Question 1

An increase in forecast accuracy

Accepted Answer

A)  decreases both the overstocked and understocked quantity and decreases a firm's profits. 
B)  decreases both the overstocked and understocked quantity and increases a firm's profits. 
C)  increases both the overstocked and understocked quantity and decreases a firm's profits. 
D)  increases both the overstocked and understocked quantity and increases a firm's profits. 
A)  decreases both the overstocked and understocked quantity and decreases a firm's profits. 
B)  decreases both the overstocked and understocked quantity and increases a firm's profits. 
C)  increases both the overstocked and understocked quantity and decreases a firm's profits. 
D)  increases both the overstocked and understocked quantity and increases a firm's profits.

Question 2

Discuss the advantages and disadvantages of quick response.

Accepted Answer

There are three important consequences o

Question 3

Which of the following is not a managerial lever to increase profitability?

Accepted Answer

A)  Increasing the salvage value of each unit 
B)  Decreasing the margin lost from a stockout 
C)  Reducing demand uncertainty 
D)  Reducing the level of product availability below optimal 
A)  Increasing the salvage value of each unit 
B)  Decreasing the margin lost from a stockout 
C)  Reducing demand uncertainty 
D)  Reducing the level of product availability below optimal

Question 4

A manager can reduce demand uncertainty via the following means EXCEPT

Accepted Answer

A)  lengthened forecasting window. 
B)  quick response. 
C)  postponement. 
D)  tailored sourcing. 
A)  lengthened forecasting window. 
B)  quick response. 
C)  postponement. 
D)  tailored sourcing.

Question 5

Supply chain managers are able to increase their forecast accuracy as lead times decrease,which allows them to better match supply with demand and increase supply chain profitability.

Accepted Answer

A) True 
 B)False

Question 6

The level of product availability is also referred to as the customer service level.

Accepted Answer

A) True 
 B)False

Question 7

As the ratio of the cost of overstocking to the cost of understocking gets smaller,

Accepted Answer

A)  the optimal level of product availability becomes irrelevant. 
B)  the optimal level of product availability decreases. 
C)  the optimal level of product availability remains stable. 
D)  the optimal level of product availability increases. 
A)  the optimal level of product availability becomes irrelevant. 
B)  the optimal level of product availability decreases. 
C)  the optimal level of product availability remains stable. 
D)  the optimal level of product availability increases.

Question 8

Quick response results in

Accepted Answer

A)  the manufacturer making a lower profit in the long term if all else is unchanged. 
B)  the manufacturer making a lower profit in the short term if all else is unchanged. 
C)  the retailer making a lower profit in the short term if all else is unchanged. 
D)  the distributor making a lower profit in the short term if all else is unchanged. 
A)  the manufacturer making a lower profit in the long term if all else is unchanged. 
B)  the manufacturer making a lower profit in the short term if all else is unchanged. 
C)  the retailer making a lower profit in the short term if all else is unchanged. 
D)  the distributor making a lower profit in the short term if all else is unchanged.

Question 9

A supply chain can use a high level of product availability to improve its responsiveness and attract customers.

Accepted Answer

A) True 
 B)False

Question 10

With reduced demand uncertainty,a supply chain manager can

Accepted Answer

A)  increase both overstocking and understocking. 
B)  increase overstocking and reduce understocking. 
C)  reduce overstocking and increase understocking. 
D)  reduce both overstocking and understocking. 
A)  increase both overstocking and understocking. 
B)  increase overstocking and reduce understocking. 
C)  reduce overstocking and increase understocking. 
D)  reduce both overstocking and understocking.

Question 11

Quick response results in the manufacturer making a lower profit in the short term if all else is unchanged.

Accepted Answer

A) True 
 B)False

Question 12

Tailored sourcing may be volume-based or product-based depending on the source of uncertainty.

Accepted Answer

A) True 
 B)False

Question 13

Postponement is valuable for a firm that sells a large variety of products with demand that is independent and comparable in size.

Accepted Answer

A) True 
 B)False

Question 14

A high level of product availability requires ________,which raises supply chain costs.

Accepted Answer

A)  large inventories 
B)  increased revenues 
C)  reduced costs 
D)  understocking the product 
A)  large inventories 
B)  increased revenues 
C)  reduced costs 
D)  understocking the product

Question 15

The loss incurred by a firm for each unsold unit at the end of the selling season is

Accepted Answer

A)  the cost of overstocking the product. 
B)  the cost of stocking the product. 
C)  the cost of understocking the product. 
D)  the cost of overselling the product. 
A)  the cost of overstocking the product. 
B)  the cost of stocking the product. 
C)  the cost of understocking the product. 
D)  the cost of overselling the product.

