Question 1

Typically,in continuous review policies,the lot size to order

Accepted Answer

A) is not known until after the order is placed. 
B) is the same as in a periodic review policy. 
C) varies with the square root of demand. 
D) is kept fixed between replenishment cycles. 
A) is not known until after the order is placed. 
B) is the same as in a periodic review policy. 
C) varies with the square root of demand. 
D) is kept fixed between replenishment cycles.

Question 2

Scenario 12.3 - The Cat Café
Daily demand for cat litter at the Cat Café in Jones is 1500 ounces with a standard deviation of 300 ounces.The proprietor orders the best cat litter money can buy online,and the average shipping time is 5 days.Of course,if the order is placed at the end of the week,then it may take a while longer to receive the shipment,so the standard deviation of lead time is 2 days.The state health department keeps a close eye on the condition of the Cat Café;a cat-loving inspector visits at least twice a week,ostensibly to inspect,but mostly to pet his favorite Scottish Fold cat named Groundskeeper Willie.
-Suppose the café wishes to erase any hint of impropriety and wants to peg their service level at 99%.How many days of safety inventory they should carry?

Accepted Answer

A) 4.77 days 
B) 5.12 days 
C) 5.33 days 
D) 5.67 days 
A) 4.77 days 
B) 5.12 days 
C) 5.33 days 
D) 5.67 days

Question 3

Often,safety inventory calculations in practice

Accepted Answer

A) do not include any measure of supply uncertainty,resulting in levels that may be higher than required. 
B) do not include any measure of supply uncertainty,resulting in levels that may be lower than required. 
C) include measures of supply uncertainty,resulting in levels that may be higher than required. 
D) include any measures of supply uncertainty,resulting in levels that may be lower than required. 
A) do not include any measure of supply uncertainty,resulting in levels that may be higher than required. 
B) do not include any measure of supply uncertainty,resulting in levels that may be lower than required. 
C) include measures of supply uncertainty,resulting in levels that may be higher than required. 
D) include any measures of supply uncertainty,resulting in levels that may be lower than required.

Question 4

Product availability reflects a firm's ability to fill a customer order out of available inventory.

Accepted Answer

A) True 
 B)False

Question 5

Lead time is the gap between

Accepted Answer

A) when an order is placed and when it is received. 
B) when an order is received and when it is put away. 
C) when an order is received and when it is used. 
D) when an order is acknowledged and when it is received. 
A) when an order is placed and when it is received. 
B) when an order is received and when it is put away. 
C) when an order is received and when it is used. 
D) when an order is acknowledged and when it is received.

Question 6

Weekly demand for avocados at the Guac Shop is normally distributed with a mean of 2500 and a standard deviation of 650.The store manager has decided to follow a periodic review policy to manage inventory of avocados.They plan to order every two weeks.The farmers currently take two weeks to fill an order.Given a desired CSL of 97.5 percent,how much safety inventory should the Guac Shop carry? What should their OUL be?

Accepted Answer

ss = Fs-1(CSL)× σT + L
= NORMS

Question 7

What is the descriptive term for demand that occurs not in a steady stream of single units but in periodic large lots?

Accepted Answer

A) Batch 
B) Bulky 
C) Lumpy 
D) Polled 
A) Batch 
B) Bulky 
C) Lumpy 
D) Polled

Question 8

Scenario 12.1 - Charm City
Avon Barksdale's operation uses large quantities of prepaid cell phones,on average 500 per week with a standard deviation of 45.The lead time for their own brand of prepaid cell phones is two weeks and they have a lot size of 125 phones.
-What is the average flow time of a phone if the reorder point used by Mr.Barksdale is 2000 phones?

Accepted Answer

A) 1.74 weeks 
B) 1.87 weeks 
C) 2.00 weeks 
D) 2.13 weeks 
A) 1.74 weeks 
B) 1.87 weeks 
C) 2.00 weeks 
D) 2.13 weeks

Question 9

The lower the coefficient of variation of an item,the greater the reduction in safety inventories as a result of centralization.

Accepted Answer

A) True 
 B)False

Question 10

It is better to carry more safety inventory downstream if

Accepted Answer

A) inventory is inexpensive to hold and customers are not time sensitive. 
B) inventory is expensive to hold and customers are not time sensitive. 
C) inventory is inexpensive to hold and customers are time sensitive. 
D) inventory is expensive to hold and customers are time sensitive. 
A) inventory is inexpensive to hold and customers are not time sensitive. 
B) inventory is expensive to hold and customers are not time sensitive. 
C) inventory is inexpensive to hold and customers are time sensitive. 
D) inventory is expensive to hold and customers are time sensitive.

Question 11

The appropriate level of safety inventory is determined by the uncertainty of both demand and supply and the desired level of cycle inventory.

Accepted Answer

A) True 
 B)False

Question 12

Which approach to aggregation requires an information system that allows access to current inventory records from each location?

Accepted Answer

A) Information centralization 
B) Specialization 
C) Product substitution 
D) Component commonality 
A) Information centralization 
B) Specialization 
C) Product substitution 
D) Component commonality

Question 13

________ is the ability of a supply chain to delay product differentiation or customization until closer to the time the product is sold.

