Question 1

Dependent demand items are those items for which demand is influenced by market conditions and is not related to inventory decision for any other item held in stock.

Accepted Answer

A) True 
 B)False

Question 2

Which one of the following statements represents an advantage of the P system over the Q system?

Accepted Answer

A)  Less safety stock is carried to achieve the same service level. 
B)  Orders can be more easily combined to the same supplier. 
C)  A P system is more suitable for quantity discounts and capacity limitations. 
D)  The replenishment intervals can be more easily individualized for items. 
A)  Less safety stock is carried to achieve the same service level. 
B)  Orders can be more easily combined to the same supplier. 
C)  A P system is more suitable for quantity discounts and capacity limitations. 
D)  The replenishment intervals can be more easily individualized for items.

Question 3

For a continuous review (Q) inventory system, with uncertain demand a company is only at risk of running out of stock over the lead time (L) required to receive an order.

Accepted Answer

A) True 
 B)False

Question 4

______ is the cost involved in changing over a machine to produce a different component or item.

Accepted Answer

The answer of ______ is the cost involved in changing...

Question 5

For an item under continuous review, the on- hand inventory is only 20 units and the reorder point R is 100 units. There are no backorders, but there is one open order for 90 units. Which one of the following statements is TRUE?

Accepted Answer

A)  An order should be placed now for 20 units. 
B)  An order should be placed now for 10 units. 
C)  The current inventory position is 100 units. 
D)  There is no need to order at the present time. 
A)  An order should be placed now for 20 units. 
B)  An order should be placed now for 10 units. 
C)  The current inventory position is 100 units. 
D)  There is no need to order at the present time.

Question 6

For continuous review (Q) inventory systems, fixed quantities of items are ordered each time inventory levels reach the reorder point (R).

Accepted Answer

A) True 
 B)False

Question 7

A stockout is a customer order that cannot be filled when promised or demanded but is filled later.

Accepted Answer

A) True 
 B)False

Question 8

______ is the time interval for which inventory must be planned when each new order is placed.

Accepted Answer

The answer of ______ is the time interval for which...

Question 9

A neighborhood sportswear store sells a pair of Nike sneakers for $40. Due to the recent fitness craze, these shoes are in high demand: 50 pairs of shoes are sold per week. The ordering cost is $20/order, and the annual holding cost is 20 percent of selling price. If the store operates 52 weeks a year, what can you say about the current lot size of 235?

Accepted Answer

A)  too large 
B)  too small 
C)  just right 
D)  cannot tell from the information given 
A)  too large 
B)  too small 
C)  just right 
D)  cannot tell from the information given

Question 10

Table $5.2$
Consider the following data for an independent demand item maintained by Vicki Crittenden, the proprietor of a local auto repair shop:

-Use the information in Table 5.2. If Crittenden uses the EOQ model, how frequently must she place orders for this item?

Accepted Answer

A)  every week 
B)  every 2 weeks 
C)  every 3 weeks 
D)  every 4 weeks 
A)  every week 
B)  every 2 weeks 
C)  every 3 weeks 
D)  every 4 weeks

Question 11

The Lemma Company manufactures and sells 10 products. Ways have been found to cut both the setup and inventory holding costs in half. What effect will this have on the economic order quantities of the 10 products?

Accepted Answer

A)  They will be increased by a factor of 1.41. 
B)  They will not change. 
C)  They will be reduced by a factor of 2.00. 
D)  They will be reduced by a factor of 1.41. 
A)  They will be increased by a factor of 1.41. 
B)  They will not change. 
C)  They will be reduced by a factor of 2.00. 
D)  They will be reduced by a factor of 1.41.

Question 12

A(n) ______ is a system that allows employees to place orders when inventory visibly reaches a certain marker.

Accepted Answer

The answer of A(n) ______ is a system that allows...

Question 13

The two- bin inventory system is a type of visual system.

Accepted Answer

A) True 
 B)False

Question 14

The primary lever for reducing ______ inventory is to reduce predictable variation. Secondary levers emphasize better coordination and adjusting the output rate of individual operations.

Accepted Answer

The answer of The primary lever for reducing ______ inventory...

Question 15

What are the secondary levers for anticipation inventory?

Accepted Answer

The secondary levers are addin

Question 16

Demand for an item is 1000 units per week, with a standard deviation in weekly demand of 60 units. The lead time is 2 weeks. The company wants to maintain an 88 percent cycle- service level. Assume demand during lead time to be normally distributed. For a continuous review system, what should be the reorder point? A normal table is attached at the end of this exam.

Accepted Answer

A)  less than or equal to 2075 
B)  greater than 2075 but less than or equal to 2085 
C)  greater than 2085 but less than or equal to 2095 
D)  greater than 2095 
A)  less than or equal to 2075 
B)  greater than 2075 but less than or equal to 2085 
C)  greater than 2085 but less than or equal to 2095 
D)  greater than 2095

Question 17

Holding inventory towards the finished goods level supports lower costs but also results in longer delivery times.

