Simulation methods are very good at evaluating a decision where the path itself is
decision dependent.
There is a close connection between the design and management of supply chain flows
and the success of a supply chain.
To create an aggregate plan, a company must specify the planning horizon for the plan
and the duration of each period within the planning horizon.
If production technology displays significant economies of scale, many local locations
are the most effective.
Wastage occurs if higher price buyers have to be turned away because the capacity has
already been committed to lower price buyers.
Seasonal inventory is inventory that is built up to counter predictable variability in
demand.
Decisions made during the supply chain design phase regarding significant investments
in the supply chain, such as the number and size of plants to build, the number of trucks
to purchase or lease, and whether to build or lease warehouse space, cannot be altered
in the short term.
When designing supply chain networks, companies must build appropriate flexibility to
help counter fluctuations in exchange rates and demand across different countries.
A distribution network designer needs to consider product characteristics as well as
network requirements when deciding on the appropriate delivery network.
Hardin (1968) described the tragedy of the commons as a dilemma arising when the
common good does not align perfectly with the good of individual entities.
The production scheduling process in the manufacturing cycle is similar to the order
entry process in the replenishment cycle.
To improve the quality of aggregate plans, forecast errors must be taken into account
when formulating aggregate plans.
A firm is often better served by ordering a convenient lot size close to the economic
order quantity rather than the precise EOQ.
In this approach to managing capacity, a firm subcontracts peak production so that
internal production remains level and can be done cheaply.
A) Time flexibility from workforce
B) Use of subcontracting
C) Use of dual facilities-specialized and flexible
D) Use of seasonal workforce
The rising popularity of bubble and squeak as a breakfast item on the menu has resulted
in a steady demand for peas. Over the course of the past week, 457 patrons have
ordered the hearty breakfast and each serving contains a half cup of English peas. It
costs two cents to hold a half cup of peas in inventory for a year and $3 to place an
order (remember they come all the way from England!). It takes two weeks to ship a
container from England loaded with peas.
If demand increases by a factor of k, the optimal lot size increases by a factor of
A) .
B) /2.
C) -squared.
D) the square root of .
The costs of overstocking and understocking have a direct impact on
A) the optimal cycle service level but not profitability.
B) profitability but not the optimal cycle service level.
C) both the optimal cycle service level and profitability.
D) neither the optimal cycle service level nor profitability.
The basis for all strategic and planning decisions in a supply chain comes from
A) the forecast of demand.
B) sales targets.
C) profitability projections.
D) production efficiency goals.
A distributor should decide his safety inventory levels based on
A) the level of safety inventory carried by all retailers supplied by him.
B) the level of safety inventory carried by other distributors.
C) the level of safety inventory carried by manufacturers supplying him.
D) the level of cycle inventory carried by all retailers supplied by him.
Investment decisions regarding the transportation infrastructure (rails, locomotives,
trucks, airplanes, etc.) are the primary concern of
A) the shipper.
B) the supplier.
C) the manufacturer.
D) the carrier.
When the capacity reserved for higher price buyers is wasted because demand from the
higher price segment does not materialize, this is
A) spill.
B) spoilage.
C) wastage.
D) excess.
________ is a mechanism that constrains the aggregate emissions by creating a limited
number of tradeable emission allowances, which emission sources must secure and
surrender in proportion to their emissions.
A) Command-and-control
B) Cap-and-trade
C) Cap-and-control
D) Emissions tax
Forecasting methods that assume that the demand forecast is highly correlated with
certain factors in the environment (e.g., the state of the economy, interest rates, etc.) to
make a forecast are known as
A) qualitative forecasting methods.
B) time series forecasting methods.
C) causal forecasting methods.
D) simulation forecasting methods.
A manufacturer of cat towers wishes to locate a super assembly facility to meet their cat
tower assembly needs for the next millennium. Currently, carpet, cylinders, yarn and
fasteners are purchased in bulk from suppliers in North Haverbrook, Ogden, and
Springfield in the quantities shown in the table. The super assembly facility would ship
to distribution centers located in Seattle, Lubbock, Nashville, and Philadelphia. The
locations of all of these cities on an x-y grid, transportation costs on a ton per mile
basis, and total tonnage are all contained in the table. Formulate and solve a model that
will minimize the shipping costs to the super assembly center.
Where should the new plant be located and what is the total system shipping cost?
