Question 1

Which of the following is the cost of carrying an item in inventory for a specific period of time?
A)Ordering cost
B)Holding cost
C)Shortage cost
D)Stock out cost

Accepted Answer

Holding cost, also known as carrying cost, refers to the expenses associated with storing unsold goods, including warehousing, insurance, depreciation, and opportunity costs.

Question 2

Which one of the following mathematical expressions can be employed to compute annual carrying cost?
A)(Q-2)H
B)(Q+2)H
C)(Q÷2)H
D)(Q×2)/H

Accepted Answer

The correct expression for computing annual carrying cost is (Q÷2)H, where Q represents the quantity of inventory and H represents the holding or carrying cost per unit per year. This formula assumes that the inventory level decreases linearly over time, averaging half the initial quantity over the period.

Question 3

In which of the following systems an item's inventory is stored at two different locations?
A)Optional replenishment system
B)Base stock system
C)Two bin system
D)Universal bar code system method

Accepted Answer

The Two bin system involves storing items in two different locations or bins. When the first bin is empty, items from the second bin are used while the first bin is replenished, ensuring continuous availability of the items.

Question 4

Which one of the following is a condition for a successful supply chain?
A)A large number of suppliers
B)Many short-term contracts
C)Trust among trading partners
D)Continuous competitive bidding

Accepted Answer

Trust among trading partners is crucial for a successful supply chain as it fosters collaboration, ensures smooth operations, and facilitates problem-solving and innovation.

Question 5

JIT stands for which of the following?
A)Just In Time
B)Just In Test
C)Job In Time
D)Job Inventory Time

Accepted Answer

JIT stands for Just In Time, a management strategy that aligns raw-material orders from suppliers directly with production schedules.

Quiz 3: E-Supply Chain Management: Concepts and Practices

Which of the following is the cost of carrying an item in inventory for a specific period of time?

Which one of the following mathematical expressions can be employed to compute annual carrying cost?

In which of the following systems an item's inventory is stored at two different locations?

Which one of the following is a condition for a successful supply chain?

JIT stands for which of the following?