question

supply chain partnerships

answer

Critical to the implementation of purchasing and supply management techniques is the development of _________________ suppliers supply chain partnerships sources long range strategies a business plan

question

strategic alliance / supply chain

answer

Also termed a __________, a supply chain partnership is a relationship formed between two independent entities in supply channels to achieve specific objectives and benefits, and it is these partnerships that form the essential building blocks of _______________ management. supply alliance / operations strategic source / supply and operations strategic alliance / supply chain preferred supplier / strategic alliance preferred partner / strategic

question

all of the above Ideally, the end result for both firms should be _____________, yielding greater control of costs, cycle times, inventory, quality, and, ultimately, customer satisfaction.

answer

Within the win-win partnership dyad, buyer and supplier share goals as well as inherent risks through joint planning and control, seeking to create a supply chain with increased information flow and enhanced loyalty. Like the overall goal of supply chain management, such coordination allows for ________________________. improved service technological innovation product design with decreased cost all of the above A and C only

question

decreased uncertainty

answer

Ideally, the end result for both firms should be _____________, yielding greater control of costs, cycle times, inventory, quality, and, ultimately, customer satisfaction. decreased uncertainty improved customer satisfaction decreased customer complaints increased certainty higher quality and reduced defects

question

buyer-supplier partnering

answer

And like supply chain management, _____________ extends beyond a simple interfirm relationship to involve integration of confidential and vital processes such as strategy formation, planning, information flow, and operations. purchasing management buyer-seller management buyer-supplier partnering buyer-seller partnering purchaser-seller relations

question

partnering / partnership

answer

Though ___________ has received abundant recognition over the last few decades from both researchers and practitioners alike, the concept of a __________ is perhaps as old as or even older than business itself. buyer relations / partnering partnering / relationships partnering / partnership strategic partners / buyer-seller relations strategic partners / buyer-seller relations

question

strategic alliance

answer

Although many firms engage in partnering activities, the specific interpretation of a ___________ or partnership is at best vague. strategic relationship buyer-seller alliance buyer-supplier partner buyer-seller relationship strategic alliance

question

True

answer

Partnerships move beyond special influence transactions by involving efforts of both firms to coordinate functional activities. The three tiers listed below show how partnerships can be segmented based on the intensity and duration of the leadership. Tier I partnerships entail short-term, single-function/division coordination. Tier II partnerships extend coordination to integration and encompass multiple activities over a longer time span. Tier III partnerships dilate into significant levels of operational integration. True False

question

ally with a reduced supplier base

answer

Supply chain partnerships bridge the barrier between buyer and seller, leading manufacturers to ________________. share more information with their suppliers ally with a reduced supplier base ally with an improved supplier base choose suppliers more wisely choose suppliers more carefully

question

a reduction in the number of suppliers

answer

Some supply managers argue that implementation of many new manufacturing techniques necessitates _______________________. a reduction in the number of suppliers choosing suppliers more carefully switching to multiple supply sources negotiating delivery terms more favorable to the company negotiating delivery terms more favorable to the company

question

a reduced number of suppliers

answer

Despite the differences in opinions about the size of the supplier base, the major issue remains that a closer relationship with suppliers facilitates a reduced number of sales representatives improved performance of all involved a closer bond with supply firms a reduced number of suppliers JIT deliveries of needed supplies

question

reduced supplier / fewer suppliers

answer

The objective of a drastically ____________ base precludes an acceptance of supplier partnerships because a firm must accept dependence upon _____________ before they can internalize legitimate forms of supply chain management and supplier partnerships. improved supplier / sales representatives reduced supplier / fewer suppliers increased supplier / fewer sales representatives improved marketing / multiple suppliers improved operations / multiple suppliers

question

less in intangible benefits

answer

A Harvard Business School study concluded that a key driver in the decline of U.S. competitiveness in the international marketplace has originated from investing _______________, such as supplier relations. more in tangible benefits less in tangible benefits less in intangible benefits more in intangible benefits none of the above

question

a competitive advantage

answer

Over recent decades, firms within the supply chain have begun to realize the advantages enjoyed from sharing of technology, information, and planning with other firms. Even competitors, and many modern business thinkers will claim that not only is a more open and relational attitude advantageous, but actually essential and inevitable in maintaining ___________________. strategic advantage a lead over the competition a competitive advantage control of the market an improved market share

question

emulate these supplier alliances

answer

Recognizing partnerships between buyer and supplier, as a fundamental driver for the success of the Pacific Rim supply chain processes, American firms have begun to _______________. become more competitive operate like Pacific Rim companies use the same processes emulate these supplier alliances improve relationships with suppliers

