Aggregate Planning In A Supply Chain

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Questions Bank

Understanding the Supply Chain
Supply Chain Performance: Achieving Strategic Fit and Scope
Supply Chain Drivers and Metrics
Designing Distribution Networks and Applications to e-Business
Network Design in the Supply Chain
Designing Global Supply Chain Networks
Demand Forecasting in a Supply Chain
Aggregate Planning in a Supply Chain
Sales and Operations Planning: Planning Supply and Demand in a Supply Chain
Coordination in a Supply Chain
Managing Economies of Scale in the Supply Chain: Cycle Inventory
Managing Uncertainty in a Supply Chain: Safety Inventory
Determining the Optimal Level of Product Availability
Transportation in a Supply Chain
Sourcing Decisions in a Supply Chain
Pricing and Revenue Management in a Supply Chain
Sustainability and the Supply Chain

All Questions

Question 1

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The goal of aggregate planning is to satisfy demand in a way that minimizes profit.

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Question 2

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Aggregate planning is a process by which a company determines levels of capacity, production, subcontracting, inventory, stockouts, and even pricing over a specified time horizon.

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Question 3

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Traditionally, much of aggregate planning is focused within an enterprise and may not always be seen as a part of supply chain management.

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Question 4

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Short-term production serves as a broad blueprint for operations and establishes the parameters within which aggregate planning decisions are made.

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Question 5

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To create an aggregate plan, a company must specify the planning horizon for the plan and the duration of each period within the planning horizon.

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Question 6

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A planning horizon is usually between three and five years.

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Question 7

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A poor aggregate plan may result in a large amount of excess inventory and capacity, thereby raising costs.

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Question 8

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The aggregate planner must make a trade-off between capacity, inventory, and backlog costs.

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Question 9

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Most strategies that an aggregate planner actually uses are in combination, and are referred to as hybrid strategies.

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Question 10

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To improve the quality of aggregate plans, forecast errors must be taken into account when formulating aggregate plans.

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Question 11

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Forecasting errors are dealt with in aggregate plans using either safety backlog or safety capacity.

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Question 12

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Safety inventory is defined as inventory held to satisfy demand that is higher than forecasted.

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Question 13

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Safety capacity is defined as capacity used to satisfy demand that is lower than forecasted.

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Question 14

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Companies should work with downstream partners to produce forecasts and with upstream partners to determine constraints when doing aggregate planning.

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Question 15

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Given that forecasts are always wrong to some degree, the aggregate plan needs to have some flexibility built into it if it is to be useful.

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Question 16

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As inputs into the aggregate plan change, managers do not need to make changes to the aggregate plan.

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Question 17

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As capacity utilization increases, it becomes less important to perform aggregate planning.

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Question 18

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The goal of aggregate planning is to build a plan that satisfies demand while minimizing downtime.

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Question 19

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Linear programming finds the solution that creates the highest profit while satisfying the constraints that a company faces.

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Question 20

Multiple Choice

The process by which a company determines levels of capacity, production, subcontracting, inventory, stockouts, and even pricing over a specified time horizon is

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aggregate planning.

detail planning.

inventory planning.

sales planning.

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