________ is used to determine customer service levels.
A) Inventory held
B) Backlog/stockout quantity
C) Workforce hired/laid off
D) Machine capacity increase/decrease
A high level of product availability requires
A) large inventories and tends to raise costs for the supply chain.
B) large inventories and tends to reduce costs for the supply chain.
C) small inventories and tends to raise costs for the supply chain.
D) small inventories and tends to reduce costs for the supply chain.
The required safety inventory
A) increases with an increase in the lead time and the standard deviation of periodic
demand.
B) decreases with an increase in the lead time and the standard deviation of periodic
demand.
C) remains stable with an increase in the lead time and the standard deviation of
periodic demand.
D) increases with a decrease in the lead time and the standard deviation of periodic
demand.
Transportation plays a key role in every supply chain because
A) products are normally produced and consumed in the same location.
B) products are rarely produced and consumed in the same location.
C) the cost of transportation is inconsequential.
D) transportation is not a factor in determining profitability.
Sammy’s is the hot new lunch spot among the hipsters, who flock there at noon for their
artisanal peanut butter and jelly sandwiches, which sell for $12.95. The sandwiches are
made from two slices of their own artisanal bread, which they bake continuously
throughout the day at a rate of seven loaves an hour (each loaf contains twenty slices).
The actual cost of a loaf of bread is $1 and the cost to hold a loaf is 80%, since
freshness is important in baking as well as to hipsters. The cost to run a new batch of a
dough is $3 per loaf. Sammy’s sells their sandwiches at a rate of fifty per hour.
What is the optimal batch size to produce?
A) 8.36 loaves
B) 1.8 loaves
C) 5.56 slices
D) 8.36 slices
The decision to have a third party perform a supply chain function is called
A) insourcing.
B) outsourcing.
C) offshoring.
D) onshoring.
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.
What is the average flow time of a half cup of peas if the diner orders at the economic
order quantity?
A) 8.76 weeks
B) 5.84 weeks
C) 2.92 weeks
D) 11.68 weeks
The inventory held in case demand exceeds expectation in order to counter uncertainty
is called
A) cycle inventory.
B) safety inventory.
C) seasonal inventory.
D) sourcing.
Using a third party requires a firm to share demand information and in some cases
intellectual property. This risk would be described as
A) leakage of sensitive data and information.
B) underestimation of the cost of coordination.
C) reduced customer/supplier contact.
D) loss of internal capability.
The art and science of making projections about what future demand and conditions
will be is
A) supply chain coordination.
B) forecasting.
C) aggregate planning.
D) revenue management.
The Mumbai dabbawalas perform
A) a forward logistics function.
B) a reverse logistics function.
C) both a forward and a reverse logistics function.
D) neither a forward nor a reverse logistics function.
In reality, demand and prices are
A) highly certain and not likely to fluctuate during the life of any supply chain decision.
B) highly certain and likely to fluctuate during the life of any supply chain decision.
C) highly uncertain and not likely to fluctuate during the life of any supply chain
decision.
D) highly uncertain and likely to fluctuate during the life of any supply chain decision.