question

vertical integration / partnerships

answer

While many firms have sought ___________ through acquisition to harness supplier expertise, some argue that _____________ can provide similar benefits without the necessity of ownership and arduous exit barriers. horizontal integration / mergers vertical integration / cooperation horizontal integration / cooperatives stakeholders / stakeholders vertical integration / partnerships

question

does not meet expectations

answer

With its many benefits, supply chain partnerships retain several inherent risks that can be potentially damaging to participants. First and foremost, heavy reliance on one partner can be disastrous if the partner _____________. changes the specifications does not deliver on time fails to produce quality products does not meet expectations increases the price of his materials

question

False

answer

Before firms can enjoy the benefits of a buyer supplier partnership, they must first develop and design the partnership implementation process. A supplier partnership involves a significant attitudinal as well as structural change from traditional supply arrangements, so the allying firms must be meticulous to ensure that a true win-win partnership is developed. True False

question

risks and benefits

answer

The first step in the supplier partnership implementation process includes the strategic verification of the need for a supplier partnership. Here, the firm must evaluate the potential ____________ of a partnership in comparison to traditional processes. strengths and weaknesses strengths and benefits strengths and risks duration and strengths risks and benefits

question

needs and participation

answer

Once a partner is selected, the establishment of the actual relationship provides the critical step in which the partners must create a complete sense of awareness about the ______________ of all involved parties. strengths and weaknesses goals and aspirations needs and participation goals and strategies goals and objectives

question

Reward partner for superb quality and service

answer

Guides to the implementation process are summarized below, with one exception. Which one is not one of the steps? Establish strategic need for partnership Develop partner criteria, evaluate suppliers, and select partner Formally establish partnership Maintain and refine partnership (possible reduction or dissolvement Reward partner for superb quality and service

question

either enhance its development or bring about its dissolution

answer

The final step in the partnering process includes the maintenance of the relationship to ______________________________. improve communications and processes foster good communications and relationships either enhance its development or bring about its dissolution develop unified goals and objectives develop unified goals and objectives

question

False

answer

Ultimate dissolution of the partnership may be necessary if the firms are able to successfully work through the critical steps of partnership formation or synergies can be recognized. True False

question

suspicion / difficult

answer

Abandonment of partners may lead to __________, making future partners _________ to attract. increased production / easier suspicion / difficult greater opportunities / easier a search for new partners / somewhat easier euphoria / exciting

question

has sufficient potential

answer

A rule of thumb must be developed that can be used to decide whether or not a partnership _____________. has sufficient potential is appropriate would work for both parties would be a good opportunity for all involved would not have any potential for success

question

social science

answer

The notion of interfirm power holds its roots in ______________ literature and has been extensively developed by marketing channel researchers. management science organizational behaviour organizational science social science operations science

question

True

answer

As defined by Maloni and Benton: the power of a supply chain member [is] the ability to control the decision variables in the supply strategy of another member in a given chain at a different level of the supply chain. It should be different from the influenced member s original level of control over their own supply strategy. True False

question

power / target and source

answer

Extremely complex in nature, ________ serves as a composite relationship-oriented variable, affecting both the ______________ in many transparent as well as concealed ways. organizational science / buyers and sellers power science / buyers and sellers a partnership / target and source power / target and source a partnership / buyers and suppliers

question

power

answer

Exploration of the effects of _______ on factors of the supplier buyer alliance provides the key to understanding the concept of the power-partnership link... politics power negotiations processes persuasion

question

power / target / target

answer

The notion of ______ in an interfirm relationship implies _______ dependence on the source; otherwise the _______ would not need to subject itself to the unbalanced relationship. politics / some / seller politics / heavy / source power politics / seller / seller power politics / target / source power / target / target

question

Power / perceptions

answer

________ is a direct result of dependence, and the extent of dependence is directly induced by _____________ of power. Power politics / the sources Politics / the targets Power / perceptions Power / sources Power politics / the illusions

question

False

answer

Two factors driven by power and critical to the partnership dyad are commitment and trust. Trust may be defined as the perception of being emotionally impelled. True False

question

power and commitment

answer

The relationship between _______________ is dependent upon the origins of the commitment. power and commitment involvement and commitment power and politics power and involvement power and involvement

question

Commitment / involvement

answer

___________ is nothing more than a form of compliance as well as identification and _________. Commitment / feelings Involvement / feelings Involvement / cooperation Cooperation / involvement Commitment / involvement

question

target / source s

answer

Power essentially attempts to force a _______ to comply with the ________ desires, and, like commitment, the level of compliance and more importantly cooperation are critical to the relationship tenure as well as profitability. seller / buyer s buyer / seller s supplier / buyer s target / seller s target / source s

