Free Certified in Production and Inventory Management (Basics of Supply Chain Management) Questions and Answers — Questions and Answers
Question 1: Which of the following functional domains makes decisions regarding the supply of products and the treatment of customers?
- Marketing (Correct answer)
- Engineering
- Finance
- Manufacturing
Correct answer: Marketing
Marketing is the functional area that decides the product to be supplied and the customers to be served.
Question 2: Which of the following claims about the idea of independent demand is accurate?
- The demand for these items is related to demand for other items
- These items are usually raw materials
- The requirements for these items are usually forecasted (Correct answer)
- The demand for these items must be calculated
Correct answer: The requirements for these items are usually forecasted
Independent demand refers to the demand for finished products or end items that are directly demanded by customers. These demands are not influenced by the demand for other items, and thus, they need to be forecasted.
Question 3: An advantageous competitive trait is one that:
- A company must exhibit to gain new sales (Correct answer)
- Is universal between customers and markets
- Differentiates among potential customers
- A company must exhibit to be considered a potential supplier
Correct answer: A company must exhibit to gain new sales
An order winner is a competitive characteristic that a company must exhibit to win sales and gain a competitive advantage in the market. It could be a feature or attribute of a product or service that makes it more desirable to customers than the offerings of competitors.
Question 4: A product is expected to sell 200 units per month. During the previous six months, the actual demand was 195, 210, 205, 190, 220, and 225. Which of the following values best represents the data's mean absolute deviation?
- 75
- 7.5
- 12.5 (Correct answer)
- 45
Correct answer: 12.5
To calculate the mean absolute deviation, we need to first find the absolute deviation of each demand value from the forecast, then find the average of those deviations. <br> <br> The absolute deviations from the forecast are: <br> <br> |195-200| = 5 <br> |210-200| = 10 <br> |205-200| = 5 <br> |190-200| = 10 <br> |220-200| = 20 <br> |225-200| = 25 <br> <br> The sum of these absolute deviations is 5 + 10 + 5 + 10 + 20 + 25 = 75. <br> <br> The mean absolute deviation is calculated by dividing this sum by the number of data points, which is 6. <br> <br> Mean absolute deviation = 75/6 = 12.5. <br> <br> Therefore, the answer is 12.5.
Question 5: What demand management activity involves handling a client request and preparing materials for manufacturing or shipping?
- Communicating with the marketplace
- Forecasting
- Order processing (Correct answer)
- Providing available-to-promise dates
Correct answer: Order processing
Order processing includes processing a customer request and making material available for production or shipping.
Question 6: Which of the following calculations is a major component that is used with extrinsic forecasting?
- Exponential smoothing
- Moving average
- An economic indicator (Correct answer)
- A seasonal index
Correct answer: An economic indicator
Extrinsic forecasting uses external data and factors to predict future demand, such as economic indicators, market trends, and competitor analysis. Therefore, there is no specific calculation that is a major component of extrinsic forecasting, as it depends on the specific data and factors being analyzed.
Question 7: Which of the following files is necessary for material requirements planning?
- Work center
- Standard cost
- Bill of materials (Correct answer)
- Routing
Correct answer: Bill of materials
Material requirements planning (MRP) requires the bill of materials (BOM) file to plan requirements.
Free Certified in Production and Inventory Management (Basics of Supply Chain Management) Questions and Answers
Which of the following functional domains makes decisions regarding the supply of products and the treatment of customers?