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Unformatted text preview: ch17 Student: ___________________________________________________________________________ 1. Inventory is defined as the stock of any item or resource used in an organization. True False 2. An inventory system is a set of policies and controls that monitors levels of inventory and determines what levels should be maintained, when stock should be replenished, and how large orders should be. True False 3. One of the basic purposes of inventory analysis in manufacturing and stockkeeping services is to specify when items should be ordered. True False 4. One of the basic purposes of inventory analysis in manufacturing and stockkeeping services is to determine the level of quality to specify. True False 5. One of the basic purposes of inventory analysis in manufacturing and stockkeeping services is to determine how large the orders to vendors should be. True False 6. In inventory models, high holding costs tend to favor high inventory levels. True False 7. In inventory models, high holding costs tend to favor low inventory levels and frequent replenishment. True False 8. If the cost to change from producing one product to producing another were zero the lot size would be very small. True False 9. Shortage costs are precise and easy to measure. True False 10. Dependent demand inventory levels are usually managed by calculations using calculus-driven, cost- minimizing models. True False 11. The fixed-time period inventory system has a smaller average inventory than the fixed-order quantity system because it must also protect against stockouts during the review period when inventory is checked. True False 12. The fixed-order quantity inventory model favors less expensive items because average inventory is lower. True False 13. The fixed-order quantity inventory model is more appropriate for important items such as critical repair parts because there is closer monitoring and therefore quicker response to a potential stockout. True False 14. The fixed-order quantity inventory model requires more time to maintain because every addition or withdrawal is logged. True False 15. Fixed-order quantity inventory models are &quot;event triggered.&quot; True False 16. Fixed-order quantity inventory models are &quot;time triggered.&quot; True False 17. Fixed-time period inventory models are &quot;event triggered.&quot; True False 18. Fixed-time period inventory models are &quot;time triggered.&quot; True False 19. Fixed-order quantity inventory systems determine the reorder point, R and the order quantity, Q values. True False 20. The computation of a firm's inventory position is found by taking the inventory on hand and adding it to the on-order inventory, and then subtracting back-ordered inventory....
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This note was uploaded on 01/05/2012 for the course COMMERCE 398 taught by Professor Dale during the Spring '11 term at UBC.
- Spring '11