question

Compliance / compliance

answer

__________ is action without inherent desire, and, thus, _________ remains a relatively easy factor to measure since it implies action, not feeling. Involvement / involvement Cooperation / cooperation Compliance / compliance Commitment / commitment Response / response

question

incompatibility of actual or desired responses

answer

Conflict can be defined as tension between two or more social entities... which arises from _______________________. mutual distrust between all the parties incompatibility of actual or desired responses a difference of opinions or desires a difference in core values one party taking advantage of the other party

question

hinders

answer

Conflict is present in the supply chain when one supply chain member ________ goal attainment and performance of another. Conflict is an omnipresent factor in any supply chain relationship. hinders blocks facilitates enhances fosters

question

Satisfaction

answer

__________ in the supply chain can be defined as the extent of contentment with the relationship. Cooperation Good Service Good supplier relations Dgodd public relations Satisfaction

question

Satisfaction

answer

Ultimate supply chain partner __________ remains the overriding factor in determining the future of a supply chain partnership. relations service power involvement Satisfaction

question

all of the above

answer

Drivers of satisfaction within supply chain partnerships include relationship-oriented factors such as _________________. planning and mutuality interdependence operational information exchange all of the above A and C only

question

performance and subsequent profitability

answer

A final point on the effects of power concerns the ultimate ______________ of the supply chain members as well as the supply chain itself. profitability performance and subsequent profitability cost reductions and subsequent profitability productivity and profitability performance

question

execute intentions and goals

answer

Performance may be defined as the ability to ________________. execute intentions and goals meet goals and objectives attain goals and meet expectations meet expectations and execute strategies execute plans and meet profit goals

question

Total quality management (TQM)

answer

________________ is still one of the hottest topics in the business world today. Management By Objectives (MBO) Theory X and Theory Y Total quality management (TQM) Theory Z Organizational Development (OD)

question

TQM

answer

Effective _____ requires the integration of production planning, marketing, engineering distribution, and field service. MBO OD RAM PODS TQM

question

TQM

answer

______ reaches much wider than the traditional quality view of incoming inspection and process control it means that the entire organization is working as a team, including top management and each and every employee. TQM MBO TMQ OB PODS

question

False

answer

MBO is an innovative way of thinking that affects the culture, the strategy, and the technology of a company. True False

question

mission / output / customers

answer

Implementing TQM requires the following: Defining the _______. Identifying systems ________. Identifying systems ________. vision / inputs / suppliers objectives / processes / clients mission / output / customers vision / weaknesses / stakeholders goals / strengths / shareholders

question

customer / customer / expectations

answer

Implementing TQM also requires the following: Negotiating __________ requirements. Developing a supplier specification that details ___________ requirements and expectations. Determining the necessary activities required to fulfill those requirements and ____________. product / supplier / goals labor / labor / standards customer / customer / expectations project / employees / responsibilities supplier / sellers / goals

question

quality management

answer

Without high-quality raw materials or component parts from suppliers, a (n) _____________ program will not be successful. quality management strategic management organizational development production management operations management

question

reduced transaction costs

answer

A healthy long-term relationship between suppliers and manufacturers is becoming more and more important and can result in ___________________. improved customer service improved product margins improved profit margins better quality products reduced transaction costs

question

key

answer

The ______ suppliers usually get the long-run demand forecast and are involved in the manufacturer s product development. backup key preferred local national

question

backup

answer

The _________ suppliers usually get a small volume of business and do not have a close working relationship with the manufacturer. backup key preferred local national

question

quality assurance/customer

answer

The suppliers ___________ systems must be consistent with the in-house quality requirements of the __________. information management/seller manufacturing/client IT/customer quality assurance/customer internal/buyer

question

True

answer

Each buying firm must specify in detail the agreed-upon quality targets. As an example, at a minimum, the following four issues should be addressed in any purchasing contract: PPM target agreement, Field failure and reliability requirements, Warranty agreement, Urgency to solve problems True False

question

traditional

answer

The ____________ approach to manufacturing process control is to select production samples and compare the attributes of the sample to the specifications. progressive current MBO traditional most effective

question

diagnosed and resolved / substandard

answer

SPC uses two control charts to ensure quality in manufacturing: the sample mean (X-bar) chart and the sample range (R) chart. The control chart limits are established for X-bar and R charts based upon tolerances set during the design stage of the product. In most cases, problems are ________________ before any ___________ parts are produced, thus reducing scrap and rework diagnosed and resolved / substandard identified / faulty solved / defective identified / new fixed / defective

question

a description of the required output / consumer

answer

The specification is ____________________, including specific characteristics such as weights and measurements that enable the product to work in a manner acceptable to the ___________. a governmental document / inspector a state mandate / auditor a plan / buyer a description of the required output / consumer program / client

