Productions 315 Quizzes Chapters 6,7,9,10 & 12

Which one of the following statements is best?

A P system requires more safety stock than a Q system.

Which one of the following statements concerning capacity cushions is best?

Companies that have considerable customization tend to have larger-capacity cushions.

Which one of the following statements on inventory placement of finished goods is best?

Forward placement might help reduce transportation cost.

The basic EOQ formula finds the optimal balance between:

Holding costs and ordering costs

Which of the following statements regarding the economic order quantity (EOQ) is true?

If an order quantity is larger than the EOQ, the annual holding cost exceeds the annual ordering cost. & A decrease in holding cost will increase the EOQ.

Which one of the following statements represents an advantage of the P system over the Q system?

Orders can be more easily combined to the same supplier.

Which one of the following is NOT an assumption of the EOQ model?

Quantity discounts can be taken advantage of for large lot sizes.

Practical application of the Theory of Constraints involves the implementation of all of the following steps EXCEPT:

Reduce the capacity at the bottleneck(s)

Which one of the following descriptions best defines the cycle-service level as a measure of customer service?

The desired probability of not running out of stock in any one inventory cycle

Which one of the following factors usually calls for a larger capacity cushion?

Uncertain demand

An inventory system answers two important questions: when to order and how much to order. Which of the following statements correctly explains how the P system (periodic review system) answers these questions?

Under a P system, an order is placed to replenish the inventory position up to the target level every P time periods.

In a continuous review inventory system, the reorder point is expressed as

Units

An expansionist capacity strategy:

can preempt market expansion by competitors by announcing a large capacity expansion.

A firm has the least amount of control over external causes of supply-chain dynamics (bull-whip effect). External causes includes

changes in customer demand

An efficient supply chain should be preferred when:

demand is highly predictable.

The focus for a process improvement exercise should be on balancing:

flow.

Some manufacturers and service providers want to measure the performance of the supply chain by the percentage of on-time deliveries. The main reason for this measure is:

increased on-time delivery increases revenue by inducing customers to buy more products from the firm.

If I look at a P system of inventory reordering over the course of a year, I will find that the time between orders _____ and the size of the order _____.

is constant ... changes

Which of the following generates pressure to increase inventories?

ordering costs

The bullwhip effect is characterized by:

ordering patterns that experience increasing variance as you proceed upstream in the chain.

When a firm provides a relatively small number of standardized products and services

output measures are typically used

A somewhat successful computer manufacturer makes a generic computer in five exciting colors. Once orders are received, the computer guts are encased in the customer's choice of colored case at the factory. This approach to production is known as:

postponement.

The practice of selecting suppliers and giving them significant responsibility for the design of certain components or systems of the product is called

presourcing.

A responsive supply chain typically has:

supply chain partners that emphasize volume flexibility.

The fourth step in Theory of Constraints application, "elevate the bottleneck(s)," means that:

the analyst should consider increasing capacity of the bottleneck.

A manager who recently attended a TOC workshop discovered that it was okay for some workers to have nothing to do at times. The reason for this is that

these workers worked at non-bottleneck processes.

The practice whereby a manufacturer has inventories of materials on consignment from its suppliers falls under the scope of

vendor managed inventory

Work should be released into the system based on:

when the bottlenecks need work.