1. A certain type of computer costs $500 per unit to build and the annual inventory holding cost is 10% of the unit cost. Annual demand is 20,000 units and the setup cost is $100 per order. What is the economic order quantity (EOQ)? Find the closest value.
156
173
1414
283
2. What are the key questions to be answered by most inventory control models?
When to place an order and the cost of the order
When to place an order and the order size
Order size and the cost of the order
Order size and with whom the order should be placed
3. The expected value of perfect information (EVPI) is
Payoff for a decision made under perfect information
Maximum EMV
Maximum average payoff
Difference between the payoff under perfect information and the maximum EMV
4. Which of the following alternative will you choose using the Maximax criterion?
States of Nature
H M L
ALT. A 50 55 60
ALT. B 30 50 80
ALT. C 70 60 50
ALT. A
ALT. B
ALT. C
CANNOT BE DETERMINED