question

1. An organization's supply chain is facilitated by: a) dedicated people b) an information system c) specific vendors d) specific customers e) government regulations

answer

b) an information system

question

2. Which of the following typically represents the beginning of a supply chain? a) Wholesalers b) Retailers c) Manufacturers d) External suppliers e) Inspectors

answer

d) External suppliers

question

3. Supply chain management is the vital business function which does not coordinate and manage: a) linking suppliers b) transporters c) human resource interviews d) internal departments e) third-party companies

answer

c) human resource interviews

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4. Typically a manufacturer will have more direct contact with which type of supplier? a) Tier one supplier b) Tier two supplier c) Tier three supplier d) Tier four supplier e) Tier five supplier

answer

a) Tier one supplier

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5. Consider a packaged milk products supply chain. A lumber company provides wood to a paper mill, who supplies cardboard to a container manufacturer, who supplies containers to the milk products manufacturer. The lumber company is: a) a tier one supplier. b) a tier two supplier. c) a tier three supplier. d) a tier four supplier. e) not in the supply chain.

answer

c) a tier three supplier.

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6. Which of the following is not a typical result of the bullwhip effect? a) Absenteeism b) Lost revenues c) Ineffective transportation use d) Poor customer service levels e) Misused manufacturing capacity

answer

a) Absenteeism

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7. Which term refers to inaccurate or distorted demand information created in the supply chain? a) Battle axe effect b) Cobra effect c) Bullwhip effect d) Lasso effect e) Whirlpool effect

answer

c) Bullwhip effect

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8. Which of the following is not a remedy for the bullwhip effect? a) Allocate units based on past demand b) Price stabilization c) Base forecasts on demand coming from the immediate downstream customer d) Eliminate order batching e) Information sharing

answer

c) Base forecasts on demand coming from the immediate downstream customer

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9. Which of the following is not one of the four major causes of the bullwhip effect? a) Demand forecast updating b) Order batching c) Price fluctuations d) The business cycle e) Rationing and shortage gaming

answer

d) The business cycle

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10. Price fluctuations follow all but which of the following marketing promotions? a) Advertising b) Price discounts c) Quantity discounts d) Coupons e) Rebates

answer

a) Advertising

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11. When do rationing and shortage gaming occur? a) Supply exceeds demand. b) Demand exceeds supply. c) Government contracts are awarded. d) Transportation workers go on strike. e) Marginal revenue exceeds marginal cost.

answer

b) Demand exceeds supply.

question

12. Collection of point-of-sale (POS) information is most useful for which bullwhip effect remedy? a) Allocate units based on past demand b) Price stabilization c) Fill orders based on a set percentage d) Eliminate order batching e) Information sharing

answer

e) Information sharing

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13. The time between order placement and the receipt of goods is called ___________________. a) receipt time b) lead time c) allowance time d) processing time e) waiting time

answer

b) lead time

question

14. Service organization supply chains are: a) similar to manufacturing organizations. b) not similar to service organizations. c) very unique. d) not a consideration when planning a service organization. e) universally government regulated.

answer

a) similar to manufacturing organizations.

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15. What is a network internal to an organization called? a) supernet b) internet c) intranet d) supranet e) internalnet

answer

c) intranet

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16. What is an extension of an intranet to include suppliers and customers called? a) supply chain net b) supernet c) supranet d) extranet e) intranet++

answer

d) extranet

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17. Net marketplaces are designed to: a) bring together only internal resources. b) bring together limited external resources. c) bring together significant number of purchasing firms. d) limit the number of daily transactions. e) limit cyber security risks.

answer

c) bring together significant number of purchasing firms.

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18. Which of the following is open to the most users? a) an intranet b) an extranet c) a LAN d) a WAN e) the Internet

answer

e) the Internet

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19. Online retailing, or B2C, has shifted: a) the cost of doing business. b) the power from the suppliers to the consumers. c) the way the internet works. d) internal corporate power to the IT department. e) corporate funding levels to the IT department.

answer

b) the power from the suppliers to the consumers.

question

20. Due to globalization, which of the following are not some commonly shared ocean shipping logistical characteristics? a) goods arrive in larger quantities b) greater break-bulk activity is required c) crossdocking is required d) typically have higher inventories e) longer port times occur

answer

c) crossdocking is required

question

21. A recent change in supply chain management has been the: a) need for faster computers. b) green supply chain management requirement. c) requirement for advanced educational degrees. d) increased government regulation. e) need for smaller ocean transportation methods.

answer

b) green supply chain management requirement.

