Archive for December 2018

_________ is a collaborative process between two trading partners that establishes formal guidelines for joint forecasting and planning.

_________ is a collaborative process between two trading partners that establishes formal guidelines for joint forecasting and planning.



a) Collaborative Planning Forecasting and Replenishment (CPFR)
b) Supply Chain Planning Forecasting and Replenishment (SCPFR)
c) Supply Chain Optimization (SCO)
d) Collaborative Creation of Guidelines (CCG)
e) Joint Planning and Forecasting (JPP)


Answer: a) Collaborative Planning Forecasting and Replenishment (CPFR)

Combined forecasting involves a rule that

Combined forecasting involves a rule that



a) you must work with different vendors
b) you need different forecasters
c) you must always use a quantitative and qualitative method
d) the results are not comparable to a single forecast
e) the forecasting methods should be different


Answer: e) the forecasting methods should be different

Which of the following would not be a consideration for selecting a forecasting software package?

Which of the following would not be a consideration for selecting a forecasting software package?



a) How easy is the package to learn?
b) Is it possible to implement new methods?
c) Do you require repetitive forecasting?
d) Does the supplier support a local conference?
e) Is there any local support?


Answer: d) Does the supplier support a local conference?

Which of the following is the simplest forecasting method?

Which of the following is the simplest forecasting method?



a) Naïve
b) Moving average
c) Weighted moving average
d) Trend adjusted exponential smoothing
e) Linear regression


Answer: a) Naïve

Which of the following is not a step in Forecasting Seasonality?

Which of the following is not a step in Forecasting Seasonality?



a) Calculate a seasonal index for each season of each year
b) Divide this year's average seasonal demand by each average seasonal index
c) Average the indexes by season
d) Forecast demand for the next year and divide by the number of seasons
e) Calculate the average demand per season


Answer: b) Divide this year's average seasonal demand by each average seasonal index

What would be the 4-month simple moving average forecast for July?

A firm has the following order history over the last 6 months.

January 120
February 95
March 100
April 75
May 100
June 50

What would be the 4-month simple moving average forecast for July?



a) 97.5
b) 325
c) 90
d) 81.25
e) 50


Answer: d) 81.25

Suppose that you are using the simple mean to make a forecast. This period's forecast was equal to 1000 units, and it was based on 99 periods of demand. This period's actual demand was 0 units. What is your forecast for next period?

Suppose that you are using the simple mean to make a forecast. This period's forecast was equal to 1000 units, and it was based on 99 periods of demand. This period's actual demand was 0 units. What is your forecast for next period?



a) 1000
b) 990
c) 0
d) 1010
e) 999


Answer: b) 990

Suppose that you are using the simple mean to make a forecast. This period's forecast was equal to 200 units, and it was based on 5 periods of demand. This period's actual demand was 300 units. What is your forecast for next period?

Suppose that you are using the simple mean to make a forecast. This period's forecast was equal to 200 units, and it was based on 5 periods of demand. This period's actual demand was 300 units. What is your forecast for next period?



a) 217
b) 250
c) 260
d) 300
e) 200


Answer: a) 217

Suppose that you are using the naïve forecasting method with trend to forecast sales. Sales have been increasing by 10% per week. Two weeks ago, sales amounted to $100. What should your forecast be for this week?

Suppose that you are using the naïve forecasting method with trend to forecast sales. Sales have been increasing by 10% per week. Two weeks ago, sales amounted to $100. What should your forecast be for this week?



a) $100
b) $ 10
c) $110
d) $121
e) $120


Answer: d) $121

Week 1 = 100 + (100 x .10 = 10)
Week 2 = 110 + (110 x .10 = 11)
Week 3 = 121

Suppose that you are using the naïve forecasting method with trend to forecast sales. If sales have been increasing by 40% per month, and this month's sales amounted to $1200, what would your forecast be for next month?

Suppose that you are using the naïve forecasting method with trend to forecast sales. If sales have been increasing by 40% per month, and this month's sales amounted to $1200, what would your forecast be for next month?



a) $1200
b) $ 480
c) $1680
d) $ 720
e) $1600


Answer: c) $1680

1200 - (.4 * 1200) = 1200 - 480 = 720
1200 + 480 = 1680

Suppose that you are using the four-period simple moving average method to forecast sales, and sales have been increasing by 40% every period. How will your forecasts perform?

Suppose that you are using the four-period simple moving average method to forecast sales, and sales have been increasing by 40% every period. How will your forecasts perform?



a) Forecasts will be increasing by 40.0% every period.
b) Forecasts will be higher than actual.
c) Forecasts will equal actual.
d) Forecasts will be decreasing.
e) Forecasts will be increasing by 10.0% every period.


Answer: a) Forecasts will be increasing by 40.0% every period.

Suppose that you are using the four-period simple moving average method to forecast sales, and sales have been increasing by 20% every period. How will your forecasts perform?

Suppose that you are using the four-period simple moving average method to forecast sales, and sales have been increasing by 20% every period. How will your forecasts perform?



a) Forecasts will be lower than actual.
b) Forecasts will be higher than actual.
c) Forecasts will equal actual.
d) Forecasts will be decreasing.
e) Forecasts will be increasing by 5.0% every period.


Answer: a) Forecasts will be lower than actual.

Suppose that you are using exponential smoothing with a = 0.5 and your initial forecast 5 months ago was for 100 units. If the actual demand last month was 0 units, which of the following is definitely true?

Suppose that you are using exponential smoothing with a = 0.5 and your initial forecast 5 months ago was for 100 units. If the actual demand last month was 0 units, which of the following is definitely true?



a) The forecast for this month should be 0.
b) The model blew up. You can't use exponential smoothing anymore.
c) The forecast for last month was 0.
d) The forecast for this month should be 50.
e) We need more information to determine this month's forecast.


Answer: e) We need more information to determine this month's forecast.

What is the mean squared error of the following forecasts?

What is the mean squared error of the following forecasts?



Month Actual Sales Forecast
Jan. 614 600
Feb. 480 480
Mar. 500 450
Apr. 500 600


a) 3174
b) 164
c) 41
d) 136
e) 12,696


Answer: a) 3174

What is the weighted moving average forecast for March, assuming a weight of 60% for the most recent month, 30% for the month preceding the most recent month, and 10% for the month preceding that one?

A firm has had the following order history over the last 4 months:
November 140
December 80
January 100
February 150


What is the weighted moving average forecast for March, assuming a weight of 60% for the most recent month, 30% for the month preceding the most recent month, and 10% for the month preceding that one?



a) 117.5
b) 228.1
c) 118.0
d) 128.0
e) 132.4


Answer: d) 128.0

Suppose that you are using the exponential smoothing forecasting method, and this period's forecast (Ft) was 100% accurate (i.e., no error). If a = .5, which of the following is definitely true?