question

standard deviation / standard deviation

answer

The ____________ is actually the average distance a normal point is from the mean. Thus, the ____________ represents a more tractable measure of the variance. common deviation / common deviation standard deviation / standard deviation quality variance / quality variance enhances fosters

question

Six-sigma / six-sigma

answer

_________ standards can be applied to both manufacturing and service firms using the same methodology. SPC provides input to the _________ approach. Eight alpha / eight alpha Sigma nine / sigma nine One omega / one omega Six epsilon / six epsilon Six-sigma / six-sigma

question

False

answer

The ability to identify errors before they occur recycles scrap material, improves downstream inspections, and will promote profitability. True False

question

Six sigma / six sigma

answer

________ is a way to measure supplier quality. Supplying firms that follow the core philosophy of _________ will make excellent strategic partners. Eight alpha / eight alpha Sigma nine / sigma nine Six sigma / six sigma One omega / one omega Six epsilon / six epsilon

question

Improvement of profit margins

answer

Six-sigma suppliers focus on all of the items listed below with one exception. Which one is the exception? Defects per million as a standard metric Provision of extensive employee training Improvement of profit margins The reduction of non-value-added activities

question

Taguchi

answer

The __________ method (TM) nicely complements many of the advantages of SPC. Tanner Taguchi Tupelo Tasmania Transactional

question

statistical / implement

answer

Although the basic ideas of TM are simple, the ___________ procedures are complex and can be difficult to __________. implementation / understand core / implement basic / understand statistical / understand statistical / implement

question

Commodity-based

answer

___________ components are those components not defined as strategic components. Composite OEM Structural Commodity-based Common

question

reverse auction

answer

Intensive price competition and information technology have led to the implementation of a ______________ procurement approach for commodity components. reverse auction progressive standardized staple multiple source

question

Acceptance sampling

answer

______________ is a methodology used to determine whether to accept or reject a batch of non-strategic components or items. TQM MBO Quality Assurance Acceptance sampling Zero-defects

question

Deming Award / Malcolm Baldridge

answer

There are major quality awards that ensure that suppliers are TQM effective. The most universally known quality awards are the ____________ and the ________________ National Quality Award. American Productivity Center Award / Master Malcolm Deming Award / Malcolm Baldridge National Productivity Center Award / Department of Commerce Department of Commerce Award / Master Baldridge Deming Productivity Center Award / Deming-Baldridge

question

Dr. W. Edwards Deming

answer

_____________________ is known as the father of the Japanese post-war industrial revival and was regarded by many as the leading quality guru in the United States. Dr. Malcolm Baldridge Dr. Samuel E. Edwards Dr. Malcolm Deming Dr. Thomas Edison Dr. W. Edwards Deming

question

True

answer

In order to qualify for the (Malcolm Baldridge) Award, applicants must address the following categories: 1. Leadership 2. Information and analysis 3. Strategic quality planning 4. Human resource development and management 5. Management of process quality 6. Quality and operational results 7. Customer focus and satisfaction True False

question

zero defect target

answer

In order to successfully achieve a __________, buying and supplying organizations must continuously improve their processes. zero defect target TQM goal quality award perfection goal or objective productivity goal or objective

question

ISO 9001 / ISO 9001

answer

_________ is a set of standards that document the implementation of a quality program. In order to be certified, suppliers need to provide documentation to an external examiner that they meet the ________ requirements. Once a firm is certified, it will be listed in a directory so that all of its potential customers can know which firms have been certified and to what level. USO 9500 / USO 9500 PSO 9000 / PSO 9000 ASO 9600 / ASO 9600 ESO 9000 / ESO 9000 ISO 9001 / ISO 9001

question

Quality Function Deployment

answer

______________ (QFD) focuses on how businesses develop high quality products for (their) customers. QFD is driven by cross functional market research. This is the process of understanding customer expectations, and how well providers of products address these expectations Quality Fabrication and Development Quantity Functional Development Quality Function Deployment Quick Functional Development Quick Fabrication and Development

question

False

answer

Customer expectations include 1) fabrication, 2) appearance, 3) maintainability, and 4) reliability. True False

question

Quality Function Deployment

answer

_______________ (QFD) is a methodology for collecting customer information to drive product development. Quality Function Deployment Quantity Functional Development Quick Functional Development Quality Fabrication and Development Quick Fabrication and Development

question

process-based evaluations and performance-based evaluations

answer

The buyer s evaluation of the supplier s performance is a catalyst for the supplier development activities. There are two main categories for the supplier evaluation. Identify the two correct evaluations. promotional-based evaluations and productivity-based evaluations production-based evaluations and effectiveness-based evaluations specification-based evaluations and goal attainment based evaluations customer service-based evaluations and customer relations-based evaluations process-based evaluations and performance-based evaluations

