Which of the following is not one of the assumptions of the basic EOQ model? |
Quantity discounts are available |

Which of the following interactions with vendors would potentially lead to inventory reductions? |
Reducing lead times |

Dairy items, fresh fruit and newspapers are items that: |
Subject to determination and spoilage |

Which of the following is least likely to be included in order costs? |
Temporary storage of delivered goods |

In an A-B-C system, the typical percentage of the number of items in inventory for A items is about: |
10 |

In the A-B-C classification system, items which account for fifteen percent of the total dollar-volume for a |
C items |

In the A-B-C classification system, items which account for sixty percent of the total dollar-volume for few |
A items |

The EOQ model is most relevant for which one of the following? |
Determining fixed order quantities |

In a supermarket, a vendor’s restocking the shelves every Monday morning is an example of: |
Fixed Order interval |

In the basic EOQ model, if lead time increases from five to 10 days, the EOQ will: |
Remain the same because EOQ is about how much to order, not when to order |

Which one of the following is not generally a determinant of the reorder point? |
Purchase Cost |

If no variations in demand or lead time exist, the ROP will equal: |
Expected usage during lead time because R=dL |

Which one of the following is implied by a "lead time" service level of 95 percent? |
The probability is 95 percent that demand during lead time will not exceed the amount on hand at the beginning of lead time |

All of the following are possible reasons for using the fixed order interval model except: |
The required safety stock is lower than with an EOQ/ROP model |

Which of these products would be most apt to involve the use of a single-period model? |
Fresh fish |

The management of supply chain inventories focuses on: |
both internal and external inventories |

An operations strategy for inventory management should work towards: |
decreasing lot sizes |

An operations strategy which recognizes high carrying costs and reduces ordering costs will result in: |
greatly decrease order quantities |

The need for safety stocks can be reduced by an operations strategy which: |
decrease lead time variaility |

With an A-B-C system, an item that had a high demand but a low annual dollar volume would probably |
C items |

The fixed order interval model would be most likely to be used for this situation: |
Grouping orders can save shipping costs |

Which one of these would not be a factor in determining the reorder point? |
The EOQ |

Which of the following interactions with vendors would potentially lead to inventory reductions? |
Reduce lead times |

A non-linear cost related to order size is the cost of: |
Receiving |

In a two-bin inventory system, the amount contained in the second bin is equal to the: |
ROP |

When carrying costs are stated as a percentage of unit price, the minimum points on the total cost curves: |
Do not line up |

Dairy items, fresh fruit and newspapers are items that: |
Are subject to deterioration and spoilage |

Which of the following is least likely to be included in order costs? |
Temporary storage of delivered goods |

The purpose of "cycle counting" is to: |
reduce discrepancies between inventory records and actual |

The EOQ model is most relevant for which one of the following? |
Determining fixed order quantaties |

Which is not a true assumption in the EOQ model? |
No more than 3 items are involved |

In a supermarket, a vendor’s restocking the shelves every Monday morning is an example of: |
Fixed order interval |

A cycle count program will usually require that ‘A’ items be counted: |
More frequently than annually |

A risk avoider would want ______ safety stock |
More |

In the basic EOQ model, if annual demand doubles, the effect on the EOQ is: |
It increases by about 40 percent |

In the basic EOQ model, if lead time increases from five to 10 days, the EOQ will: |
Remain the same |

In the basic EOQ model, an annual demand of 40 units, an ordering cost of $5, and a holding cost of $1 per unit per year will result in an EOQ of: |
20 Square root 2540)/(1)=20 |

In the basic EOQ model, if D = 60 per month, S = $12, and H = $10 per unit per month, EOQ is |
12 Square Root (21260)/(10)=12 |

In the basic EOQ model, if annual demand is 50, carrying cost is $2, and ordering cost is $15, EOQ is approximately: |
Square Root (25015)/(2)=27.386 |

Which of the following is not true for Economic Production Quantity model? |
There are no ordering set up costs |

Given the same demand, setup/ordering costs, and carrying costs, the EOQ calculated using incremental replenishment will be ____________ if instantaneous replenishment was assumed: |
Greater than the EOQ |

The introduction of quantity discounts will cause the optimum order quantity to be |
Unchanged or greater |

A fill rate is the percentage of _____ filled by stock on hand |
Demand |

In the quantity discount model, with carrying cost stated as a percentage of unit purchase price, in order for the EOQ of the lowest curve to be optimum, it must |
Be in a feasible range |

Which one of the following is not generally a determinant of the reorder point? |
Purchase Cost |

If no variations in demand or lead time exist, the ROP will equal: |
Expected usage during lead time |

If average demand for an inventory item is 200 units per day, lead time is three days, and safety stock is 100 units, the reorder point is: |
700 (200*3)+100=700 The ROP will be the safety stock added to the product of the demand rate and the lead time. |

Which one of the following is implied by a "lead time" service level of 95 percent? |
The probability is 95 percent that demand during lead time will not exceed the amount on hand at the beginning of lead time |

Which one of the following is implied by an "annual" service level of 95 percent? |
None of the above |

Daily usage is exactly 60 gallons per day. Lead time is normally distributed with a mean of 10 days and a standard deviation of 2 days. What is the standard deviation of demand during lead time? |
60*2 The standard deviation of demand during lead time is the square root of squared demand times the squared standard deviation of lead time |

Lead time is exactly 20 days long. Daily demand is normally distributed with a mean of 10 gallons per day and a standard deviation of 2 gallons. What is the standard deviation of demand during lead time? |
2 times the square root of 20 The standard deviation of demand during lead time equals the daily standard deviation of demand times the square root of the lead time. |

All of the following are possible reasons for using the fixed order interval model except: |
The required safety stock is lower than with an EOQ/ROP model |

Which of these products would be most apt to involve the use of a single-period model? |
fresh fish |

In a single-period model, if shortage and excess costs are equal, then the optimum service level is: |
.50 The ratio of shortage cost to shortage plus excess cost is 0.5. |

In a single-period model, if shortage cost is four times excess cost, then the optimum service level is ___ percent. |
80 The ratio of shortage cost to shortage plus excess cost is .8 |

In the single-period model, if excess cost is double shortage cost, the approximate stockout risk, assuming an optimum service level, is ___ percent |
67 |

If, in a single-period inventory situation, the probabilities of demand being 1, 2, 3, or 4 units are .3, .3, .2, and .2, respectively. If two units are stocked, what is the probability of selling both of them? |
.7 both units will be sold of demand is for 2,3,4 units |

The management of supply chain inventories focuses on: |
Both external and internal inventories |

Cycle stock inventory is intended to deal with ________. |
Expected demand |

An operations strategy which recognizes high carrying costs and reduces ordering costs will result in: |
Greatly decrease order quantaties |

The need for safety stocks can be reduced by an operations strategy which: |
Decrease lead time and variability |

If average demand for an item is 20 units per day, safety stock is 50 units, and lead time is four days, the ROP will be: |
130 (20*4)+50=130 Multiply the demand rate by the lead time and add the safety stock |

With an A-B-C system, an item that had a high demand but a low annual dollar volume would probably be classified as: |
C Low dollar volume items tend to be classified as C items. |

The fixed order interval model would be most likely to be used for this situation |
Grouping orders can save shipping costs |

Which item would be least likely to be ordered under a fixed order interval system? |
Auto parts at an assembly plant |

Which one of these would not be a factor in determining the reorder point? |
the EOQ |

# MGMT CH13 Inventory Management

### Share This

## Unfinished tasks keep piling up?

Let us complete them for you. Quickly and professionally.

Check Price