Supply Chain Supply Chain

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Supply Chain Management, 6e, Global Edition (Chopra/Meindl)

Chapter 1 Understanding the Supply Chain

1.1 True/False Questions

1) A supply chain could be more accurately described as a supply network or supply web.

Answer: TRUE

Diff: 2

Topic: 1.1 What Is a Supply Chain?

AACSB: Application of knowledge

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

2) All stages of an enterprise are involved, either directly or indirectly, in fulfilling a customer

request.

Answer: TRUE

Diff: 2

Topic: 1.1 What Is a Supply Chain?

AACSB: Application of knowledge

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

3) A supply chain includes only the organizations directly involved in supplying components

needed for manufacturing.

Answer: FALSE

Diff: 2

Topic: 1.2 The Objective of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

4) The objective of every supply chain is to maximize the overall value generated.

Answer: TRUE

Diff: 1

Topic: 1.2 The Objective of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

5) The objective of the customer arrival process is to ensure that orders are quickly and

accurately entered and communicated to other affected supply chain processes.

Answer: FALSE

Diff: 2

Topic: 1.2 The Objective of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

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6) The objective of customer order entry is to maintain a record of product receipt and complete

payment.

Answer: FALSE

Diff: 3

Topic: 1.2 The Objective of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

7) The difference between the value of the product and its price remains with the customer as

consumer surplus.

Answer: TRUE

Diff: 1

Topic: 1.2 The Objective of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

8) The supply chain planning phase exceeds the supply chain design phase in duration.

Answer: FALSE

Diff: 2

Topic: 1.4 Decision Phases in a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.2: Identify the three key supply chain decision phases and explain the

significance of each one.

9) The goal during the supply chain operation phase is to exploit the reduction of uncertainty and

optimize performance.

Answer: TRUE

Diff: 2

Topic: 1.4 Decision Phases in a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.2: Identify the three key supply chain decision phases and explain the

significance of each one.

10) The replenishment cycle occurs at the retailer/distributor interface.

Answer: TRUE

Diff: 3

Topic: 1.5 Process Views of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.3: Describe the cycle and push/pull views of a supply chain.

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11) The manufacturing cycle occurs at the distributor/manufacturer interface.

Answer: TRUE

Diff: 2

Topic: 1.5 Process Views of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.3: Describe the cycle and push/pull views of a supply chain.

12) The push/pull view of a supply chain holds that the processes in a supply chain are divided

into 2 categories depending on whether they are initiated in response to or in anticipation of

customer orders.

Answer: TRUE

Diff: 1

Topic: 1.5 Process Views of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.3: Describe the cycle and push/pull views of a supply chain.

13) The production scheduling process in the manufacturing cycle is similar to the order entry

process in the replenishment cycle.

Answer: TRUE

Diff: 3

Topic: 1.5 Process Views of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.3: Describe the cycle and push/pull views of a supply chain.

14) The cycle view of a supply chain holds that the processes in a supply chain are divided into 2

categories depending on whether they are initiated in response to or in anticipation of customer

orders.

Answer: FALSE

Diff: 2

Topic: 1.5 Process Views of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.3: Describe the cycle and push/pull views of a supply chain.

15) The procurement cycle occurs at the manufacturer/supplier interface.

Answer: TRUE

Diff: 1

Topic: 1.5 Process Views of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.3: Describe the cycle and push/pull views of a supply chain.

16) The cycle view of the supply chain is useful when considering operational decisions, because

it specifies the roles and responsibilities of each member of the supply chain.

Answer: TRUE

Diff: 2

Topic: 1.5 Process Views of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.3: Describe the cycle and push/pull views of a supply chain.

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17) Push processes may also be referred to as speculative processes.

Answer: TRUE

Diff: 1

Topic: 1.5 Process Views of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.3: Describe the cycle and push/pull views of a supply chain.

18) All supply chain activities within a firm belong to one of three macro processes — CRM,

ISCM and SRM.

Answer: TRUE

Diff: 1

Topic: 1.5 Process Views of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.4: Classify the supply chain macro processes in a firm.

19) There is a close connection between the design and management of supply chain flows and

the success of a supply chain.

Answer: TRUE

Diff: 1

Topic: 1.5 Process Views of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

20) The drawback of Zara’s responsive supply chain is that it tends to sell more products at

markdown than most of its competitors.

Answer: FALSE

Diff: 2

Topic: 1.6 Examples of Supply Chains

AACSB: Application of knowledge

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

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1.2 Multiple Choice Questions

1) Each stage in a supply chain is connected through the flow of products, information, and

funds. These flows often occur in both directions and are usually managed by

A) pricing department.

B) one of the stages.

C) upper management.

D) engineering department.

Answer: B

Diff: 2

Topic: 1.1 What Is a Supply Chain?

AACSB: Application of knowledge

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

2) A supply chain features a constant flow of

A) information, product and funds.

B) personnel, information, and policies.

C) processes, funds, and product.

D) product, processes, and support.

Answer: A

Diff: 2

Topic: 1.1 What Is a Supply Chain?

AACSB: Application of knowledge

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

3) Which set of supply chain flows is correctly described?

A) Funds flow only upstream but information flows both upstream and downstream in a supply

chain.

B) Product flows only downstream and information flows only upstream in a supply chain.

C) Information and product both flow upstream and downstream in a supply chain.

D) Funds flow both upstream and downstream but product flows only downstream in a supply

chain.

Answer: C

Diff: 2

Topic: 1.1 What Is a Supply Chain?

AACSB: Application of knowledge

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

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4) Which statement about supply chains is best?

A) New product development is not a supply chain function.

B) If a supplier uses a shipping company to send product to a customer, the shipping company is

technically not a supply chain member.

C) Funds in a supply chain flow upstream only.

D) Flows in a supply chain may be managed by an intermediary.

Answer: D

Diff: 3

Topic: 1.1 What Is a Supply Chain?

AACSB: Application of knowledge

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

5) Which sequence of stages is typical for product flow in a supply chain?

A) Supplier → Manufacturer → Distributor

B) Retailer → Distributor → Customer

C) Manufacturer → Retailer → Distributor

D) Supplier → Customer → Retailer

Answer: A

Diff: 1

Topic: 1.1 What Is a Supply Chain?

AACSB: Application of knowledge

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

6) Supply chain surplus involves what two parts?

A) Manufacturing cost and selling price

B) Customer value and supply chain cost

C) Customer value and high quality products

D) Reliable transportation and supply chain cost

Answer: B

Diff: 3

Topic: 1.2 The Objective of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

7) For any supply chain, the source of revenue is generated by

A) efficient operations.

B) information flows.

C) the customer.

D) product flows.

Answer: C

Diff: 3

Topic: 1.2 The Objective of a Supply Chain

AACSB: Application of knowledge

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

8) Customer value is

A) the sum of the supply chain surplus and supply chain cost.

B) the remainder after supply chain cost is subtracted from supply chain surplus.

C) the remainder after supply chain surplus is subtracted from supply chain cost.

D) supply chain profitability minus the supply chain cost.

Answer: A

Diff: 3

Topic: 1.2 The Objective of a Supply Chain

AACSB: Analytical thinking

Objective: LO 1.1: Discuss the goal of a supply chain and explain the impact of supply chain

decisions on the success of a firm.

9) The objective of every supply chain is to