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1 | |
Inventory may be classified as raw materials, finished products, component parts, supplies, and work-in-process. |
| | A) | True |
| | B) | False |
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2 | |
In a fixed-time period system, inventory is counted on a periodic basis because there is not perpetual inventory record. |
| | A) | True |
| | B) | False |
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3 | |
Compared to the simple EOQ model Q = sqrt2DS/H), the inclusion of a usage rate has the effect of modifying the simple model, making Q larger. |
| | A) | True |
| | B) | False |
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4 | |
The amount of safety stock is dependent on the variation in leadtime. |
| | A) | True |
| | B) | False |
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5 | |
Costs that refer to the managerial and clerical costs entailed in preparing the purchase of production order are known as: |
| | A) | Ordering costs |
| | B) | Header costs |
| | C) | Line costs |
| | D) | Setup costs |
| | E) | All of the above |
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6 | |
Fixed-order quantity models are: |
| | A) | Time triggered |
| | B) | Fixed for a specified time period |
| | C) | Made up of a variable order size |
| | D) | Event triggered |
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7 | |
The time between the issuance of a replenishment order and the receipt of stock is: |
| | A) | Stock time |
| | B) | Lead time |
| | C) | Work content time |
| | D) | In-process time |
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8 | |
Most inventory models are made based on: |
| | A) | Cost minimization |
| | B) | Profit maximization |
| | C) | Optimum influence on demand |
| | D) | Minimizing setup times |
| | E) | Minimizing lead time |
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9 | |
Within the production system, partially completed units are called: |
| | A) | Work-in-process |
| | B) | Buffer stock |
| | C) | Units-in-order |
| | D) | None of the above |
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10 | |
A firm can participate in the quantity discount illustrated below when purchasing a product. It costs $20 to place an order each time. The holding cost rate is .20. The annual demand for the product is 10,000 units. Lead time for the product is 1 month.
| Quantity | Cost | | <300 | $12 | | 300-520 | $10 | | >520 | $9 |
What is the minimum total cost that this firm can purchase and inventory this item while facing a quantity discount? |
| | A) | 90,468 |
| | B) | 90,853 |
| | C) | 90,894 |
| | D) | 100,000 |
| | E) | 100,894 |
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11 | |
Which of the following inventory systems would be most appropriate in controlling many items ordered from the same vendor? |
| | A) | Fixed Order Quantity System |
| | B) | Fixed Time Period System |
| | C) | Materials Requirements Planning System |
| | D) | One Period Inventory Model Using Marginal Analysis |
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12 | |
Which of the following systems would be most appropriate in controlling components used in a complex assembly? |
| | A) | Fixed Order Quantity System |
| | B) | Fixed Time Period System |
| | C) | Dependent Demand System |
| | D) | Single Period Inventory Model |
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2002 McGraw-Hill Higher Education