Suppose that you are using the exponential smoothing forecasting method, and this period's forecast (Ft) was 100% accurate (i.e., no error). If a = .5, which of the following is definitely true?



a) Next period's forecast will also be 100% accurate.
b) Next period's forecast equals this period's actual.
c) This period's forecast must be thrown out, and next period's forecast equals Ft-1 + a (At-1 a - Ft-1).
d) Next period's forecast equals 50% of this period's forecast.
e) Next period's forecast equals 50% more than this period's forecast.


Answer: b) Next period's forecast equals this period's actual.

Suppose that you want to set up a 3-month weighted moving average forecasting system. You want the weights to be percentages (that add to 100%). Furthermore, you want weights for the most recent two months to be equal but you want each of those weights to be twice as large as the weight for the oldest month. What should the weight be for the oldest month?

Suppose that you want to set up a 3-month weighted moving average forecasting system. You want the weights to be percentages (that add to 100%). Furthermore, you want weights for the most recent two months to be equal but you want each of those weights to be twice as large as the weight for the oldest month. What should the weight be for the oldest month?



a) 33%
b) 25%
c) 80%
d) 50%
e) 20%


Answer: e) 20%

Solution: 40 + 40 +_20 = 100

Consider the demand data listed below. What is the 4-month moving average forecast for June?

Consider the demand data listed below. What is the 4-month moving average forecast for June?



Month Actual Demand
Jan. 10,000
Feb. 12,000
Mar. 24,000
Apr. 8,000
May 14,000


a) 14,000
b) Not enough information is given to answer the question.
c) 14,500
d) 13,500
e) 15,333


Answer: c) 14,500

12,000 + 24,000 + 8,000 + 14,000 = 58,000 / 4 = 14,500

What is the mean absolute deviation and mean squared error of the following forecast

What is the mean absolute deviation and mean squared error of the following forecast


Day Sales Sale Forecast

24 37
31 41
27 46
29 47
25 50

a) 13, 157
b) 14, 321
c) 16, 312
d) 17, 316
e) 18, 321


Answer: d) 17, 316

Using the first Days of Sales and Sale Forecast as an example,
24 - 37 = -13; 13; 13x13 = 169
Do this for each set of data then add all five errors.
Day Sales Sale Fore Error Error error2
24 37 -13 13 169
31 41 -10 10 100
27 46 -19 19 361
29 47 -18 18 324
25 50 -25 25 625
136 221 -85 85 1579
17 315.8

What would be a 3-month weighted moving average forecast for July, using weights of 40% for the most recent month, 30% for the month preceding the most recent month, and 30% for the month preceding that one?

A firm has the following order history over the last 6 months.

January 120
February 95
March 100
April 75
May 100
June 50

What would be a 3-month weighted moving average forecast for July, using weights of 40% for the most recent month, 30% for the month preceding the most recent month, and 30% for the month preceding that one?



a) 75
b) 72.5
c) 50
d) 90
e) 106.5


Answer: b) 72.5

Solution:
Ct At CtAt
April .3 75 22.5
May .3 100 30
June .4 50 20
Forecast 72.5

Suppose that Jane's company uses exponential smoothing to make forecasts. Further suppose that last period's demand forecast was for 500 units and last period's actual demand was 480 units. In addition, yesterday Jane found out that this period's actual demand will be for 550 units. Jane's company uses an a value of .20. Today, Jane's boss asked her to prepare a forecast for this period. What should that forecast be?

Suppose that Jane's company uses exponential smoothing to make forecasts. Further suppose that last period's demand forecast was for 500 units and last period's actual demand was 480 units. In addition, yesterday Jane found out that this period's actual demand will be for 550 units. Jane's company uses an a value of .20. Today, Jane's boss asked her to prepare a forecast for this period. What should that forecast be?



a) 504
b) 496
c) 510
d) 484
e) 550


Answer: c) 510

Solution: .2(550) + (1-.2)500 = 110 + .8(500) = 110 + 400 = 510

Suppose that Sally's company uses exponential smoothing to make forecasts. Further suppose that last period's demand forecast was for 20,000 units and last period's actual demand was 21,000 units. Sally's company uses a smoothing constant (a) equal to 40%. What should be the forecast for this period?

Suppose that Sally's company uses exponential smoothing to make forecasts. Further suppose that last period's demand forecast was for 20,000 units and last period's actual demand was 21,000 units. Sally's company uses a smoothing constant (a) equal to 40%. What should be the forecast for this period?



a) 20,000
b) 21,000
c) 20,600
d) 20,400
e) 19,600


Answer: d) 20,400

Solution: .4(21,000) + (1- .4)20,000 = 8400 + (.6 x 20,000) = 8400 + 12,000 = 20,400

What is a tracking signal used for?

What is a tracking signal used for?



a) To identify trends in actual data
b) To identify seasonality in actual data
c) To identify the effect of business cycles on actual data
d) To compute the value of the smoothing constant, a, for exponential smoothing
e) To identify forecast bias


Answer: e) To identify forecast bias

In linear regression, an r2 of .984 implies what?

In linear regression, an r2 of .984 implies what?



a) 98.4% of the variability of the independent variable is explained by the dependent variable
b) 98.4% of the variability of the dependent variable is explained by the independent variable
c) 1.6% of the variability of the independent variable is explained by the dependent variable
d) 1.6% of the variability of the dependent variable is explained by the independent variable
e) 99.2% of the variability of the dependent variable is explained by the independent variable


Answer: b) 98.4% of the variability of the dependent variable is explained by the independent variable

What does the linear regression line do?

What does the linear regression line do?



a) Minimizes sum of errors
b) Minimizes product of squared errors
c) Minimizes sum of squared errors
d) Minimizes product of errors
e) Minimizes sum of absolute value of errors


Answer: c) Minimizes sum of squared errors

In linear regression, what are we trying to forecast?

In linear regression, what are we trying to forecast?



a) Beta parameter
b) Dependent variable
c) Independent variable
d) Y-intercept of the line
e) Slope of the line


Answer: b) Dependent variable

What are the most frequently used forecasting techniques?

What are the most frequently used forecasting techniques?



a) Linear regression
b) Simple mean
c) Exponential smoothing
d) Weighted moving average
e) Econometric models


Answer: c) Exponential smoothing

The following sales figures show actual sales over the identified time period. What can be determined by comparing a simple mean forecast and a six month moving average forecast?

