a.Stock turn over3-This is the cost to have one unit of an item in stock for one period of time. As theusual period for calculation stock cost is a year.a.Holding cost.4-Is the standard convention in many countries, and assumes that the unit boughtearliest are used first. a) Reorder point.a.First-in-First-out.5-Take care of materials held in stock until they are needed.a.Warehousing/store.6-The variable cost that the EOQ model suggest is very stable around the EOQ found.a.True / False7-The most important assumption is that demand is known exactly, is continuous andis not constant over time.a.True / False8-Economic order quantity takes an idealized stock and finds the fixed order size thatminimizes costs. It is the basis of the most independent demand.a.True / False9-Small, frequent orders have a high reorder cost component, so the total cost ishigh.a.True / False10-LIFO assumes that the units bought last are sold last.a.True / False11-Business Strategy Decisions includes: warehousing, investment in stock, transport,materials handling, recruiting and training, and customer service.a.True / False12-The variable cost that the EOQ model suggests is very stable around the EOQfound.a.True / False13-The most important assumption is that the demand is know exactly, is continuousand is not constant over time.
a.True / False14-Which of the following is not an assumption for the EOQ model:a.Lead time is defined by each supplier.15-Moves materials from receiving and puts them into stores. It is responsible for allmovements of materials within an organization.a.Material Handling.16-Is the cost of having lack of inventory and not being to meet demand from stock.a.Shortage cost.17-Which is the only variable that is directly under our control and we can give thisany value we like.a.Order Quantity18-This time is needed for a supplier to process the order and prepare the delivery. Itis highly variable and can be very short for small items.a.Time at supplier.19-Michael Porter suggested four basis strategies: Cost leadership, Quality, ProductDifferentiation, and Niche Suppliers.a.True / False20-A Lean strategy looks for ways of eliminating the 6 “washes”: Quality, wringproduction level of capacity, poor process, waiting, movement, and stock.a.True / False21-ROA gives a measure of how well available resources are used, and it is defined asthe pre-tax profit earned divided by the value of the assets employed.a.True / False22-Large, frequent orders have a high holding cost component, so the total cost ishigh.a.True / False23-Main strengths of the EOQ is that the fix cost rises slowly for orders near theoptimal.a.True / False24-Finds and removes materials from stores. Typically materials for a customer orderare located, identified, checked, removed from racks consolidated into single load,wrapped and moved to a departure area for loading onto delivery vehicle.a.Order picking25-This time can be eliminated by e-business processes.a.Time to processb.Time to get order to the right place in suppliers.26-This finds the average unit cost of all purchases over some time and assigns thisvalue to all remaining stock.
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