Online Access Free L4M7 Practice Test

Multiple approval levels for a small purchase request is an example of which type of waste?

• A.Inventory
• B.Not using talent
• C.Over-production
• D.Over-processing

Is it correct to state that the accuracy of demand forecasts depends on the accuracy of the available information?

• A.Yes, and that information can only be verified and approved by the suppliers
• B.Yes, including other considerations such as the validity and reliability of the information
• C.No, considerations such as the skill and objectivity of the forecasters are always more important
• D.No, the only information determining the accuracy of demand forecasts is extracted from stock issue notes

What cost factors should be considered for the maintenance and repair of manufacturing equipment?
* Direct labor cost
* Cost of utilities during the use of the equipment
* Cost of the goods being sold
* Guarantee and warranty cost

• A.1 and 4 only
• B.2 and 3 only
• C.3 and 4 only
• D.1 and 2 only

XYZ Inc opens a tender to purchase new forklift trucks for their new established warehouse. In the final round, there are two suppliers remain who offer two different bids. Supplier A's bid has high initial investment. After calculating the net present value, the NPV in year five is positive. On the other hand, supplier B's bid has low purchase price, with the NPV in year five is negative. If the NPV is the sole selection criterion, XYZ Inc should select the bid which has...?

• A.The lowest NPV
• B.Negative NPV
• C.Zero NPV
• D.Positive NPV

XYZ Ltd is a large retailer who offers a range of products with different margins. The warehouse manager suggests that different product groups should have different level of safety stock. The appropriate level of safety stock is typically determined by...?

• A.Carrying sufficient safety stock so as to eliminate all stockouts
• B.Taking the square root of the economic order quantity
• C.Choosing the level of safety stock that assures a given service level
• D.Expected stockout cost multiplies with product margin