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The cost of carrying one unit in inventory for a specified period of time, usually one
year, is referred to as
A) the material cost and is denoted by C.
B) the fixed ordering cost and is denoted by S.
C) the holding cost and is denoted by H.
D) the purchase price and is denoted by P.
Cycle inventory exists because producing or purchasing in large lots allows a stage of
the supply chain to
A) exploit economies of scale and raise cost.
B) exploit economies of scale and lower cost.
C) exploit customers and lower cost.
D) exploit customers and raise cost.
Outbound transportation costs per unit tend to be
A) about the same as inbound costs.
B) higher than inbound costs.
C) lower than inbound costs.
D) neither higher or lower than inbound costs.
The evaluation of supply chain networks
A) should use only one metric.
B) should use multiple metrics.
C) should not use more than one metric.
D) should be subjective.
Strategic planning and financial planning
A) should be performed independently during supply chain network design.
B) should be performed sequentially during supply chain network design.
C) should be performed concurrently during supply chain network design.
D) should be combined during supply chain network design.
As capacity utilization increases,
A) it becomes less important to perform aggregate planning.
B) it becomes more important to perform aggregate planning.
C) it does not affect the importance of performing aggregate planning.
D) it lessens the importance of aggregate planning.
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.
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.
How many units are produced using overtime in the optimal aggregate plan developed
to address Scenario 8.2?
A) 360
B) 200
C) 400
D) 280
In volume-based tailored sourcing,
A) the predictable part of a product's demand is produced at an efficient facility.
B) the uncertain portion is produced at an efficient facility.
C) the predictable part of a product's demand is produced at a flexible facility.
D) the predictable part of a product's demand is outsourced.
Problems in learning within organizations that contribute to the bullwhip effect are
referred to as
A) incentive obstacles.
B) information processing obstacles.
C) pricing obstacles.
D) behavioral obstacles.
Supply chain surplus involves what two parts?
A) Manufacturing cost and selling price
B) Customer value and supply chain cost
C) Customer value and high quality products
D) Reliable transportation and supply chain cost
The quality of the forecast can be improved by using information from
A) the focal firm.
B) downstream partners.
C) upstream partners.
D) competing supply chains.
Price has traditionally been the only dimension that suppliers have been compared on
during the process of
A) procurement.
B) sourcing.
C) supplier scoring and assessment.
D) supplier selection.
Which of the following would result in lower return on assets for Katz if all other
entries in their selected financial data were held constant?
A) A reduction in earnings before interest and taxes
B) An increase in asset turnover
C) A reduction in total assets
D) An increase in profit margin
The capacity management approach that uses flexible work hours from the workforce to
manage capacity to better meet demand is
A) time flexibility from workforce.
B) use of seasonal workforce.
C) use of subcontracting.
D) use of dual facilities-dedicated and flexible.
Wasted capacity (or inventory) occurs when
A) there are excessive cancellations.
B) there are few cancellations.
C) an expensive backup needs to be arranged.
D) all of the above
What is the mean absolute percentage error if the forecasts for periods 1-10 are in order,
176.6, 174.2, 176.1, 178.7, 160.4, 165.4, 177.7, 191.1, 191.0, and 175.2?
A) 5.8
B) 5.6
C) 5.4
D) 5.2
