1) The production order quantity model helps organizations by? a. Finding the co
ID: 332401 • Letter: 1
Question
1) The production order quantity model helps organizations by?
a. Finding the correct inventory amount needed to support production at the most economical cost of the inventory system.
b. Finding the best batch size for production at the most economical cost of the inventory system.
c. Finding the correct amount of units needed to support demand.
d. None of the above
2. Method used to find a distribution center that will minimize distribution costs?
a. The Factor- Rating Method
b. Location Cost-Volume Analysis
c. Center-of-Gravity Method
d. Transportation Model
Explanation / Answer
Answer 1: Option A - Finding the correct inventory amount needed to support production at the most economical cost of the inventory system.
Explanation: Through EOQ methods, the companies get to know the most economical amount of order to be placed so that inventory holding cost, reordering cost, pilferage and theft cost are low to the company.
Answer 2: Option C - Center-of-Gravity Method
Explanation: Also known as weight center technique, Centre-of-gravity method is used to locate a warehouse facility at the center of movement of operations based on weight and distance.
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