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22. Purchasing is typically responsible for: a) initiating purchasing requests. b) physically inventorying all received materials. c) developing the engineering specifications. d) analyzing the make-buy decision. e) monitoring supplier performance.

answer

e) monitoring supplier performance.

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23. Which activity appears to be most frequently outsourced by large companies? a) Purchasing b) Marketing c) Finance d) Accounting e) Manufacturing

answer

e) Manufacturing

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24. What refers to owning or controlling sources of raw materials and components? a) Backward integration b) Horizontal integration c) Encapsulating integration d) Forward integration e) Subsuming integration

answer

a) Backward integration

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25. What term refers to processes or activities that are completed in-house? a) Ownsource b) Insource c) Homesource d) Outsource e) Supplysource

answer

b) Insource

question

26. What term refers to processes or activities that are completed by suppliers? a) Vendorsource b) Insource c) Homesource d) Outsource e) Supplysource

answer

d) Outsource

question

27. A higher level of vertical integration implies: a) more outsourcing and more insourcing b) less outsourcing c) more insourcing d) less insourcing e) less outsourcing and more insourcing

answer

e) less outsourcing and more insourcing

question

28. The quantity that equates the cost of making a product to the cost of buying the product is generally called what? a) Neutrality point b) Point of equality c) Indifference point d) Point of optimality e) No such point can exist.

answer

c) Indifference point

question

29. According to the financial calculations of the make-or-buy decision, if we need fewer units than the indifference point, then which option should we definitely choose? a) Make b) Buy c) The option with the lower variable costs d) The option with the higher variable costs e) It is not profitable to choose either option.

answer

d) The option with the higher variable costs

question

30. To perform the financial calculations of the make-or-buy decision, which costs are needed? a) Fixed and variable b) Fixed and average c) Variable and average d) Variable only e) Average only

answer

a) Fixed and variable

question

31. Which of the following is not a positive attribute of Multiple Suppliers? a) provides a greater flexibility of volume b) eliminates a supplier's dependence on the purchaser c) probability of assured supply is better d) deliveries can be schedule more easily e) allows for testing of new suppliers without jeopardizing the flow of materials

answer

c) probability of assured supply is better

question

32. In general, what comprises the bulk of the cost of goods sold? a) Overhead b) Materials c) Electricity d) Depreciation e) Labor

answer

b) Materials

question

33. A constant concern within purchasing departments is the issue of ethics in managing _______________. a) customers b) web sites c) inventory d) suppliers e) entry-level employees

answer

d) suppliers

question

34. What are the Institute for Supply Management's principles of ethical supply chain management conduct? a) objectivity always, loyalty to your organization, and faith in your profession b) objectivity always, justice to those with whom you deal, and faith in your profession c) objectivity always, justice to those with whom you deal, and loyalty to your organization d) objectivity always, know the law, and justice to those with whom you deal e) loyalty to your organization, justice to those with whom you deal, and faith in your profession

answer

e) loyalty to your organization, justice to those with whom you deal, and faith in your profession

question

35. According to several studies, what are the three most important criteria for selecting suppliers? a) Price, quality, fast delivery b) Quality, fast delivery, on-time delivery c) Price, flexibility, on-time delivery d) Quality, flexibility, fast delivery e) Price, quality, on-time delivery

answer

e) Price, quality, on-time delivery

question

36. What is the common term for a process of developing a long-term relationship with a supplier based on mutual trust, shared vision, shared information, and shared risks? a) Marrying b) Cohabitating c) Sharing d) Partnering e) Diversifying

answer

d) Partnering

question

37. Going beyond a basic partnership, an expanded partnership between a firm and its supplier implies: a) mutual respect b) honesty c) trust d) open and frequent communications e) a commitment to helping each other succeed

answer

e) a commitment to helping each other succeed

question

38. According to the textbook, the two kinds of partnerships are basic and what? a) Expanded b) Enhanced c) Enlarged d) Elaborated e) Evolved

answer

a) Expanded

question

39. What does the textbook define as the three most critical factors in successful partnering? a) Impact, mission, vision b) Impact, intimacy, vision c) Contracting, mission, vision d) Contracting, intimacy, mission e) Contracting, impact, intimacy

answer

b) Impact, intimacy, vision

question

40. What term refers to attaining levels of productivity and competitiveness that are not possible through normal supplier relationships? a) Intimacy b) Vision c) Impact d) Power e) Collusion

