10. The following are components of what type of inventory cost: order preparation expenses, mailing charges, shipping cost? a. Total cost b. Ordering cost c. Holding cost d. Maintenance cost
11. The following are components of what type of inventory cost: finance charges, warehousing, and shelf space, handling equipment, bookkeeping, insurance, taxes or spoilage? a. Total cost b. Ordering cost c. Holding cost d. Maintenance cost
12. Ordering costs ______________ as the order size increases. a. Declines b. Increases c. Constant d. No effect
13. Holding costs are __________ regardless of the number of units ordered. a. Declines b. Increases c. Constant d. No effect
14. An inventory system can be designed by defining two inventory rules: a. Order Quantity and Re-order Point b. Ordering and Holding c. Order Quantity and Inventory Quantity d. Production cycle and Customer Demands
15. Units that an organization will carry over and above Q in order to meet contingency is known as? a. Overflow stock b. Extra inventory c. Safety Stock d. Safety inventory
16. Savings are realized through reduced ordering cost and lower cost of buying is a result of? a. Quantity Discount b. Vendor Discount c. Inventory Discount d. Sales Quantity
17. The production order quantity model helps organizations by? a. Finding the correct inventory amount needed to support production at the most economical cost of the inventory system. b. Finding the best batch size for production at the most economical cost of the inventory system. c. Finding the correct amount of units needed to support demand. d. None of the above.
18. What type of decision would political risks, cultural issues and exchange rates be part of? a. Site b. Region c. Country d. Rural