question

performance-based

answer

The ___________ evaluation is an assessment of the supplier s actual performance on a variety of criteria, such as delivery reliability, cost, quality defect rate, etc. productivity-based customer service-based customer relations-based effectiveness-based performance-based

question

Taguchi

answer

The ________ method (TM) addresses design and engineering (offline) as well as manufacturing (online) quality. This fundamentally differentiates TM from SPC, which is purely an online quality control method. Tasmania Truk Taguchi Tanner Transactional

question

the loss of sales

answer

The most severe penalty for poor quality expectations is (are) ____________. If the quality of the inputs to the productive system is inferior, the final product will be inferior. government sanctions consumer boycotts court cases consumer complaints the loss of sales

question

Acceptance plans

answer

_____________ must be developed to determine the disposition of a lot of raw materials on component parts. If a batch of parts is inferior, it should be rejected and returned to the supplier. Specifications Warranties Guarantees Return policies Acceptance plans

question

acceptance

answer

Setting the ___________ criteria is usually based on either predetermined standards or basic statistics. return warranty acceptance specification specification

question

an acceptable final test sample / generated and verified

answer

The new or modified part agreement between the buying and the selling firm is usually complete after ________________________ has been _____________. a sample / produced prototype / created and tested an acceptable final test sample / generated and verified production / set up and is in operation the design / approved by engineering

question

pay for its items and services

answer

One of the most important and complex decisions a firm has to make is how much to _____________________. buy for its production lint charge for its products and services pay for its items and services pay its employees charge off as expenses

question

all of the above

answer

The price of a product or service should be expected to cover cost of _____________, plus a reasonable profit. production promotion distribution all of the above A and B only

question

market price

answer

The effective buyer in a competitive environment will more than likely obtain purchased goods and services at a __________ given that quality, delivery, and proper quantities are appropriate. market price discount fair price low bargain

question

be rendered noncompetitive

answer

If you buy items for one-half the market price without obtaining appropriate quality, delivery, or quantity standards, your firm would _________________. have a competitive advantage suffer the consequences be at a strategic disadvantage be rendered noncompetitive be ahead of the competition

question

it is only one

answer

In general, price is important; however, remember __________ of many variables that go into purchasing decisions. it is the single most important quality is the most important it is only one delivery is the most important quantity standards are the most important

question

right / right / right / right

answer

The objective of the purchasing department is to buy the _______ materials from the ______ supplier at the ______ time and at the ______ price. best quality / best / appropriate / lowest best / best / appropriate / best right / right / right / right most / best / best / best right / best / appropriate / lowest

question

business environment / power imbalance

answer

Perhaps the most important factor associated with the purchasing decision is the _____________ and the ______________ between the buying and supplying firms. business environment / power imbalance economy / relationship economy / power relationship economic environment / power relationship business economy / power imbalance

question

conceptual and the economic impacts

answer

Given the complexity of the buying decision, the purchasing professional must be prepared to analyze each significant buying situation on the basis of the ___________________ of various buying decisions technological impacts conceptual and the economic impacts competitive impacts economic and competitive impacts productivity and economic impacts

question

at least two potential

answer

The analysis phase (of the buying decision) requires the decision maker to investigate _____________ sources of supply. at least two potential at least five potential all potential the best the best three

question

below its total cost / make a profit or quit the business

answer

In the short term, a firm can sell its products ____________; however, at some point, the firm will be required to _______________. at low prices / make money or close up shop at above average prices / get competitive at high prices / become competitive or lose sales below its total cost / make a profit or quit the business competitive prices / become profitable

question

competitors / customers

answer

The market approach to pricing is more erratic simply because the supplier, through the use of market research, collects information on its __________ and from their ___________ to determine where the price should be pegged. markets / suppliers customers / research expenses / sales representatives competitors / customers web site / sales representatives

question

False

answer

A cost-based approach cannot succeed in a competitive market if the product does not remain acceptable to the Department of Commerce. True False

question

quality and service

answer

The customer perception of _______________ is also important when determining market prices. the company value quality and service competition value and quality

question

target pricing / target price

answer

In the end, the buying firm must determine whether the purchase price fits its competitive cost structure. This is called ____________. If the _________ is too low to generate interest from suppliers, it may be necessary for the buyer to consider applying a value analysis approach to the product in question. discount pricing / discount price market pricing / market price competitive pricing / competitive price target pricing / target price cost analysis / discount price

question

power / powerful / increases

answer

The major psychological influence in a buyer supplier relationship is __________. It is conceivable that a (n) _________ buyer could force a supplier to eliminate its overhead from the ultimate price. The danger for the buyer is that this so-called good buy may drive the supplier out of business and that this reduction in competition may result in massive price __________ in the long run. prestige / chain store / discounts feelings / strong / decreases credibility / influential / increases power / weak / decreases power / powerful / increases

