ISQS 3344 - Burns, TTU - Final Exam; Questions
& Answers 100% Solved
Bob Barker, a store owner in New York City, takes night business classes and is forced to consider
the economic order quantity (EOQ) model to improve his business. Using the constant demand
assumption in the EOQ model, what...
ISQS 3344 - Burns, TTU - Final Exam; Questions
& Answers 100% Solved
Bob Barker, a store owner in New York City, takes night business classes and is forced to consider
the economic order quantity (EOQ) model to improve his business. Using the constant demand
assumption in the EOQ model, what would Bob's average cycle inventory be? Correct
answer-average cycle inventory = half of the order quantity
Bright Tots Toys manages its inventories by utilizing a fixed-quantity system. Batteries and plastic
are included in their inventory. A manager reports that the company frequently finds itself
dealing with a stockout of plastic. The 7-day demand for plastic is 50 pounds, on average.
Further, the standard deviation of 7-day demand is approximately 5. The lead time from the
plastic supplier is 21 days. The acceptable service level is 95 percent, and the number of
standard deviations required to reach the acceptable service level is 1.645. With all of this in
mind, the reorder point for plastic with safety stock is ________. Correct answer-more
than 125 pounds but less than or equal to 175 pounds
Storage Craft Inc., a cabinet manufacturer, employs ABC analysis to define their inventory value.
The inventory contains wood, copper, adhesive, and carbon fiber. If carbon fiber accounts for 10
percent of the items and 55 percent of the total dollar value; adhesive accounts for 50 percent
of the items and 7 percent of the total dollar value; copper accounts for 25 percent of the items
and 18 percent of the total dollar value; and wood accounts for 15 percent of the items and 20
percent of the total dollar value, ________ can be classified as a class C item. Correct
answer-adhesive
The demand for apricots in Jacksonville ranges from 250 to 270 tons daily, every day of the year.
The demand is satisfied daily without any significant issue. This demand for apricots can be
categorized as _______. Correct answer-static demand
Which type of analysis can solve a single-period inventory problem? Correct answer-
Marginal economic analysis.
Which system or model should be used when the inventory situation is the following: strictly
one order is placed for a good in anticipation of a future selling season and its demand is
subject to considerable uncertainty? Correct answer-The single-period inventory model
________ can be described as a surplus amount of inventory which is kept, exceeding the
average amount needed to meet demand. Correct answer-Safety stock inventory
Which type of costs can be representative of service interruptions or backorders for external
customers, from the standpoint of inventory costs? Correct answer-Stockout costs
Recall ABC inventory analysis. Choose the most accurate statement below as it pertains to class
C items. Correct answer-They can be managed using automated computer systems.
Stable demand is typically referred to as ________. Correct answer-static demand
Consider a fixed-period system (FPS). Choose the most accurate statement regarding an FPS.
Correct answer-It orders sufficient stock at the time of review to bring the inventory
position up to the replenishment level (M).
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