 Exam
Management
Fall- 2020
Sections: BBA-A, B, C Total Time: 1 Hour
Wednesday, November 25, 2020 Total Marks: 55
Course Instructor
________________
M. Hammad Majeed Signature of Invigilator

________________ _______ _______ ___________________

Student Name Roll No Section Signature

DO NOT OPEN THE QUESTION BOOK OR START UNTIL INSTRUCTED.

Instructions:

1. Verify at the start of the exam that you have a total of Two (02) Parts printed on eight
(08) Pages including this title page.
2. Attempt all questions on the answer-book and in the given order.
3. The exam is closed books, closed notes. Please see that the area in your threshold is
free of any material classified as ‘useful in the paper’ or else there may a charge of
cheating.
4. Read the questions carefully for clarity of context and understanding of meaning and
make assumptions wherever required, for neither the invigilator will address your
queries, nor the teacher/examiner will come to the examination hall for any assistance.
5. Fit in all your answers in the provided space. You may use extra space on the last page
if required. If you do so, clearly mark question/part number on that page to avoid
confusion.
6. Use only your own stationery and calculator. If you do not have your own calculator,
use manual calculations.
7. Use only permanent ink-pens. Only the questions attempted with permanent ink-pens
will be considered. Any part of paper done in lead pencil cannot be claimed for
checking/rechecking.

Part - 1 Part - 2 Total

Total
25 30 55
Marks
Marks
Obtained
 National University of Computer and Emerging Sciences
FAST School of Management Fall 2020 Islamabad Campus

Please read the questions carefully and answer all the questions. Marks of each question
are written in front of that question. Therefore, give due time to each question so that you
can finish the paper well in time.

Question 1 25 Marks
Select one of the options given to answer/ complete the statement and mark respective
answer in the appropriate cell in the table given below.
ANY CUTTING/ OVERWRITING WILL LEAD TO ZERO MARK

Q# Answer Q# Answer
A B C D E A B C D E
1 15
2 16
3 17
4 18
5 19
6 20
7 21
8 22
9 23
10 24
11 25
12
13
14

1 ________ is used to rank a company's products to determine which products represent the best use of
the firm's resources, or, perhaps, to determine which products are to be eliminated.
A) Value analysis
B) Value engineering
C) Financial analysis
D) Product-by-value analysis
E) Product cost justification
Answer: D

2) Which of the following would likely cause a change in market opportunities based upon levels of
income and wealth?
A) economic change
B) sociological and demographic change
C) technological change
D) political change
E) legal change
Answer: A

3) Which of the following represents an opportunity for generating a new product?

A) understanding the customer
B) demographic change, such as decreasing family size
C) changes in professional standards
D) economic change, such as rising household incomes

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 National University of Computer and Emerging Sciences
FAST School of Management Fall 2020 Islamabad Campus
E) All of the above are such opportunities.
Answer: E

4) Which of the following is true regarding value engineering?

A) Value engineering occurs only after the product is selected and designed.
B) Value engineering creates fragile design.
C) Value engineering is oriented toward improvement of design.
D) Value engineering occurs during production when it is clear the product is a success.
E) Value engineering can save substantial amounts of product cost, but quality suffers.
Answer: C

5) Reducing the complexity of a product and improving a product's maintainability are activities of:
A) product lifecycle management (PLM).
B) product-by-value analysis.
C) manufacturability and value engineering.
D) organizing for product development.
E) design for destruction (DFD).
Answer: C

6) Quality function deployment (QFD):

A) determines what will satisfy the customer.
B) translates customer desires into the target design.
C) is used early in the design process.
D) is used to determine where to deploy quality efforts.
E) all of the above
Answer: E

7) Which of the following is an example of an external product development strategy?

A) new internally developed products
B) enhancements to existing products
C) alliances
D) migrations of existing products
E) All of the above are examples of internal product development strategy.
Answer: C

8) Which of the following product development strategies has the highest product development risk?
A) acquiring the developer
B) alliances
C) joint ventures
D) new internally developed products
E) purchasing technology
Answer: D

9) Which of the following typically shows the hierarchy of components, their description, and the
quantity of each required to make one unit of a product?
A) an engineering drawing
B) an assembly drawing
C) a bill of material
D) an assembly chart
E) a route sheet
Answer: C

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 National University of Computer and Emerging Sciences
FAST School of Management Fall 2020 Islamabad Campus
10) "Making it right the first time" is:
A) an unrealistic definition of quality.
B) a user-based definition of quality.
C) a manufacturing-based definition of quality.
D) a product-based definition of quality.
E) the definition of quality proposed by the American Society for Quality
Answer: C

11) A Three Sigma program has how many defects per million?
A) 34
B) 3
C) 3 times the standard deviation
D) 2700
E) 1500
Asnwer: D

12) PDCA is most often applied with regard to which aspect of TQM?
A) Six Sigma
B) employee empowerment
C) continuous improvement
D) benchmarking
E) JIT
Answer: C

13) A Six Sigma program has how many defects per million?
A) 3.4
B) 34
C) 1000
D) 6 times the standard deviation
E) 2700
Answer: A

14) If 1 million passengers pass through the St. Louis Airport with checked baggage each month, a
successful Six Sigma program for baggage handling would result in how many passengers with
misplaced luggage?
A) 3.4
B) 6.0
C) 34
D) 2700
E) 6 times the monthly standard deviation of passengers
Answer: A

15) Total quality management emphasizes:

A) the responsibility of the quality control staff to identify and solve all quality-related problems.
B) a commitment to quality that goes beyond internal company issues to suppliers and customers.
C) a system where strong managers are the only decision makers.
D) a process where mostly statisticians get involved.
E) ISO 14000 certification.
Answer: B

16) A successful TQM program incorporates all EXCEPT which of the following?
A) continuous improvement
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 National University of Computer and Emerging Sciences
FAST School of Management Fall 2020 Islamabad Campus
B) employee involvement
C) benchmarking
D) centralized decision-making authority
E) JIT
Answer: D

17) Kaizen is a Japanese term meaning:

A) a foolproof mechanism.
B) just-in-time (JIT).
C) a fishbone diagram.
D) setting standards.
E) continuous improvement.
Answer: E

18) Which of the following statements regarding "Six Sigma" is TRUE?