question

fair price

answer

The buying firm, no matter how powerful, should attempt to obtain a ___________ and good consensus. fair price market price discount price low price standard price

question

gain market share or dump unwanted items

answer

There are some instances where the supplier will employ short-term strategic pricing in order to _______________. gain a competitive advantage increase market share or increase sales gain a competitive advantage or close out obsolete items close out discontinued items gain market share or dump unwanted items

question

cash, trade, and quantity

answer

The first question a purchasing professional should ask a supplier is, How much of a discount can I receive if I buy from you? Some of the more popular discounts are __________________ discounts. cash, trade, and quality cash, seasonal, and trade seasonal, trade, and quantity cash, trade, and quantity quarterly, cash, and quantity

question

cash

answer

In today s business environment, when sound money management is so important, selling firms will offer ________ discounts if payments for goods and services are promptly remitted. seasonal cash quantity trade rebates

question

quantity

answer

_________ discounts are discounts granted to the buyer for buying larger quantities. Trade Cash Seasonal Preferred quantity

question

holding costs

answer

The buying firm must consider its total cost of accepting a quantity discount. Specifically, the ___________ associated with carrying larger quantities must be compared to the expected benefit of the discounts. direcy costs indirect costs holding costs transportation costs cash outlay

question

False

answer

Justifying a quantity discount is the responsibility of the buying firm. The buyer must be able to document the actual cost savings. True False

question

Robinson-Patman

answer

The ___________ Act suggests that it is illegal to offer a quantity discount for commodities of like grade and quality that are not based on differences in the cost of manufacturer sales, or delivery resulting from the differing methods or quantities in which such commodities are sold or delivered. Robin-Parmer Robinson-Patrick Robinson-Patman Martin-Parmer Roberts-Pullman

question

Price determination

answer

__________________ is becoming the most important competitive weapon necessary to ensure survival in today s competitive environment. Strategic planning Competitive analysis A low price strategy A differentiated market segmentation strategy Price determination

question

the acquisition of goods and services

answer

Companies are spending an increasingly larger percentage of their revenue dollars for __________________. the acquisition of goods and services labor advertising and promotion supplies advanced technology

question

all of the above

answer

Price reflects more than cost and profit; pricing decisions also must be based on the degrees of competition and buyer seller relationships. According to the textbook the competitive pressures of price also must consider which of the following? the number of sellers in the market the number of buyers in the market the general economic environment all of the above A and B only

question

all of the above

answer

The general sources of price information are which of the following? published price lists and quotations other buyers in the market and trade journals negotiations and competitive bidding distribution all of the above

question

Direct/direct

answer

The cost components of price determination can be divided into direct and indirect costs. _______ costs relate to the actual units of production. If the unit is not produced, ________ costs are not incurred. Indirect/indirect Direct/direct

question

Indirect/indirect

answer

_________ costs are associated with non-manufacturing-related costs. Insurance, managerial salaries, property taxes, and depreciation expenses are examples of _________ costs. Direct/direct Indirect/indirect

question

variable

answer

The purchasing professional must understand the dynamic nature of ________ cost. indirect direct variable labor advertising

question

False

answer

Improvements are possible in the way most tasks are performed. The improvement process may have an insignificant effect on the buyer s total purchase price. True False

question

True

answer

The underlying behavior of the improvement curve reflects a systematic improvement (percentage reduction) of labor per unit as a function of cumulative units produced. True False

question

learning curve

answer

The ____________ techniques have been used extensively in cost estimating, pricing, negotiating contracts, and estimating the major implications of changes in design. TQM MBO Herzberg Deming learning curve

question

Standard

answer

___________ price lists are usually prices generated based on the seller s total cost structure. Discount Trade Standard Catalogue Preferred customer

question

pricing strategies on competitive positions

answer

The competitive bidding process must begin with an assessment sizing up the suppliers _________________. labor and materials costs pricing strategies on competitive positions power need for sales competitive strength

question

False

answer

When the buying firm is buying from sellers that service firms similar to the buying firm s markets, the prices will more than likely increase. True False

question

standard

answer

Negotiation should be used any time the buyer does not have confidence in the __________ price lists and competitive bidding seems unreasonable. catalogue standard trade direct discount

question

high-priced

answer

A buying firm must consider the price variation that is inherent in buying __________ components in order to understand various design specifications and associated costs. high-priced low-priced standard custom all

question

fall into a competitive bidding trap

answer

If setup cost and learning rates are ignored, a buying firm will, more than likely, _______________. become engaged in a price war suffer from a competitive disadvantage gain a competitive advantage receive a major discount fall into a competitive bidding trap

question

False

answer

Large setup and tooling costs can easily be amortized by the buying firm True False

question

Bargaining

answer

____________ occurs between all forms of human groupings including individuals, groups, organizations, and countries. Communicating Trading Bargaining Swapping Organizing

question

bargaining

answer

The condition under which ____________ takes place is when two or more parties have divergent interests or goals and communication between the parties is possible. Communicating Swapping organizing trading bargaining

question

The provisional offers must determine the outcome of the situation, i.e., one party must lose and the other party must win.

