6) Which of the following statements regarding Amazon.com is FALSE? |
B |

7) Which of the following is a function of inventory? |
E |

8) Which of the following would NOT generally be a motive for a firm to hold inventories? |
D |

9) Which of the following is NOT one of the four main types of inventory? |
D |

8) Which of the following statements about ABC analysis is FALSE? |
D |

9) All EXCEPT which of the following statements about ABC analysis are true? |
D |

10) ABC analysis is based upon the principle that: |
B |

11) ABC analysis divides on-hand inventory into three classes, generally based upon which of the following? |
E |

12) Cycle counting: |
B |

13) Which of the following statements regarding control of service inventories is TRUE? |
C |

14) Among the advantages of cycle counting is that it: |
D |

3) Which of the following is an element of inventory holding costs? |
E |

4) Which category of inventory holding costs has a much higher percentage than average for rapid-change industries such as PCs and cell phones? |
E |

10) The two most basic inventory questions answered by the typical inventory model are: |
C |

11) Which of the following is NOT an assumption of the economic order quantity model shown below? Q* = SQRT((2DS)/H) A) Demand is known, constant, and independent. |
D |

12) What is the primary purpose of the basic economic order quantity model shown below? Q* = SQRT((2DS)/H) A) to calculate the reorder point, so that replenishments take place at the proper time |
D |

13) If the actual order quantity is the economic order quantity in a problem that meets the assumptions of the economic order quantity model shown below, the average amount of inventory on hand: Q* = SQRT((2DS)/H) A) is smaller than the holding cost per unit. |
C |

14) A certain type of computer costs $1,000, and the annual holding cost is 25% of the value of the item. Annual demand is 10,000 units, and the order cost is $150 per order. What is the approximate economic order quantity? |
C |

15) Most inventory models attempt to minimize: |
C |

16) In the basic EOQ model, if the cost of placing an order doubles, and all other values remain constant, the EOQ will: |
A |

17) In the basic EOQ model, if D = 6000 per year, S = $100, and holding cost = $5 per unit per month, what is the economic order quantity? |
C |

18) Which of the following statements about the basic EOQ model is TRUE? |
E |

19) Which of the following statements about the basic EOQ model is FALSE? |
D |

20) A product whose EOQ is 40 units experiences a decrease in ordering cost from $90 per order to $10 per order. The revised EOQ is: |
B |

21) A product whose EOQ is 400 units experiences a 50% increase in demand. The new EOQ is: |
B |

22) For a certain item, the cost-minimizing order quantity obtained with the basic EOQ model is 200 units, and the total annual inventory (carrying and setup) cost is $600. What is the inventory carrying cost per unit per year for this item? |
C |

23) A product has a demand of 4000 units per year. Ordering cost is $20, and holding cost is $4 per unit per year. The EOQ model is appropriate. The cost-minimizing solution for this product will cost ________ per year in total annual inventory (holding and setup) costs. |
B |

24) A product has a demand of 4000 units per year. Ordering cost is $20, and holding cost is $4 per unit per year. The cost-minimizing solution for this product is to order: |
B |

25) Which of the following statements regarding the reorder point is TRUE? |
E |

26) An inventory decision rule states, "When the inventory level goes down to 14 gearboxes, 100 gearboxes will be ordered." Which of the following statements is TRUE? |
B |

27) Which of the following statements regarding the production order quantity model is TRUE? |
B |

28) Which of these statements about the production order quantity model is FALSE? |
D |

29) The assumptions of the production order quantity model are met in a situation where annual demand is 3650 units, setup cost is $50, holding cost is $12 per unit per year, the daily demand rate is 10 and the daily production rate is 100. What is the production order quantity for this problem? |
C |

30) A production order quantity problem has a daily demand rate = 10 and a daily production rate = 50. The production order quantity for this problem is approximately 612 units. What is the average inventory for this problem? |
B |

31) When quantity discounts are allowed, the cost-minimizing order quantity: |
E |

32) Which of the following statements about quantity discounts is FALSE? |
D |

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? |
E |

4) A specific product has demand during lead time of 100 units, with a standard deviation during lead time of 25 units. What safety stock (approximately) provides a 95% service level? |
A |

5) Demand for dishwasher water pumps is 8 per day. The standard deviation of demand is 3 per day, and the order lead time is four days. The service level is 95%. What should the reorder point be? |
E |

6) The purpose of safety stock is to: |
D |

7) The proper quantity of safety stock is typically determined by: |
D |

8) If demand is not uniform and constant, then stockout risks can be controlled by: |
D |

9) If daily demand is normally distributed with a mean of 15 and standard deviation of 5, and lead time is constant at 4 days, a 90 percent service level will require how much safety stock? |
C |

10) If daily demand is constant at 10 units per day, and lead time averages 12 days with a standard deviation of 3 days, 95 percent service requires how much safety stock? |
C |

11) In a safety stock problem where both demand and lead time are variable, demand averages 150 units per day with a daily standard deviation of 16, and lead time averages 5 days with a standard deviation of 1 day. What is the standard deviation of demand during lead time? |
C |

1) Which of the following items is mostly likely managed using a single-period order model? |
A |

2) The main trait of a single-period model is that: |
A |

3) A local club is selling Christmas trees and deciding how many to stock for the month of December. If demand is normally distributed with a mean of 100 and standard deviation of 20, trees have no salvage value at the end of the month, trees cost $20, and trees sell for $50 what is the service level? |
A |

4) Suppose that papers for a newspaper stand cost $0.40 and sell for $0.80. They currently have no salvage value. If the stand owner is able to find an outlet that would provide a salvage value of $0.10, what would be the increase in service level? |
C |

5) Service level is: |
E |

6) 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. |
D |

2) The fixed-period inventory system requires more safety stock than a fixed-quantity system because: |
A |

3) A disadvantage of the fixed-period inventory system is that: |
D |

4) What is the difference between P and Q inventory systems? |
E |

5) Which of the following is a requirement of Q systems? |
A |

6) Q is to ________ systems as P is to ________ systems. |
A |

7) Which of the following should be higher in P systems than Q systems? |
E |

8) An advantage of the fixed-period inventory system is that: |
B |

# SCMA 331 – Ch 12

### Share This

## Unfinished tasks keep piling up?

Let us complete them for you. Quickly and professionally.

Check Price