Intro to Supply Chain Management Quiz Answers
The top 2 primary functions of inventory are
(1) To meet customer demand, and (2) To buffer against uncertainty in demand and/or supply.
CPFR
Collaborative Planning, Forecasting, and Replenishment
What is the primary purpose of the basic economic order quantity model?
To minimize the sum of ordering cost and holding cost
Strategic partnerships are seen as one of the foundations of supply chain management [T or F]
True
Supply Chain Management starts with understanding the flow. [T or F]
True
The Economic Order Quantity (EOQ) is the optimal order size because it minimizes the annual total inventory cost. [T or F]
True
The Qualitative forecasting method is based on opinion & intuition. [T or F]
True
The goal of supply chain planning is to balance supply and demand in a way that realizes the financial and service objectives of the company. [T or F]
True
The three basic production strategies for addressing the aggregate planning problem are the chase production strategy, the level production strategy, and the mixed production strategy. [T or F]
True
Which one of the following is NOT a common mode of transportation in the supply chain?
Bus
Successful modern supply chain management typically includes the practice of?
Collaborating and sharing information between supply chain partners
Which one of the following is NOT one of the four Foundations of Supply Chain Management?
Demand Management
Collaborative Planning, Forecasting, and Replenishment is the process of combining statistical forecasting techniques and judgment to construct demand estimates for products or services. [T or F]
False
Forecasts are more accurate the farther out into the future that you forecast. [T or F]
False
Independent Demand is demand for an item that is directly related to other items or finished products, such as a component or material used in making a finished product. [T or F]
False
Master Production Scheduling is a process that brings all the demand and supply plans for the business (sales, marketing, development, production, sourcing, and finance) together to provide management with the ability to strategically direct the business to achieve a competitive advantage [T or F]
False
Material Requirement Planning is the system intended to develop long-range plans (more than a year away) concerning product families manufactured by the organization. [T or F]
False
Service firms offer intangible products (meaning products that cannot be physically touched), therefore, they do not have a supply chain. [T or F]
False
The Chase Production Strategy relies on a constant output rate and capacity while varying inventory and backlog levels to handle the fluctuating demand pattern. [T or F]
False
The goal of Supply Chain Management is to increase customer service by increasing inventory and reducing costs. [T or F]
False
The lowest inventory level at which a new order must be placed to avoid a stockout is known as the Replenishment Threshold [T or F]
False
There are no inventories in the service industry. [T or F]
False
The Bullwhip Effect
In the absence of any other information or visibility, individual supply chain participants can begin second-guessing what is happening with ordering patterns, and potentially start over-reacting.
Fixed Costs
Inventory costs which are independent of the output quantity
_______________________ measures the size of the forecast error in units. It is calculated as the average of the unsigned errors over a specified period of time.
Mean Absolute Deviation
Which one of the following is NOT a type of qualitative forecasting?
Naive Method
Organizations that choose to implement one single system with all of the desired applications from a single vendor is said to have chosen a?
Single Integrator Solution
Rough-Cut Capacity Planning (RCCP)
The medium-range capacity planning technique used to check the feasibility of the Master Production Schedule (MPS)
Which of the following is NOT an example of an ordering cost for products purchased from a supplier?
The opportunity cost of not ordering from a least cost supplier
MRP Explosion
The process of converting a parent item's planned order releases into component gross requirements
Cause-and-Effect Models can have multiple independent variables. [T or F]
True
It was intense global competition that led manufacturers to adopt Supply Chain Management (SCM) and other practices such as Just-in-Time (JIT). [T or F]
True
Seasonal Variation
When creating a quantitative forecast, data should be evaluated to detect for a repeating pattern of demand from year to year, or over some other time interval, with some periods of considerably higher demand than others.
Base Stock Level System
a type of inventory system that issues an order whenever a withdrawal is made from inventory
Bill of Materials
an engineering document that shows an inclusive listing of all the component parts and assemblies making up the final product
Strategic Stock
inventory stock level generally used for a very specific purpose or future event, and for a defined period of time
The four broad categories of inventory are
raw materials, work-in-process, MRO, and finished goods.
Scheduled Receipts (SR)
represents a committed order awaiting delivery for a specific period