answer

c) Impact

question

41. What term refers to the working relationship between partners? a) Impact b) Vision c) Familiarity d) Intimacy e) Proximity

answer

d) Intimacy

question

42. What term refers to the mission or objectives of a partnership? a) Impact b) Intimacy c) Dream d) Conception e) Vision

answer

e) Vision

question

43. What do studies suggest are the three sources of impact? a) Reduce waste, leverage core competence, and create new opportunities b) Provide quantity discounts, reduce waste, and create new opportunities c) Create detailed contracts, reduce waste, and create new opportunities d) Create detailed contracts, leverage core competence, and reduce waste e) Create detailed contracts, leverage core competence, and create new opportunities

answer

a) Reduce waste, leverage core competence, and create new opportunities

question

44. Leveraging core competence is about sharing: a) workers b) knowledge c) machines d) expenses e) financial hedges

answer

b) knowledge

question

45. Which of the following is not considered to be a characteristic of partnership relations? a) Have a long-term orientation b) Are strategic in nature c) Are "arms-length" in nature d) Share a common vision e) Share short- and long-term plans

answer

c) Are "arms-length" in nature

question

46. What does ESI stand for? a) Easy supplier integration b) Early stage initiation c) Every supplier's important d) Early supplier involvement e) Engaged supply initiative

answer

d) Early supplier involvement

question

47. Early supplier involvement refers to the involvement of critical suppliers for what? a) Strategic planning b) Assembly line design c) Speedy delivery planning d) Selection of new suppliers e) New product design

answer

e) New product design

question

48. According to a 1996 study by the Council for Logistics Management of the third-party logistics industry, which companies are particularly likely to use third-party logistics services to handle most of their logistics needs? a) Companies engaged in international business b) Transportation companies c) Warehousing companies d) Hospital equipment manufacturers e) Large retailers

answer

a) Companies engaged in international business

question

49. Which of the following is least likely to be a benefit of implementing barcode scanners at retail store checkout registers? a) Improved forecasting b) More efficient packaging of customer orders c) Improved inventory control d) Faster checkout for customers e) More accurate checkout for customers

answer

b) More efficient packaging of customer orders

question

50. The discussion in the textbook implies that information sharing has shifted power in the supply chain the most to which group? a) Suppliers b) Manufacturers c) Distributors d) Retailers e) Individual consumers

answer

e) Individual consumers

question

51. Which type of technology provides "point-of-sale information?" a) Automatic guided vehicles (AGV) b) Automatic storage and retrieval systems (ASRS) c) Barcode scanners d) Flexible manufacturing systems (FMS) e) Computer aided design/computer aided manufacturing (CAD/CAM)

answer

c) Barcode scanners

question

52. What does EDI stand for? a) Easy data interchange b) Electronic door interface c) Electronic detachable interface d) Elementary data integration e) Electronic data interchange

answer

e) Electronic data interchange

question

53. Which of the following is not considered to be a benefit of EDI? a) Increased human interaction b) Reduced paperwork c) Improved data accuracy d) Improved tracking capability e) Reduced clerical costs

answer

a) Increased human interaction

question

54. Some warehouses provide product mixing. This is referred to as: a) reduced value-added service for customers. b) value-added service for customers. c) mix and match capability. d) correcting earlier mistakes in shipping. e) storage warehouse functions.

answer

b) value-added service for customers.

question

55. What is the throughput of Fingerhut's warehouse in St. Cloud, MN? a) 30,000 items per minute b) 30,000 items per hour c) 30,000 items per day d) 30,000 items per week e) 30,000 items per month

answer

b) 30,000 items per hour

question

56. What type of warehouse is used for long-term storage? a) Customized b) Strategic c) General d) Distribution e) Tactical

answer

c) General

question

57. What type of warehouse is used for short-term storage, consolidation, and product mixing? a) Customized b) Strategic c) General d) Distribution e) Tactical

answer

d) Distribution

question

58. What does TL stand for? a) Transportation lead time b) Transportation logistics c) Trucking line d) Trucking life e) Truckload (quantity)

answer

e) Truckload (quantity)

question

59. What is the process whereby shipments are transferred directly from inbound trailers to outbound trailers? a) crossdocking b) directdocking c) nodocking d) simuldocking e) transferdocking

