5.6 BM quiz 1

What is the minimum stock level that a firm wishes to hold at any point in time called?

• Finished goods

• Reorder level

• Buffer stock

• Maximum stock level

What does capacity utilization refer to?

• The extent to which an organization operates at its maximum level

• The amount of stock ordered

• The efficiency of labor

• The total cost of production

What is the term for the choice of managers whether to manufacture a product in-house or purchase it?

• Make or buy decision

• Production planning

• Supply chain management

• Stock control

What does the defect rate measure?

• The average output per worker

• The proportion of output that does not meet quality standards

• The time taken for stock delivery

• The total cost of subcontracting

What is just-in-time (JIT) stock control system based on?

• Deliveries being made just in time for production

• Maintaining high levels of buffer stock

• Stockpiling for peak demand

• Ordering stock in advance

What are raw materials?

• Completed final products

• Substandard output

• Work-in-progress components

• Natural resources used in production

What does the term 'lead time' refer to?

• The time taken to produce a product

• The timeframe from placing an order to receiving stock

• The duration of stockpiling

• The time taken to analyze stock levels

What is a stock control chart used for?

• To determine the defect rate

• To calculate the cost to make

• To monitor and analyze stock levels

• To measure labor productivity

What does the term 'stock-out' mean?

• Ordering more stock than usual

• The process of reordering stock

• Having excess stock

• Running out of stock for production or sale

What is the maximum level that a firm is able to operate at called?

• Capacity utilization

• Productive capacity

• Buffer stock

• Finished goods