01. The soft goods department of a large department store sells 175 units per month of a certain large bath towel. The unit cost of a towel to the store is $2.50 and the cost of placing an order has been estimated to be $12.00. The store uses an inventory carrying charge of I = 27% per year. Determine the optimal order quantity.

Select one:

a. 273.25

b. 184.44

c. 78.88

d. 215.87

02. Suppose that the last four months of sales were 8, 10, 15, and 9 units, respectively. Suppose further that the last four forecasts were 5, 6, 11, and 12 units, respectively. What is the Mean Absolute Deviation (MAD) of these forecasts?

Select one:

a. 10.5

b. 9

c. 2

d. 3.5

03. The jobs listed below need to be completed. If the jobs are sequenced according to the shortest processing time rule, what is the average completion time?

Job	Processing Time (days)	Job due date (days)
A	20	180
B	30	200
C	10	175
D	16	230
E	18	210

Select one:

a. 47.6 days

b. 238.0 days

c. 94.0 days

d. 60.2 day

04. A vending machine dispenses hot chocolate or coffee. Service duration is 25 seconds per cup and is constant. Customers arrive at a mean rate of 94 per hour (assume Poisson). Also assume that each customer buys only one cup. Determine the average time customers spend in the system.

Select one:

a. 0.0295 hours

b. 0.0135hours

c. 0.0279 hours

d. 0.0056 hours

05. What is the expected value of perfect information of the following decision table?

	States of nature
Alternatives	S1	S2
Probability	0.6	0.4
Option 1	200	300
Option 2	50	350

Select one:

a. 0

b. 50

c. 20

d. 150

06.The Hastings Company is a nation-wide wholesaler for small electronic devices. One of its most popular items is a new GPS unit called the WAMI-1000. The company operates 365 days (52 weeks) in a year. Hastings has gathered the following information:

Average demand = 52,000 units/year

Standard deviation of yearly demand = 10,400 units

Average lead time = 5 weeks

Standard deviation of lead time= 1.5 weeks

Z (service level) =1.04

What is the optimal amount of safety stock for the company?

Select one:

a. 1627.86

b. 5000

c. 6627.86

d. 1565.25

07. A city police chief decides to conduct an annual review of the police department by checking the number of monthly complaints. If the total number of complaints in each of the 12 months were 15, 18, 13, 12, 16, 20, 5, 10, 9, 11, 8, and 3 and the police chief wants a z=1.65 confidence level to control the number of complaints. What is the lower control limit in the control chat?

Select one:

a. 0

b. 6.033

c. 17.307

d. 12.586

08. Five jobs are waiting for processing through two work centers. Their processing time (in minutes) at each work center is contained in the table below. Each job requires work center Sigma before work center Delta. According to Johnson's rule, what sequence of jobs will minimize the completion time for all jobs?

Job	Sigma	Delta
R	40	10
S	25	30
T	50	20
U	35	35
V	55	15

Select one:

a. S-V-T-R-U

b. R-S-T-U-V

c. V-R-U-S-T

d. S-U-T-V-R

09. What is the forecast for May based on a three-months weighted moving average applied to the following past demand data and using the weights: 4, 3, 2 (largest weight is for most recent data)?

Nov	Dec	Jan	Feb	Mar	Apr
37	36	40	42	47	43

Select one:

a. 46.7

b. 55.9

c. 44.1

d. 38.9

10.Scotiabank is the only bank in the small town of St. Thomas. On a typical Friday, an average of 10 customers per hour (Poisson distribution) arrive at the bank to transact business. The are two tellers at the bank and the average time required to transact business is four minutes. It is assumed that service time is described by the exponential distribution. A single line would be used and the customer at the front of the line would go to the first available teller. What is the average number of customers in the line.

Select one:

a. 2

b. 1.333

c. 0.75

d. 0.0833

11. A department chair wants to monitor the percentage of failing students in classes in her department. Each class had an enrollment of 50 student's last spring. The number of failing students in the 10 classes offered that term were 1, 4, 2, 0, 0, 0, 0, 0, 0, and 3, respectively. Calculate the upper-bound for the control limits for a p-chart at z=1.96.

Select one:

a. 0

b. 0.0973

c. 0.0198

d. 0.0589

12. A cleaning company uses $10 of chemicals, $40 of labor, and $5 of misc. expenses for each house it cleans. After some quality complaints, the company has decided to increase its use of chemicals by 50%. By what percentage has multifactor productivity fallen?

Select one:

a. 8.3%

b. 25%

c. 50%

d. 0%

13. If Brandon Edward were working to develop a forecast using a moving averages approach, but he noticed a detectable trend in the historical data, he should:

Select one:

a. use weights to minimize the importance of the trend.

b. use a simple moving average.

c. change to a qualitative approach.

d. use weights to place more emphasis on recent data.

14. A six-month moving average forecast is generally better than a three-month moving average forecast if demand:

Select one:

a. follows a downward trend.

b. follows an upward trend.

c. is rather stable.

d. has been changing due to recent promotional efforts.