Question 1

In a net change MRP system, requirements and schedules are considered rigid and never updated.

Accepted Answer

Net change systems are "activity" driven, and requirements and schedules are updated whenever a transaction is processed that has an impact on the item.Net change enables the system to reflect in "real time" the exact status of each item managed by the system.

Question 2

The least total cost method (LTC) lot-sizing technique calculates the order quantity by comparing the carrying cost and the setup (or ordering) costs for various lot sizes and then selects the lot in which these are most nearly equal.

Accepted Answer

The least total cost method (LTC) is a dynamic lot-sizing technique that calculates the order quantity by comparing the carrying cost and the setup (or ordering) costs for various lot sizes and then selects the lot in which these are most nearly equal.

Question 3

A lot-for-lot (L4L) lot-sizing technique does not take into account setup costs or capacity limitations.

Accepted Answer

Lot-for-lot (L4L) is the most common technique.It:
• Sets planned orders to exactly match the net requirements.• Produces exactly what is needed each week with none carried over into future periods.• Minimizes carrying cost.• Does not take into account setup costs or capacity limitations.

Question 4

"Projected available balance" is a term referring to unsold finished goods inventory.

Accepted Answer

Projected available balance is the amount of inventory (not just unsold finished goods) that is expected as of the end of a period.

Question 5

The economic order quantity (EOQ) lot-sizing technique uses the "square root formula" to balance setup cost, carrying cost, and cost of stockouts.

Accepted Answer

The EOQ model balances setup and holding costs.

Question 6

The lot-for-lot (L4L) lot-sizing technique minimizes carrying cost by taking into account setup costs and capacity limitations.

Accepted Answer

Lot-for-lot (L4L) is the most common technique.It:
• Sets planned orders to exactly match the net requirements.• Produces exactly what is needed each week with none carried over into future periods.• Minimizes carrying cost.• Does not take into account setup costs or capacity limitations.

Question 7

The economic order quantity (EOQ) lot-sizing technique produces or acquires exactly the amount of product that is needed each time period with none carried over into future periods.

Accepted Answer

EOQ assumes that parts are used continuously during the period.The lot sizes generated by EOQ do not always cover the entire number of periods.For example, the EOQ might provide the requirements for 4.6 periods (when another EOQ would be needed).

Question 8

Projected available balance is the amount of inventory that is expected as of the beginning of a period.

Accepted Answer

Projected available balance is the amount of inventory that is expected as of the end of a period (or the beginning of the next period).

Question 9

In a net change MRP system, requirements and schedules are updated whenever a transaction is processed that has an impact on the item.

Accepted Answer

Net change systems are "activity" driven, and requirements and schedules are updated whenever a transaction is processed that has an impact on the item.Net change enables the system to reflect in "real time" the exact status of each item managed by the system.

Question 10

The least unit cost method of lot-sizing adds ordering, stockout, and inventory carrying costs for each trial lot size and divides by the number of units in each lot size, picking the lot size with the lowest unit cost.

Accepted Answer

The least unit cost method is a dynamic lot-sizing technique that adds ordering and inventory carrying cost for each trial lot size and divides by the number of units in each lot size, picking the lot size with the lowest unit cost.

Question 11

Net change MRP systems are "activity" driven.

Accepted Answer

Net change systems are "activity" driven, and requirements and schedules are updated whenever a transaction is processed that has an impact on the item.Net change enables the system to reflect in "real time" the exact status of each item managed by the system.

Question 12

The three main inputs to an MRP system are the bill of materials, the master schedule, and the inventory records file.

Accepted Answer

This BOM file is one of the three main inputs to the MRP program.(The other two are the master schedule and the inventory records file.)

Question 13

Net change MRP reflects the exact status of each item managed by the system in "real time."

Accepted Answer

Net change systems are "activity" driven, and requirements and schedules are updated whenever a transaction is processed that has an impact on the item.Net change enables the system to reflect in "real time" the exact status of each item managed by the system.

