1. ARTIC Inc. is attempting to predict the profitability of a new product line. The marketing department has developed three different forecasts of annual demand and their related probabilities of occurrence for the coming year ....low (0.2), medium (0.5), and high (0.3). To develop an estimate of the annual profit figure for the new product line, Artic Inc. should employ:

a. Queuing theory

b. Expected value analysis

c. Correlation and regression analysis

d. Discounted cash flow techniques

2. A company has a choice of making Product A (fixed costs = P10,000 and variable costs = P5 per unit) or Product B (fixed costs = P20,000 and variable costs = P3 per unit). There are two possible projected sales levels for each product: sales of 10,000 units and sales of 20,000 units. The unit selling price of each product is P3.75. if the company chooses to produce B and the 20,000 units are sold, then the resultant payoff would be ______.

3. Compute the expected total stockout cost for the year based on the following: 12 orders per year, P0.40 stockout cost per unit, and stockout probability estimates of: Probability of stockout: 0.20; Stockout in Units: 50; Probability of stockout: 0.10 ; Stockout in Units: 100

4. Clerks A, B and C process 50%, 20%, and 30% of the sales order, respectively. The percentage of errors made in processing a sales order by clerks A, B and C are 2%, 5% and 10%, respectively. What is the probability that this invoice was processed by clerk C?

5. A plant has 6,000 male and 4,000 female employees. 20% of these employees work overtime. A random sample of 100 plant employees would be expected to contain about: Female: ______

6. Suppose WWW's financial consultants report (1) that the inventory turnover ratio is Sales / Inventory = 3 times versus an industry average of 4 times, (2) that WWW can reduce inventories and thus raise its turnover to 4 without affecting sales, the profit margin, or the other asset turnover ratios. Under those conditions, use the AFN equation to determine the amount of additional funds WWW will require next year if sales grow by 20%.

7. The inability to accurately estimate demand is a problem. If demand is greater than the number of units available, sales will be lost. If demand is less than the number of units available, the carrying cost will increase. In order to minimize costs associated with stocking more or less units than the actual demand, the company should use:

a. Queuing analysis

b. Inventory planning techniques

c. Linear programming

d. Program evaluation review techniques

8. LUPID Inc. sells 10,000 RTW pants evenly throughout the year, the cost of carrying one unit in inventory for one year is P6 and the purchase order cost is P108 per order. What is the EOQ?

9. Information regarding the usage of material Y which shall be required evenly throughout the year by GAC COMPANY: Annual usage in units 30,000; Working days per year 250; Safety stock in units 1,200; Normal lead time in working days 25. The order point is_____.

(Nos. 10 to 12) Given the following data: WEEK: 1, 2, 3, 4, 5, 6, 7, 8, 9, 10 SALES: 3, 5, 7, 9, 11, 13, 15, 17, 19, 21. The time series follows a _____ model (CONSTANT MODEL OR TREND MODEL)?

11. Using a three week moving average system, what would be the sales forecast for week 4?

12. Using a five week moving average system, what would be the sales forecast for week 6?