Inventory Management Learning Block 4 Practice Questions

Question 1

Which of the following forecast methods better takes into account a recent trend in sales, whether upward or downward?

Answer 1

Weighted moving average

Question 2

Accurate forecasts result in:

Answer 2

Lower quantity safety stock and fewer overall inventory requirements

Question 3

Which is the preferred method of estimating a company’s future needs?

Answer 3

Demand forecasting

Question 4

The weighting factors in a weighted moving average forecast should add up to:

Answer 4

1.0

Question 5

What is the three-week simple moving average forecast for the following numbers?

Answer 5

300

Question 6

In a bicycle assembly facility, what is the independent forecasted demand?

Answer 6

The assembled bicycles

Question 7

When forecasting the requirements for kitchen tables, the demand for complete tables vs. the demand for table legs is:

Answer 7

Independent demand vs. dependent demand

Question 8

The term often used to describe demand forecasting and inventory control together is:

Answer 8

Demand planning

Question 9

When calculating forecast error, forecasts that are too high and too low balance each other out and indicate a more accurate forecast than actually occurred. To account for this, companies use what kind of forecast error for each period?

Answer 9

Absolute

Question 10

A flaw or drawback of the simple moving average is when:

Answer 10

Equal weights are included for each time period