T3Opsy2011 - Name: _ Date: _ 1. Hand tools, lubricants, and...

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Name: __________________________ Date: _____________ 1. Hand tools, lubricants, and cleaning supplies are usually examples of what? A) WIP inventory B) finished goods inventory C) raw materials inventory D) distribution inventory E) MRO inventory 2. Which inventory function specifically is designed to allow the company to maintain a level production strategy? A) anticipation inventory B) fluctuation inventory C) lot-size inventory D) transportation inventory E) speculative inventory 3. If a company carries 13 weeks of supply , what is the inventory turnover ? A) 0.077 B) 4 C) 7.77 D) 676 E) 0.25 4. Which of the following is not affected by decisions about how much inventory to hold? A) item costs B) holding costs C) depreciation D) ordering costs E) stockout costs 5. Which of the following is an assumption of the basic EOQ model? A) Lead time is unknown. B) Demand may be seasonal. C) Orders can arrive in partial shipments. D) Quantity discounts are not considered. E) Lost sales are allowed, but not back orders. Page 1
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6. Which of the following is an assumption of the basic EOQ model? A) Lead time is known and constant. B) Demand may be seasonal. C) Orders can arrive in partial shipments. D) Quantity discounts are considered. E) Lost sales are allowed, but not back orders. 7. What costs are considered in the basic EOQ model? A) annual ordering costs + annual holding costs B) annual purchasing costs + annual holding costs C) annual ordering costs + annual holding costs + annual shortage costs D) annual purchasing costs + annual ordering costs + annual holding costs + annual shortage costs E) ordering costs per order + annual holding costs 8. If annual demand is 24,000 units, orders are placed every 0.5 months, and the cost to place an order is $50, what is the annual ordering cost? A) $50 B) $1,200,000 C) $2,400,000 D) $1,200 E) $600,000 9. If annual demand is 48,000 units, orders are placed in quantities of 2000 units at a time, and the cost to place an order is $80, what is the annual ordering cost? A) $1,920 B) $3,840,000 C) $160,000 D) $80 E) $4,160 10. If the EOQ is ordered, which of the following is true? A) Annual ordering cost exceeds annual holding cost. B) Annual holding cost exceeds annual ordering cost. C) Annual ordering cost is equal to annual holding cost. D) The sum of annual ordering cost plus annual holding cost is maximized. E) The annual holding cost curve is decreasing. Page 2
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11. If the costs (S and H) and demands (D) are the same, which of the following is not true with regard to the EPQ model as compared to the EOQ model? A) The EPQ model produces a lower total annual cost. B) The maximum inventory level is lower under the EPQ model than under the EOQ model. C) Both models use the same formula to compute annual ordering cost.
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This note was uploaded on 03/27/2012 for the course OPSY 4314 taught by Professor Staff during the Spring '08 term at Texas A&M University, Corpus Christi.

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T3Opsy2011 - Name: _ Date: _ 1. Hand tools, lubricants, and...

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