Question 1

Safety inventory is defined as inventory held to satisfy demand that is higher than forecasted.

Accepted Answer

A) True 
 B)False

Question 2

The length of the planning horizon is usually between

Accepted Answer

A)  one and three months. 
B)  three and eighteen months. 
C)  one and three years. 
D)  three and five years. 
A)  one and three months. 
B)  three and eighteen months. 
C)  one and three years. 
D)  three and five years.

Question 3

Given that forecasts are always wrong to some degree, the aggregate plan needs to have some flexibility built into it if it is to be useful.

Accepted Answer

A) True 
 B)False

Question 4

Scenario 8.2 - Willow
A company faces the aggregate planning problem shown in the table below. Cost of regular production is $8 per unit, the cost of producing the same unit on overtime is $15, the cost of subcontracting is $12 per unit, and the cost of carrying a unit in inventory from one month to the next is $6.
 $\begin{array}{|l|c|c|c|c|c|}
\hline & \text { January } & \text { February } & \text { March } & \text { April } & \text { May } \
\hline \text { Forecast } & 400 & 800 & 1200 & 700 & 300 \
\hline \text { Beginning Inventory } & 100 & & & & \
\hline \text { Regular Time } & & & & & \
\hline \text { Qvertime } & & & & & \
\hline \text { Subcontracting } & & & & & \
\hline \text { Ending Inventory } & & & & & \
\hline
\end{array}$ 
The labor contract at the plant prohibits both overtime and subcontracting output to exceed 400 units in any five month window. The plant capacity is 20 units per day produced using two shifts and the plant runs seven days a week. By policy, management wants to avoid stockouts.
-Without actually solving the aggregate planning problem, it is safe to conclude that in the optimal solution to Scenario 8.2.

Accepted Answer

A)  the total ending inventory will exceed the number of units made using overtime. 
B)  the number of units made using subcontracting will exceed the number of units made using overtime. 
C)  the number of units made using regular time will exceed the forecast. 
D)  the number of units made using subcontracting will exceed the number of units made using regular time. 
A)  the total ending inventory will exceed the number of units made using overtime. 
B)  the number of units made using subcontracting will exceed the number of units made using overtime. 
C)  the number of units made using regular time will exceed the forecast. 
D)  the number of units made using subcontracting will exceed the number of units made using regular time.

Question 5

Capacity used to satisfy demand that is higher than forecasted is

Accepted Answer

A)  safety backlog. 
B)  safety capacity. 
C)  safety inventory. 
D)  safety sales. 
A)  safety backlog. 
B)  safety capacity. 
C)  safety inventory. 
D)  safety sales.

Question 6

The strategy where a stable machine capacity and workforce are maintained with a constant output rate, with inventory levels fluctuating over time, is the

Accepted Answer

A)  adjustable strategy. 
B)  chase strategy. 
C)  level strategy. 
D)  mixed strategy. 
A)  adjustable strategy. 
B)  chase strategy. 
C)  level strategy. 
D)  mixed strategy.

Question 7

Scenario 8.1 - Gang Aft Agley
Gang Aft Agley, a manufacturing company, faces the aggregate planning problem shown in the table below. Cost of regular production is $5 per unit, the cost of producing the same unit on overtime is $7.50, the cost of subcontracting is $9 per unit, and the cost of carrying a unit in inventory from one month to the next is $2.
 $\begin{array}{|l|c|c|c|c|c|}
\hline & \text { January } & \text { February } & \text { March } & \text { April } & \text { May } \
\hline \text { Forecast } & 500 & 750 & 1200 & 650 & 300 \
\hline \text { Beginning Inventory } & 100 & & & & \
\hline \text { Regular Time } & & & & & \
\hline \text { Overtime } & & & & & \
\hline \text { Subcontracting } & & & & & \
\hline \text { Ending Inventory } & & & & & \
\hline
\end{array}$ 
The labor contract at the plant prohibits both overtime and subcontracting output to exceed 300 units in any five month window. The plant capacity is 600 units per month produced using two shifts, regardless of the number of days in a month. By policy, management wants to avoid stockouts.
-Formulate the aggregate plan using linear programming.

Accepted Answer

Using the variables @#LAT-DLM& regular production;

Question 8

Most strategies that an aggregate planner actually uses are in combination and are referred to as the

Accepted Answer

A)  adjustable strategy. 
B)  chase strategy. 
C)  level strategy. 
D)  mixed strategy. 
A)  adjustable strategy. 
B)  chase strategy. 
C)  level strategy. 
D)  mixed strategy.

Question 9

The goal of aggregate planning is to

Accepted Answer

A)  dissatisfy customers in a way that maximizes profit. 
B)  dissatisfy customers in a way that minimizes profit. 
C)  satisfy demand in a way that maximizes profit. 
D)  satisfy demand in a way that minimizes profit. 
A)  dissatisfy customers in a way that maximizes profit. 
B)  dissatisfy customers in a way that minimizes profit. 
C)  satisfy demand in a way that maximizes profit. 
D)  satisfy demand in a way that minimizes profit.