answer

According to the textbook, three additional conditions also must exist in order for bargaining to occur. Which of the following is not one of those conditions? The provisional offers must determine the outcome of the situation, i.e., one party must lose and the other party must win. Mutual compromise must be possible. If one of the parties must choose between total victory and complete loss, no bargaining occurs. Bargaining situations require intermediate solutions for the parties involved. The possibility must exist for provisional offers to be made by those involved in the situation. The provisional offers must not determine the outcome of the situation until the terms are accepted by all parties

question

explicit bargaining

answer

A bargaining situation can then be defined as an interaction where parties with certain disagreements confer and exchange ideas about a possible solution until a compromise is reached or the bargaining is terminated. This is referred to as ______________. standard bargaining implicit bargaining routine bargaining explicit bargaining fail safe bargaining

question

distributive / integrative

answer

Two-party bargaining can be divided into two types: _________ and ___________. standard / routine fail safe / goal oriented distributive / integrative win / lose routine / fail safe

question

distributive

answer

The parties in __________ bargaining are in basic conflict and competition because of a clash of goals: the more one party gets, the less the other gets. standard routine distributive fail safe common

question

distributive

answer

Discussion, understanding, and agreements are vital to ___________ bargaining. distributive common standard routine fail safe

question

varying-sum

answer

In a __________ schedule bargaining situation, the profits (and/or losses) of the respective bargainers, when added together, need not always equal the same fixed amount. standard-sum routine-sum fixed-sum floating-sum varying-sum

question

zero-sum / zero-sum / zero

answer

In the ________ bargaining situation, the profits (and/or losses) of the respective bargainers always sum to the same fixed amount. The term _________ stands for the fact that what one bargainer gains, the other losses and the gains (and/or losses) net out to be _______. net-sum / net-sum / one zero-sum / zero-sum / zero routine-sum / routine-sum / two zero-sum / zero-sum / ten net-sum / net-sum / zero

question

Integrative bargaining

answer

________________ exists where there are areas of mutual concern and complementary interests. The situation is a varying-sum schedule such that, by working together, both parties can increase the total profits available to be divided between them. Integrative bargaining Routine bargaining Distributive bargaining Net-sum bargaining Net-zero bargaining

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negotiation

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The word ___________ is derived from Latin and in civil law means trading on deliberations leading to an agreement. bargaining deliberating discussion negotiation considering

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bargainer

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The ____________ needs to determine how he/she, as a decision maker, ought to behave in light of his/her analysis of how his/her opponent might behave. organizer bargainer representative executive agent

question

the final maximum offer

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All of the following, with one exception, are the minimum necessary variables for a model of the overall bargaining process (which) include both the decision maker s and the opponent s ______________. Which one is the exception? initial offers desired outcomes rate of concession the final maximum offer maximum level of concession (zero profit level)

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distributive

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Economists, on the other hand, have seen ____________ bargaining as a problem that only involves two parties dividing fixed resources with no opportunity for any outside influence of third parties net-sum zero-sum distributive routine standard

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Bargaining system

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The findings by psychologists can be categorized under six areas, each representing a major factor assumed to affect bargaining. Listed below are five of the six areas. However, one is incorrect. Which one? General bargaining predispositions Social relationship with the opponent Situational factors Bargaining system Social relationship with significant others

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General bargaining predispositions

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Individual differences in bargaining predispositions may affect bargaining behavior. This is referred to as ________________. Standard bargaining predispositions Routine bargaining predispositions Individualized bargaining predispositions Cooperative bargaining predispositions General bargaining predispositions

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Payoff system

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Payoffs result from various aspects of the negotiated agreement. For example, certain terms may yield a specific amount of profit, or there may be a bonus for attaining a specified agreement, or the time spent in bargaining may involve certain costs. This is referring to __________. Social relationships Compensation systems Bargaining systems Bargaining strategies Payoff system

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Social relationship with the opponent

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One of the factors refers to the social relationship existing between the bargainers. Examples are degree of friendship or differences in status or power. Which of the following factors is this referring to? General bargaining predispositions Social relationship with significant others Social relationship with the opponent Payoff system Situational factors

