Question 1

Which of the following is not a concern of the supply chain?

• Number of internal managers

• Credit and cash transfers

• Vendor reliability

• Distributors and banks

• Having fewer suppliers

Question 2

In the make-or-buy decision, one of the reasons for buying is

• to ensure adequate supply.

• to obtain desired quality.

• to remove supplier collusion.          

• adequate capacity.          

• None of the above

Question 3

The cost-based price model is a type of negotiating strategy that requires the supplier to

• open its books to the purchasers.

• combine procurement strategies.

• promote competitive bidding.

• control costs.

• None of the above    

Question 4

Building a chain of suppliers that focuses on maximizing value to the ultimate customer is

• the primary objective of supply-chain strategy.

• to select suppliers primarily on response or differentiation.

• the goal of production lead time.  

• to increase the number of suppliers.          

Question 5

Long-term partnering with a few suppliers is a supply-chain strategy that creates value by allowing suppliers to

• become part of a company coalition.

• enjoy the economies of scale.

• become vertically integrated.

• negotiate with many suppliers.          

Question 6

In the make-or-buy decision, which of the following is a reason for making an item?

• Management focus on its primary business

• To ensure an adequate supply in terms of quantity

• Inadequate capacity

• Reduce inventory costs          

Question 7

Which of the following statements is most accurate?

• Nearly all outsourcing relationships do not last beyond 2 years.

• Nearly all U.S. firms that outsourced processes to India have backsourced them.

• Approximately half of all outsourcing agreements fail.

• Outsourcing is a relatively risk-free activity.

• More than 90% of outsourcing agreements succeed.

Question 8

A manufacturing plant is considering outsourcing its production of tires. There are five risk areas on which the decision will be based. The current plant had scores of 1, 2, 4, 8, and 2; and the outsourced plant had scores of 3, 2, 4, 2, and 5. What is the current plant's score if high scores indicate low risk, and an unweighted factor method is applied?

• 14

• 15

• 16

• 17

• None of the above        

Question 9

Which of the following is NOT a concern of the supply chain?

• Warehousing and inventory levels

• Credit and cash transfers

• Suppliers

• Distributors and banks

• Maintenance scheduling      

Question 10

Keeping a product generic as long as possible before customizing is known as

• postponement.

• keiretsu.

• vendor-managed inventory.

• forward integration.

• backward integration.