Assuming constant annual demand for an item, increasing its order
quantity: *
 Increases the number of orders placed per year.
 Increases the total annual purchasing cost.
 Increases the total annual inventory carrying costs.
 Decreases the number of orders placed per year
In the fixed-time period model, the order quantity is determined for
which: *
 The total annual inventory cost is minimized.
 The annual setup cost is equal to the annual holding cost.
 The probability of stockout is minimized
Inventory carrying costs include the following EXCEPT: *
 Transportation cost.
 Obsolescence.
 Cost of storage space.
 Cost of money invested in inventory
Inventory carrying costs differ from inventory holding costs when: *
 The item is not moved from one place of the storage area to
another.
 The owner of the inventory does not own the warehouse.
 The item is not perishable.
 None of the above
Procurement costs do not include: *
 Issuing purchase orders.
 Setup costs.
 Purchasing costs.
 Receiving goods and placing them into inventory.
The basic EOQ model is based on all the following assumptions except:*
 Annual demand is known and constant.
 The item is always available when needed.
 Estimates of ordering and carrying costs are accurate.
 Order is instantaneously received exactly when previous
inventory has just been used up.
The “how much to order” decision always has an influence on the
following costs except: *
 Annual purchasing costs.
 Annual carrying costs.
 Annual procurement costs.
 Total annual inventory costs
The level of inventory at which a new order needs to be placed to
replenish depleted stock is called the: *
 Service level.
 Reorder point.
 Minimum inventory level.
 Safety stock.
To establish the reorder point in the EOQ model, we must know both: *
 The annual demand and the number of orders placed per year.
 The annual demand and the lead time.
 The daily demand and the order quantity.
 None of the above
In the basic EOQ model, the average inventory level is equal to one-half
this value: *
 Maximum inventory level.
 Order quantity.
 Reorder point
 Both A and B.
PERT could be used to answer which of the following management
questions? *
 Can we delay a particular activity and still finish the project on
time?
 When are we scheduled to start a particular activity?
 Which activities should be finished on time?
 All of the above.
If an activity has a zero slack, it: *
 Is on the critical path.
 Must be a noncritical activity.
 Can be completed in no time at all
 Means the project is expected to be delayed.
The following descriptions are always true of the critical path in a project
EXCEPT: *
 Contains the critical activities
 Is the longest path in a project
 Has the most number of activities
 Takes the longest time to be completed
The following statement about a noncritical activity is FALSE: *
 Delaying it beyond its slack will cause the delay of the whole
project.
 It can be delayed.
 Both A and B.
 Neither A nor B.
Activities A, B, and C are started at Week 0 and are the immediate
predecessors for Activity J. If the earliest finish times for the three
activities are Week 11, Week 15, and Week 10, respectively, then the
earliest start time for J will be *
 Week 10
 Week 11
 Week 12
 Week 15
Given a project with three paths and their corresponding path lengths: AB-C: 25 days, A-D-E: 15 days, and B-C-E: 20 days; which of the
following statements is TRUE? *
 Activity B has the most slack
 The critical activities are A, B and C
 The earliest project completion time is 15 days
 The expected duration of the project is 60 days
If Activity C has an expected time estimate of 5 days, which of the
following statements is TRUE? *
 Activity C should not be delayed
 Activity C can be delayed for a maximum of 5 days
 The activity time estimates for Activity C are: 2, 4, and 9 days
 The activity time estimates for Activity C are: 1, 3, and 17 days
Which of the following questions regarding a project CANNOT be
answered even if the critical path of a project is known? *
 How long can each of the activities be delayed without delaying
the project?
 When is the earliest project completion time?
 Which activities should not be delayed?
 None of the above
The basic difference between PERT and CPM *
 No difference
 How activity times are estimated
 CPM can be used to monitor project costs, while PERT cannot
 PERT can be used for large projects, while CPM is only suitable
for simple projects
The activities in a project whose completion times need to be shortened
in order to finish the project ahead of schedule are the *
 Critical activities
 Noncritical activities
 Activities with the most slack
 Activities that require the least resources
How many units of Item X should be ordered each time? *
 94 units
 95 units
 100 units
 2,000 units
When should Item X be ordered? *
 50 times a year
 Every 50 days
 Every 9 days
 Whenever Item X’s inventory level drops to 50 units
How many times per year would Item X be ordered? *
 21x
 50x
 40x
 None of the above
What is Item X's average inventory level? *
 40 units
 48 units
 223 units
 None of the above
How much would be Item X's total annual purchasing cost? *
 Php 8,485
 Php 16,971
 Php 2,000,000
 None of the above
How much would be Item X's total annual procurement cost? *
 Php 8,485
 Php 16,971
 Php 2,000,000
 None of the above
How much would be Item X's total annual storage cost? *
 Php 8,485
 Php 16,971
 Php 2,000,000
 None of the above
How much would be Item X's total annual stockout cost? *
 Zero
 Php 8,485
 Php 16,971
 None of the above
Including its total annual purchasing cost, how much would be Item X's
total annual inventory cost? *
 Php 2,008,485
 Php 2,000,000
 Php 2,016,971
 None of the above
How many rolls of gauze bandages should be ordered for this period? *
 13 rolls
 33 rolls
 53 rolls
 137 rolls
How many units would be the safety stock? *
 13 rolls
 33 rolls
 53 rolls
 137 rolls
What's the expected demand during the order interval and lead time? *
 33 rolls
 53 rolls
 137 rolls
 144 rolls
What would have been the desired service level if an order quantity of
142 rolls were placed when the stock on hand is 30 rolls? (Assume:
amount on order and backorder is zero). *
 95%
 96%
 97%
 99%
s
b. What is the expected project completion time? *
 The expected project completion is 8 weeks.
c. Which are the critical activities? *
 The critical activities are A, B, G, and I.
b. Identify the critical path. *
 A–C–H
c. What’s the significance of identifying the critical path? *
 Is the time required to finish the path which is equivalent to
the earliest time required for the completion of the project.
d. Determine the expected project completion time. *
 15 weeks
e. Which activities are critical? *
 A–C–H
f. What’s the significance of identifying the critical activities? *
 Is to determine which activity should be prioritized or started
first and to know which activity can be started at the letter
part.
g. Which activities can be delayed? *
 B- D–E–F–G
h. If activity B were delayed by 2 days, how long can activity G be
delayed without delaying the whole project?
 12 days