Question 1

Demand that incorporates uncertainty is called ____.

Accepted Answer

A)  Static
B)  Dynamic
C)  Stochastic
D)  DeterministicE) None of the above
F) B) and C)

Question 2

"C" items are the critical few that must be closely managed in an inventory system.

Accepted Answer

A) True 
 B)False

Question 3

Inventory that represents partially completed products waiting further processing is called ____ inventory.

Accepted Answer

A)  Raw materials
B)  Work-in-process
C)  Cycle
D)  Safety stockE) B) and D)
F) None of the above

Question 4

In a single-period inventory situation, the only inventory decision is when to trigger an order.

Accepted Answer

A) True 
 B)False

Question 5

Because of demanding customers, organizations must always maintain a 100% service level.

Accepted Answer

A) True 
 B)False

Question 6

Demand that is stable over time is called ____.

Accepted Answer

A)  Static
B)  Dynamic
C)  Stochastic
D)  DeterministicE) A) and B)
F) None of the above

Question 7

Because the fixed quantity system orders the same amount each time, time between orders will be constant, even with variable demand.

Accepted Answer

A) True 
 B)False

Question 8

Define the EOQ model and explain its major assumptions.

Accepted Answer

The Economic Order Quantity (EOQ) Model ...

Question 9

Which one of the following statements is true?

Accepted Answer

A)  The level of safety stock maintained decreases when the desired cycle-service level increases.
B)  The level of safety stock maintained decreases when the standard deviation of demand during lead time increases.
C)  In a fixed period inventory system, the value of Q is kept the same from one cycle to another.
D)  When demand is uncertain and no safety stock is maintained, stock outs will occur during approximately 50 percent of the cycles.E) C) and D)
F) A) and B)

Question 10

Using the data below, find the EOQ, the total annual cost associated with the economic order quantity, and the reorder point.
 $$\begin{array} { l l } 
\text { Annual Demand: } & \text { 8,000 units } \
\text { Weeks Operating: } & 52 / \text { year } \
\text { Ordering Cost: } & \$ 35 / \text { arder } \
\text { Holding Cost: } & \$ 4 / \text { unityear } \
\text { Lead-Time: } & 3 \text { weeks }
\end{array}$$

Accepted Answer

Q* = Sq. root of (2 x 8000 x 35/4) = 3...

Question 11

Costs associated with inspecting, unpacking and putting into storage incoming inventory are components of ____ cost.

Accepted Answer

A)  Ordering or setup
B)  Holding
C)  Shortage
D)  UnitE) A) and D)
F) B) and C)

Question 12

Lead time is the time it takes to prepare an order for shipping to a customer.

Accepted Answer

A) True 
 B)False

Question 13

Discuss the concept of safety stock in a fixed order quantity system with uncertain demand.

Accepted Answer

Stockouts occur whenever the lead-time d...

Question 14

Many practical inventory situations include backorders and quantity discounts.

Accepted Answer

A) True 
 B)False

Question 15

Explain the ABC inventory classification.

Accepted Answer

ABC analysis consists of categorizing in...

Question 16

When a customer is unwilling to wait for an item that is not in stock and purchases the item elsewhere, a backorder has occurred.

Accepted Answer

A) True 
 B)False

Question 17

Inventory that acts as a buffer between workstations in flow shops or departments in job shops is called ____ inventory.

Accepted Answer

A)  Raw materials
B)  Work-in-process
C)  Cycle stock
D)  Safety stockE) B) and C)
F) A) and C)

Question 18

Which one of the following statements is true?

Accepted Answer

A)  The EOQ is most accurate when both inventory and order costs are estimated on a full cost basis.
B)  The EOQ is most accurate when both inventory and order costs are estimated on a pure variable cost basis.
C)  The EOQ is most accurate when inventory costs are estimated on a full cost basis while order costs are estimated on a pure variable cost basis.
D)  The EOQ is most accurate when inventory costs are estimated on a pure variable cost basis while order costs are estimated on a full cost basis.E) All of the above
F) B) and C)

Question 19

The decision of how many fruit baskets to make for the holiday season would be analyzed using a single-period inventory model.

Accepted Answer

A) True 
 B)False

Question 20

What is inventory management and why is it important?

Accepted Answer

Inventory management involves planning, ...

Exam 12: Managing Inventories

Lead time is the time it takes to prepare an order for shipping to a customer.

Correct Answer
verified

Costs associated with inspecting, unpacking and putting into storage incoming inventory are components of ____ cost.

Correct Answer
verified

What is inventory management and why is it important?

