Question 1

Several inventory models assume "independent demand." Explain what that term means and why the assumption is important.

Accepted Answer

Independent demand means that demand for

Question 2

Consider a supply chain where a manufacturer sells to a distributor who sells to a wholesaler who sells to a retailer. Last year, the retailer's weekly variance of demand was 3000 units. The weekly variance of orders was 4000; 8000; 17,000; and 12,000 units for the retailer, wholesaler, distributor, and manufacturer, respectively. (Note that the variance of orders equals the variance of demand for that firm's supplier.)
(a) Calculate the bullwhip measure for the retailer.
(b) Calculate the bullwhip measure for the wholesaler.
(c) Calculate the bullwhip measure for the distributor.
(d) Calculate the bullwhip measure for the manufacturer.
(e) Which firm appears to be contributing the most to the bullwhip effect in this supply chain?

Accepted Answer

(a) 4000 / 3000 = 1.33; (b) 8000 / 4000

Question 3

If the standard deviation of demand is six per week, demand is 50 per week, and the desired service level is 95%, approximately what is the statistical safety stock?

Accepted Answer

A)  8 units 
B)  10 units 
C)  16 units 
D)  64 units 
E)  Cannot be determined without lead time data. 
A)  8 units 
B)  10 units 
C)  16 units 
D)  64 units 
E)  Cannot be determined without lead time data.

Question 4

In cycle counting, the frequency of item counting and stock verification usually varies from item to item depending upon the item's classification.

Accepted Answer

A) True 
 B)False

Question 5

A bakery wants to determine how many trays of doughnuts it should prepare each day. Demand is normal with a mean of 5 trays and standard deviation of 1 tray. If the owner wants a service level of at least 95%, how many trays should he prepare (rounded to the nearest whole tray)? Assume doughnuts have no salvage value after the day is complete.

Accepted Answer

A)  5 
B)  4 
C)  6 
D)  7 
E)  unable to determine with the above information 
A)  5 
B)  4 
C)  6 
D)  7 
E)  unable to determine with the above information

Question 6

The main trait of a single-period model is that:

Accepted Answer

A)  inventory has limited value after a certain period of time. 
B)  it has the largest EOQ sizes. 
C)  the order quantity should usually equal the expected value of demand. 
D)  supply is limited. 
E)  the cost of a shortage cannot be determined accurately. 
A)  inventory has limited value after a certain period of time. 
B)  it has the largest EOQ sizes. 
C)  the order quantity should usually equal the expected value of demand. 
D)  supply is limited. 
E)  the cost of a shortage cannot be determined accurately.

Question 7

In the disaster risk decision tree model, a(n) ________ disrupts all suppliers simultaneously.

Accepted Answer

The answer of In the disaster risk decision tree model,...

Question 8

What are the assumptions of the EOQ model?

Accepted Answer

(1) Demand for an item is known, reasona

Question 9

Thomas' Bike Shop stocks a high-volume item that has a normally distributed demand during lead time. The average daily demand is 100 units, the lead time is 4 days, and the standard deviation of demand during lead time is 20.
(a) How much safety stock provides a 90% service level to Thomas?
(b) What should the reorder point be?

Accepted Answer

(a) SS = 1.28 × 20 =

Question 10

What is the difference between P and Q inventory systems?

Accepted Answer

A)  order size 
B)  order spacing 
C)  maximum service level 
D)  lead time length 
E)  A and B 
A)  order size 
B)  order spacing 
C)  maximum service level 
D)  lead time length 
E)  A and B

Several inventory models assume "independent demand." Explain what that term means and why the assumption is important.

If the standard deviation of demand is six per week, demand is 50 per week, and the desired service level is 95%, approximately what is the statistical safety stock?

In cycle counting, the frequency of item counting and stock verification usually varies from item to item depending upon the item's classification.

The main trait of a single-period model is that:

In the disaster risk decision tree model, a(n) ________ disrupts all suppliers simultaneously.

What are the assumptions of the EOQ model?

What is the difference between P and Q inventory systems?

Operations and Productivity

Operations Strategy in a Global Environment

Project Management

Forecasting

Design of Goods and Services

Managing Quality

Process Strategies

Location Strategies

Human Resources, Job Design, and Work Measurement

Supply Chain Management

Aggregate Planning and Sop

Material Requirements Planning Mrp and Erp

Short-Term Scheduling

Lean Operations

Maintenance and Reliability

Decision-Making Tools

Linear Programming

Transportation Models

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Applying Analytics to Big Data in Operations Management

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Exam 11: Inventory Management

Several inventory models assume "independent demand." Explain what that term means and why the assumption is important.

If the standard deviation of demand is six per week, demand is 50 per week, and the desired service level is 95%, approximately what is the statistical safety stock?

In cycle counting, the frequency of item counting and stock verification usually varies from item to item depending upon the item's classification.

The main trait of a single-period model is that:

In the disaster risk decision tree model, a(n) ________ disrupts all suppliers simultaneously.

What are the assumptions of the EOQ model?

What is the difference between P and Q inventory systems?

Operations and Productivity

Operations Strategy in a Global Environment

Project Management

Forecasting

Design of Goods and Services

Managing Quality

Process Strategies

Location Strategies

Human Resources, Job Design, and Work Measurement

Supply Chain Management

Aggregate Planning and Sop

Material Requirements Planning Mrp and Erp

Short-Term Scheduling

Lean Operations

Maintenance and Reliability

Decision-Making Tools

Linear Programming

Transportation Models

Waiting-Line Models

Learning Curves

Simulation

Applying Analytics to Big Data in Operations Management

Filters