Question 1

Use the graph below to answer the question(s).  
-In the ABC Inventory Matrix,inventory in area Y suggests

Accepted Answer

A) under-stocked A and B items. 
B) under-stocked B and C items. 
C) overstocked A and B items. 
D) over-stocked B and C items. 
E) inventory matches sales. 
A) under-stocked A and B items. 
B) under-stocked B and C items. 
C) overstocked A and B items. 
D) over-stocked B and C items. 
E) inventory matches sales. E

Question 2

When demand and lead time are constant,reorder point is the demand during lead time.

Accepted Answer

A) True 
 B)False  True

Question 3

When demand and delivery lead time are known and constant,and demand is eight per day,and purchase lead time is four days,the reorder point is:

Accepted Answer

A) 3. 
B) 8. 
C) 32. 
D) 35. 
E) 56. 
A) 3. 
B) 8. 
C) 32. 
D) 35. 
E) 56. C

Question 4

Which of the following is not an assumption of the economic order quantity model?

Accepted Answer

A) Demand is known,constant,and independent. 
B) Lead time is known and constant. 
C) Quantity discounts are not possible. 
D) Production and use can occur simultaneously. 
E) The only variable costs are setup cost and holding (or carrying)cost. 
A) Demand is known,constant,and independent. 
B) Lead time is known and constant. 
C) Quantity discounts are not possible. 
D) Production and use can occur simultaneously. 
E) The only variable costs are setup cost and holding (or carrying)cost.

Question 5

The (s,S)continuous review inventory system orders the same quantity Q when physical inventory reaches the reorder points.

Accepted Answer

A) True 
 B)False

Question 6

What inventory factor may be omitted from the basic EOQ derivation because it is a constant?

Accepted Answer

A) Annual order-processing cost 
B) Annual purchase cost of goods 
C) Annual capital cost 
D) Annual setup costs 
E) all of these 
A) Annual order-processing cost 
B) Annual purchase cost of goods 
C) Annual capital cost 
D) Annual setup costs 
E) all of these

Question 7

The total annual inventory cost is the sum of the annual purchase cost,the annual holding cost,the annual capacity cost,and the annual ordering cost.

Accepted Answer

A) True 
 B)False

Question 8

The EOQ,also known as the economic order quantity,is the order size where annual inventory holding costs equal annual ordering costs.

Accepted Answer

A) True 
 B)False

Question 9

The term Cycle Counting is synonymous with physically counting inventory.

Accepted Answer

A) True 
 B)False

Question 10

The primary purpose of the basic economic order quantity model is

Accepted Answer

A) to calculate the reorder point,so that replenishments take place at the proper time 
B) to minimize the sum of carrying cost and holding cost 
C) to maximize the customer service level 
D) to minimize the sum of setup cost and holding cost 
E) to calculate the optimum safety stock 
A) to calculate the reorder point,so that replenishments take place at the proper time 
B) to minimize the sum of carrying cost and holding cost 
C) to maximize the customer service level 
D) to minimize the sum of setup cost and holding cost 
E) to calculate the optimum safety stock

Question 11

Dependent demand and independent demand items differ in that
I.for any product,all components are dependent-demand items
II.the need for independent-demand items is forecast
III.the need for dependent-demand items is calculated

Accepted Answer

A) I only 
B) I & II only 
C) I & III only 
D) II & III only 
E) I,II & III 
A) I only 
B) I & II only 
C) I & III only 
D) II & III only 
E) I,II & III

Question 12

Which of the following would most likely be considered a dependent demand item?

Accepted Answer

A) Bicycle tires used to assemble a bicycle 
B) Television (TV) 
C) Couch 
D) Lawn Mower 
A) Bicycle tires used to assemble a bicycle 
B) Television (TV) 
C) Couch 
D) Lawn Mower

Question 13

____,such as lubricants for machines,are used in the production process,but do not become parts of the final products.

Accepted Answer

A) Raw materials 
B) Work-in-process 
C) Maintenance,repair and operating supplies 
D) Finished goods 
E) Cycle stock 
A) Raw materials 
B) Work-in-process 
C) Maintenance,repair and operating supplies 
D) Finished goods 
E) Cycle stock

Question 14

The cost of a widget is $5,and the carrying rate is 40%;cost of processing an order is $25,annual demand is for 400 widgets,and supply and usage patterns are stable.What is the economic order quantity (EOQ)?

Accepted Answer

A) 5 
B) 20 
C) 25 
D) 100 
E) 200 
A) 5 
B) 20 
C) 25 
D) 100 
E) 200

Question 15

Which of the following is a global RFID challenge?

Accepted Answer

A) Foreign firms are skeptical about sharing potentially confidential information with foreign businesses. 
B) Globally,the RFID industry does not have its own UHF spectrum allocation. 
C) UHF signals are reflected by metal and absorbed by water. 
D) All of the above. 
E) None of these. 
A) Foreign firms are skeptical about sharing potentially confidential information with foreign businesses. 
B) Globally,the RFID industry does not have its own UHF spectrum allocation. 
C) UHF signals are reflected by metal and absorbed by water. 
D) All of the above. 
E) None of these.

Question 16

Use the graph below to answer the question(s).  
-In the ABC Inventory Matrix,inventory in area Z suggests

Accepted Answer

A) under-stocked A and B items. 
B) under-stocked B and C items. 
C) overstocked A and B items. 
D) over-stocked B and C items. 
E) inventory matches sales. 
A) under-stocked A and B items. 
B) under-stocked B and C items. 
C) overstocked A and B items. 
D) over-stocked B and C items. 
E) inventory matches sales.

Question 17

The periodic inventory review system reviews physical inventory at specific points in time.

