Chapter 12: Inventory Management
Multiple Choice

1 .       One use of inventory is [Hint]


2 .       ABC analysis divides an organization's on-hand inventory into three classes based upon [Hint]


3 .       Cycle counting [Hint]


4 .       The major advantage of cycle counting is [Hint]


5 .       The difference(s) between the basic EOQ model and the production order quantity model is (are) that [Hint]


6 .       Extra units that are held in inventory to reduce stockouts are called [Hint]


7 .       Inventory record accuracy can be improved by [Hint]


8 .       The two most important inventory-based questions answered by the typical inventory model are [Hint]


9 .       The appropriate level of safety stock is typically determined by [Hint]


10 .       Which of the following is not a type of inventory? [Hint]


11 .       An appropriate technique for the control of inventory in services is [Hint]


12 .       In the probabilistic model, increasing the service level will [Hint]


13 .       A system that triggers ordering on a uniform time basis is called a [Hint]


14 .       A company wishes to determine the EOQ for an item that has an annual demand of 2,000 units, a cost per order of $75, and annual carrying cost of $7.50 per unit. What is the EOQ? [Hint]


15 .       A production facility is trying to determine the best batch size for an item that is produced intermittently. This item has an annual demand of 1,000 units, an annual carrying cost of $10 per unit, a setup cost of $400. They operate 50 weeks per year, and can produce 40 units per week. What is the best batch size for this item? [Hint]


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