ferrin #6

With the Lot-For-Lot(L4L) lot sizing technique used in materials requirements planning system, which would we expect

minimized inventory carrying costs

Management is willing to accept 1 stockout every 2 years. If 10 orders are placed for the item every year the service level of management is willing to accept:

• 95%

In TQM, the purpose of process control is ___?

• All of the above

The product design dimension of quality refers to ___?

• All of the above

The cost of failure to control quality includes which of these?

• Cost of scrap, rework, & spoilage; cost of warranty claims; cost of returned materials; All of the above

Assuming the cost per order is fixed, and usage (demand) is stable, increasing the order quantity will cause total annual order costs to ___?

• Decrease

Which is accurate?

• Given uncertainty in demand and/or lead time duration, reorder point = expected demand during lead time + safety stock

Carrying cost ___.

• Includes all expenses incurred by the firm because of the amount of inventory held

If the order quantity is increased, the annual costs of carrying inventory will ___ because ___ will ___?

• Increase; average inventory; increase

Performance measurement is one of the six basic components of TQM. Which in a TQM environment is not a use for performance measurement data?

• Minimize the number of equipment setups required to complete scheduled production

Which is (are) included in the cost of preventing poor quality?

• Operator training; final inspection; incoming inspections; All of the above

The cost of controlling quality includes which of these?

• Prevention and Appraisal costs

Which describes the spread of a sample of values?

• Range

Which is NOT TRUE regarding safety inventory in the supply chain?

• Safety inventory is introduced by increasing the order quantity

Which is NOT one of the six basic concepts of TQM?

• Senior management should not be involved in the initiation of TQM programs

The manufacturing dimension of quality refers to ___?

• The ability of the manufacturing process to achieve the precision necessary to meet the specifications and tolerance established in the product design

Which statement about safety stock is true?

• The amount of safety stock required depends ONLY on the variation in the rate of demand

Given the variable demand, safety stock is introduced by adjusting the reorder point since ___.

• The risk of stock is greatest at the end of the inventory cycle because inventory and adjusting the reorder point increases inventory available

Which statement best describes lead time?

• The time required to replenish inventory

In manufacturing, the allowable amount of deviation from perfectly achieving a design specification is the ___?

• Tolerance