Accepted Answer

A) Specialization 
B) Centralization 
C) Postponement 
D) Aggregation 
A) Specialization 
B) Centralization 
C) Postponement 
D) Aggregation

Question 14

Describe the two types of ordering policies and the impact each has on safety inventory.

Accepted Answer

A replenishment policy consists of decis

Question 15

A goal of any supply chain manager is to

Accepted Answer

A) increase the level of safety inventory required in a way that does not adversely affect product availability. 
B) increase the level of safety inventory required regardless of the effect on product availability. 
C) reduce the level of safety inventory required regardless of the effect on product availability. 
D) reduce the level of safety inventory required in a way that does not adversely affect product availability. 
A) increase the level of safety inventory required in a way that does not adversely affect product availability. 
B) increase the level of safety inventory required regardless of the effect on product availability. 
C) reduce the level of safety inventory required regardless of the effect on product availability. 
D) reduce the level of safety inventory required in a way that does not adversely affect product availability.

Question 16

Carrying excessive inventory can help counter demand volatility when new products come on the market.

Accepted Answer

A) True 
 B)False

Question 17

Figure 1: Inventory Profile for Periodic Review Policy
  
-What does the distance F-E represent in Figure 1?

Accepted Answer

A) Order up to level 
B) Safety inventory 
C) Warehouse inventory 
D) Pipeline inventory 
A) Order up to level 
B) Safety inventory 
C) Warehouse inventory 
D) Pipeline inventory

Question 18

Product fill rate is the fraction of product demand that is satisfied from product in inventory.

Accepted Answer

A) True 
 B)False

Question 19

Explain the impact of aggregation on safety inventory.

Accepted Answer

Aggregation reduces the standard deviati

Question 20

The trade-off that a supply chain manager must consider when planning safety inventory is

Accepted Answer

A) increasing product availability versus increasing inventory holding costs. 
B) decreasing product availability versus decreasing inventory holding costs. 
C) increasing product availability versus raising the level of safety inventory. 
D) decreasing product availability versus decreasing the level of safety inventory. 
A) increasing product availability versus increasing inventory holding costs. 
B) decreasing product availability versus decreasing inventory holding costs. 
C) increasing product availability versus raising the level of safety inventory. 
D) decreasing product availability versus decreasing the level of safety inventory.

Typically,in continuous review policies,the lot size to order

Often,safety inventory calculations in practice

Product availability reflects a firm's ability to fill a customer order out of available inventory.

Lead time is the gap between

What is the descriptive term for demand that occurs not in a steady stream of single units but in periodic large lots?

The lower the coefficient of variation of an item,the greater the reduction in safety inventories as a result of centralization.

It is better to carry more safety inventory downstream if

The appropriate level of safety inventory is determined by the uncertainty of both demand and supply and the desired level of cycle inventory.

Which approach to aggregation requires an information system that allows access to current inventory records from each location?

________ is the ability of a supply chain to delay product differentiation or customization until closer to the time the product is sold.

Describe the two types of ordering policies and the impact each has on safety inventory.

A goal of any supply chain manager is to

Carrying excessive inventory can help counter demand volatility when new products come on the market.

Figure 1: Inventory Profile for Periodic Review Policy -What does the distance F-E represent in Figure 1?

Product fill rate is the fraction of product demand that is satisfied from product in inventory.

Explain the impact of aggregation on safety inventory.

The trade-off that a supply chain manager must consider when planning safety inventory is

Understanding the Supply Chain

Achieving Strategic Fit in a Supply Chain

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

Coordination in a Supply Chain

Managing Economies of Scale in a Supply Chain: Cycle Inventory

Linking Product Availability to Profits

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 12: Managing Uncertainty in a Supply Chain: Safety Inventory

Typically,in continuous review policies,the lot size to order

Often,safety inventory calculations in practice

Product availability reflects a firm's ability to fill a customer order out of available inventory.

Lead time is the gap between

What is the descriptive term for demand that occurs not in a steady stream of single units but in periodic large lots?

The lower the coefficient of variation of an item,the greater the reduction in safety inventories as a result of centralization.

It is better to carry more safety inventory downstream if

The appropriate level of safety inventory is determined by the uncertainty of both demand and supply and the desired level of cycle inventory.

Which approach to aggregation requires an information system that allows access to current inventory records from each location?

________ is the ability of a supply chain to delay product differentiation or customization until closer to the time the product is sold.

Describe the two types of ordering policies and the impact each has on safety inventory.

A goal of any supply chain manager is to

Carrying excessive inventory can help counter demand volatility when new products come on the market.

Figure 1: Inventory Profile for Periodic Review Policy -What does the distance F-E represent in Figure 1?

Product fill rate is the fraction of product demand that is satisfied from product in inventory.

Explain the impact of aggregation on safety inventory.

The trade-off that a supply chain manager must consider when planning safety inventory is

Understanding the Supply Chain

Achieving Strategic Fit in a Supply Chain

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

Coordination in a Supply Chain

Managing Economies of Scale in a Supply Chain: Cycle Inventory

Linking Product Availability to Profits

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