1. All things being equal, higher order processing (setup) costs tend to result in a smaller economic order quantity. T or F

2. All things being equal, higher inventory holding costs tend to result in a smaller economic order quantity. T or F

3. All things being equal, higher order lead times tend to result in a smaller economic order quantity. T or F

4. Which of these is not a primary mode of integration within a supply chain? internal integration, forward integration, or systems integration

5. All things being equal, when lead times get longer the reorder point is lower. All things being equal, when lead times get longer the reorder point is lower. (F- The reorder point is proportionate to the lead time. The longer the lead time, the higher the demand during the lead time, and thus the sooner an order for replenishment of inventory must take place.) T or F

6. Value Electronics had a total sales of $3M in 2015. Their average inventory holding for the same year was $500K. What is their Inventory Turnover?

7. Value Electronics forecasted annual demand for its tablet at 100,000 units. The order processing cost per order is $2,000, and inventory holding cost is $100/item/year. What is the ideal quantity of tablets to order in one shipment?

8. Value Electronics forecasted annual demand for its tablet at 100,000. It has the order quantity set at 1,000. To allow for uncertainties in delivery and in customer demand, it holds 4 weeks of demand as safety stock. What should its reorder point be if the delivery lead time is 4 weeks (rounded to the nearest whole number)?

9. In procurement, the performance of the buyer is often measured by the purchase price variance, which is the difference between the purchase price negotiated by the buyer and the lowest price paid for that product. T or F

10. The main goal of delayed product differentiation is to reduce inventory holding costs. T or F

11. One very effective way to control the inventory level in the supply chain is to vary the transportation mode and speed based on actual and target inventory level. T or F

12. ABC Analysis is an inventory management strategy that is based on the Pareto Principle. T or F