1. Forecasts A) become more accurate with longer time horizons. B) are rarely perfect. C) are more accurate for individual items than for groups of items. D) are more accurate for new products than for existing products. E) are impossible to make.

2. Which of the following is not a service design technique used to reduce cost? A) increasing customer interaction B) delaying customization C) automation D) modularizing the product E) reducing customer interaction

3. Which of the following is not one of the four main types of inventory? A) raw material inventory B) work-in-process inventory C) maintenance/repair/operating supply inventory D) safety stock inventory E) finished goods inventory

4. Outsourcing A) transfers traditional internal activities to outside vendors. B) utilizes the efficiency which comes with specialization. C) lets the outsourcing firm focus on its key success factors. D) None of the above are true of outsourcing. E) All of the above are true of outsourcing.

5. A production order quantity problem has daily demand rate = 10 and daily production rate = 50. The production order quantity for this problem is approximately 612 units. The average inventory for this problem is approximately A) 61. B) 245. C) 300. D) 306. E) 490.