The following sales figures show actual sales over the identified time period. What can be determined by comparing a simple mean forecast and a six month moving average forecast? 



December 4,000
January 5,000
February 4,000
March 4,500
April 5,500
May 5,000


a) moving average develops a smoother forecast
b) 4.7, 5
c) 4.7, 4
d) 4, 4
e) 4, 4.7


Answer: d) 4, 4

Suppose that you are using the four-period weighted moving average forecasting method to forecast sales and you know that sales will be increasing every period for the foreseeable future. What of the following would be the best set of weights to use (listed in order from the most recent period to four periods ago, respectively)?

Suppose that you are using the four-period weighted moving average forecasting method to forecast sales and you know that sales will be increasing every period for the foreseeable future. What of the following would be the best set of weights to use (listed in order from the most recent period to four periods ago, respectively)?



a) 0.25, 0.25, 0.25, 0.25
b) 0.40, 0.30, 0.20, 0.10
c) 1.00, 0.00, 0.00, 0.00
d) 0.10, 0.20, 0.30, 0.40
e) 0.00, 0.00, 0.00, 1.00


Answer: c) 1.00, 0.00, 0.00, 0.00

Suppose that you are using the four-period simple moving average method to forecast sales, and sales have been decreasing by 10% every period. How will your forecasts perform?

Suppose that you are using the four-period simple moving average method to forecast sales, and sales have been decreasing by 10% every period. How will your forecasts perform?




a) Forecasts will be lower than actual.
b) Forecasts will be higher than actual.
c) Forecasts will equal actual.
d) Forecasts will be increasing.
e) Forecasts will be decreasing by 2.5% every period.


Answer: b) Forecasts will be higher than actual.

Suppose that you are using the simple mean to make a forecast. This period's forecast was equal to 100 units, and it was based on 6 periods of demand. This period's actual demand was 86 units. What is your forecast for next period?

Suppose that you are using the simple mean to make a forecast. This period's forecast was equal to 100 units, and it was based on 6 periods of demand. This period's actual demand was 86 units. What is your forecast for next period?




a) 98
b) 100
c) 93
d) 86
e) Not enough information is given to answer the question.


Answer: a) 98

Solution: 100 + 100 + 100 + 100 + 100 + 86 = 586/6 = 98

Suppose that you are using the naïve forecasting method with trend to forecast sales. If sales have been declining by 20% per week, and this week's sales amounted to $200, what would your forecast be for next week?

Suppose that you are using the naïve forecasting method with trend to forecast sales. If sales have been declining by 20% per week, and this week's sales amounted to $200, what would your forecast be for next week?



a) $200
b) $ 40
c) $240
d. $180
e) $160


Answer: e) $160

Solution: 200 x .20 = 40; 200 - 40 = 160

The OM supervisor informs you, the researcher, that the data has a large standard deviation. What data pattern would you expect to observe once you generated a time series trend?

The OM supervisor informs you, the researcher, that the data has a large standard deviation. What data pattern would you expect to observe once you generated a time series trend?



a) horizontal
b) seasonal
c) positive/negative trend
d) cycle
e) insufficient information to derive a valid response


Answer: e) insufficient information to derive a valid response

In looking at seasonal indexes one weakness to watch for is

In looking at seasonal indexes one weakness to watch for is



a) use of the wrong alpha
b) incorrect selection of weights
c) a clear lack of linear relationship
d) seasonality is not present
e) significant increase in computational requirements


Answer: d) seasonality is not present

Which of the following is a causal forecasting method?

Which of the following is a causal forecasting method?



a) Naïve
b) Moving average
c) Weighted moving average
d) Trend adjusted exponential smoothing
e) Linear regression


Answer: e) Linear regression

A causal research model is based on the assumption that

A causal research model is based on the assumption that



a) the independent variable is related to the dependent variable
b) there is a relationship between the time series and the dependent variable
c) the variable being forecast is related to other variables in the environment
d) there is a relationship between the time series and the independent variable
e) the information is contained in a time series of data


Answer: c) the variable being forecast is related to other variables in the environment

What are the two categories of quantitative models?

What are the two categories of quantitative models?



a) Delphi and non-causal
b) Causal and non-causal
c) Delphi and time series
d) Causal and time series
e) Causal and Delphi


Answer: d) Causal and time series

Which of the following forecasting methods is most likely to be implemented to change an existing quantitative forecast to account for a new competitor in the marketplace?

Which of the following forecasting methods is most likely to be implemented to change an existing quantitative forecast to account for a new competitor in the marketplace?



a) Market research
b) Executive opinion
c) Delphi method
d) Naïve method
e) Gamma method


Answer: b) Executive opinion

One quantitative forecasting models limitation is

One quantitative forecasting models limitation is



a) it is objective
b) they are consistent
c) they are based on mathematical formulas
d) they are limited on the quality of available data
e) they can work around bad data


Answer: d) they are limited on the quality of available data

Qualitative forecasting methods

Qualitative forecasting methods



a) are made objectively by the forecaster
b) are made subjectively by the forecaster
c) are made using existing data sources
d) are based on mathematical models
e) are only used in parallel with quantitative models


Answer: b) are made subjectively by the forecaster

The first step in forecasting is:

The first step in forecasting is:



a) determine what data is available
b) decide what to forecast
c) evaluate and analyze appropriate data
d) select and test the forecast model
e) establish the forecast accuracy requirements


Answer: b) decide what to forecast

Which of the following is not a feature common to all forecasting models?

Which of the following is not a feature common to all forecasting models?



a) This period's forecast error is needed to compute next period's forecast.
b) Forecasts are rarely perfect.
c) Forecasts are more accurate for groups of items rather than for individual items.
d) Forecasts are more accurate for shorter rather than for longer time horizons.
e) All of the answer choices are correct.


Answer: a) This period's forecast error is needed to compute next period's forecast.

When evaluating forecasting models it is accurate to say:

When evaluating forecasting models it is accurate to say:



a) they all rely on the same data sets
b) they will provide the same results
c) they are usually accurate
d) they differ in their degree of complexity
e) they do not differ in their degree of complexity


Answer: d) they differ in their degree of complexity

Forecasting is not a function which contributes to:

Forecasting is not a function which contributes to:



a) deciding which business market to pursue
b) deciding which product to produce
c) deciding how bonuses should be allocated
d) deciding how much inventory to carry
e) deciding how many people to hire


c) deciding how bonuses should be allocated

When were Gantt charts developed?

When were Gantt charts developed?



a) early 1800s
b) early 1900s
c) early 1920s
d) early 1940s
e) early 1960s


Answer: b) early 1900s

Jim-O's fast focus restaurant is opening up a new branch. Based on demand forecast the following service personnel levels are anticipated. What days will employee #1 have off?

