GMS805 Final exam Weeks 8-12 Practice Questions and Answers
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Course
GMS805
Institution
GMS805
GMS805 Final exam Weeks 8-12 Practice
Questions and Answers
What are the main characteristics of an inventory policy? -
Answer️️ -WHen to order (ROP) and how much to order (EOQ)
Product availability is measured by - Answer️️ -Cycle service level,
or fill rate
Cycle service level - Ans...
TORONTO METROPOLITAN UNIVERSITY
GMS805 Final exam Weeks 8-12 Practice
Questions and Answers
What are the main characteristics of an inventory policy? -
Answer✔️✔️-WHen to order (ROP) and how much to order (EOQ)
Product availability is measured by - Answer✔️✔️-Cycle service level,
or fill rate
Cycle service level - Answer✔️✔️-Amount of customer demand
satisfied from available invetory
The optimal level of product availability is one that - Answer✔️✔️-
Maximizes supply chain profitability.
What are some strategies to decrease loss from stockout? -
Answer✔️✔️-Backout sourcing, expediting shipping, providing a
substitute
What is the purpose of supply chain coordination? - Answer✔️✔️-All
stages of the chain take actions that are aligned and increase total
supply chain surplus
Lack of coordination results when - Answer✔️✔️-Objectives of
different stages conflict, each stage has a different owner who tries
to maximize its own profit, information moving b/w stages is
delayed or distorted
TORONTO METROPOLITAN UNIVERSITY
The Bullwhip effect - Answer✔️✔️-The variance of orders is greater
than that of sales, and more variability is injected by supply chain
partners as one moves upstream
Obstacles to coordination - Answer✔️✔️-Forecast updating, Order
batching, Pricing decisions, Long Lead times
Forecast updating - Answer✔️✔️-Each member of chain forecasts
orders received on their end, but multiple forecasts by each entity
leads to significant distortion.
Order batching - Answer✔️✔️-Each member of the chain has it's own
economies of scale resulting in planning practices leading to order
batching
Pricing decisions - Answer✔️✔️-May result in forward buying,
frequent price changes affect the ordering pattern of the
downstream to upstream party.
Long lead times - Answer✔️✔️-Increases the planning horizon of the
other partners in the chain, each partner is forced to keep large
amounts of safety stock
Double marginalisation - Answer✔️✔️-When different stages make
their pricing decisions independently, causes to total supply chain
to lose profit due to lower market demand.
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