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Exam 12: Managing Inventories in Supply Chains

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Question 1

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In the context of inventory costs,_____ costs are incurred as a result of the work involved in configuring tools,equipment,and machines within a factory to produce an item.

A) setup
B) holding
C) stockout
D) unit

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Question 2

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In a fixed-order-quantity system,when demand is uncertain,using economic order quantity (EOQ)based only on the average demand will result in a low probability of a stockout.

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Question 3

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The single-period inventory model applies to inventory situations where demand is uncertain.

In the context of inventory costs,_____ costs can reflect lost sales for external customers or costs associated with interruptions to assembly lines for internal customers.

Which of the following statements is true of backorders?

A single-period inventory problem can be solved using a technique called _____ analysis.

The demand for bread in Ahoma City ranges from 100 to 120 tons per day,every day of the year.The demand is easily satisfied on a daily basis.This demand for bread can be categorized as _____ demand.

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

Marketing and operations prefer high inventory levels,whereas finance would prefer small inventories.

In the Pareto Principle,a vital few control a high percentage of the wealth.

In the context of inventory management,a(n) _____ is a single item or asset stored at a particular location.

Stable demand is usually called _____ demand.

CraftWare Inc.,a furniture manufacturer,uses ABC analysis to define its inventory value.The inventory contains wood,cast iron,adhesive,and carbon fiber.If wood accounts for 50 percent of the items and 5 percent of the total dollar value; carbon fiber accounts for 10 percent of the items and 60 percent of the total dollar value; cast iron accounts for 25 percent of the items and 18 percent of the total dollar value; and adhesive accounts for 15 percent of the items and 17 percent of the total dollar value,_____ can be classified as a class C item.

Single-period inventory models are used in situations involving items that can be carried in inventory and sold in future periods.

Vision Toys uses a fixed-quantity system to manage its inventories.The inventory includes plastic and LED bulbs.It was observed that the company often faces stockout of plastic.The average weekly demand for plastic is 100 pounds,and historical data show that the standard deviation of weekly demand is about 7.The lead time from the plastic supplier is 2 weeks.If the company's acceptable service level is 95 percent and the number of standard deviations necessary to achieve the acceptable service level is 1.645,the reorder point for plastic with safety stock is:

In the context of a fixed-order-quantity system,stockouts occur whenever the lead-time demand _____.

The demand for trains between Marshdell and Deepbarrow varies throughout the year.The demand reaches its peak in summer and drops during winter.This demand for trains can be categorized as _____ demand.

Radio-frequency identification (RFID)chips allow firms to track individual containers.

In the context of using technology to manage inventories,radio-frequency identification (RFID)chips offer an accuracy of less than 70 percent.

In the context of managing inventories in supply chains,_____ is the time between placement of an order and its receipt.