Jim-O's fast focus restaurant is opening up a new branch. Based on demand forecast the following service personnel levels are anticipated. What days will employee #1 have off?



Days of Week Monday Tuesday Wednesday Thursday Friday Saturday Sunday
Staff needs 5 4 4 3 6 6 5


a) Mon - Tue
b) Tue - Wed
c) Wed - Thur
d) Thur - Fri
e) Fri - Sat


Answer: c) Wed - Thur

Solution:
M T 9
T W 8
W Th 7
Th F 9
F St 12
St S 11

Jim-O's fast focus restaurant is opening up a new branch. Based on demand forecast the following service personnel levels are anticipated. What is the number of employees needed for Thursday-Friday pair?

Jim-O's fast focus restaurant is opening up a new branch. Based on demand forecast the following service personnel levels are anticipated. What is the number of employees needed for Thursday-Friday pair?



Days of Week Monday Tuesday Wednesday Thursday Friday Saturday Sunday
Staff needs 5 4 3 4 6 6 5


a) 7
b) 9
c) 10
d) 11
e) 12


Answer: c) 10

Solution: Using Step 1 and 2 of the technique developed by Tibrewala, Philippe, and Brown, Thursday (4) + Friday (6) = 10

Only Roses Flower Shop currently operates 7 days per week. The staffing needs for each day are shown in the following table. Each of the employees must have two consecutive days off in a week. (Since Monday is used as the first day of the pay week, an employee cannot be off on both Sunday and Monday.) What is the minimum number of employees that needs to be hired?

Only Roses Flower Shop currently operates 7 days per week. The staffing needs for each day are shown in the following table. Each of the employees must have two consecutive days off in a week. (Since Monday is used as the first day of the pay week, an employee cannot be off on both Sunday and Monday.) What is the minimum number of employees that needs to be hired? 



Days of Week Monday Tuesday Wednesday Thursday Friday Saturday Sunday
Staff Need 2 3 4 4 5 4 6


a) 5
b) 6
c) 7
d) 8
e) 9


Answer: b) 6

Solution: need 6 on Sunday; a schedule can then be further developed to cover all other days

Which of the following is mostly like to be a policy constraint?

Which of the following is mostly like to be a policy constraint?



a) strike at the supplier's plant
b) raw material shipping problems
c) decreasing market demand
d) no overtime
e) a regular bottleneck in the product process


Answer: d) no overtime

Which of the following is mostly like to be a market constraint?

Which of the following is mostly like to be a market constraint?



a) strike at the supplier's plant
b) raw material shipping problems
c) decreasing market demand
d) no overtime
e) a regular bottleneck in the product process


Answer: c) decreasing market demand

Which of the following is mostly like to be an internal resource constraint?

Which of the following is mostly like to be an internal resource constraint?



a) increasing market demand
b) raw material shipping problems
c) decreasing market demand
d) no overtime
e) a regular bottleneck in the product process


Answer: e) a regular bottleneck in the product process

Which of the following statements is not true?

Which of the following statements is not true?



a) An hour lost at a bottleneck is an hour lost forever.
b) An hour lost at a non-bottleneck is just a mirage.
c) Bottlenecks determine throughput and system inventory.
d) The transfer batch does not have to equal the process batch.
e) Lead times are predetermined.


Answer: e) Lead times are predetermined.

The process batch should:

The process batch should:



a) match the transfer batch.
b) exceed the transfer batch.
c) be smaller than the transfer batch.
d) be fixed.
e) be variable.


Answer: e) be variable.

What is a transfer batch?

What is a transfer batch?



a) the quantity of finished goods that can be sold
b) the quantity of items moved at the same time from one resource to the next
c) the quantity of work-in-process inventory
d) the quantity produced at a resource before the resource is switched over to produce another product
e) the quantity of items needed to attain a full truckload (TL) shipping rate


Answer: b) the quantity of items moved at the same time from one resource to the next

What is a process batch?

What is a process batch?



a) the quantity of finished goods that can be sold
b) the quantity of items moved at the same time from one resource to the next
c) the quantity of work-in-process inventory
d) the quantity produced at a resource before the resource is switched over to produce another product
e) the set of machines used to make products


Answer: d) the quantity produced at a resource before the resource is switched over to produce another product

What is throughput?

What is throughput?



a) the quantity of finished goods that can be sold
b) the quantity of items moved at the same time from one resource to the next
c) the quantity of work-in-process inventory
d) the quantity produced at a resource before the resource is switched over to produce another product
e) the average flow time of the system


Answer: a) the quantity of finished goods that can be sold

Which of the following statements is not a valid scheduling principle?

Which of the following statements is not a valid scheduling principle?



a) Balance the process rather than the flow.
b) Non-bottleneck usage is determined by some other constraint in the system.
c) Usage and activation of a resource are the same.
d) The process batch should be variable.
e) An hour lost at a bottleneck resource is an hour lost forever.


Answer: c) Usage and activation of a resource are the same.

Consider a production line with five stations. The first station can process a unit in 8 minutes. The second station has two identical machines, each of which can process a unit in 18 minutes (each unit only needs to be processed on one of the two machines). The third station can process a unit in 4 minutes. The fourth station has two different machines, one can process a unit in 5 minutes, and the other one can process a unit in 9 minutes (each unit needs to be processed on both machines). The fifth station can process a unit in 10 minutes. Which station is the bottleneck station?

Consider a production line with five stations. The first station can process a unit in 8 minutes. The second station has two identical machines, each of which can process a unit in 18 minutes (each unit only needs to be processed on one of the two machines). The third station can process a unit in 4 minutes. The fourth station has two different machines, one can process a unit in 5 minutes, and the other one can process a unit in 9 minutes (each unit needs to be processed on both machines). The fifth station can process a unit in 10 minutes. Which station is the bottleneck station?



a) Station 1
b) Station 2
c) Station 3
d) Station 4
e) Station 5


Answer: e) Station 5

Which of the following is the least effective tactic for managing a bottleneck station?

Which of the following is the least effective tactic for managing a bottleneck station?



a) Assign extra workers to the bottleneck station if necessary in order to keep it running.
b) Increase the production rate at the bottleneck station.
c) Inspect items just as soon as they come out of the bottleneck station.
d) Subcontract part of the workload at that station to other companies.
e) Assign your best people to that station to improve efficiency.


Answer: d) Subcontract part of the workload at that station to other companies.

Seven jobs must be scheduled. Each of the jobs must be processed on two machines (A and B) in the same order. The processing times are listed below. According to Johnson's rule, in what order should the jobs be processed?

