BUSI 403 Final Exam Practice Review Test.
T/F: For a given annual demand, total annual ordering cost is dependent on order size - CORRECT ANSWER True
t/F: When calculating a reorder point, an item's EOQ would not affect the calculation - CORRECT ANSWER TRUE
t/f: Inventory management is c...
BUSI 403 Final Exam Practice Review
Test.
T/F: For a given annual demand, total annual ordering cost is dependent on order size - CORRECT
ANSWER True
t/F: When calculating a reorder point, an item's EOQ would not affect the calculation - CORRECT
ANSWER TRUE
t/f: Inventory management is concerned with how much to order and when to order - CORRECT
ANSWER True
t/f: If Demand has a linearly decreasing trend, a 3-period moving everage would overestimate the
forecast as compared to a linear regression forecast - CORRECT ANSWER True
t/f: The four primary functional areas of a firm are marketing, finance, operations, and legal. - CORRECT
ANSWER False
T/F: It's generally more difficult to provide an accurate forecast of SKU level demand than it is to provide
an accurate forecast of total demand - CORRECT ANSWER TRUE
T/F: the core competencies of an organization are the strengths that are unique to that organization -
CORRECT ANSWER True
t/f: expanding manufacturing capacity can generally be done quickly and at minimal cost - CORRECT
ANSWER FALSE
The Capacity of a system is determined by ____. - CORRECT ANSWER bottleneck
Which of the following values for a smoothing constant would provide the most responsive
exponentially-smoothed forecast? (.05,.5,.75, or 1) - CORRECT ANSWER 1
,which of the following assumptions is TRUE about the Eoq model?
(a) constant demand rate
(b) demand can be unmet
(c) there's no fixed cost for order placement
(d) it allows stock-out and ther's a penalty cost for it
(e) all of the above are true - CORRECT ANSWER (a) constand demand rate assumption is true
What are the differences between goods and services? - CORRECT ANSWER Goods can be stored as
physcial inventory, whereas services cannot.
A tracking signal provides a method for monitoring a forecast by quanitifying ____ - CORRECT ANSWER
bias
Basic customer expectations are generally considered the minumum performance level required to stay
in business and are often called ______ - CORRECT ANSWER order qualifiers
assuming a replenishment system for a product that has verying demend, a reduction in order lead time
will affect all of the following except:
the order quantity
The amount of safety stock
The reorder point
the total annual inventory cost - CORRECT ANSWER the order quantity
_____ is the additional amount of inventory that is kept over and above the average amount required to
meet demand - CORRECT ANSWER Safety stock inventory
In the context of managing inventory supply chains, _____ is the time between placement of an order
and its recepit - CORRECT ANSWER The lead time
, Process capacity is.... - CORRECT ANSWER The maximum rate of output of a process in unites of output
per time
Which of the following is a direct output of the aggregate planning process? - CORRECT ANSWER The
production plan
Zara's places RFID chips inside security tags, which allows them to do everything EXCEPT
Perform inventory tracking more quickly
Track purchase data to specific customers
Reuse the chips to reduce costs
Expedite replenishment once a garment sold
All of the above - CORRECT ANSWER Perform inventory tracking more quickly
Which of the following would best help to mitigate the bull whip effect? - CORRECT ANSWER sharing
demand information in collaborative relationships with suppliers
Which of the following is not a variable cost in the aggregate planning process?
Overtime/slack costs
hiring/firing costs
Inventory carrying costs
Cost to actually prepare the plan
All of the above are considered. - CORRECT ANSWER Costs to actually prepare the plan
What is the correct production planning sequence? - CORRECT ANSWER Aggregate plan --> MPS --->
MRP
Which of the following are included in Taiichi Ohno's Seven wastes?
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