Concept explainers
1. Which of the following quantities has no effect on the first period’s ATP calculation?
a) Current on-hand Inventory
b) Booked customer orders for the first periods
c) MPS quantity for the first period
d)
2. Which one of the following is an MRP lot-sizing rule that attempts to minimize the amount to minimize the amount of average inventory?
a) Periodic order quantity (POQ), WITH P=2
b)Fixed order quantity (FOQ)
c) Economic order quantity (EOQ)
d)Lot for Lot (L4L).
3. Which of the following statements about lot-sizing rules for MRP is true?
a) The periodic order quantity (POQ) rule generates a higher level of average inventory since it creates inventory remnants.
b) FOQ is a dynamic lot-sizing rule which reduces the amount of inventory, by doing a better job of matching the order quantity to the projected on-hand inventory quantity.
c) The lot for lot rule minimizes inventory investment but maximizes the number of orders placed.
d) In general, static lot-sizing rules introduce greater instability into the production process.
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