DMD Supply Chain & Logistics in Manufacturing 3

Question 1

What is the Economic Order Quantity (EOQ) model used to determine?

Accepted Answer

The optimal order size that minimizes total inventory holding and ordering costs

Answer

EOQ calculates the order quantity that balances the cost of ordering too frequently against the cost of holding excess inventory.

Question 2

In supply chain risk management, what is a 'single-source supplier' risk?

Accepted Answer

Dependence on one supplier for a critical component, creating vulnerability to supply disruptions

Answer

Single-source dependency means that if the sole supplier fails, experiences a disaster, or raises prices dramatically, there is no backup, halting production.

Question 3

What role does blockchain technology play in modern digital manufacturing supply chains?

Accepted Answer

Providing an immutable, transparent ledger for tracking parts, materials, and transactions across the supply chain

Answer

Blockchain creates a tamper-proof, shared record of every supply chain transaction, improving traceability, authenticity verification, and trust between parties.

Question 4

What is 'cross-docking' in supply chain logistics?

Accepted Answer

Transferring incoming goods directly from receiving to outbound shipping with minimal or no storage time

Answer

Cross-docking eliminates warehouse storage by immediately transferring inbound shipments to outbound transport, reducing handling time and costs.

Question 5

Which KPI measures how efficiently a company converts its inventory into revenue?

Accepted Answer

Inventory turnover ratio

Answer

Inventory turnover ratio (Cost of Goods Sold ÷ Average Inventory) shows how many times inventory is sold and replaced in a period.

DMD - Digital Manufacturing and Design Technology Certification Practice Test

DMD - Digital Manufacturing and Design Technology Certification Practice Test

DMD Supply Chain & Logistics in Manufacturing 3