Operations Management
17th Edition
ISBN: 9781259142208
Author: CACHON, Gérard, Terwiesch, Christian
Publisher: Mcgraw-hill Education,
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Chapter 10, Problem 4CQ
Summary Introduction
To determine: The correct option.
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Which type of inventory, exists as material cannot
be transported instantaneously between the point
of supply and point of demand
O a. Cycle Inventory
O b. Safety Stock Inventory
O c. Anticipation Inventory
O d. Pipeline Inventory
Which of the following is less likely to represent an inventory ordering cost?
a.
Warehousing costs
b.
Transportation costs per order
c.
Cost of initiating an order
d.
Lost profits from lost sales due to shortages
e.
Cost of production disruptions and set up costs to reinstate production due to shortage of raw materials or components
The ranking of items in ABC inventory analysis is based on
O a. unit price
b.
C. alphabetical order
d. item number
e. annual dollar usage
annual demand in units
Chapter 10 Solutions
Operations Management
Ch. 10 - It is costly to hold inventory, but inventory can...Ch. 10 - A delivery truck from a food wholesaler has just...Ch. 10 - Prob. 3CQCh. 10 - Prob. 4CQCh. 10 - Prob. 5CQCh. 10 - Prob. 6CQCh. 10 - Prob. 7CQCh. 10 - Prob. 8CQCh. 10 - Prob. 9CQCh. 10 - Prob. 10CQ
Ch. 10 - Prob. 11CQCh. 10 - Prob. 1PACh. 10 - Prob. 2PACh. 10 - Prob. 3PACh. 10 - An electronics manufacturer has 25 days-of-supply...Ch. 10 - Prob. 5PACh. 10 - Prob. 6PACh. 10 - Prob. 7PACh. 10 - Prob. 8PACh. 10 - An online shoe retailers annual cost of holding...Ch. 10 - Prob. 10PACh. 10 - Prob. 11PACh. 10 - Prob. 12PACh. 10 - Prob. 13PACh. 10 - Prob. 14PACh. 10 - Prob. 15PACh. 10 - Prob. 16PACh. 10 - A retailer has annual sales of 500,000 and an...Ch. 10 - Prob. 18PACh. 10 - Prob. 19PACh. 10 - Prob. 1CCh. 10 - Prob. 3CCh. 10 - Prob. 4C
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- The chapter presented various approaches for the control of inventory investment. Discuss three additional approaches not included that might involve supply chain managers.arrow_forwardIt is an inventory model that is intended to minimize the ordering and carrying cost of an inventoryarrow_forward2. It is an inventory strategy a company employs to increase efficiency and decrease waste by receiving and producing goods as they are needed in the production process, thereby reducing inventory costs. a.Just In Time Inventory System B.min-Max Inventory System C.Pareto/80-20 inventory rule D.ABC inventory system E.None of the abovearrow_forward
- Suppose the following item is being managed using a fixed-order quantity model with safety stock. Annual Demand = 100,000 units Order quantity = 30,000 units Safety stock = 4000 units What are the average inventory level and inventory turnover for this item?arrow_forwardThe period from the date of order is placed to the date merchandise is delivered for sale is called: a. Lead time b. Buffer stock c. Reorder point d. Usage ratearrow_forwardAmong the following multi-period inventory models, which one has the highest probability of stockout? A. Fixed Order Quantity with Safety Stock B. Fixed Time Period Model C. Fixed Order Quantity D. Both Fixed Order Quantity & Fixed Order Quantity with Safety Stockarrow_forward
- Company ABC utilizes an inventory system in which order gets placed after uniform time duration. Which of the following represents the inventory policy used by the Company? a) (0, x) Model b) EOQ Model c) Fixed period model d) Fixed quantity modelarrow_forwardThe principal goal of inventory management systems is to balance the costs of ordering, shipping, and receiving goods with the cost of carrying those goods, while simultaneously meeting the firm's policy with respect to avoiding running short of stock and disrupting production schedules. True Falsearrow_forwardWhen a retailer places large order of inventory: a. Ordering costs reduces and holding costs increases b. Ordering costs reduces and holding costs decreases c. Ordering costs increases and holding costs increases d. Ordering costs increases and holding costs decreasesarrow_forward
- As the Manager of Branson’s Department Store, you are responsible for ensuring that reorder quantities for the various items have been correctly established. You decide to test one item and choose product Z. A continuous review inventory policy has been used, so you examine this as well as other records and come up with the following data: Cost per unit $35 Holding cost 20 percent of unit cost Average daily demand 10 units Ordering cost $30 per order Standard deviation of daily demand 3 units Delivery lead time 4 days Because customers generally do not wait but go elsewhere, you decide on a service probability of 90 percent. Assume that Branson’s Department Store operates 320 days per year. [What is the annual demand (D)? Determine the optimal order quantity, Q*. Determine the reorder point (R) if demand is constant. Determine the reorder point (R) if demand is varies.arrow_forwardWhich among the following is an advantage of maintaining huge Inventory O a. Independence from the supply chain O b. Non-value added costs O c. Opportunity Cost O d. Management of obsolete itemsarrow_forwardInventory in excess of expected demand to compensate for variability and lead time is_ a. Temporary inventory b. Buffering inventory c. Anticipated stock d. Safety stock inventory e. Seasonal inventoryarrow_forward
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