Exam 1 True/False

question

The first decade of the twenty-first century was a period of rapid change for organizations, especially businesses
answer

True
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A key element in Wal-Mart’s ability to discount brand name products was an understanding of the criticality of efficiency in its logistics and supply chain system
answer

True
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Globalization has had little effect on consumers
answer

False
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Supply and demand has become less volatile as managers become more adept at controlling the elements
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False
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Outsourcing is a fairly new concept
answer

False
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SAB should examine their off-shore purchasing policy, even though the products are sourced from the U.S.
answer

True
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It is expected that some or all of the BRIC countries (Brazil, Russia, India, & China) will replace the so-called VISTA (Vietnam, Indonesia, South Africa, Turkey and Argentina) as low cost producers of various products and services
answer

False
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The world economy still favors the United States and European countries, even though China and India can participate in the global economy much more readily
answer

False
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It is predicted that social networks such as Facebook and Twitter will influence supply chains because of their impact on customer demand and the speed of information transfers
answer

True
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The U.S. transportation system was deregulated in the 1930’s and 1940’s in response to economic conditions and World War 2
answer

False
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Even though there are references to supply chain management in the 1980’s , SCM did not capture the attention of senior-level management until the 1990’s
answer

True
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Supply chain managers no longer need to worry about sub optimization in light of todays technology
answer

False
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The utility created through the basic marketing activities is known as place utility
answer

False
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Transportation is the physical movement or flow of goods
answer

True
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During the 1990’s and 2000’s, logistics costs as a percentage of gross national product declined
answer

True
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An aircraft manufacturer is a good example of an organization with a heavy inbound flow and a simple outbound flow
answer

True
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Acme Battery distributes its batteries to warehouses, where they are store until orderly by a retailer. The warehouses are located close by the retail markets served. This is the logistics channel approach to logistics
answer

True
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In a logistics system, warehousing should be optimized at the expense of related logistics activities, such as transportation and procurement
answer

False
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The mathematical calculation of the point of equality between systems under analysis is used for short-run/static analysis
answer

False
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To hold down distribution cost, the lowest close carrier should always be used
answer

False
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The inverse relationship that exists between the cost of lost sales and inventory costs is the inventory effect
answer

True
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Globalization is not considered to be one of the external factors driving change in logistics
answer

False
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The third era of globalization is said to have begun around the year 2000. The significant characteristic of this era is that it is being powered by individuals and smaller organizations in contrast to the countries of the first era and the large companies of the second era
answer

True
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The supply chain should manage four important flows, namely, materials, and products, information, financials, and demand
answer

True
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Operating globally has become harder to accomplish for individuals and small companies
answer

False
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The terms of a demise charter transfers full control of the chartered vessel to the charterer
answer

True
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Customs Trade Partnership Against Terrorism (C-TPAT) is a mandatory program in which importers must participate
answer

False
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The North American Free Trade Agreement has removed all trade barriers between the U.S, Canada, and Mexico
answer

False
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A maquiladora plant can be located anywhere in South America
answer

False
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Ocean transportation offsets slower service with lower rates than other modes
answer

True
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A firm using air transportation cannot use the same packaging for international shipping as for domestic shipping because many cargo aircraft are not pressurized
answer

False
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A Foreign Freight Forwarder is unregulated by the government
answer

False
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Export Trading Companies and Export Management Companies are essentially the same
answer

False
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An importer can store goods in a bonded warehouse for up to three years without paying duty
answer

True
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Soft issues such as social and cultural concerns should not present a challenge for supply chain managers, whose role is to focus on the physical side of supply chain execution
answer

False
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Many organizations have directed significant attention toward working more closely with supply chain partners, including not only customers and suppliers but also various types of logistics suppliers
answer

True
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A horizontal relationship refers to firms on the same level in the supply chain
answer

False
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The range of relationships with 3PL’s ranges from being a vendor to being a vertical supplier
answer

False
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The first stage in the process model for forming and sustaining supply chain relationships involves the process by which a manufacturer becomes fully aware of its logistics and supply chain needs
answer

True
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Drivers and facilitators are internal issues that an organization must address before seeking a 3PL
answer

False
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Once a 3PL provider is chosen, it is not necessary for an organization to seek continuous improvements as the 3PL will handle that function
answer

