Question

Which contract is set up so that the wholesale price is lowered and paid up front, but, if the parts are sold, an additional amount is paid to the wholesaler?

Select one:

a. Buy-Back Contract

b. Quantity Discount Contract

c. Revenue Sharing Contract

d. Price Protection Contract

e. Quantity Flexible Contract

f. Options Contract

Q 22

Question 22

Continuous Replenishment is a strategic supply chain alliance between a supplier and a retailer. Which of the following statements about Continuous Replenishment is true?

Select one:

a. The supplier will replenish inventory based on shared POS data and ships to agreed inventory levels based on this information.

b. The supplier determines inventory levels and inventory replenishment policies at retailer in order to reduce the bullwhip effect.

c. The forecasted demand is converted at store-level over a specified time frame into factory replenishment orders.

d. The retailer collaborates with the supplier, providing forecast demand for seasonal goods that allows for raw material ordering and capacity planning.

e. The supplier will replenish inventory based on shared POS data in order to minimize the inventory holdings at the retailer.

In a particular setting where the newsvendor model applies, demand is Normally distributed and the underage cost Cu can be calculated at 5, while the overage cost can be calculated as 10. This means that

Select one:

a. the expected profit-maximizing order quantity is more than expected demand.

b. the expected profit-maximizing order quantity is less than expected demand.

c. the expected profit-maximizing order quantity is exactly equal to expected demand.

d. From the given information, you do not know if the expected profit-maximizing order quantity is less than, equal to or greater than expected demand.

e. The critical ratio will be 0.5000.

Q 9

Question 9

Our textbook defines the Overage Cost (Co) as the cost of ordering one more unit than what you would have ordered had you known demand. Which statement describes Co best?

Select one:

a. Co is the increase in profit you would have enjoyed had you ordered one fewer unit.

b. Co is the premium paid for having a second ordering opportunity during the season.

c. Co is the amount you receive in salvage for one unit of excess inventory at the end of a season.

d. Co is the production cost of one unit.

Q 25

Question 25

According to our book, why can matching supply and demand be challenging?

Select one:

a. Demand can vary in predictable or unpredictable ways.

b. Supply is always certain and lead times are fixed.

c. System slack is inexpensive and can be used to create buffers throughout the supply chain.

d. Taking advantage of economies of scale in purchasing or transportation allows inventory to be built up at key points along the supply chain.

Answer 1

Revenue Sharing Contract -contract is set up so that the wholesale price is lowered and paid up front, but, if the parts are sold, an additional amount is paid to the wholesaler .This allows both the manufacture and retailer to increase the profit .Eg-Media ,Entertainment

The supplier determines inventory levels and inventory replenishment policies at retailer in order to reduce the bullwhip effect.-This is the true statement of Continuous Replenishment. It is an agreement between supplier and retailer and it maintain better flow in supply chain and minimize bullwhip effect.

Co is the amount you receive in salvage for one unit of excess inventory at the end of a season defines Overage Cost.

Overage cost=purchase price-Salvage price

Ans-Demand can vary in predictable or unpredictable ways.