Seven jobs must be scheduled. Each of the jobs must be processed on two machines (A and B) in the same order. The processing times are listed below. According to Johnson's rule, in what order should the jobs be processed?



Job Machine A Machine B
A 6 25
B 12 2
C 11 7
D 4 3
E
F
G 7
9
18 8
1
5


a) A-E-C-G-D-B-F
b) A-C-E-G-D-B-F
c) F-B-D-G-C-E-A
d) F-D-B-G-E-C-A
e) G-D-B-F-A-E-C


Answer: a) A-E-C-G-D-B-F

Solution:
A 6 25
E 7 8
C 11 7
G 18 5
D 4 3
B 12 2
F 9 1

What does "negative lateness" mean?

What does "negative lateness" mean?



a) The job is finished after its due date.
b) The job is finished on its due date.
c) The job is finished before its due date.
d) The job is not finished.
e) The job has not started.


Answer: c) The job is finished before its due date.

Five jobs must be scheduled. Each of the jobs must be processed on two machines (A and B) in the same order. The processing times are listed below. According to Johnson's rule, in what order should the jobs be processed?

Five jobs must be scheduled. Each of the jobs must be processed on two machines (A and B) in the same order. The processing times are listed below. According to Johnson's rule, in what order should the jobs be processed?


Job Machine A Machine B
A 6 30
B 23 2
C 1 7
D 4 3
E 8 8


a) C-B-D-A-E
b) C-D-A-E-B
c) B-E-A-D-C
d) C-A-E-D-B
e) C-D-E-B-A


Answer: d) C-A-E-D-B

Hint:
C 1 7
D 4 3
A 6 30
E 8 8
B 23 2

Using the following data, calculate the average job tardiness.

Using the following data, calculate the average job tardiness.


Job Completion Date Due Date
A 15 12
B 11 24
C 25 22
D 18 19


a) 6 days
b) 1.5 days
c) -2 days
d) -8 days
e) 3 days


Answer: b) 1.5 days

Hint:
Job Completion Date Due Date lateness tardiness
A 15 12 3 3
B 11 24 -13 0
C 25 22 3 3
D 18 19 -1 0
-8 6
-2 1.5

Using the following data, calculate the average job lateness.

Using the following data, calculate the average job lateness.


Job Completion Date Due Date
A 15 12
B 11 24
C 25 22
D 18 19


a) -2 days
b) 3 days
c) 13 days
d) -8 days
e) 1.5 days


Answer: a) -2 days

Solution: A 15-12= 3
B 11-24= -13
C 25-22= 3
D 18-19= -1
Total = -8/4=-2

Which of the following scheduling rules minimizes mean job flow time?

Which of the following scheduling rules minimizes mean job flow time?



a) first come, first served
b) last come, first served
c) earliest due date
d) shortest processing time
e) longest processing time


Answer: d) shortest processing time

A greater number of jobs in the system implies what?

A greater number of jobs in the system implies what?



a) a higher work-in-process inventory level and a longer response time
b) a lower work-in-process inventory level and a longer response time
c) a higher work-in-process inventory level and a shorter response time
d) a lower work-in-process inventory level and a shorter response time
e) more jobs will certainly be tardy.


Answer: a) a higher work-in-process inventory level and a longer response time

Green Inc. manufactures a variety of wooden desks. Five jobs are waiting to be processed using the LPT priority rule. Their processing times are shown in the following table. What is the makespan?

Green Inc. manufactures a variety of wooden desks. Five jobs are waiting to be processed using the LPT priority rule. Their processing times are shown in the following table. What is the makespan?



Job Processing Time

A 8
B 2
C 4
D 6
E 7


a) 66
b) 13.2
c) 27
d) 5.4
e) 2.4


Answer: c) 27

Solution:
A 8
E 7
D 6
C 4
B 2
Total = 27

Sweet-Dreams Inc. manufactures custom pillows. Five jobs are waiting to be processed using the SPT priority rule. Their processing times are shown in the following table. What is the average number of jobs in the system?

Sweet-Dreams Inc. manufactures custom pillows. Five jobs are waiting to be processed using the SPT priority rule. Their processing times are shown in the following table. What is the average number of jobs in the system?



Job Processing Time
A 8
B 2
C 4
D 6
E 7


a) 66
b) 13.2
c) 27
d) 5.4
e) 3.38


Answer: e) 3.38

Solution:
B 2
C 4
D 6
E 7
A 8
Total = 27/5=5.4 mean
27/8=3.38

The following jobs must be processed in the Super Clean motor shop. Assume that the company operates seven days per week. Using FCFS as the priority rule, calculate average job tardiness.

The following jobs must be processed in the Super Clean motor shop. Assume that the company operates seven days per week. Using FCFS as the priority rule, calculate average job tardiness.



Job Arrival Comp Due Date

A Nov. 1 8 16
F Nov. 5 12 10
E Nov. 6 12 15
B Nov. 4 12 11
C Nov. 2 20 21
D Nov. 3 5 13


a) 0
b) 6
c) .5
d) -2.833
e) -8


Answer: c) .5

Hint:
Job Arrival Comp Due Date Lateness Tardiness
A Nov. 1 8 16 -8 0
C Nov. 2 20 21 -1 0
D Nov. 3 5 13 -8 0
B Nov. 4 12 11 1 1
F Nov. 5 12 10 2 2
E Nov. 6 12 15 -3 0
-17 3
-2.83333 0.5

Heavy Eyes Inc. manufactures custom pillows. Five jobs are waiting to be processed using the SPT priority rule. Their processing times are shown in the following table. What is the mean flow time?

Heavy Eyes Inc. manufactures custom pillows. Five jobs are waiting to be processed using the SPT priority rule. Their processing times are shown in the following table. What is the mean flow time?

Job Processing Time

A 6
B 2
C 10
D 8
E 1


a) 57 days
b) 11.4 days
c) 17 days
d) 5.4 days
e) 27 days


Answer: d) 5.4 days

Solution: 6+2+10+8+1=27/5=5.4

Sweet-Dreams Inc. manufactures custom pillows. Five jobs are waiting to be processed. Job A has a flow time of 8 days, job B has a flow time of 10 days, job C has a flow time of 15 days, job D has a flow time of 20 days, and job E has a flow time of 27 days. What is the mean flow time?

Sweet-Dreams Inc. manufactures custom pillows. Five jobs are waiting to be processed. Job A has a flow time of 8 days, job B has a flow time of 10 days, job C has a flow time of 15 days, job D has a flow time of 20 days, and job E has a flow time of 27 days. What is the mean flow time?



a) 8 days
b) 10 days
c) 7 days
d) 0 days
e) 16 days


e) 16 days

Solution: 8+10+15+20+27=80/5=16

A measure of response time is:

A measure of response time is:



a) makespan
b) job flow time
c) due date
d) job lateness
e) job schedule time


Answer: b) job flow time

What does makespan measure?

