1. Matching the production rate to the demand rate by hiring and laying off employees as the demand rate varies is which of the following Production Planning Strategies?
a. Constant workforce plan
b. Chase
c. Level
d. Mixed
e. None of the above
2. Which of the following assumptions are used in the Basic Fixed-Order Quantity inventory model?
a. Lead time is averaged
b. Ordering costs are variable
c. Price per unit of product is constant
d. None of the above
3. The exponential smoothing method with a = 0.25 yields the same distribution of forecast errors as the simple moving average method with
a. N = 7
b. N = 5
c. N = 3
d. none of the above
4. Which of the following forecasting method yields the smoothest series?
a. Exponential smoothing method with alpha a =0.10
b. Exponential smoothing method with alpha a = 1.00
c. Simple moving average method with N =1
d. Both b and c
The annual demand for a product is 26,000 units. The cost to place an order is $52, and the company operates 360 days per year. Each unit of product purchased costs an average of $6.4 and holding costs for inventory are 25%.
5. What is the optimal order quantity?
6. The Cycle time (time between orders) is
7. The weekly demand of a product is 500 units with a standard deviation of 50 units and the time from ordering to receipt is four weeks.
Safety Stock necessary to provide a 97 percent service probability is?
Note: Use z = 1.88
8. Compute the reorder point necessary to provide a 97 percent service probability.
Charlie’s Pizza orders all of its pepperoni, olives, anchovies, and mozzarella cheese to be shipped directly from Italy. An American distributor stops by every three weeks to take orders. Because the orders are shipped directly from Italy, they take one week to arrive. Charlie’s Pizza uses an average of 150 pounds of pepperoni each week, with a standard deviation of 25 pounds. Charlie’s prides itself on offering only the best-quality ingredients and a high level of service, so it wants to ensure a 99 percent probability of not stocking out on pepperoni (here z = 2.33). Assume that the sales representative just walked in the door and there are currently 200 pounds of pepperoni in the walk-in cooler. How many pounds of pepperoni must be ordered?
9. The demand during the lead time is?
10. The safety factor to maintain a 99% service level is?
Assume that the sales representative just walked in the door and there are currently 200 pounds of pepperoni in the walk-in cooler. How many pounds of pepperoni must be ordered? Hint. Find the ROP first.
Forecast using linear regression. Please use final exam exhibit posted on blackboard for question 12-13.
11. The slope of the regression line and the intercept are:
12. The forecast for the month of June is?
13. Observed weekly sales of ball peen hammers at the town hardware store over a six-week period have been 15, 10, 30, 25, 35, 15.
Suppose that three-week moving averages (MA) are used to forecast sales. Determine the one step- ahead forecasts for weeks 4 through 6.
14. Suppose that exponential smoothing (ES) is used to with a smoothing constant of alpha = 0.20. Find the exponential smoothing forecasts for weeks 4 through 6. (To get the method started, use the same forecast for week 4 as you used in question 13)
15. with Using the mean absolute deviation (MAD) over three periods 4, 5 and 6?