A) The term has two distinct meanings–one is statistical; the other is a comprehensive quality system.
B) Six Sigma means that about 94 percent of a firm's output is free of defects.
C) The Six Sigma program was developed by Toyota in the 1970s.
D) The Six Sigma program is for manufacturing firms and is not applicable to services.
E) Six Sigma certification is granted by the International Standards Organization (ISO).
Answer: A

19) Assignable causes:

A) are not as important as natural causes.
B) are within the limits of a control chart.
C) depend on the inspector assigned to the job.
D) are also referred to as "chance" causes.
E) are causes of variation that can be identified and investigated.
Answer: E

20) Natural variations:

A) are variations that are to be identified and investigated.
B) are variations that can be traced to a specific cause.
C) are the same as assignable variations.
D) lead to occasional false findings that processes are out of control.
E) play no role in statistical process control.
Answer: D

21) Control charts for variables are based on data that come from:
A) acceptance sampling.
B) individual items.
C) averages of small samples.
D) averages of large samples.
E) the entire lot.
Answer: C

22) The purpose of an x-bar chart is to determine whether there has been a:
A) change in the dispersion of the process output.
B) change in the percent defective in a sample.
C) change in the central tendency of the process output.
D) change in the number of defects in a sample.
E) change in the AOQ.
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 National University of Computer and Emerging Sciences
FAST School of Management Fall 2020 Islamabad Campus
Answer: C

23) The number of defects after a hotel room cleaning (sheets not straight, smears on mirror, missed
debris on carpet, etc) should be measured using what type of control chart?
A) x-bar chart
B) R-chart
C) p-chart
D) c-chart
E) either x-bar chart or R chart
Answer: D

24) The number of late insurance claim payouts per 100 should be measured with what type of control
chart?
A) x-bar chart
B) R-chart
C) p-chart
D) c-chart
E) either p-chart or c-chart
Answer: C

25) Red Top Cab Company receives multiple complaints per day about driver behavior. Over 9 days the
owner recorded the number of calls to be 3, 0, 8, 9, 6, 7, 4, 9, and 8. What is the upper control limit for the
3-sigma c-chart?
A) 13.35
B) 8.45
C) 24.00
D) 0.00
E) 9.03
Answer: A

Question 2 5x6=30 Marks

Bus and subway ridership for the summer months in city ABC, is believed to be tied heavily to the
number of tourists visiting the city. During the past 12 years, the following data have been collected;
Year (summer months) Number of tourists (millions) Ridership (millions)
1 7 1.5
2 2 1.0
3 6 1.3
4 4 1.5
5 14 2.5
6 15 2.7
7 16 2.4
8 12 2.0
9 14 2.7
10 20 4.4
11 15 3.4
12 7 1.7
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 National University of Computer and Emerging Sciences
FAST School of Management Fall 2020 Islamabad Campus

a) Develop a regression relationship.

b) What is expected ridership if 10 million tourists visit the city in a year? 12 million tourists visit
the city in a year?
c) What is standard error of the estimate?
d) Explain the predicted ridership if there are no tourists at all?
e) What is correlation of the two variables?
f) How much degree of change in ridership with respect to tourists is explained by your regression
relationship?
Year (summer Number of tourists Ridership X2 Y2 XY
months) (millions) (X) (millions) (Y)
1 7 1.5 49 2.25 10.5
2 2 1.0 4 1.00 2.0
3 6 1.3 36 1.69 7.8
4 4 1.5 16 2.25 6.0
5 14 2.5 196 6.25 35.0
6 15 2.7 225 7.29 40.5
7 16 2.4 256 5.76 38.4
8 12 2.0 144 4.00 24.0
9 14 2.7 196 7.29 37.8
10 20 4.4 400 19.36 88.0
11 15 3.4 225 11.56 51.0
12 7 1.7 49 2.89 11.9
∑ 132 27.1 1796 71.59 352.9
(a)

𝑋̅ = 11, 𝑌̅ = 2.26

b = {352.9 – (12*11*2.26)} / [{1796 – (12*112)}] = 0.159

a = 2.26 – (0.159*11) = 0.511

Y = 0.511 + 0.159X

(b)
Y = 0.511 + (0.159*10) = 2.101 million
Y = 0.511 + (0.159*12) = 2.419 million

(c)
(∑𝑌^2−𝑎∑𝑌−𝑏∑𝑋𝑌)
Syx = √ = √{71.59 − (0.511 ∗ 27.1) − (0.159 ∗ 352.9)}/(12 − 2) = 0.404
𝑛−2
The estimated ridership may vary by 0.404 million

(d)
Y = 0.511 + (0.159*0) = 0.511 million

(e)
r = 0.917
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 National University of Computer and Emerging Sciences
FAST School of Management Fall 2020 Islamabad Campus
(f)
r2 = (0.917)2 = 0.840

≈ 84% variance in the ridership due to number of tourists visiting the city is explained by this
relationship

, , ,

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