What does makespan measure?



a) WIP inventory
b) due-date performance
c) the amount of time it takes to finish a batch of jobs
d) job tardiness
e) job lateness


Answer: c) the amount of time it takes to finish a batch of jobs

What does job flow time measure?

What does job flow time measure?



a) the time a job spends in the shop
b) due-date performance
c) the amount of time it takes to finish a batch of jobs
d) job tardiness
e) job lateness


Answer: a) the time a job spends in the shop

If using CR as the priority rule, which of the following jobs will be scheduled first?

If using CR as the priority rule, which of the following jobs will be scheduled first?



a) the first job arrives at a work center
b) the job with the least slack per remaining operations
c) the job with the highest slack per remaining operations
d) the job with the smallest ratio of time remaining until due date to process time remaining
e) the job with the largest ratio of time remaining until due date to process time remaining


Answer: d) the job with the smallest ratio of time remaining until due date to process time remaining

Using the S/RO rule, which of the following jobs will be scheduled first?

Using the S/RO rule, which of the following jobs will be scheduled first?



a) the first job that arrives at a work center
b) the job with the least slack per remaining operations
c) the job with the highest slack per remaining operations
d) the job with the smallest ratio of time remaining until due date to process time remaining
e) the job with the largest ratio of time remaining until due date to process time remaining


Answer: b) the job with the least slack per remaining operations

The jobs listed below have not yet been scheduled. Using the S/RO technique, in what sequence would you schedule these jobs?

The jobs listed below have not yet been scheduled. Using the S/RO technique, in what sequence would you schedule these jobs?



Job Slack Remaining Operations
A 3 1
B 10 11
C 5 4
D 12 6
E 8 8
a) B-E-C-D-A
b) A-D-C-E-B
c) A-C-E-B-D
d) A-C-D-E-B
e) E-C-D-A-B


Answer: a) B-E-C-D-A

Hint:
Job Slack Remaining S/RO
A 3 1 4
B 10 11 1.90909
C 5 4 2.25
D 12 6 3
E 8 8 2

B E C D A

The jobs listed below have not yet been scheduled. Today is day 0. Using the critical-ratio technique, in what sequence would you schedule these jobs?

The jobs listed below have not yet been scheduled. Today is day 0. Using the critical-ratio technique, in what sequence would you schedule these jobs?


Job Due Date Duration (days)
A 3 1
B 10 11
C 5 4
D 12 6
E 8 8


a) B-E-C-D-A
b) A-D-C-E-B
c) A-C-E-B-D
d) A-C-D-E-B
e) E-C-D-A-B


Answer: a) B-E-C-D-A

Hint:
Job Due Date Duration Remaining
A 3 1 -2
B 10 11 1
C 5 4 -1
D 12 6 -6
E 8 8 0

B E C D A

The following jobs are waiting to be scheduled. Today is day 9. Determine the sequence of jobs by using LCFS as a priority rule.

The following jobs are waiting to be scheduled. Today is day 9. Determine the sequence of jobs by using LCFS as a priority rule.

Job Number Arrival Date (day #) Processing Time (days) Due Date (day #)


A 6 2 12
B 1 12 30
C 10 6 21
D 12 1 14
E 3 10 28


a) D-C-A-E-B
b) A-B-C-D-E
c) B-E-A-C-D
d) B-E-C-A-D
e) B-E-C-D-A


Answer: a) D-C-A-E-B

Hint: LCFS (the last job into the work center or at the top of the stack is processed first); sequence by "arrival date" column, highest number first.

The following jobs are waiting to be scheduled. Today is day 9. Determine the sequence of jobs by using FCFS as a priority rule.

The following jobs are waiting to be scheduled. Today is day 9. Determine the sequence of jobs by using FCFS as a priority rule.

Job Number Arrival Date (day #) Processing Time (days) Due Date (day #)


A 4 2 12
B 5 12 30
C 1 6 21
D 2 1 14
E 3 10 28


a) D-A-C-E-B
b) B-E-C-A-D
c) C-D-E-A-B
d) B-A-E-D-C
e) A-D-C-E-B


Answer: c) C-D-E-A-B

Hint: FCFS (jobs are processed in the order in which they arrive at a machine or work center); sequence by "arrival date" column.

The following jobs are waiting to be scheduled. Today is day 9. Determine the sequence of jobs by using EDD as a priority rule.

The following jobs are waiting to be scheduled. Today is day 9. Determine the sequence of jobs by using EDD as a priority rule.

Job Number Arrival Date (day #) Processing Time (days) Due Date (day #)

A 4 2 12
B 5 12 30
C 1 6 21
D 2 1 14
E 3 10 28


a) D-A-C-E-B
b) B-E-C-A-D
c) C-D-E-A-B
d) B-A-E-D-C
e) A-D-C-E-B


Answer: e) A-D-C-E-B

Hint: EDD (the job due the earliest has the highest priority); sequence using the "Due date" column.

The following jobs are waiting to be scheduled. Today is day 9. Determine the sequence of jobs by using LPT as a priority rule.

The following jobs are waiting to be scheduled. Today is day 9. Determine the sequence of jobs by using LPT as a priority rule.


Job Number Arrival Date (day #) Processing Time (days) Due Date (day #)
A 4 2 12
B 5 12 30
C 1 6 21
D 2 1 14
E 3 10 28


a) D-A-C-E-B
b) B-E-C-A-D
c) C-D-E-A-B
d) B-A-E-D-C
e) A-D-C-E-B


Answer: b) B-E-C-A-D

Solution: Determine sequencing by longest "processing time" column

The following jobs are waiting to be scheduled. Today is day 9. Determine the sequence of jobs by using SPT as a priority rule.

The following jobs are waiting to be scheduled. Today is day 9. Determine the sequence of jobs by using SPT as a priority rule.


1) Job Number 2) Arrival Date (day #) 3) Processing Time (days) 4) Due Date (day #)
A 4 2 12
B 5 12 30
C 1 6 21
D 2 1 14
E 3 10 28


a) D-A-C-E-B
b) B-E-C-A-D
c) C-D-E-A-B
d) B-A-E-D-C
e) A-D-C-E-B


Answer: a) D-A-C-E-B

Solution: Determine sequencing by shortest "processing time" column

Which of the following is not an assumption of priority rules?

