BUAD 331 EXAM 3 WITH COMPLETE QUESTIONS AND ANSWERS 2024.

BUAD 331 EXAM 3 WITH COMPLETE QUESTIONS AND ANSWERS 2024. What is the process around the interface between the customer demand creation and supply creation of form, time, and place value to fulfill that demand? - ANSWER Order Cycle The difference between the customer's desired order cycle time and the total supply chain order cycle time is known as a.) order cycle time b.) logistics lead time c.) customer delivery cycle d.) lead time gap - ANSWER d.) lead time gap What is the total elapsed time from when the customer first recognizes need to when that need is ultimately fulfilled? - ANSWER order cycle time What is is the technique based on anticipating the form, time, and place characteristics of demand in advance of actual orders? - ANSWER anticipatory or efficient technique What does EOQ stand for? - ANSWER Economic Order Quantity What 2 competing costs curves associated with order fulfillment does the EOQ model seek to balance? - ANSWER 1.) order or setup costs 2.) costs of carrying inventory As order quantity increases, order or setup costs ______________. - ANSWER decrease. Are the costs below part of the a.) order or setup costs, or b.) costs of carrying inventory? These costs are incurred every time an order is placed, or production is set up. Includes the administrative costs associated with locating sources of supply and moving supplies to the location they are needed and/or the operating costs brought with setting up equipment to build the appropriate product. The cost is BUAD 331 EXAM 3 WITH COMPLETE QUESTIONS AND ANSWERS 2024 calculated per order; it varies with the quantity of product ordered at any one point. - ANSWER a.) order or setup costs Are the costs below part of the a.) order or setup costs, or b.) costs of carrying inventory? These costs include the cost of handling inventory, the costs of the facility where it is held, utility costs to keep it cool/warm, insure it, pay taxes on it, and incur the cost of the time value of money actually tied up in the investment. ___________ _________ are greatest when ordering a large quantity at any one time since it all arrives at the same time and must be handled in advance of demand. - ANSWER b.) costs of carrying inventory (2 blanks are "carrying costs") What does ROP stand for? - ANSWER Reorder Point "So, another component of the EOQ model is determining when we need to reorder inventory to avoid stocking out. This is called the ___________ ________." - ANSWER Reorder Point How is ROP calculated? - ANSWER (Average time it takes suppliers to replenish our orders) * (Average number of inventory sold each day) What is the stock that we hold just in case demand or lead time exceeds our average? - ANSWER Safety stock The greater the uncertainty of demand and lead time, the _________ (greater, lesser) the variance, hence the __________ (more, less) safety stock we have to hold. - ANSWER greater, more When calculating average inventory, we take 1/2 of our EOQ cycle stock plus a full unit value of ________ stock. - ANSWER safety From an accounting standpoint, ___________ (safety/cycle) stock is twice as expensive as ____________ (safety/cycle) stock. - ANSWER safety, cycle This model aims to calculate the optimal amount of inventory to be reordered by balancing ordering costs with carrying costs. - ANSWER EOQ (Economic Order Quantity) model Safety stock keeps us "safe" from stock-outs, at least to the level we are willing to pay for based on our __________ policy. - ANSWER service _________ involves applying a set of process improvement techniques to improve a system's efficiency by reducing systematic waste often found in accumulated inventory. - ANSWER Lean A ________ supply chain value creation system starts with the creation of a short-term horizon plan for the demand that has been created in collaboration with input from all elements of the end-to-end supply chain. This includes internal functions involved with demand creations/fulfillment as well as external goods/services. This short-term can be far greater than that of long-term plans that do not leverage information across the supply chain. - ANSWER lean Lean techniques aim to reduce the costs of ordering or setup, thus pushing the order/setup cost curve to the ________ (right/left) and reducing EOQ to a much lower quantity ordered __________ frequently. - ANSWER left, more With lean techniques used at their extreme, order/setup costs can be pushed to near zero. When this happens, it becomes most efficient to order small volumes frequently, even once or more per day. Such small-volume, frequent ordering is referred to as ___________ _____ ________. - ANSWER Just-in-Time (JIT) If average daily demand for a product is 5 units and average lead time for an order to arrive is 7 days, what is the reorder point (ROP) for the product? - ANSWER 35 units This type of supply chain value creation system responds to actual demand rather than anticipating it--it also requires a high unit cost of operations in procurement, manufacturing, and logistics. However, there is no forecasted inventory in this system, meaning there is perfect accuracy of form, time, and place value creation. - ANSWER Responsive Value Creation.