False
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Collaboration is usually defined as a “business practice that encourages individual organizations to share information and resources for the benefit of all”
answer

True
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A Third Party Logistics firm is defined as a company that owns trucks and warehouses so as to offer integrated services
answer

False
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Outsourcing and contract logistics are terms sometimes used to describe third-party logistics
answer

True
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A financial based 3PL is a firm that takes a financial interest in an organization in order to underwrite the outsourcing of that firms logistics
answer

False
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The most frequently outsourced function is freight bill payment
answer

False
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The “IT gap” refers to the difference between the internal IT capabilities of 3PL users and the IT expertise of the 3PL providers
answer

False
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Outbound-to-customer logistics systems are also referred to as physical distribution
answer

True
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Materials management and physical supply are terms that cannot be used interchangeably
answer

False
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Demand management might be defined as focused efforts to estimate and manage customers demand, with the intention of using this information to shape operating decisions
answer

True
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Phantom demand is created by over-ordering during peak demand
answer

True
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The essence of demand management is to estimate and manage customer demand so that demand and supply are balanced to the point where there are zero stockouts and zero safety stocks
answer

False
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External balancing methods involve managing production and inventory flexibility to help offset the imbalance of supply and demand
answer

False
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Forecasting has become extremely accurate, especially since the development of the S&OP process
answer

False
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Dependent demand is directly influenced by independent demand
answer

True
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A weighted moving average assigns higher weights to more recent periods
answer

True
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Exponential shooting can use constants higher than 1, but not more than 5
answer

False
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Adjusting a forecast for seasons basically uses a combination of seasonal factors and average demand to arrive at an adjusted forecast
answer

True
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While there are four types of forecast error measures that can be used, none are foolproof
answer

True
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A sales and operations planning process (S&OP) can produce a forecast internally that all functional areas agree upon and can execute
answer

True
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Collaborative planning, forecasting, and replenishment (CPFR) has not been considered to be a good process, as it excludes transportation
answer

False
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A channel of distribution is controlled by the marketing departments, which selects the physical structures and intermediaries through which the products flow
answer

False
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An important observation to note about channel structure is that it involves the elements of fixed costs versus variable costs
answer

True
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Integrated fulfillment is preferred to dedicated fulfillment
answer

False
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Customer service is anything that touches the customer
answer

True
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Most organizations employ all six definitions of customer service in their management process
answer

False
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Customer relationship management is a new concept only recently receiving attention
answer

False
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Firms today are beginning to use techniques such as activity-based costing to more accurately allocate costs to customers based on the specific costs of serving a customers orders relative to how, how much, what, and when a customer orders
answer

True
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The identification of the product/service package for each customer segment is one of the easier activities in the CRM process
answer

False
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Activity-Based costing works well in warehouse-type environments but does not work or customer service applications
answer

False
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With the proper information on how a customers interaction with the shipper drives the firms costs, the firm can then segment its customers by profitability
answer

True
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“Order to cash” and “order cycle” are the same
answer

True
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“Order to cash” and “replenishment cycle” are the same
answer

False
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The buyer and seller look at order time from the same perspective
answer

Flase
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Process D1: Deliver stocked product in the supply chain council SCOR model is the same as the OTC cycle model
answer

True
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There are ten principal activities to the OTC model
answer

False
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Reserve inventory and determined delivery date has traditionally been referred to as order processing
answer

True
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A driving force behind the attention to OTC cycle variability is safety stock. The absolute length of the order cycle will influence demand inventory
answer

True
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Customer service is of equal importance to both logistics and marketing
answer

True
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From a marketing perspective, logistics customer service can be thought of as a feature of the argument product that adds value for the customer
answer

True
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Dependability is not as important to a buyer as is absolute length of lead time
answer

False
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There are four types of communications that exist between a buyer and a seller
answer

False
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There are five logistics performance metrics from the buyers point of view
answer

True
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A stockout always results in a back order
answer

False
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For the best service, all products should be available at all levels regardless of cost
answer

False
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By using the latest information technology it is possible to substitute information for inventory and other logistics expenses
answer

True
question

The manufacturer must lead the channel design process regardless of the relative market power and financial strength of the members of the supply chain
answer

False

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