Which of the following is not an assumption of priority rules?



a) There is no variability in the setup time.
b) There is no variability in the run time of the job.
c) Multiple jobs are waiting to be processed.
d) Only a single job is waiting to be processed.
e) None of these answer choices are correct.


Answer: d) Only a single job is waiting to be processed.

What is Period 3's standard hour deviation for Frank's manufacturing firm, based on the following input/output information?

What is Period 3's standard hour deviation for Frank's manufacturing firm, based on the following input/output information?


Input Information
Period 1 2 3 4
Planned Input 48 68 54 62
Actual Input 47 72 56 48

Output Information
Period 1 2 3 4
Planned Output 50 65 55 65
Actual Output 52 60 53 67
a) 4, -5
b) -3, 2
c) 3, -2
d) 2, -2
e) -14, 2


Answer: d) 2, -2

Solution:
Input Information
Period 1 2 3 4
Planned Input 48 68 54 62
Actual Input 47 72 56 48
Deviation -1 4 2 -14
Cumulative Deviation -1 3 5 -9

Output Information
Period 1 2 3 4
Planned Output 50 65 55 65
Actual Output 52 60 53 67
Deviation 2 -5 -2 2
Cumulative Deviation 2 -3 -5 -3

A Dallas firm manufactures dishwashing liquid. The manager wants to evaluate the performance of station 3, the bottleneck in the filling operation. The following output report is given.

A Dallas firm manufactures dishwashing liquid. The manager wants to evaluate the performance of station 3, the bottleneck in the filling operation. The following output report is given. 

Output Information
Period 1 2 3
Planned Output (hours) 100 100 100
Actual Output (hours) 80 70 110
Calculate the cumulative deviation of the output at the end of period 3.


a) -20
b) -40
c) 10
d) 20
e) 40


Answer: b) -40

Solution:
Output Information
Period 1 2 3
Planned Output (hours) 100 100 100
Actual Output (hours) 80 70 110
Deviation -20 -30 10
Cumulative Deviation -20 -50 -40

Quick-Slim Inc. produces a variety of nutritional diet products. Management wants to evaluate the performance of Work Center 10, the bottleneck in the packaging line. The following input report is given.

Quick-Slim Inc. produces a variety of nutritional diet products. Management wants to evaluate the performance of Work Center 10, the bottleneck in the packaging line. The following input report is given.
Input Information
Period 1 2 3
Planned Input (hours) 110 80 130
Actual Input (hours) 80 120 100

Calculate the cumulative deviation of the input at the end of period 3.



a) -20
b) -30
c) 10
d) 20
e) 30


Answer: a) -20

Solution:
Planned Input (hours) 110 80 130
Actual Input (hours) 80 120 100
Deviation -30 40 -30
Cumulative Deviation -30 10 -20

The initial backlog was 100 hours. Based on the above information, calculate the backlog hours of Work Center 10 at the end of period 3.

Slim-Quick Inc. produces a variety of nutritional diet products. Management wants to evaluate the performance of Work Center 10, the bottleneck in the packaging line. They are particularly worried about the backlogging problem in the work center. The following input/output report is given.
Input Information
Period 1 2 3
Planned Input (hours) 110 80 130
Actual Input (hours) 80 120 100

Output Information
Period 1 2 3
Planned Output (hours) 100 100 100
Actual Output (hours) 80 70 110
The initial backlog was 100 hours. Based on the above information, calculate the backlog hours of Work Center 10 at the end of period 3.

The initial backlog was 100 hours. Based on the above information, calculate the backlog hours of Work Center 10 at the end of period 3.


a) 100
b) 110
c) 140
d) 150
e) 200
c) 140

Solution:
Planned Input (hours) 110 80 130
Actual Input (hours) 80 120 100
Deviation -30 40 -30
Cumulative Deviation -30 10 -20

Planned Output (hours) 100 100 100
Actual Output (hours) 80 70 110
Deviation -20 -30 10
Cumulative Deviation -20 -50 -40

Backlog hours 0 50 -10
Total backlog hours = 100 + 40 or 140

Which of the following scheduling rules is a global priority rule?

Which of the following scheduling rules is a global priority rule?



a) first come, first served
b) last come, first served
c) earliest due date
d) shortest processing time
e) slack per remaining operations


Answer: e) slack per remaining operations

If the schedule shows a 5 day slack between the end of Task A and start of Task B, this means:

If the schedule shows a 5 day slack between the end of Task A and start of Task B, this means:



a) you must start Task B as soon as Task A ends.
b) Task B start is late.
c) Task A is taking longer to complete.
d) Task A and Task B should be performed concurrently.
e) Task B start can be delayed up to 5 days after Task A's scheduled completion.


Answer: e) Task B start can be delayed up to 5 days after Task A's scheduled completion.

Slack can be calculated if __________.

Slack can be calculated if __________.



a) infinite loading and finite loading are used together
b) infinite loading and forward scheduling are used together
c) finite loading and backward scheduling are used together
d) finite loading and forward scheduling are used together
e) forward scheduling and backward scheduling are used together


Answer: e) forward scheduling and backward scheduling are used together

A progress chart shows the relationship between:

A progress chart shows the relationship between:



a) a Gantt chart and PERT chart
b) vacation schedule and work schedule
c) forecast and historical performance
d) planned and actual performance
e) planned and actual efficiency


Answer: d) planned and actual performance

A well designed high-volume system will minimize _________ inventory and reduce _____________for the product or service.

A well designed high-volume system will minimize _________ inventory and reduce _____________for the product or service.



a) work-in-process, throughput time
b) raw material, storage capacity
c) finished, throughput time
d) work-in-process, storage capacity
e) finished, transportation cost


Answer: a) work-in-process, throughput time

Which of the following is not a feature of job-shop operations?

Which of the following is not a feature of job-shop operations?



a) a process layout
b) highly skilled employees
c) special-purpose equipment and tooling
d) highly customized products
e) low volume production


Answer: c) special-purpose equipment and tooling

Flow operations can be ________ or ________ operations.

Flow operations can be ________ or ________ operations.



a) intermittent, continuous
b) intermittent, repetitive
c) repetitive, single shot
d) repetitive, continuous
e) single shot, continuous


Answer: d) repetitive, continuous

Which of the following is not a feature of flow operations?

