Question

Question 1

3. In solving LP, the graphical method only works when there is just 1 decision variable.

True

False

Question 2

10. The two fundamental decisions that you should make when controlling inventory are:

(1) how much to order and (2) how much to use.

True

False

Question 3

2. A decision variable is a measurable quantity that may vary, or is subject to change, and can be controlled.

True

False

Question 4

5. The annual demand of the Ivory Chip Company is 525 units, the ordering cost (C_o) is $100 and the average carrying cost (C_h) per unit per year amounts to $50, and the optimal numbers of units to be ordered annually are 300.

Based on the above information, the total annual cost (TC) calculated is cost $7675.   

True

False

Question 5

1. Assuming Mr.Sam has a product with the following parameters:

Demand= 480; Holding cost per year = $ 2.00; Order cost = $ 150 per order.

The calculated EOQ is:

		268
		200
		352
		289

Question 6

2. The daily demand of motor bikes is 5, and 3 days are allowed between order placement and order receipt. The ROP (reorder point) calculated is:   

		8
		25
		15
		22

Question 7

8. A company manufactures 2 types of products A1 and A2. Let X1 and X2 be their respective number of units to be produced each month. The company has a contract with one of its customers to produce a minimum of 500 units of each product per month. This information can be expressed in the LP as follows:

		X1+X2 ≥ 500
		X1 ≥ 500, X2 ≥ 500
		X1+X2 ≥ 1000
		Maximize X1 + X2

Question 8

6. A company manufactures pharmaceutical products. The annual demand of one of its products is 144. On an average, the company produces 6 boxes per day. The average daily demand is 5 units. The set up cost calculated is $30. The carrying cost is $10 per box per year. The number of boxes to be produced by the company in each batch is approximately:

		108
		72
		94
		86

Answer 1