We can always predict the future perfectly when we use forecasting methods.

The key difference between an EOQ inventory model where demand is known and one where demand is uncertain is in computing the reorder point.

Supply chain decisions are not generally strategic in nature, because purchasing is not a large expense for most firms.

Short-range forecasts tends to be more accurate than longer-range forecasts.

The first step in devising an effective supply chain strategy is to consider the nature of the demand for your products.

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

Demand for ice cream at the Ouachita Dairy can be approximated by a normal distribution with a mean of 47 gallons per day and a standard deviation of 8 gallons per day. The management desires a service level of 95%. Lead time is four days. What reorder point would be consistent with the desired service level in an EOQ model? 

Fresh Market Doughnuts prepares and sells fresh doughnuts. The regular price is $1.25. Day-old doughnuts are sold for $0.50 each. The cost of baking doughnuts is $0.80, and demand is estimated to be normally distributed with a mean of 150 and a standard deviation of 50. What is the optimal stocking level? 

Using the ABC classification system for inventory, which of the following is a true statement?

Safety stock can be defined as the amount of inventory carried in addition to the expected demand.