SCM Pre Assessment

The term cycle counting is synonymous with physically counting inventory.

True

What inventory factor may be omitted form the basic EOQ derivation because it is a constant?

Annual purchase cost of goods

Your company is conducting forecasting that revolves around the current recession and expansion of the US economy. This type of forecasting can be referred to as what component of a timer series?

Cyclical variations

If you felt that recent demand trends were more significant, and thus should be emphasized more in formulating a forecast, then in forecasting demand for the upcoming demand period, you would probably favor using a simple moving average over the conventional weighted moving average. T/F?

False

Inventory turnover ratio shows how many times a firm turns over its inventory in an accounting period. Faster turnovers are generally viewed as negative because it indicates instability in the firms inventory level.

False

Quantitative forecasting methods are based on opinions and intuition, whereas qualitative forecasting methods use mathematical models and relevant historical data to generate forecasts. T/F?

False

The continuous review inventory system requires less safety stock compared o the periodic review inventory system.

False

The four broad categories of inventory are raw materials, working progress, subassemblies, and finished goods.

False

The goal of a good forecasting technique is to achieve 98.7% accuracy between the forecast and actual demand.

False

____, such as lubricants for machines, are used in the production process, but do not become parts of the final products.

Maintenance, repair and operating supplies

If an item is ordered at its economic order quantity, the annual carrying cost should be:

equal to the annual ordering cost.

Dependent demand must be forecasted based on market conditions

false

If a tracking gisgnal is positive, which one of the following is true?

Actual value is higher than forecast

Associative forecasting methods are based on opinions and intuition

False

One common Cause and Effect Model used is:

Regression analysis

When demand and delivery lead time are known and constant, reorder point is the ____.

demand during lead time