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Social relationship with significant others

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This factor refers to the relationships of the bargainers to significant others not participating directly in the bargaining. Which of the following is this statement referring to? Social relationship with the opponent Social relationship with significant others Social payoff systems Social relationships with management Social relationships with various parties

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Situational factors

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The physical and social setting of the bargaining may have an effect. Is the bargaining being conducted in the home territory of one of the bargainers or on neutral ground? What, if any, is the seating arrangement? Which of the factors is this statement referring to? Situational factors Payoff system Physical systems Forum factors Physical and maintenance factors

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Bargaining strategy

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Of the items listed below which is the factor that includes the specific actions of the bargainer during bargaining. For example: How extreme is his/her opening? Does he/she concede frequently or infrequently? Negotiating Planning organizing Operating Bargaining strategy

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net-sum point

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Various names have been used to describe the amount that must be exceeded in the bargaining interaction in order to obtain a profit. Several of the names are listed below. However, one is incorrect. Which one? maximum concession point breakeven point net-sum point zero-profit point minimum disposition

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False

answer

A bargainer s resistance to making concessions is negatively correlated to both the time required to make a further concession and the probability of withdrawing from the negotiations. True False

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False

answer

The level of resistance also is assumed to be related to the minimum necessary share. As a bargainer concedes toward his/her minimum necessary share, (his/her) resistance should increase. It also can be predicted that for a given offer, the lower the minimum necessary share, the greater the resistance. True False

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True

answer

Time pressure in psychological experiments has been exerted in various ways: High or low probability that the present round of offers would be the last. Warning that time was almost up. Number of offers remaining before penalties for additional offers. Cost of each of the trial offers. True False

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False

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Usually a tougher bargaining one using a more extreme opening position, fewer concessions, and/or smaller concessions can obtain a more favorable agreement. True False

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tough but fair

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The best strategy is to give the other side the impression that one is _________. tough fair rigid tough but fair not easily pushed around

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always / less

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A strategy of _________ reciprocating both the frequency and magnitude of the other bargainer s concessions was found to be more effective in obtaining concessions from the other bargainer than strategies involving _______ reciprocation. occasionally / frequent always / less frequently / less sometimes / full occasionally / full

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False

answer

Conceding only in response to a strike threat by the other side gives the impression that one is strong, while sometimes reciprocating a concession gives the impression that one is tough. This leads to the general conclusion that every agreement ought to lie somewhere between the two starting points of the bargainers. True False

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best

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Giving a bargaining opponent the impression that tough bargaining is because of one s payoff system and that one is firm but fair is the _________ strategy. worst poorest best fairest weakest

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economic / psychological

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In general, __________ theory can help predict the approximate outcome of bargaining situations, but _____________ conditions will cause the true solution to vary around the predicted outcome point. statistical / physical economic / psychological management / economic economic / financial financial / psychological

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economic/psychology

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A combined _____________ approach will help provide the truest solution and best approach to understanding bargaining and negotiation situations and their outcomes. economic/psychology statistical/physical economic/financial financial/psychological management/economic

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planning activity

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The most important ____________ for a seller is to submit the most responsive Request for Proposal (RFP) or Request for Quote (RFQ). bargaining tactic organizing activity strategic step negotiating step planning activity

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True

answer

The seller s bargaining strengths depend on the following: The sellers current capacity. The probability of being the successful bidder. The sellers deadline. The status of the seller. True False

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All of the above

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There are standard procedures for processing RFPs. After receipt of the initial proposals, the proposals should be screened for responsiveness in terms of ________. technical quality and managerial capability financial stability experience on similar projects and other relevant criteria All of the above B and C only

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True

answer

The buyer s bargaining strengths are: The number of bidders . The urgency of the buyer needs. The length of time before agreement. The status of the buyer. True False

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False

answer

The buyer must be thoroughly prepared for each and every negotiation. Data collection is the first step in the preparation process. The next step involves setting the time and place of the negotiations and then identifying the negotiation team members. True False

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True

answer

It is not enough to set as an objective to negotiate a percentage improvement from the seller s original price proposal. The buyer should never reveal (his/her) objectives to the seller. The negotiation s objectives should also use a data driven approach to determine minimum and maximum pricing strategies. True False

question

True

answer

The procedure for a formal negotiation [a short version] is given below: 1. Select team 2. Determine objectives 3. Prepare 4. Determine bargaining strength 5. Develop a plan 6. Set strategy 7. Determine tactics 8. Follow-up True False

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five

answer

The model [the buyer-seller interactions exchange model] is built on the relationships inherent in a bargaining situation and illustrates at least _______ major types of relations that can be affected by any bargaining interaction. four five six seven eight

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