NCSU BUS 370 TEST 3| ACTUAL QUESTIONS & CORRECT
VERIFIED ANSWERS| LATEST 2026 UPDATE
1. Inventory
correct answer > Those stocks or items used to support production (raw materials and work-in process
items), supporting activities (maintenance, repair and operations) and customer service (finished goods and spare
parts)
2. Cycle Stock Inventories
correct answer > Components or products that are received in bulk by a downstream partner, gradually
used up, and then replenished
3. Safety Stock Inventories
correct answer > Extra inventory that companies hold to protect themselves against uncertainties in either
demand or replenishment time
4. Anticipation Inventories
correct answer > Held in anticipation of customer demand
5. Hedging Inventories
correct answer > Form of inventory buildup to butter against a potential event (strike, price increase, civil
unrest). Involves speculation to hedge against events that could severely impact the company's strategic initiatives.
6. Transportation Inventories
correct answer > Inventories that is moving from one link in the supply chain to another. Inventory that
is "in the pipeline."
7. Smoothing Inventories
correct answer > Inventories used to smooth out ditterences between upstream production levels and
downstream demand.
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, 8. safety stock, hedge inventory driver
correct answer > Uncertainty in supply or demand
9. Cycle stock driver
correct answer > Mismatch between downstream partner's demand and most eflcient production or
shipment volumes for upstream partner
10. Smoothing inventory driver
correct answer > Mismatch between downstream demand levels and upstream produc- tion capacity
11. Anticipation inventory, transportation inventory driver
correct answer > Mismatch between timing of customer demand and supply chain lead times
12. Independent Demand Inventory
correct answer > Inventory items with demand levels that are beyond a company's complete control.
13. Dependent Demand Inventory
correct answer > inventory items whose demand levels are tied directly to a compa- ny's planned
production of another item
14. Continuous Review
correct answer > An inventory system used to manage independent demand inventory. The inventory level
for an item is constantly monitored, and when the reorder point is reached, an order is released.
15. Invested funds, storage space, insurance
correct answer > Costs that increase as order size go up
16. Ordering, stock-out, transportation, Potential for quantity discounts
correct answer > Costs that decrease as order size goes up
17. Variance
correct answer > the fact or quality of being ditterent, divergent, or inconsistent
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12
VERIFIED ANSWERS| LATEST 2026 UPDATE
1. Inventory
correct answer > Those stocks or items used to support production (raw materials and work-in process
items), supporting activities (maintenance, repair and operations) and customer service (finished goods and spare
parts)
2. Cycle Stock Inventories
correct answer > Components or products that are received in bulk by a downstream partner, gradually
used up, and then replenished
3. Safety Stock Inventories
correct answer > Extra inventory that companies hold to protect themselves against uncertainties in either
demand or replenishment time
4. Anticipation Inventories
correct answer > Held in anticipation of customer demand
5. Hedging Inventories
correct answer > Form of inventory buildup to butter against a potential event (strike, price increase, civil
unrest). Involves speculation to hedge against events that could severely impact the company's strategic initiatives.
6. Transportation Inventories
correct answer > Inventories that is moving from one link in the supply chain to another. Inventory that
is "in the pipeline."
7. Smoothing Inventories
correct answer > Inventories used to smooth out ditterences between upstream production levels and
downstream demand.
https://www.stuvia.com/en-us/user/MBoffin 1/
12
, 8. safety stock, hedge inventory driver
correct answer > Uncertainty in supply or demand
9. Cycle stock driver
correct answer > Mismatch between downstream partner's demand and most eflcient production or
shipment volumes for upstream partner
10. Smoothing inventory driver
correct answer > Mismatch between downstream demand levels and upstream produc- tion capacity
11. Anticipation inventory, transportation inventory driver
correct answer > Mismatch between timing of customer demand and supply chain lead times
12. Independent Demand Inventory
correct answer > Inventory items with demand levels that are beyond a company's complete control.
13. Dependent Demand Inventory
correct answer > inventory items whose demand levels are tied directly to a compa- ny's planned
production of another item
14. Continuous Review
correct answer > An inventory system used to manage independent demand inventory. The inventory level
for an item is constantly monitored, and when the reorder point is reached, an order is released.
15. Invested funds, storage space, insurance
correct answer > Costs that increase as order size go up
16. Ordering, stock-out, transportation, Potential for quantity discounts
correct answer > Costs that decrease as order size goes up
17. Variance
correct answer > the fact or quality of being ditterent, divergent, or inconsistent
https://www.stuvia.com/en-us/user/MBoffin 2/
12
