OMP 105 / MMP 104:

Distribution and Logistics Management

Module Test II

I. Multiple Choice.

_____ 1. The application of management principles to logistics operations for efficient and cost effective movement of goods Strategy

a. Logistics management

b. Logistics strategy

c. Distribution management

d. none of the above

_____ 2. A strategy aimed at reducing the variable cost related to the movement and storage of goods

a. Capital reduction strategy

b. Cost reduction strategy

c. Service improvement strategy

d. none of the above

_____ 3. A strategy devoted towards minimizing the level of investment in logistical system

a. Capital reduction strategy

b. Cost reduction strategy

c. Service improvement strategy

d. none of the above

_____ 4. Which of the following is not a cost reduction strategy?

a. altering the number and location of warehouses

b. route optimization for the transport function

c. optimizing level of inventory

d. none of the above

_____ 5. Locations where inventory is received, stored and shipped out according to demand.

a. Retail outlets

b. Production plant

c. Warehouses

d. none of the above

_____ 6. Involves unloading of the goods, updating of inventory records, inspection of damage and verification of the merchandise count against orders and shipping records

a. Transferring

b. Order picking

c. Receiving

d. all of the above

_____ 7. Involves transferring the shipment received to locations within the warehouse specifically meant for the product category for easing access whenever required.

a. Shipping

b. Order picking

c. Receiving

d. none of the above

_____ 8. Which of the following is not an information warehouse operation provides?

a. Inventory levels

b. Inbound and outbound logistics

c. Stock keeping location

d. none of the above

_____ 9. Which of the following is not considered in deciding about the number of warehouses?

a. Cost of lost sale

b. Inventory cost

c. Transportation cost

d. none of the above

_____ 10. These are the resources required in the production or processing activity of the enterprise.

a. Raw materials

b. Work in process goods

c. Finished products

d. all of the above

_____ 11. Refers to an Inventory that has reached the final production process and are ready for dispatch

a. Raw materials

b. Work in process goods

c. Finished products

d. none of the above

_____ 12. Which of the following is not a reason for holding inventory?

a. Reduce cost

b. Smoothen the operations of the logistics system

c. Improve customer service

d. none of the above

_____ 13. These are fixed cost which has to be incurred in setting up the machinery, procurement of related materials, transportation and order processing.

a. procurement cost

b. stock out cost

c. inventory carrying cost

d. none of the above

_____ 14. Which of the following is not part of inventory carrying cost?

a. inventory risk cost

b. stock out cost

c. inventory service cost

d. storage space cost

_____ 15. The inventory management is centralized and decisions about the inventory levels are forecasted at the central office.

a. push strategy

b. pull strategy

c. safety strategy

d. none of the above

_____ 16. Which of thefollowing is nota major decisionarea in transportation management?

a. mode selection

b. vehicle routing and scheduling

c. shipment consolidation

d. none of the above

_____ 17. A system where an order is placed for the same constant amount whenever the inventory on hand decreases to a predetermined level.

a. continuous system

b. periodic system

c. ABC classification system

d. none of the above

_____ 18. The order quantity that minimizes total inventory holding costs and ordering costs

a. reorder point

b. economic order quantity

c. safety inventory

d. none of the above

_____ 19. Inventory carried for the purpose of satisfying demand that exceeds the amount forecasted in a given period

a. reorder point

b. economic order quantity

c. safety inventory

d. none of the above

_____ 20. In this system, an order is placed for a variable amount after specific regular intervals

a. continuous system

b. periodic system

c. ABC classification system

d. none of the above

II. Modified Multiple Choice.

Items 1-9. Identify the mode of transportation described below:

a. Air c.Motor e. Pipeline

b. Water d. Rail

_____ 1. Fastest but most expensive mode of transportation

_____ 2. Most common mode of international shipment

_____ 3. Most flexible mode of transportation

_____ 4. Very appropriate for light, high value goods that need to travel long distances quickly

_____ 5. Most appropriate for low value, heavy and bulky shipments

_____ 6. Flow of products are usually controlled and monitored by computers

_____ 7. Relatively slow and inflexible since they only drop shipment in terminals

_____ 8. Offers door to door service, local pick-up and delivery and small and large shipment hauling

_____ 9. Carries product in liquid or gaseous state

Items 10-13. Identify the product related factors affecting cost of transportation:

a. Product density c.Ease or difficulty of handling

b. Stow-ability d.Liability

_____ 10. Refers to product's weight to volume ratio

_____ 11. Degree to which a product can fill the space in a transportation vehicle

_____ 12. Products which have high value to weight like electronic gadgets can be easily damaged and cost more to transport

_____ 13. Products with uniform physical characteristicsrequires less handling expenses and are therefore less costly to transport

Items 14 - 20. Identify the inventory carrying cost described below:

a. Capital cost c. Storage cost

b. Inventory service cost d. Inventory risk cost

_____ 14. Insurance

_____ 15. Obsolescence

_____ 16. Taxes

_____ 17. Opportunity cost

_____ 18. Maintenance cost

_____ 19. Shrinkage cost

_____ 20. Water and lighting