answer

a) crossdocking

question

60. Crossdocking ____________________________________________________. a) eliminates the receiving and shipping functions of a distribution warehouse while still performing its storage and order picking functions b) eliminates the receiving and storage functions of a distribution warehouse while still performing its shipping and order picking functions c) eliminates the storage and shipping functions of a distribution warehouse while still performing its order picking and receiving functions d) eliminates the receiving and order picking functions of a distribution warehouse while still performing its storage and shipping functions e) eliminates the storage and order picking functions of a distribution warehouse while still performing its receiving and shipping functions

answer

e) eliminates the storage and order picking functions of a distribution warehouse while still performing its receiving and shipping functions

question

61. Crossdocking allows the retailer to replace ______________ with information and coordination. a) trucks b) buildings c) inventory d) truck loaders e) conveyor belts

answer

c) inventory

question

62. _________________ crossdocking is the receiving and consolidating of inbound supplies to support just-in-time manufacturing. a) Warehouse b) Manufacturing c) Distributor d) Transportation e) Retail

answer

b) Manufacturing

question

63. _________________ crossdocking is the consolidating of shipments from LTL and small package industries to gain economies of scale. a) Warehouse b) Manufacturing c) Distributor d) Transportation e) Retail

answer

d) Transportation

question

64. What is a virtual organization? a) A company that provides core functions and outsources everything else b) An e-commerce company c) A web server developer d) A computer manufacturer e) A company with no vertical levels of management

answer

a) A company that provides core functions and outsources everything else

question

65. Benetton is well known for the practice of assembling all white sweaters and waiting to dye them much closer to the time of sale. This is an example of what? a) Stupidity b) Postponement c) Fractionalization d) Partitioning e) Genericness

answer

b) Postponement

question

66. Which of the following is not an argument in favor of having a single supplier? a) Quantity discounts may be achieved. b) Partnering becomes more possible. c) Consistency of input materials is achieved. d) Probability of assured supply is better. e) Deliveries can be scheduled more easily.

answer

d) Probability of assured supply is better.

question

67. Which of the following is not an argument in favor of having multiple suppliers? a) The Just-in-time philosophy can be better utilized. b) Supplier capacity is less important. c) Volume flexibility is obtained. d) Risks may be spread. e) New suppliers may more easily be tested.

answer

a) The Just-in-time philosophy can be better utilized.

question

68. Insourcing incurs an annual fixed cost of $500,000 and a variable cost of $60 per unit. Outsourcing incurs an annual fixed cost of $750,000 and a variable cost of $20 per unit. What is the indifference point between the two alternatives? a) 0 units b) ?6250 units c) 6250 units d) 40 units e) 12,500 units

answer

c) 6250 units Solution: (FCBUY + (VCBUY*Q) = FC Make + (VC Make*Q) $750,000 + ($20Q) = $500,000 + ($60Q) = 6,250)

question

69. What is the electronic marketplace for the auto industry? a) Carnet b) Autoexchange c) Covisint d) Citroen e) Motorint

answer

c) Covisint

question

70. In January 2003, how many suppliers were members of Covisint? a) 76 b) 760 c) 7,600 d) 76,000 e) 760,000

answer

d) 76,000

question

71. Which of the following is a "buyer-side," typically industry-specific solution? a) automated order entry systems b) electronic data interchange c) electronic storefronts d) net marketplaces e) advertising revenue model

answer

b) electronic data interchange

question

72. Which B2C model does MyPoints.com utilize? a) advertising revenue model b) subscription revenue model c) transaction fee model d) sales revenue model e) affiliate revenue model

answer

e) affiliate revenue model

question

73. Companies want a supply chain that makes it possible to: a) manage all suppliers' development costs. b) manage and adapt to all of the business dynamics. c) manage distribution display. d) manage distribution outlet retail prices. e) manage customer demands.

answer

b) manage and adapt to all of the business dynamics.

question

74. Which of the following is not one of the supply chain wastes the text book identifies? a) over production b) delay between activities c) procurement/purchasing delay d) unnecessary transport or conveyance of product e) unnecessary movement by people

answer

c) procurement/purchasing delay

question

75. Supply chain velocity refers to a) how fast the transportation vendor is b) how fast the company pays the supply chain vendors c) how fast the purchasing department responds to a request d) the speed at which a product moves through a pipeline from the manufacturer to the customer e) the speed at which the warehouse is able to crossdock a shipment

answer

d) the speed at which a product moves through a pipeline from the manufacturer to the customer

question

76. Which of the following is the term for "arranging the method of shipment for both incoming and outgoing products or material"? a) TQM b) Employee management c) Distribution management d) Traffic management e) Logistics management

answer

d) Traffic management

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