Correct Answer
verified
Inventory management involves planning, ...
View Answer

Explain the ABC inventory classification.

Correct Answer
verified
ABC analysis consists of categorizing in...
View Answer

When a customer is unwilling to wait for an item that is not in stock and purchases the item elsewhere, a backorder has occurred.

Correct Answer
verified

Demand that incorporates uncertainty is called ____.

Correct Answer
verified

Define the EOQ model and explain its major assumptions.

Correct Answer
verified
The Economic Order Quantity (EOQ) Model ...
View Answer

Inventory that acts as a buffer between workstations in flow shops or departments in job shops is called ____ inventory.

Correct Answer
verified

The decision of how many fruit baskets to make for the holiday season would be analyzed using a single-period inventory model.

Correct Answer
verified

Because the fixed quantity system orders the same amount each time, time between orders will be constant, even with variable demand.

Correct Answer
verified

Inventory that represents partially completed products waiting further processing is called ____ inventory.

Correct Answer
verified

In a single-period inventory situation, the only inventory decision is when to trigger an order.

Correct Answer
verified

Demand that is stable over time is called ____.

Correct Answer
verified

Which one of the following statements is true?

Correct Answer
verified

Which one of the following statements is true?

Correct Answer
verified

Because of demanding customers, organizations must always maintain a 100% service level.

Correct Answer
verified

Discuss the concept of safety stock in a fixed order quantity system with uncertain demand.

Correct Answer
verified
Stockouts occur whenever the lead-time d...
View Answer

Many practical inventory situations include backorders and quantity discounts.

Correct Answer
verified

Correct Answer
verified

Q* = Sq. root of (2 x 8000 x 35/4) = 3...
View Answer

"C" items are the critical few that must be closely managed in an inventory system.

Correct Answer
verified

Exam 12: Managing Inventories

Lead time is the time it takes to prepare an order for shipping to a customer.

Correct AnswerverifiedShow Answer

Costs associated with inspecting, unpacking and putting into storage incoming inventory are components of ____ cost.

Correct AnswerverifiedShow Answer

What is inventory management and why is it important?

Correct AnswerverifiedInventory management involves planning, ...View AnswerShow Answer

Explain the ABC inventory classification.

Correct AnswerverifiedABC analysis consists of categorizing in...View AnswerShow Answer

When a customer is unwilling to wait for an item that is not in stock and purchases the item elsewhere, a backorder has occurred.

Correct AnswerverifiedShow Answer

Demand that incorporates uncertainty is called ____.

Correct AnswerverifiedShow Answer

Define the EOQ model and explain its major assumptions.

Correct AnswerverifiedThe Economic Order Quantity (EOQ) Model ...View AnswerShow Answer

Inventory that acts as a buffer between workstations in flow shops or departments in job shops is called ____ inventory.

Correct AnswerverifiedShow Answer

The decision of how many fruit baskets to make for the holiday season would be analyzed using a single-period inventory model.

Correct AnswerverifiedShow Answer

Because the fixed quantity system orders the same amount each time, time between orders will be constant, even with variable demand.

Correct AnswerverifiedShow Answer

Inventory that represents partially completed products waiting further processing is called ____ inventory.

Correct AnswerverifiedShow Answer

In a single-period inventory situation, the only inventory decision is when to trigger an order.

Correct AnswerverifiedShow Answer

Demand that is stable over time is called ____.

Correct AnswerverifiedShow Answer

Which one of the following statements is true?

Correct AnswerverifiedShow Answer

Which one of the following statements is true?

Correct AnswerverifiedShow Answer

Because of demanding customers, organizations must always maintain a 100% service level.

Correct AnswerverifiedShow Answer

Discuss the concept of safety stock in a fixed order quantity system with uncertain demand.

Correct AnswerverifiedStockouts occur whenever the lead-time d...View AnswerShow Answer

Many practical inventory situations include backorders and quantity discounts.

Correct AnswerverifiedShow Answer

Correct Answerverified Q* = Sq. root of (2 x 8000 x 35/4) = 3...View AnswerShow Answer

"C" items are the critical few that must be closely managed in an inventory system.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Inventory management involves planning, ...
View Answer

Correct Answer
verified
ABC analysis consists of categorizing in...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The Economic Order Quantity (EOQ) Model ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Stockouts occur whenever the lead-time d...
View Answer

Correct Answer
verified

Correct Answer
verified

Q* = Sq. root of (2 x 8000 x 35/4) = 3...
View Answer

Correct Answer
verified