What is the primary purpose of Material Requirements Planning (MRP)?
a) To manage employee performance
b) To forecast future sales
c) To ensure that materials and components are available for production when needed
d) To design new products Answer: c) To ensure that materials and components are available for production when needed
Which of the following is NOT a key input to the MRP system?
a) Bill of Materials (BOM)
b) Master Production Schedule (MPS)
c) Inventory Records
d) Market Demand Forecast Answer: d) Market Demand Forecast
What does the Bill of Materials (BOM) specify in MRP?
a) The sales forecast for a product
b) The sequence of production operations
c) The materials and components required to manufacture a product
d) The production capacity of manufacturing equipment Answer: c) The materials and components required to manufacture a product
What is the “Master Production Schedule” (MPS) used for in MRP?
a) To list all suppliers and their lead times
b) To specify the quantity and timing of finished goods production
c) To manage employee schedules
d) To design new product features Answer: b) To specify the quantity and timing of finished goods production
In MRP, what does “Lead Time” refer to?
a) The time required to complete a production run
b) The time between ordering materials and their arrival
c) The time needed to design a new product
d) The time taken to forecast future demand Answer: b) The time between ordering materials and their arrival
Which of the following is a key output of an MRP system?
a) Sales Forecast
b) Production Schedule
c) Supplier List
d) Inventory Records Answer: b) Production Schedule
What is “Gross Requirements” in the context of MRP?
a) The total amount of finished goods needed for the production plan
b) The total amount of materials needed before accounting for inventory on hand
c) The amount of inventory required to meet future demand
d) The amount of materials ordered from suppliers Answer: b) The total amount of materials needed before accounting for inventory on hand
In MRP, what does “Net Requirements” refer to?
a) The total inventory available for production
b) The difference between gross requirements and on-hand inventory
c) The total amount of materials on order
d) The amount of finished goods required for the market Answer: b) The difference between gross requirements and on-hand inventory
What does “Safety Stock” refer to in MRP?
a) The additional inventory kept to prevent stockouts
b) The amount of inventory needed for production
c) The minimum order quantity from suppliers
d) The inventory used for quality control Answer: a) The additional inventory kept to prevent stockouts
Which report in MRP indicates the need to order materials to meet production schedules?
a) Purchase Order Report
b) Material Requirement Report
c) Inventory Turnover Report
d) Production Order Report Answer: b) Material Requirement Report
What is “Capacity Planning” in relation to MRP?
a) Estimating future sales
b) Determining the production capacity needed to meet material requirements
c) Scheduling employee shifts
d) Designing new production facilities Answer: b) Determining the production capacity needed to meet material requirements
Which of the following is NOT a benefit of using an MRP system?
a) Improved inventory control
b) Increased lead times
c) Better production scheduling
d) Reduced stockouts Answer: b) Increased lead times
What is the purpose of “Order Release” in MRP?
a) To authorize the production of new products
b) To initiate the procurement of materials needed for production
c) To forecast future material requirements
d) To design new supply chain processes Answer: b) To initiate the procurement of materials needed for production
Which term refers to the adjustment of MRP outputs to account for changes in demand or supply conditions?
a) Dynamic Adjustment
b) Demand Forecasting
c) Capacity Adjustment
d) MRP Rescheduling Answer: d) MRP Rescheduling
What is “Lot Sizing” in MRP?
a) Determining the quantity of materials to order or produce at one time
b) Scheduling production runs
c) Managing supplier relationships
d) Forecasting future sales Answer: a) Determining the quantity of materials to order or produce at one time
What does “ATP” stand for in MRP systems?
a) Available-to-Promise
b) Actual-to-Production
c) Advanced-to-Produce
d) Average-to-Plan Answer: a) Available-to-Promise
What is the function of “Reorder Point” in MRP?
a) To determine when to place an order based on inventory levels
b) To schedule production runs
c) To calculate material requirements
d) To design new production processes Answer: a) To determine when to place an order based on inventory levels
Which of the following best describes the “Time Bucket” concept in MRP?
a) A period of time used for aggregating material requirements
b) The lead time required to receive materials from suppliers
c) The total production time for a product
d) The period of time for forecasting demand Answer: a) A period of time used for aggregating material requirements
What does “MRP II” stand for, and how does it differ from basic MRP?
a) Material Requirements Planning II; it integrates additional functions like finance and HR
b) Managed Resource Planning II; it focuses on supplier management
c) Manufacturing Resource Planning II; it includes advanced scheduling and capacity planning
d) Maximum Resource Planning II; it increases inventory levels Answer: c) Manufacturing Resource Planning II; it includes advanced scheduling and capacity planning
What is the key difference between “Push” and “Pull” systems in MRP?
a) Push systems schedule production based on forecasts, while pull systems schedule based on actual demand
b) Push systems focus on supplier relationships, while pull systems focus on production
c) Push systems are used for batch production, while pull systems are for continuous production
d) Push systems increase inventory, while pull systems reduce inventory Answer: a) Push systems schedule production based on forecasts, while pull systems schedule based on actual demand