Question 1

Annual purchase cost is included in the total cost in

Accepted Answer

A) the EOQ model. 
B) the economic production lot size model. 
C) the quantity discount model. 
D) all inventory models. 
A) the EOQ model. 
B) the economic production lot size model. 
C) the quantity discount model. 
D) all inventory models.

Question 2

If the optimal production lot size decreases, average inventory increases.

Accepted Answer

A) True 
 B)False

Question 3

In the single-period inventory model with probabilistic demand,

Accepted Answer

A) surplus items are not allowed to be carried in future inventory. 
B) co = c?u . 
C) probabilities are used to calculate expected losses. 
D) All of the alternatives are correct. 
A) surplus items are not allowed to be carried in future inventory. 
B) co = c?u . 
C) probabilities are used to calculate expected losses. 
D) All of the alternatives are correct.

Question 4

When quantity discounts are available, order an amount from the highest discount category.

Accepted Answer

A) True 
 B)False

Question 5

Inventory position is defined as

Accepted Answer

A) the amount of inventory on hand in excess of expected demand. 
B) the amount of inventory on hand. 
C) the amount of inventory on hand plus the amount of inventory on order. 
D) None of the alternatives is correct. 
A) the amount of inventory on hand in excess of expected demand. 
B) the amount of inventory on hand. 
C) the amount of inventory on hand plus the amount of inventory on order. 
D) None of the alternatives is correct.

Question 6

When demand is independent, it is not related to demand for other components or items produced by the firm.

Accepted Answer

A) True 
 B)False

Question 7

The EOQ model

Accepted Answer

A) determines only how frequently to order. 
B) considers total cost. 
C) minimizes both ordering and holding costs. 
D) All of the alternatives are correct. 
A) determines only how frequently to order. 
B) considers total cost. 
C) minimizes both ordering and holding costs. 
D) All of the alternatives are correct.

Question 8

The EOQ model is insensitive to small variations or errors in the cost estimates.

Accepted Answer

A) True 
 B)False

Question 9

Which cost would not be considered part of a holding cost?

Accepted Answer

A) cost of capital 
B) shipping cost 
C) insurance cost 
D) warehouse overhead 
A) cost of capital 
B) shipping cost 
C) insurance cost 
D) warehouse overhead

Question 10

Constant demand is a key assumption of the EOQ model.

Accepted Answer

A) True 
 B)False

Question 11

The time between placing orders is the lead time.

Accepted Answer

A) True 
 B)False

Question 12

To be considered as inventory, goods must be finished and waiting for delivery.

Accepted Answer

A) True 
 B)False

Question 13

The definition of service level used in this chapter is

Accepted Answer

A) the percentage of all demand that can be satisfied from inventory. 
B) the percentage of all order cycles that do not experience a stockout. 
C) the percentage of demand during the lead-time period that can be satisfied from inventory 
D) None of the alternatives is correct. 
A) the percentage of all demand that can be satisfied from inventory. 
B) the percentage of all order cycles that do not experience a stockout. 
C) the percentage of demand during the lead-time period that can be satisfied from inventory 
D) None of the alternatives is correct.

Annual purchase cost is included in the total cost in

If the optimal production lot size decreases, average inventory increases.

In the single-period inventory model with probabilistic demand,

When quantity discounts are available, order an amount from the highest discount category.

Inventory position is defined as

When demand is independent, it is not related to demand for other components or items produced by the firm.

The EOQ model

The EOQ model is insensitive to small variations or errors in the cost estimates.

Which cost would not be considered part of a holding cost?

Constant demand is a key assumption of the EOQ model.

The time between placing orders is the lead time.

To be considered as inventory, goods must be finished and waiting for delivery.

The definition of service level used in this chapter is

Introduction

Introduction to Linear Programming

LP Sensitivity Analysis and Interpretation of Solution

Linear Programming Applications

Advanced Linear Programming Applications

Distribution and Network Problems

Integer Linear Programming

Nonlinear Optimization Models

Project Scheduling: Pertcpm

Waiting Line Models

Simulation

Decision Analysis

Multicriteria Decisions

Forecasting

Markov Processes

LP: Simplex Method

Simplex-Based Sensitivity Analysis and Duality

Solution Procedures for Transportation and Assignment Problems

Minimal Spanning Tree

Dynamic Programming

Filters

Exam 10: Inventory Models

Annual purchase cost is included in the total cost in

If the optimal production lot size decreases, average inventory increases.

In the single-period inventory model with probabilistic demand,

When quantity discounts are available, order an amount from the highest discount category.

Inventory position is defined as

When demand is independent, it is not related to demand for other components or items produced by the firm.

The EOQ model

The EOQ model is insensitive to small variations or errors in the cost estimates.

Which cost would not be considered part of a holding cost?

Constant demand is a key assumption of the EOQ model.

The time between placing orders is the lead time.

To be considered as inventory, goods must be finished and waiting for delivery.

The definition of service level used in this chapter is

Introduction

Introduction to Linear Programming

LP Sensitivity Analysis and Interpretation of Solution

Linear Programming Applications

Advanced Linear Programming Applications

Distribution and Network Problems

Integer Linear Programming

Nonlinear Optimization Models

Project Scheduling: Pertcpm

Waiting Line Models

Simulation

Decision Analysis

Multicriteria Decisions

Forecasting

Markov Processes

LP: Simplex Method

Simplex-Based Sensitivity Analysis and Duality

Solution Procedures for Transportation and Assignment Problems

Minimal Spanning Tree

Dynamic Programming

Filters