Accepted Answer

A) True 
 B)False

Question 18

For a continuous review (Q) inventory system, with uncertain demand the time between orders (TBO) is the same for each cycle.

Accepted Answer

A) True 
 B)False

Question 19

______ systems are systems in which an item's inventory position is reviewed periodically rather than continuously.

Accepted Answer

The answer of ______ systems are systems in which an...

Question 20

As the setup cost (S) increases, the economic order quantity (EOQ) decreases.

Accepted Answer

A) True 
 B)False

Dependent demand items are those items for which demand is influenced by market conditions and is not related to inventory decision for any other item held in stock.

Which one of the following statements represents an advantage of the P system over the Q system?

For a continuous review (Q) inventory system, with uncertain demand a company is only at risk of running out of stock over the lead time (L) required to receive an order.

______ is the cost involved in changing over a machine to produce a different component or item.

For an item under continuous review, the on- hand inventory is only 20 units and the reorder point R is 100 units. There are no backorders, but there is one open order for 90 units. Which one of the following statements is TRUE?

For continuous review (Q) inventory systems, fixed quantities of items are ordered each time inventory levels reach the reorder point (R).

A stockout is a customer order that cannot be filled when promised or demanded but is filled later.

______ is the time interval for which inventory must be planned when each new order is placed.

Table $5.2$ Consider the following data for an independent demand item maintained by Vicki Crittenden, the proprietor of a local auto repair shop: -Use the information in Table 5.2. If Crittenden uses the EOQ model, how frequently must she place orders for this item?

The Lemma Company manufactures and sells 10 products. Ways have been found to cut both the setup and inventory holding costs in half. What effect will this have on the economic order quantities of the 10 products?

A(n) ______ is a system that allows employees to place orders when inventory visibly reaches a certain marker.

The two- bin inventory system is a type of visual system.

The primary lever for reducing ______ inventory is to reduce predictable variation. Secondary levers emphasize better coordination and adjusting the output rate of individual operations.

What are the secondary levers for anticipation inventory?

Holding inventory towards the finished goods level supports lower costs but also results in longer delivery times.

For a continuous review (Q) inventory system, with uncertain demand the time between orders (TBO) is the same for each cycle.

______ systems are systems in which an item's inventory position is reviewed periodically rather than continuously.

As the setup cost (S) increases, the economic order quantity (EOQ) decreases.

Creating Customer Value

Supply Chain Management

Supply Chain Sustainability and Humanitarian Logistics

Process Configuration

Capacity

Inventory Management

Quality and Process Improvement

Lean Systems

Location and Layout

Managing Demand and Forecasting

Operations Planning and Scheduling

Resource Planning

Filters

Exam 6: Waiting Lines

Dependent demand items are those items for which demand is influenced by market conditions and is not related to inventory decision for any other item held in stock.

Which one of the following statements represents an advantage of the P system over the Q system?

For a continuous review (Q) inventory system, with uncertain demand a company is only at risk of running out of stock over the lead time (L) required to receive an order.

______ is the cost involved in changing over a machine to produce a different component or item.

For an item under continuous review, the on- hand inventory is only 20 units and the reorder point R is 100 units. There are no backorders, but there is one open order for 90 units. Which one of the following statements is TRUE?

For continuous review (Q) inventory systems, fixed quantities of items are ordered each time inventory levels reach the reorder point (R).

A stockout is a customer order that cannot be filled when promised or demanded but is filled later.

______ is the time interval for which inventory must be planned when each new order is placed.

Table 5.25.25.2 Consider the following data for an independent demand item maintained by Vicki Crittenden, the proprietor of a local auto repair shop: -Use the information in Table 5.2. If Crittenden uses the EOQ model, how frequently must she place orders for this item?

The Lemma Company manufactures and sells 10 products. Ways have been found to cut both the setup and inventory holding costs in half. What effect will this have on the economic order quantities of the 10 products?

A(n) ______ is a system that allows employees to place orders when inventory visibly reaches a certain marker.

The two- bin inventory system is a type of visual system.

The primary lever for reducing ______ inventory is to reduce predictable variation. Secondary levers emphasize better coordination and adjusting the output rate of individual operations.

What are the secondary levers for anticipation inventory?

Holding inventory towards the finished goods level supports lower costs but also results in longer delivery times.

For a continuous review (Q) inventory system, with uncertain demand the time between orders (TBO) is the same for each cycle.

______ systems are systems in which an item's inventory position is reviewed periodically rather than continuously.

As the setup cost (S) increases, the economic order quantity (EOQ) decreases.

Creating Customer Value

Supply Chain Management

Supply Chain Sustainability and Humanitarian Logistics

Process Configuration

Capacity

Inventory Management

Quality and Process Improvement

Lean Systems

Location and Layout

Managing Demand and Forecasting

Operations Planning and Scheduling

Resource Planning

Filters

Table $5.2$ Consider the following data for an independent demand item maintained by Vicki Crittenden, the proprietor of a local auto repair shop: -Use the information in Table 5.2. If Crittenden uses the EOQ model, how frequently must she place orders for this item?