MGT 227 FINAL EXAM STUDY GUIDE
Aggregate operations plan - Answers - translates annual and quarterly business plans
into broad labor and output plans for the intermediate term
sales and operation planning - Answers - helps a firm provide better customer service,
lower inventory, shorten customer lead times, stabilize production rates, and give top
management a handle on the business.
long-range planning - Answers - One year or more
short-range planning - Answers - a day to six months
production rate - Answers - units completed per unit of time
workforce level - Answers - number of workers needed in a period
backorder costs - Answers - A cost incurred by a business when it is unable to fill an
order and must complete it later
level strategy - Answers - demand changes are absorbed by fluctuating inventory levels,
order backlogs, and lost sales.
chase strategy - Answers - a strategy that involves hiring and laying off employees to
match the demand forecast
yield management - Answers - the application of pricing strategies to allocate capacity
among various categories of demand
inventory - Answers - the stock of any item or resource that we use in an organization
Q-system - Answers - Reorder after a fixed quantity (Q) whenever the inventory falls to
or below a reorder point (R). Continuous review system. Time between orders varies
P-system - Answers - Reorder after a fixed time period (P). Periodic review system.
Order quantity (Q) varies (Q = target inventory level - Current inventory level)
Newsvendor model - Answers -
ordering cost - Answers - the cost of preparing a purchase order for a supplier or a
production order for manufacturing
Aggregate operations plan - Answers - translates annual and quarterly business plans
into broad labor and output plans for the intermediate term
sales and operation planning - Answers - helps a firm provide better customer service,
lower inventory, shorten customer lead times, stabilize production rates, and give top
management a handle on the business.
long-range planning - Answers - One year or more
short-range planning - Answers - a day to six months
production rate - Answers - units completed per unit of time
workforce level - Answers - number of workers needed in a period
backorder costs - Answers - A cost incurred by a business when it is unable to fill an
order and must complete it later
level strategy - Answers - demand changes are absorbed by fluctuating inventory levels,
order backlogs, and lost sales.
chase strategy - Answers - a strategy that involves hiring and laying off employees to
match the demand forecast
yield management - Answers - the application of pricing strategies to allocate capacity
among various categories of demand
inventory - Answers - the stock of any item or resource that we use in an organization
Q-system - Answers - Reorder after a fixed quantity (Q) whenever the inventory falls to
or below a reorder point (R). Continuous review system. Time between orders varies
P-system - Answers - Reorder after a fixed time period (P). Periodic review system.
Order quantity (Q) varies (Q = target inventory level - Current inventory level)
Newsvendor model - Answers -
ordering cost - Answers - the cost of preparing a purchase order for a supplier or a
production order for manufacturing
