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What advantage does Distribution Requirements Planning (DRP) have over a fair share method of inventory deployment?


  1. What advantage does Distribution Requirements Planning (DRP) have over a fair share method of inventory deployment?
  1. Compare and contrast the transport principles of economy of scale and economy of distance. Illustrate how they combine to create efficient transportation.

3a. A chemical plant consumes sulfuric acid in a certain process at a uniform rate.  Total annual consumption is 25,000 gallons.  The plant produces its own sulfuric acid and can set up a production run for a cost of $4,000.  The acid can be stored for $21 per gallon per year, including all carrying cost (cost of capital as well as cost to hold in storage). The production rate is so rapid that inventory depletion during production may be ignored.

i What is the EOQ?  

3b. The provincial government uses massive quantities of computer printer paper, which it buys centrally.  The purchasing department calculates an economic order quantity based on an assumed carrying-cost rate of 30% per year.   A box of printer paper cost $45, it costs $80 to process an order, and annual demand is for 44, 000 boxes of paper.

  1. What is the EOQ?

 4a. What is a shipper’s responsibility when terms of purchase are F.O.B. origin? F.O.B. destination?  Why would a

Shipper prefer one over the other?

4b. What is the role of the freight bill and the bill of lading in a transportation transaction?

  1. Under what conditions could it make sense to combine private and public warehouses in a logistical system?
  2. What is the primary purpose of bar codes or Radio Frequency Identification (RFID) in different in packaging? Is the role different in materials handling?
  1. Jangson Group has just opened a new business in Nigeria. As part of the business plan needed to secure start-up financing, they forecasted a 12 months demand. Data below shows the demand/sales pattern.  Column 1 shows business months 1- 12.

Months        Sales         Forecast         Error          Absolute Error         Square Error        Absolute Percentage Error


1                 328             326

2                 310            337

3                 355            348

4                 362            359

5                 375            369

6                 380             380

7                 408            391

8                 415            401

  1. 417            412
  2. 412            423
  3. 429            434
  4. 434            444



  1. Mean Error (ME)
  2. Mean Absolute Deviation (MAD)
  3. Mean Square Error (MSE)
  4. Mean Absolute Percentage Error (MAPE)


  1. As an aspiring entrepreneur discuss how you’ll lunch your business on the web in a potential foreign market considering the sociocultural factors.
  1. Discuss these two forms of financing in international Trade: Secured and Unsecured.
  2. Discuss the types of risks for doing business in the global market and how to avoid them.

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