Question 16

In the previous problem,the manufacturer performs additional market research.Based on this research,they determine that they can increase the price to $150 and are able to reduce the standard deviation of the forecast to σ = 30.At the same time,they have made an arrangement with an outlet store that will purchase unsold equipment for $60 each.How will these changes affect the cost of overstocking,cost of understocking,optimal cycle service level and optimal order size?

Accepted Answer

Co = c - s
= $75 - $50
= $25
Cu = p - c

Question 17

If quick response allows multiple orders in the season,

Accepted Answer

A)  profits decrease and the overstock quantity decreases. 
B)  profits decrease and the overstock quantity increases. 
C)  profits increase and the overstock quantity decreases. 
D)  profits increase and the overstock quantity increases. 
A)  profits decrease and the overstock quantity decreases. 
B)  profits decrease and the overstock quantity increases. 
C)  profits increase and the overstock quantity decreases. 
D)  profits increase and the overstock quantity increases.

Question 18

Postponement is

Accepted Answer

A)  not very effective if a large fraction of demand comes from multiple products. 
B)  not very effective if a small fraction of demand comes from a single product. 
C)  only effective if a large fraction of demand comes from a single product. 
D)  effective even if a large fraction of demand comes from a single product. 
A)  not very effective if a large fraction of demand comes from multiple products. 
B)  not very effective if a small fraction of demand comes from a single product. 
C)  only effective if a large fraction of demand comes from a single product. 
D)  effective even if a large fraction of demand comes from a single product.

Question 19

If quick response allows multiple orders in the season,profits increase and the overstock quantity increases.

Accepted Answer

A) True 
 B)False

Question 20

The level of product availability

Accepted Answer

A)  is also referred to as the customer service level. 
B)  is an important component of any supply chain's responsiveness. 
C)  increases revenues for the supply chain by increasing sales. 
D)  Only A and B are true. 
A)  is also referred to as the customer service level. 
B)  is an important component of any supply chain's responsiveness. 
C)  increases revenues for the supply chain by increasing sales. 
D)  Only A and B are true.

An increase in forecast accuracy

Discuss the advantages and disadvantages of quick response.

Which of the following is not a managerial lever to increase profitability?

A manager can reduce demand uncertainty via the following means EXCEPT

Supply chain managers are able to increase their forecast accuracy as lead times decrease,which allows them to better match supply with demand and increase supply chain profitability.

The level of product availability is also referred to as the customer service level.

As the ratio of the cost of overstocking to the cost of understocking gets smaller,

Quick response results in

A supply chain can use a high level of product availability to improve its responsiveness and attract customers.

With reduced demand uncertainty,a supply chain manager can

Quick response results in the manufacturer making a lower profit in the short term if all else is unchanged.

Tailored sourcing may be volume-based or product-based depending on the source of uncertainty.

Postponement is valuable for a firm that sells a large variety of products with demand that is independent and comparable in size.

A high level of product availability requires ________,which raises supply chain costs.

The loss incurred by a firm for each unsold unit at the end of the selling season is

If quick response allows multiple orders in the season,

Postponement is

If quick response allows multiple orders in the season,profits increase and the overstock quantity increases.

The level of product availability

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

Aggregate Planning 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

Transportation in a Supply Chain

Sourcing Decisions in a Supply Chain

Pricing and Revenue Management in a Supply Chain

Information Technology in a Supply Chain

Sustainability and the Supply Chain

Filters

Exam 13: Determining the Optimal Level of Product Availability

An increase in forecast accuracy

Discuss the advantages and disadvantages of quick response.

Which of the following is not a managerial lever to increase profitability?

A manager can reduce demand uncertainty via the following means EXCEPT

Supply chain managers are able to increase their forecast accuracy as lead times decrease,which allows them to better match supply with demand and increase supply chain profitability.

The level of product availability is also referred to as the customer service level.

As the ratio of the cost of overstocking to the cost of understocking gets smaller,

Quick response results in

A supply chain can use a high level of product availability to improve its responsiveness and attract customers.

With reduced demand uncertainty,a supply chain manager can

Quick response results in the manufacturer making a lower profit in the short term if all else is unchanged.

Tailored sourcing may be volume-based or product-based depending on the source of uncertainty.

Postponement is valuable for a firm that sells a large variety of products with demand that is independent and comparable in size.

A high level of product availability requires ________,which raises supply chain costs.

The loss incurred by a firm for each unsold unit at the end of the selling season is

If quick response allows multiple orders in the season,

Postponement is

If quick response allows multiple orders in the season,profits increase and the overstock quantity increases.

The level of product availability

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

Aggregate Planning 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

Transportation in a Supply Chain

Sourcing Decisions in a Supply Chain

Pricing and Revenue Management in a Supply Chain

Information Technology in a Supply Chain

Sustainability and the Supply Chain

Filters