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Which inventory technique is used when the demand for one item depends on demand for another?
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What is seasonal inventory?
inventory built up to counter predictable variability in demand
What are economic order quantity assumptions?
EOQ is one of the most common known inventory control technique. This technique involves some assumptions: 1. demand is known and constant 2. the lead time is known and constant 3. the receipt of inventory is instantaneous 4. quantity discounts are not possible 5. the only variable costs are the ordering cost and the holding cost. 6. orders are placed so that stockouts are avoided.
What determines the supply and demand of the factors of production?
The demand for labor is a derived demand in that it depends on a company's decision to supply output in another market. This expansion in a market that has customers is the main factor in how much the demand for labor will increase.
Distinguish between in-process inventory and safety stock inventory and seasonal inventory?
Inventory need for the ongoing process and kept at a level that production will not be affected. Inventory kept for emergencies, or as a buffer for a sudden a surge in demand. Inventory that is only needed for one season, after which it is sold off or stored off-site.
Is a technique advertisers employ to increase consumer demand for their goods and services?
turning luxuries into necessities
What is seasonal inventory?
inventory built up to counter predictable variability in demand
What are the six types of inventions?
Cycle inventory - Average amount of inventory used to satisfy demand between shipments.Safety inventory - Inventory held in case demand exceeds expectations.Seasonal inventory - Inventory built up to counter predictable variability in demand.In-transit Inventory - Inventory in transit between origin and destination.Speculative Inventory - Inventory held for the reasons of speculation.Dead Inventory - Non-moving inventory.
What is the risk of holding inventory?
Demand may drop and your inventory may lose all of its value.
Inventory models in which the rate of demand is constant are called?
Deterministic.
What are economic order quantity assumptions?
EOQ is one of the most common known inventory control technique. This technique involves some assumptions: 1. demand is known and constant 2. the lead time is known and constant 3. the receipt of inventory is instantaneous 4. quantity discounts are not possible 5. the only variable costs are the ordering cost and the holding cost. 6. orders are placed so that stockouts are avoided.
Why do you need to keep inventory?
to maintain the risk of demand uncertainity in an organization
Formula for Annual inventory holding cost?
Holding cost per unit * Average Demand Average Demand= 1/2 * Annual Demand
What determines the supply and demand of the factors of production?
The demand for labor is a derived demand in that it depends on a company's decision to supply output in another market. This expansion in a market that has customers is the main factor in how much the demand for labor will increase.
An aircraft company would have an low inventory turnover?
An aircraft company will incur low inventory turnover if the stock is purchased as bulk and demand is low, thus slow discharge of inventory.
What is J.I.T inventory?
J.I.T inventory stands for Just-In-Time inventory management, a strategy where products are delivered to a company right when they are needed for production or sale. This approach minimizes inventory carrying costs and reduces waste by having inventory arrive "just in time" to meet demand.
Distinguish between in-process inventory and safety stock inventory and seasonal inventory?
Inventory need for the ongoing process and kept at a level that production will not be affected. Inventory kept for emergencies, or as a buffer for a sudden a surge in demand. Inventory that is only needed for one season, after which it is sold off or stored off-site.
What is anticipation inventory?
Components, material, or goods kept at hand to meet seasonal fluctuations in demand or to meet the shortfall caused by erratic production. Also called anticipation inventory, build stock, seasonal inventory, or seasonal stock.
