OM - Ch 12

in abc analysis, which of the following items typically comprise 60 to 80 percent of total dollar usage by only 10 to 30 percent of the items

a

two fundamental inventory decisions are: when to order and how much to order. which of the following statement is true about fixed-quantity (fqs) and fixed-period (fps) inventory system?

an fps must cover a time period of t + l to cover the risk of a stock-out

a fixed period (fps) inventory system?

chooses a replenishment level (m) which includes the demand during the review period and lead time, plus any safety stock

in abc inventory analysis, which of the following is true of class a items?

class a items account for a relatively small percentage of total items

in abc inventory analysis, which of the following is true of class c items?

class c items make up a lower percentage of total dollar value than either class a or class b items

in a fixed order quantity (foq) system, which of the following is true when interest rates increase and all other costs remain the same?

cycle inventory decreases

which of the following is not a key assumption underlining the classic economic order quantity (eoq) model?

demand is assumed to be stochastic

which of the following statements is true?

dependent demand is directly related to the demand of other stock-keeping units (skus) and can be calculated without needing to be forecasted

demand that varies over time is called ______ demand

dynamic

which of the following statements is true (stock/inventory) ?

in a fixed-order-quantity system, the reorder point is the average demand during the lead time, plus the additional safety stock when demand is uncertain

inventory position is computed using all the following except

lead-time demand

back-orders :

may occur as a result of a stock-out

independent demand

needs to be forcasted

average inventory in the economic order quantity (eoq) model is defined as:

one-half of the order quantity

which of the following is NOT a component of holding cost

order processing

costs associated with configured tools, equipment, and machines within a factory to produce an item are components of ________ costs

ordering

additional inventory that is kept over and above the average amount required to meet demand is called _____ inventory

safety stock

costs associated with back-ordering products are called ____ costs

shortage

demand that is stable over time is called _____ demand

static

demand that incorporates uncertainty is called _____

stochastic

which of the following statements is not true?

stock keeping unit (sku) is a single item or asset stored at multiple locations

a _____ is defined as the inability to satisfy the demand for an item

stock-out

which of the following statements is true (costs) ?

sunk costs associated with any ordering are irrelevant

which of the following statements concerning the economic order quantity (eoq) model is not true when the unit holding cost increases?

the economic order quantity will decrease

which of the following statements is NOT TRUE regarding the fixed-period system (fps)?

the optimal replenishment level includes the demand during the review period, plus any desired safety stock

which is NOT a feature of the periodic review system?

the order quantity, q, is always fixed

in a fixed-quantity system (fqs), as the order point increases:

the safety stock increases

which of the following is not true regarding inventory management

the two fundamental inventory decisions are : where to order and what to order

_____ inventory acts as a buffer between workstations in flow shops or departments in job shops to enable the operating process to continue

work-in-process

____ inventory consists of partially completed products in various stages of completion that are awaiting further processing

work-in-process (wip)