Which of the following is not a feature of flow operations?



a) a process layout
b) fixed routings
c) special-purpose equipment and tooling
d) high volume production
e) high levels of labor and equipment utilization


Answer: a) a process layout

The exchange of debt-service obligations denominated in one currency for the service on an agreed-upon principal amount of debt denominated in another currency is known

The exchange of debt-service obligations denominated in one currency for the service on an agreed-upon principal amount of debt denominated in another currency is known



A. a currency swap
B. an interest rate swap
C. a floating-rate bond
D. a fixed-rate bond


Answer: A. a currency swap

The basic differences between forward and future contracts is that:

The basic differences between forward and future contracts is that:



A. forward contracts are individually tailored while futures contracts are standardized
B. forward contracts are negotiated with banks whereas futures contracts are bought and sold on an organized exchange
C. forward contracts have no daily limits on price fluctuations whereas future contracts have a daily limit on price flutations
D. all of the above


Answer: D. all of the above

Which of the following is correct? Major advantages of future contracts include the:

Which of the following is correct? Major advantages of future contracts include the:



A. large number of currencies traded
B. extensive delivery dates available
C. freedom to liquidate the contract at any time before its maturity
D. unlimited contract sizes


Answer: C. freedom to liquidate the contract at any time before its maturity

International factoring______?

International factoring______?


a. Is more complicated than domestic factoring.

b. Can be used to extend credit beyond what the exporter can normally afford.

c. Often involves factoring firms in both the exporting and importing countries.

d. All the above.

e. None of the above.


Answer: d. All the above.

International commercial risk can be evaluated by ____?

International commercial risk can be evaluated by ____?


a. Credit report companies.

b. factoring houses

c. Some accounting firms, insurance companies, and banks.

d. All the above.

e. None of the above


Answer: d. All the above.

Argentina, after being chastised by the World Trade Organization for having increased its duty rate on footwear, reduced them, and immediately reimposed them through a ___ tax designed to protect its footwear industry against foreign competition?

Argentina, after being chastised by the World Trade Organization for having increased its duty rate on footwear, reduced them, and immediately reimposed them through a ___ tax designed to protect its footwear industry against foreign competition?



Answer: safeguard

In the Harmonized System of classification, an incomplete or unfinished product is classified ___?

In the Harmonized System of classification, an incomplete or unfinished product is classified ___?


a. in several classifications, depending upon the raw materials of the product

b. in several classifications, depending upon the classifications of the subassemblies of the product

c. in the classification of the closest similar product

d. under a special classification designated "unfinished product"

e. None of the above


Answer: e. None of the above

The choice of a proper Incoterm is a critical decision because?

The choice of a proper Incoterm is a critical decision because?


a. it can be an integral part of export strategy.

b. it is linked to the level of customer service

c. the firm is attempting to provide it can be a competitive advantage

d. All of the above

e. None of


Answer: d. All of the above

The sentence " This merchandise licensed by U.S. for ultimate destination [country]. Diversion contrary to U.S. Law prohibited " is _____?

The sentence " This merchandise licensed by U.S. for ultimate destination [country]. Diversion contrary to U.S. Law prohibited " is _____?


a. a Commerce Control List

b. the Fenwick Anti-Terrorist Amendment of the Export Administration Act

c. the "List of Specially Designated Nationals"

d. the Denied Person's List

e. None of the above


Answer: e. None of the above

The pro forma invoice ___?

The pro forma invoice ___?



Answer: must be written with extreme care to avoid discrepancies between the letter of credit and the commercial invoice

The commercial invoice ___.

The commercial invoice ___. 


a. is sent ahead of the shipment

b. is the same thing as a letter of credit

c. replaces the need for an export license

d. All of the above

e. None of the above


Answer: e. None of the above

The commercial invoice

The commercial invoice



a.is sent ahead of the shipment.

b.is the same thing as a letter of credit.

c.replaces the need for an export license

d.All of the above

e.None of the above


Answer: e.None of the above

An agreement between an exporter and an agent/distributor may state that the laws of the exporter's country apply to governing of the contract. This can be complicated by ______?

An agreement between an exporter and an agent/distributor may state that the laws of the exporter's country apply to governing of the contract. This can be complicated by ______?



Answer: the government of the country where the agent/distributor is located, as it may say it has jurisdiction over the contract.

A contract with no determined duration and which can no longer be terminated for non-performance (since termination did not take place earlier, even though there was evidence of non-performance), is called an evergreen contract?

A contract with no determined duration and which can no longer be terminated for non-performance (since termination did not take place earlier, even though there was evidence of non-performance), is called an evergreen contract?



Answer: True

Under the Uniform Commercial Code (UCC), when a buyer agrees to an offer made by a seller, but indicates a desire for a different schedule of delivery or term of payment, such a response is considered to be a rejection of the offer?

Under the Uniform Commercial Code (UCC), when a buyer agrees to an offer made by a seller, but indicates a desire for a different schedule of delivery or term of payment, such a response is considered to be a rejection of the offer?



Answer: False

The document that corresponds clearly to the transfer of responsibility for a Free Carrier shipment is the receipt given by the carrier to the exporter. This receipt can be?

The document that corresponds clearly to the transfer of responsibility for a Free Carrier shipment is the receipt given by the carrier to the exporter. This receipt can be?


a. a sea waybill.

b. an air waybill.

c. an airway bill

d. All of the above

e. None of the above


Answer: d. All of the above

The Incoterm EXW specifies what regarding delivery?

The Incoterm EXW specifies what regarding delivery?


a. the mode of transportation for delivery

b. who pays for delivery

c.. who buys insurance for delivery

d. All of the above

e. None of the above


Answer: e. None of the above

Incoterms determine?

Incoterms determine?



Answer: which tasks will be performed by the exporter

FOB is

FOB is 


a. Free On Board.

b. an Incoterm that can be used for any merchandise.

c. an Incoterm specifically designed for ocean transportation

d. All of the above

e. None of the above


Answer: d. All of the above


International factoring ___.?

International factoring ___.?


a. is more complicated than domestic factoring

b. can be used to extend credit beyond what the exporter can normally afford

c. often involves factoring firms in both the exporting and importing countries

d. All of the above

e. None of the above


Answer: d. All of the above

International commercial risk can be evaluated by ___.?

International commercial risk can be evaluated by ___.?


a. credit report companies

b. factoring houses

c. some accounting firms, insurance companies, and banks

d. All of the above

e. None of the above


Answer: d. All of the above

The commercial invoice ?

The commercial invoice ?


a. is sent ahead of the shipment.

b. is the same thing as a letter of credit.

c.replaces the need for an export license

d. All the above

e. None of the above.


Answer: None of the above

The ______________ is a self-sustaining federal agency responsible for insuring direct U.S. investments in foreign countries against the risk of currency inconvertibility, expropriation, and other political risk?

The ______________ is a self-sustaining federal agency responsible for insuring direct U.S. investments in foreign countries against the risk of currency inconvertibility, expropriation, and other political risk?



Answer: Overseas Private Investment Corporation

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