1. In manufacturing organisations, finished goods and spare parts typically belong to the category of:
A. Dependent demand
B. Independent demand
C. Continuous demand
D. Uncertainty of demand

2. How many types of Inventory are normally found in organisations? What are they?
A. One type of inventory: Physical inventory
B. Two types of inventory: First in First out inventory, Last in First out inventory
C. Three types of inventory: Discriminant inventory, Transit inventory, Buffer inventory
D. Five types of inventory: Seasonal inventory, Decoupling inventory, Cyclic inventory, Pipeline inventory and safety stock

3. What are the several costs associated with inventory planning and control?
A. Inventory-carrying Cost, Cost of Ordering, Cost of Shortages
B. Storing Cost, Opportunity Cost, Purchase Cost
C. Transportation Cost, Deterioration Cost, Obsolescence Cost
D. Stock Out Cost, Holding Cost, Shrinkage Cost

4. When the total cost is minimum, we obtain the most economic?
A. Resource utilisation
B. order quantity
C. And effective process flow
D. None of the above

5. When the item is available in stock, there is:
A. No risk of shortage
B. Risk of maintaining the stock
C. Production line can be shut down
D. None of the above

6. What are the Inventory Control Systems?
A. Perpetual, Periodic
B. Inventory Management, Technology
C. Continuous Review, Periodic Review
D. Barcode, Radio Frequency

7. Selective control of Inventories are:
A. Re-ordering level, Maximum level and Economic Order Quantity
B. HML Analysis, SDE Analysis and Golf Analysis
C. SOS Analysis, FSN Analysis, XYZ Analysis
D. ABC Classification, XYZ Classification, VED Classification and Combination of more than one classification

8. In a single-period demand the unfilled demand
cannot be:
A. Pre-ordered to the next period
B. Back-ordered to the next period
C. Post-ordered to the next period
D. None of the above

9. What is the problem in inventory planning and control?
A. Opportunities for better inventory control and management often exist outside of the materials management function in organization
B. Low Product Turnover Failure to track demand can lead to a lower than expected product turn￾over due to low demand
C. Excess Inventory
D. Failure to keep track of stock

10. Despite their simplicity and initial success, which installation faces several problems after implementations:
A. MRP                                                                                                                                                                                                                          B. SAP
C. ERP                                                                                                                                                                                                                            D. DTP


Please click here for the MCQ’s for chapter 5 – Manufacturing Economics

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