Accepted Answer

A) True 
 B)False

Question 18

When both the demand and lead time of a product are variable,firms keep a higher safety stock level when compared to variations in only the demand or only the lead time.

Accepted Answer

A) True 
 B)False

Question 19

Figure 7-1
Use the graph below to answer the question(s).  
-Which of the following is true under the Periodic Review System:

Accepted Answer

A) a lower level of safety stock is needed to buffer against uncertainty in demand over a longer planning horizon 
B) a higher level of safety stock is needed to buffer against uncertainty in demand over a longer planning horizon 
C) it is more expensive to administer 
D) The only uncertainty is the magnitude of demand during the delivery lead time 
E) there are no discrepancies between physical inventory and the stock record 
A) a lower level of safety stock is needed to buffer against uncertainty in demand over a longer planning horizon 
B) a higher level of safety stock is needed to buffer against uncertainty in demand over a longer planning horizon 
C) it is more expensive to administer 
D) The only uncertainty is the magnitude of demand during the delivery lead time 
E) there are no discrepancies between physical inventory and the stock record

Question 20

The optimal order quantity for the quantity discount model may exist at a price breakpoint.

Accepted Answer

A) True 
 B)False

Use the graph below to answer the question(s). -In the ABC Inventory Matrix,inventory in area Y suggests

When demand and lead time are constant,reorder point is the demand during lead time.

When demand and delivery lead time are known and constant,and demand is eight per day,and purchase lead time is four days,the reorder point is:

Which of the following is not an assumption of the economic order quantity model?

The (s,S)continuous review inventory system orders the same quantity Q when physical inventory reaches the reorder points.

What inventory factor may be omitted from the basic EOQ derivation because it is a constant?

The total annual inventory cost is the sum of the annual purchase cost,the annual holding cost,the annual capacity cost,and the annual ordering cost.

The EOQ,also known as the economic order quantity,is the order size where annual inventory holding costs equal annual ordering costs.

The term Cycle Counting is synonymous with physically counting inventory.

The primary purpose of the basic economic order quantity model is

Dependent demand and independent demand items differ in that I.for any product,all components are dependent-demand items II.the need for independent-demand items is forecast III.the need for dependent-demand items is calculated

Which of the following would most likely be considered a dependent demand item?

____,such as lubricants for machines,are used in the production process,but do not become parts of the final products.

The cost of a widget is $5,and the carrying rate is 40%;cost of processing an order is $25,annual demand is for 400 widgets,and supply and usage patterns are stable.What is the economic order quantity (EOQ)?

Which of the following is a global RFID challenge?

Use the graph below to answer the question(s). -In the ABC Inventory Matrix,inventory in area Z suggests

The periodic inventory review system reviews physical inventory at specific points in time.

When both the demand and lead time of a product are variable,firms keep a higher safety stock level when compared to variations in only the demand or only the lead time.

Figure 7-1 Use the graph below to answer the question(s). -Which of the following is true under the Periodic Review System:

The optimal order quantity for the quantity discount model may exist at a price breakpoint.

Introduction to Supply Chain Management

Purchasing Management

Creating and Managing Supplier Relationship

Ethical and Sustainable Sourcing

Demand Forecasting

Resource Planning Systems

Process Management - Lean and Six Sigma in the Supply Chain

Domestic Usand Global Logistics

Customer Relationship Management

Global Location Decisions

Service Response Logistics

Supply Chain Process Integration

Performance Measurement Along the Supply Chain

Filters

Exam 7: Inventory Management

Use the graph below to answer the question(s). -In the ABC Inventory Matrix,inventory in area Y suggests

When demand and lead time are constant,reorder point is the demand during lead time.

When demand and delivery lead time are known and constant,and demand is eight per day,and purchase lead time is four days,the reorder point is:

Which of the following is not an assumption of the economic order quantity model?

The (s,S)continuous review inventory system orders the same quantity Q when physical inventory reaches the reorder points.

What inventory factor may be omitted from the basic EOQ derivation because it is a constant?

The total annual inventory cost is the sum of the annual purchase cost,the annual holding cost,the annual capacity cost,and the annual ordering cost.

The EOQ,also known as the economic order quantity,is the order size where annual inventory holding costs equal annual ordering costs.

The term Cycle Counting is synonymous with physically counting inventory.

The primary purpose of the basic economic order quantity model is

Dependent demand and independent demand items differ in that I.for any product,all components are dependent-demand items II.the need for independent-demand items is forecast III.the need for dependent-demand items is calculated

Which of the following would most likely be considered a dependent demand item?

____,such as lubricants for machines,are used in the production process,but do not become parts of the final products.

The cost of a widget is $5,and the carrying rate is 40%;cost of processing an order is $25,annual demand is for 400 widgets,and supply and usage patterns are stable.What is the economic order quantity (EOQ)?

Which of the following is a global RFID challenge?

Use the graph below to answer the question(s). -In the ABC Inventory Matrix,inventory in area Z suggests

The periodic inventory review system reviews physical inventory at specific points in time.

When both the demand and lead time of a product are variable,firms keep a higher safety stock level when compared to variations in only the demand or only the lead time.

Figure 7-1 Use the graph below to answer the question(s). -Which of the following is true under the Periodic Review System:

The optimal order quantity for the quantity discount model may exist at a price breakpoint.

Introduction to Supply Chain Management

Purchasing Management

Creating and Managing Supplier Relationship

Ethical and Sustainable Sourcing

Demand Forecasting

Resource Planning Systems

Process Management - Lean and Six Sigma in the Supply Chain

Domestic Usand Global Logistics

Customer Relationship Management

Global Location Decisions

Service Response Logistics

Supply Chain Process Integration

Performance Measurement Along the Supply Chain

Filters