Question 10

Scenario 8.2 - Willow
A company faces the aggregate planning problem shown in the table below. Cost of regular production is $8 per unit, the cost of producing the same unit on overtime is $15, the cost of subcontracting is $12 per unit, and the cost of carrying a unit in inventory from one month to the next is $6.
 $\begin{array}{|l|c|c|c|c|c|}
\hline & \text { January } & \text { February } & \text { March } & \text { April } & \text { May } \
\hline \text { Forecast } & 400 & 800 & 1200 & 700 & 300 \
\hline \text { Beginning Inventory } & 100 & & & & \
\hline \text { Regular Time } & & & & & \
\hline \text { Qvertime } & & & & & \
\hline \text { Subcontracting } & & & & & \
\hline \text { Ending Inventory } & & & & & \
\hline
\end{array}$ 
The labor contract at the plant prohibits both overtime and subcontracting output to exceed 400 units in any five month window. The plant capacity is 20 units per day produced using two shifts and the plant runs seven days a week. By policy, management wants to avoid stockouts.
-What is the optimal total cost of the aggregate plan developed to address Scenario 8.2?

Accepted Answer

A)  $27,200 
B)  $20,960 
C)  $31,400 
D)  $26,600 
A)  $27,200 
B)  $20,960 
C)  $31,400 
D)  $26,600

Question 11

Scenario 8.1-Gang Aft Agley
Gang Aft Agley, a manufacturing company, faces the aggregate planning problem shown in the table below. Cost of regular production is $5 per unit, the cost of producing the same unit on overtime is $7.50, the cost of subcontracting is $9 per unit, and the cost of carrying a unit in inventory from one month to the next is $2.
 $\begin{array}{|l|c|c|c|c|c|}
\hline & \text { January } & \text { February } & \text { March } & \text { April } & \text { May } \
\hline \text { Forecast } & 500 & 750 & 1200 & 650 & 300 \
\hline \text { Beginning Inventory } & 100 & & & & \
\hline \text { Regular Time } & & & & & \
\hline \text { Overtime } & & & & & \
\hline \text { Subcontracting } & & & & & \
\hline \text { Ending Inventory } & & & & & \
\hline
\end{array}$ 
The labor contract at the plant prohibits both overtime and subcontracting output to exceed 300 units in any five month window. The plant capacity is 600 units per month produced using two shifts, regardless of the number of days in a month. By policy, management wants to avoid stockouts.
-Use the information from Scenario 8.1 to determine the number of decision variables in this scenario.

Accepted Answer

A)  10 
B)  15 
C)  20 
D)  24 
A)  10 
B)  15 
C)  20 
D)  24

Question 12

The aggregate plan should be communicated to

Accepted Answer

A)  only the local firm. 
B)  only downstream partners. 
C)  only upstream partners. 
D)  all supply chain partners who will be affected by it. 
A)  only the local firm. 
B)  only downstream partners. 
C)  only upstream partners. 
D)  all supply chain partners who will be affected by it.

Question 13

Scenario 8.1-Gang Aft Agley
Gang Aft Agley, a manufacturing company, faces the aggregate planning problem shown in the table below. Cost of regular production is $5 per unit, the cost of producing the same unit on overtime is $7.50, the cost of subcontracting is $9 per unit, and the cost of carrying a unit in inventory from one month to the next is $2.
 $\begin{array}{|l|c|c|c|c|c|}
\hline & \text { January } & \text { February } & \text { March } & \text { April } & \text { May } \
\hline \text { Forecast } & 500 & 750 & 1200 & 650 & 300 \
\hline \text { Beginning Inventory } & 100 & & & & \
\hline \text { Regular Time } & & & & & \
\hline \text { Overtime } & & & & & \
\hline \text { Subcontracting } & & & & & \
\hline \text { Ending Inventory } & & & & & \
\hline
\end{array}$ 
The labor contract at the plant prohibits both overtime and subcontracting output to exceed 300 units in any five month window. The plant capacity is 600 units per month produced using two shifts, regardless of the number of days in a month. By policy, management wants to avoid stockouts.
-What is the optimal total cost of the aggregate plan developed to address Scenario 8.1?

Accepted Answer

A)  $16,700 
B)  $18,950 
C)  $18,450 
D)  $16,250 
A)  $16,700 
B)  $18,950 
C)  $18,450 
D)  $16,250

Question 14

A planning horizon is usually between three and five years.

