Inventory Management and Aggregate Planning in Operations
 Question 1 3 out of 3 points
Inventory that acts as a buffer between workstations in flow shops or departments in job
shops is called ____ inventory.
Answer
Selected Answer:
Work-in-process
Correct Answer:
Work-in-process
 Question 2 3 out of 3 points
Backorders ____.
Answer
Selected Answer:
May occur as a result of a stockout
Correct Answer:
May occur as a result of a stockout
 Question 3 3 out of 3 points
Costs associated with backordering a product are called ____ costs.
Answer
Selected Answer:
Shortage
Correct Answer:
Shortage
 Question 4 3 out of 3 points
Which is not an advantage of the periodic review system?
Answer
Selected Answer:
Helps to control "A" items
Correct Answer:
Helps to control "A" items
 Question 5 3 out of 3 points
Using a fixed quantity system (FQS), as the reorder point increases
Answer
Selected Answer:
safety stock increases
Correct Answer:

safety stock increases
 Question 6 3 out of 3 points
Which of the following is not a key assumption underlining the classic economic order quantity (EOQ)
model?
Answer
Selected Answer:
Demand is assumed to be stochastic
Correct Answer:
Demand is assumed to be stochastic
 Question 7 3 out of 3 points
Additional inventory kept over and above the average amount required to meet demand
is called ____ inventory.
Answer
Selected Answer:
Safety stock
Correct Answer:
Safety stock
 Question 8 3 out of 3 points
Demand that varies over time is called ____.
Answer
Selected Answer:
Dynamic
Correct Answer:
Dynamic
 Question 9 3 out of 3 points
“The inability to satisfy the demand for an item” is the definition of a
Answer
Selected Answer:
stockout
Correct Answer:
stockout
 Question 10 3 out of 3 points
Costs associated with inspecting, unpacking and putting into storage incoming inventory
are components of ____ cost.
Answer
Selected Answer:
Ordering or setup

Inventory Management and Aggregate Planning in Operations

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