APICS CPIM-Part-2 Exam Questions

The priority rule that is most consistent with the objective of meeting due dates is slack time per operation. Slack time per operation is a priority rule that assigns a priority index to each job based on the ratio of the remaining slack time to the remaining number of operations. Slack time is the difference between the due date and the expected completion time of a job. A lower ratio means a higher priority, as it indicates that the job has less slack time per operation and is more likely to be late. Slack time per operation is a dynamic priority rule, as it updates the priority index after each operation is completed. Slack time per operation can help minimize the number of tardy jobs and the average tardiness of jobs, as it gives preference to the jobs that are closer to their due dates and have more operations left.

First-come-first-served (FCFS) is not a priority rule that is consistent with the objective of meeting due dates. FCFS is a priority rule that processes jobs in the order of their arrival or release times. FCFS is a simple and fair rule, but it ignores the processing times and due dates of jobs. FCFS can result in poor due date performance, as it can delay urgent or short jobs behind long or non-urgent jobs.

Shortest processing time (SPT) is not a priority rule that is consistent with the objective of meeting due dates. SPT is a priority rule that processes jobs in ascending order of their processing times. SPT is an effective rule for minimizing the average flow time and work-in-process inventory of jobs, as it clears out small jobs quickly and reduces congestion in the system. However, SPT does not consider the due dates of jobs, and it can make long or urgent jobs late.

Fewest operations remaining is not a priority rule that is consistent with the objective of meeting due dates. Fewest operations remaining is a priority rule that processes jobs in ascending order of their remaining number of operations. Fewest operations remaining is a rule that can reduce the variability and complexity of jobs, as it tends to complete jobs faster and reduce their flow times. However, fewest operations remaining does not take into account the slack times or due dates of jobs, and it can make urgent or short jobs late.

Mean time between failures (MTBF) is the predicted elapsed time between inherent failures of a mechanical or electronic system during normal system operation1.MTBF can be calculated as the arithmetic mean (average) time between failures of a system1. MTBF is a useful measure of reliability, because it indicates how long a system is likely to work before failing.The higher the MTBF, the more reliable the system2.Reliability is the probability that a system will perform its intended function without failure for a specified period of time under specified conditions3.

The other statements about MTBF are false. MTBF is not used for non-repairable products, but for repairable systems.For non-repairable products, mean time to failure (MTTF) is used instead4.MTTF is the expected time to failure for a non-repairable system1.An increase in MTBF is not proportional to an increase in quality, because quality is not only determined by reliability, but also by other factors such as performance, functionality, durability, and customer satisfaction5.MTBF is not the same as operating life or service life, because operating life or service life is the total time that a system can operate before it reaches the end of its useful life, while MTBF is the average time between failures during the operating life6.

Rivalry among competing sellers is the degree of competition between firms in the same industry. It can affect the profitability and market share of the firms, and influence their strategies and decisions. Rivalry tends to be stronger when the demand is slow, the products are similar, the switching costs are low, and the capacity is high. Rivalry can also lead to innovation, differentiation, and customer satisfaction.

Rivalry among competing sellers is generally weaker when buyer demand is growing rapidly. This is because a fast-growing market offers more opportunities for expansion and growth for all the firms, without having to compete aggressively for a limited number of customers. A fast-growing market also reduces the pressure to cut prices or increase advertising, as the demand exceeds the supply. A fast-growing market can also attract new entrants, which can increase the rivalry in the long run, but in the short run, it can create more diversity and segmentation in the market.

The inventory turns ratio is a financial metric that measures how efficiently a company manages its inventory. The inventory turns ratio is calculated by dividing the cost of goods sold (COGS) by the average inventory investment. The cost of goods sold is the direct cost of producing or purchasing the goods sold by the company. The average inventory investment is the average value of the inventory held by the company over a period of time. A higher inventory turns ratio indicates a higher inventory turnover and a lower inventory holding cost.

In this case, the company sold 8,400 units last year, and the unit cost is $207. Therefore, the cost of goods sold is:

COGS = Unit cost x Units sold = 207 x 8,400 = $1,738,800

The average inventory investment was $42,000. Therefore, the inventory turns ratio is:

Inventory turns ratio = COGS / Average inventory investment = 1,738,800 / 42,000 = 41.4

To express the inventory turns ratio as a whole number, we can round it to the nearest integer. Therefore, the inventory turns ratio is 5.

The output of the equipment on Day 6 can be calculated by multiplying the demonstrated capacity, the utilization, and the efficiency. The demonstrated capacity is given as $1,200 per day. The utilization is the ratio of the actual time that the equipment is used to the available time that it could be used. Since the utilization is reduced by 25% on Day 6, it means that the equipment is used for 75% of the available time. Therefore, the utilization is 0.75. The efficiency is the ratio of the actual output to the standard output. It is given as 110%, which means that the equipment produces 10% more than the standard output. Therefore, the efficiency is 1.1. The output on Day 6 can be found by multiplying these three factors:

Output = Demonstrated capacity x Utilization x Efficiency Output = $1,200 x 0.75 x 1.1 Output = $990

Therefore, the output on Day 6 is $990.Reference: CPIM Part 2 Exam Content Manual, Version 7.0, Domain 6: Plan, Manage, and Execute Detailed Schedules, Section A: Detailed Capacity Planning and Scheduling, Subsection 2: Capacity Management Concepts and Calculations, p. 37-38.