QUESTION 55

The primary objective of the basic economic order quantity model is

a. to calculate the reorder point, so that replenishments take place at the proper time.

b. to minimize the sum of the annual carrying and holding costs.

c. to maximize the customer service level.

d. to minimize the sum of the annual ordering and holding costs.

e. to calculate the optimum safety stock.

QUESTION 56

The WBS is

a. a chart showing the flow of work from the start to the end of the project.

b. a chart showing the hierarchical listing of all the tasks and sub-tasks to be performed.

c. a narrative (text) description of all the tasks and sub-tasks to be performed.

d. a chart showing the time line of activities for the life of the project.

e. only a and b.

QUESTION 57

The annual holding cost of a certain type of computer is 30% of its cost of $1,000. Annual demand is expected to be 10,000 units, and the order cost is $150 per order. What is the approximate economic order quantity?

a. 316.23.

b. 70.

c. 100.

d. 10000.

e. 316.

QUESTION 58

Which of the following statements regarding the reorder point is true?

a. The reorder point is that quantity that triggers an action to restock an item.

b. There is a reorder point even if lead time and demand during lead time are constant.

c. The reorder point is the amount of inventory on hand through the lead time.

d. The fixed-period model has no reorder point.

e. All of the above are true.

QUESTION 59

A product-focused process is commonly used to produce:

a. high-volume, high-variety products.

b. low-volume, high-variety products.

c. high-volume, low-variety products.

d. low-variety products at either high- or low-volume.

e. high-volume products of either high- or low-variety.