Accepted Answer

A) True 
 B)False

Question 15

The earliest IT supply chain products were

Accepted Answer

A)  aggregate planning modules. 
B)  cloud-based. 
C)  SaaS (software as a service). 
D)  enterprise resource planning modules. 
A)  aggregate planning modules. 
B)  cloud-based. 
C)  SaaS (software as a service). 
D)  enterprise resource planning modules.

Question 16

Scenario 8.1-Gang Aft Agley
Gang Aft Agley, a manufacturing company, faces the aggregate planning problem shown in the table below. Cost of regular production is $5 per unit, the cost of producing the same unit on overtime is $7.50, the cost of subcontracting is $9 per unit, and the cost of carrying a unit in inventory from one month to the next is $2.
 $\begin{array}{|l|c|c|c|c|c|}
\hline & \text { January } & \text { February } & \text { March } & \text { April } & \text { May } \
\hline \text { Forecast } & 500 & 750 & 1200 & 650 & 300 \
\hline \text { Beginning Inventory } & 100 & & & & \
\hline \text { Regular Time } & & & & & \
\hline \text { Overtime } & & & & & \
\hline \text { Subcontracting } & & & & & \
\hline \text { Ending Inventory } & & & & & \
\hline
\end{array}$ 
The labor contract at the plant prohibits both overtime and subcontracting output to exceed 300 units in any five month window. The plant capacity is 600 units per month produced using two shifts, regardless of the number of days in a month. By policy, management wants to avoid stockouts.
-Which of these is a constraint that is appropriate for Scenario 8.1?

Accepted Answer

A)  $\sum \text { Output } \geq 680$ 
B)  $\sum \text { Ending Inventory } \leq 0$ 
C)  $\sum \text { Subcontracting } + \sum \text { Overtime } \leq 300$ 
D)  $\sum \text { Subcontracting } \leq 300$ 
A)  $\sum \text { Output } \geq 680$ 
B)  $\sum \text { Ending Inventory } \leq 0$ 
C)  $\sum \text { Subcontracting } + \sum \text { Overtime } \leq 300$ 
D)  $\sum \text { Subcontracting } \leq 300$

Safety inventory is defined as inventory held to satisfy demand that is higher than forecasted.

The length of the planning horizon is usually between

Given that forecasts are always wrong to some degree, the aggregate plan needs to have some flexibility built into it if it is to be useful.

Capacity used to satisfy demand that is higher than forecasted is

The strategy where a stable machine capacity and workforce are maintained with a constant output rate, with inventory levels fluctuating over time, is the

Most strategies that an aggregate planner actually uses are in combination and are referred to as the

The goal of aggregate planning is to

The aggregate plan should be communicated to

A planning horizon is usually between three and five years.

The earliest IT supply chain products were

Understanding the Supply Chain

Supply Chain Performance: Achieving Strategic Fit and Scope

Supply Chain Drivers and Metrics

Designing Distribution Networks and Applications to e-Business

Network Design in the Supply Chain

Designing Global Supply Chain Networks

Demand Forecasting in a Supply Chain

Sales and Operations Planning: Planning Supply and Demand in a Supply Chain

Coordination in a Supply Chain

Managing Economies of Scale in the Supply Chain: Cycle Inventory

Managing Uncertainty in a Supply Chain: Safety Inventory

Determining the Optimal Level of Product Availability

Transportation in a Supply Chain

Sourcing Decisions in a Supply Chain

Pricing and Revenue Management in a Supply Chain

Sustainability and the Supply Chain

Filters

Exam 8: Aggregate Planning in a Supply Chain

Safety inventory is defined as inventory held to satisfy demand that is higher than forecasted.

The length of the planning horizon is usually between

Given that forecasts are always wrong to some degree, the aggregate plan needs to have some flexibility built into it if it is to be useful.

Capacity used to satisfy demand that is higher than forecasted is

The strategy where a stable machine capacity and workforce are maintained with a constant output rate, with inventory levels fluctuating over time, is the

Most strategies that an aggregate planner actually uses are in combination and are referred to as the

The goal of aggregate planning is to

The aggregate plan should be communicated to

A planning horizon is usually between three and five years.

The earliest IT supply chain products were

Understanding the Supply Chain

Supply Chain Performance: Achieving Strategic Fit and Scope

Supply Chain Drivers and Metrics

Designing Distribution Networks and Applications to e-Business

Network Design in the Supply Chain

Designing Global Supply Chain Networks

Demand Forecasting in a Supply Chain

Sales and Operations Planning: Planning Supply and Demand in a Supply Chain

Coordination in a Supply Chain

Managing Economies of Scale in the Supply Chain: Cycle Inventory

Managing Uncertainty in a Supply Chain: Safety Inventory

Determining the Optimal Level of Product Availability

Transportation in a Supply Chain

Sourcing Decisions in a Supply Chain

Pricing and Revenue Management in a Supply Chain

Sustainability and the Supply Chain

Filters