CPIM Inventory Planning & Control Strategies

Question 1

What is the primary goal of inventory planning?

Accepted Answer

To optimize stock levels and meet customer demand

Answer

To increase storage costs

Answer

To reduce order processing speed

Answer

To delay supply chain operations

Question 2

Which of the following is a common inventory control technique?

Accepted Answer

Fixed-period ordering

Answer

Randomized reordering

Answer

Guess-based inventory tracking

Answer

Annual inventory planning

Question 3

What does the Economic Order Quantity (EOQ) model help determine?

Accepted Answer

Optimal order quantity that minimizes total inventory costs

Answer

Maximum inventory capacity

Answer

Employee scheduling

Answer

Annual profit margins

Question 4

Which inventory strategy aims to reduce inventory levels while ensuring availability?

Accepted Answer

Just-In-Time (JIT)

Answer

Bulk inventory method

Answer

Random storage policy

Answer

Push inventory model

Question 5

What is the primary function of safety stock?

Accepted Answer

To protect against stockouts and demand fluctuations

Answer

To reduce customer demand

Answer

To speed up delivery times

Answer

To calculate employee bonuses

Question 6

ABC analysis in inventory control is used to:

Accepted Answer

Classify inventory based on value and frequency

Answer

Assign employee roles

Answer

Plan production schedules

Answer

Calculate annual revenues

Question 7

Which metric is most useful for tracking inventory turnover?

Accepted Answer

Inventory turnover ratio

Answer

Gross profit margin

Answer

Cash flow ratio

Answer

Fixed asset turnover

Question 8

Cycle counting helps in:

Accepted Answer

Ensuring inventory accuracy without full physical counts

Answer

Reducing the number of products

Answer

Increasing purchase orders

Answer

Calculating workforce efficiency

Question 9

A reorder point is best defined as:

Accepted Answer

Inventory level that triggers a new purchase order

Answer

Maximum stock level allowed

Answer

Annual sales volume

Answer

Demand forecast accuracy