Question 14

The economic order quantity (EOQ) lot-sizing technique uses the "square root formula" to balance setup cost and carrying cost.

Accepted Answer

The EOQ model balances setup and holding costs.

Question 15

Generally, determining lot sizes in MRP systems is simple.

Accepted Answer

Determination of lot sizes in an MRP system is a complicated and difficult problem.

Question 16

Low-level coding in MRP indicates the exact status of each item managed by the system in "real time."

Accepted Answer

Low-level coding (is where) each item is placed at the lowest level at which it appears in the structure hierarchy.

Question 17

Lot-for-lot (L4L) is the most common lot-sizing technique.

Accepted Answer

Lot-for-lot (L4L) is the most common technique.

Question 18

The least unit cost method of lot-sizing technique adds ordering and inventory carrying cost for each trial lot size and divides by the number of units in each lot size, picking the lot size with the lowest unit cost.

Accepted Answer

The least unit cost method is a dynamic lot-sizing technique that adds ordering and inventory carrying cost for each trial lot size and divides by the number of units in each lot size, picking the lot size with the lowest unit cost.

Question 19

In a net change MRP program, a change in one item will result in a completely new inventory plan and schedule for every item in the master production schedule.

Accepted Answer

In a net change MRP program, changes are made only for those items directly affected by the change, not for every item in the master production schedule.

Question 20

The least unit cost method (LUC) lot-sizing technique calculates the order quantity by comparing the carrying cost and the setup (or ordering) costs for various lot sizes and then selects the lot in which these are most nearly equal.

Accepted Answer

The least unit cost method is a dynamic lot-sizing technique that adds ordering and inventory carrying cost for each trial lot size and divides by the number of units in each lot size, picking the lot size with the lowest unit cost.

Quiz 21: Material Requirements Planning

In a net change MRP system, requirements and schedules are considered rigid and never updated.

The least total cost method (LTC) lot-sizing technique calculates the order quantity by comparing the carrying cost and the setup (or ordering) costs for various lot sizes and then selects the lot in which these are most nearly equal.

A lot-for-lot (L4L) lot-sizing technique does not take into account setup costs or capacity limitations.

"Projected available balance" is a term referring to unsold finished goods inventory.

The economic order quantity (EOQ) lot-sizing technique uses the "square root formula" to balance setup cost, carrying cost, and cost of stockouts.

The lot-for-lot (L4L) lot-sizing technique minimizes carrying cost by taking into account setup costs and capacity limitations.

The economic order quantity (EOQ) lot-sizing technique produces or acquires exactly the amount of product that is needed each time period with none carried over into future periods.

Projected available balance is the amount of inventory that is expected as of the beginning of a period.

In a net change MRP system, requirements and schedules are updated whenever a transaction is processed that has an impact on the item.

The least unit cost method of lot-sizing adds ordering, stockout, and inventory carrying costs for each trial lot size and divides by the number of units in each lot size, picking the lot size with the lowest unit cost.

Net change MRP systems are "activity" driven.

The three main inputs to an MRP system are the bill of materials, the master schedule, and the inventory records file.

Net change MRP reflects the exact status of each item managed by the system in "real time."

The economic order quantity (EOQ) lot-sizing technique uses the "square root formula" to balance setup cost and carrying cost.

Generally, determining lot sizes in MRP systems is simple.

Low-level coding in MRP indicates the exact status of each item managed by the system in "real time."

Lot-for-lot (L4L) is the most common lot-sizing technique.

The least unit cost method of lot-sizing technique adds ordering and inventory carrying cost for each trial lot size and divides by the number of units in each lot size, picking the lot size with the lowest unit cost.

In a net change MRP program, a change in one item will result in a completely new inventory plan and schedule for every item in the master production schedule.

The least unit cost method (LUC) lot-sizing technique calculates the order quantity by comparing the carrying cost and the setup (or ordering) costs for various lot sizes and then selects the lot in which these are most nearly equal.