What would be the total cost of inventory if a firm holds 200 units of a product ‘A’,where the carrying cost is Rs. 2 per unit?

• A) Rs. 400
• B) Rs. 100
• C) Rs. 202
• D) Rs. 198

If the “holding cost” decreases, the EOQ will

• A) Remain the same
• B) Increase
• C) Decrease
• D) Change in an irregular pattern

An effective JIT effort should result in increased

• A) Queue time
• B) Quality
• C) Costs
• D) Delay time

Which of the following takes information from the Master Production Schedule to evaluate its feasibility?

• A) Material requirements plan
• B) Aggregate plan
• C) Capacity requirements plan
• D) Rough-cut capacity plan

The ultimate goal of rough-cut capacity planning is:

• A) Achieving efficiency in the processes
• B) Determining feasibility of a cost volume analysis
• C) Approximating inventory requirements
• D) Determining feasibility of a master schedule

Which of the following refers to the cost associated with the order of inventory and its receipt?

• A) Stock out cost
• B) Holding cost
• C) Ordering cost
• D) Shortage cost

Which of the following mathematical expressions can be used to compute total annual cost?

• A) (Q/2) H + (D/Q) S
• B) (Q/2) H - (D/Q) S
• C) (Q/2)S + (D/Q) H
• D) (Q/H) 2 + (D/Q) S

The main advantage of holding the inventory mainly in the manufacturing organizations is:

• A) Improved quality
• B) Material handling reduced
• C) Greater availability
• D) Reduced obsolescence

Identify the time span covered by aggregate planning.

• A) 2-12 months
• B) 2-10 months
• C) 3-7 months
• D) 4-8 months

Refer to the percentage of items in group A of ABC classification system for inventory management

• A) 50%
• B) 10%
• C) 30%
• D) 70%

The foundation of the JIT philosophy lies in:

• A) Re-engineering for breakthrough
• B) Waste reduction
• C) Push production
• D) Variability increase

Capacity requirement planning is the process of determining capacity requirements for

• A) Suppliers
• B) Short-range
• C) Long-range
• D) Customers

Which of the following depicts the overall production rate and size of the workforce required to meet the demand?

• A) Master requirements plan
• B) Master production schedule
• C) Aggregate plan
• D) Capacity requirements plan

Which of the following costs is born by the firm when demand exceeds the supply?

• A) Ordering cost
• B) Holding cost
• C) Stock out cost
• D) Shortage cost

Adjustment of due dates, cancellation of orders and changes in order quantities comes in ___________ of MRP process.

• A) Output
• B) Inventory records
• C) Master production schedule
• D) Bills of material

Lot sizing determines the ____ and ____ of order quantity

• A) Timing, date
• B) Size, price
• C) Timing, size
• D) Date, size

The basic inputs of capacity planning process are:

• A) All of the given
• B) The current shop load & job times
• C) Routing information
• D) Planned order releases for MRP

Which one of the following is an example of a long range plan?

• A) Machine loading
• B) Work schedule
• C) Backorders
• D) Facilities layout

Which of the following formulae can be used to determine number of orders per year?

• A) Q/D
• B) D+Q
• C) D/Q
• D) D-Q

Which of the following is an example of an output of aggregate planning?

• A) Demand forecast
• B) Projected inventory
• C) Overtime cost
• D) Facilities layout