83) Marble Counters Inc. prides itself on quality control and advertises that “we won’t ship a
product unless we make it the way you want.” Based on this, Marble Counters Inc. most likely
A) works in a regional market.
B) buys products from a wholesaler for use in its products.
C) works in a national market.
D) is a monopoly.
E) makes all of the products it ships.
84) If a firm possesses proprietary product technology, the best option for that firm would be to
A) manufacture the product in-house so that it does not lose its competitive advantage.
B) outsource the production activities to independent suppliers in order to realize economies of
scale.
C) merge with competitors to reduce investments on technology.
D) share the technology to make the industry more competitive.
E) transfer the technology to less developed countries.
85) As the inventory control manager for a group of retail stores, Henry calls the DoubleBlue Jeans
warehouse when he needs to restock this product because the manufacturer stores all of its
products there. Another name for this warehouse would be a(n)
A) wholesaler.
B) offshoring site.
C) acquisition.
D) distribution center.
E) franchisee.
86) The ________ function of packaging refers to the ability of a product in a package to handle
being transported between areas within the global supply chain.
A) protect
B) partition
C) inform
D) impact
E) perform
87) During a planning meeting, the environmental team discusses how returned items should be
disposed of or recycled. What aspect of the global supply chain are they discussing?
A) reverse logistics
B) geographic location
C) mass customization
D) flexible machine cells
E) consumer tastes
88) Pioneer Plastics is based in the United States and has transferred its information technology
processes to suppliers in Canada. What is this an example of?
A) reverse logistics
B) insourcing
C) nearshoring
D) mass customization
E) co-sourcing
89) Which country pioneered the concept of just-in-time inventory?
A) England
B) Germany
C) Mexico
D) Japan
E) United States
90) NewTone Manufacturing does not keep excess stock on hand. When orders are received, the
company brings in parts from suppliers, creates products, and fulfils the order. This represents a
________ system
A) fulfillment warehouse
B) periodic review
C) buffer stock
D) just-in-time inventory
E) wholesale
91) One characteristic of a just-in–time (JIT) inventory system is that
A) a company is more likely to have excess unsold inventory to write off against earnings.
B) parts enter the manufacturing process immediately; they are not warehoused.
C) it is difficult to spot and fix defective inputs.
D) the working capital a company needs to finance inventory increases is high.
E) a firm has an ample buffer stock of inventory.
92) Under a just-in-time (JIT) inventory system, it is likely that the ________ will increase.
A) amount of working capital for inventory
B) inventory turnover
C) number of defective parts
D) inventory holding costs
E) storage costs
93) A major cost savings from just-in-time inventory systems comes from
A) a shift in focus away from quality.
B) increasing productivity of workers.
C) speeding up inventory turnover.
D) creating a buffer stock of inventory.
E) writing off excess unsold inventory against earnings.
94) How does a just-in-time inventory system help enhance product quality?
A) Ordering parts only when needed allows a company to customize products.
B) Defective parts are noticed more quickly than in a traditional warehouse system.
C) JIT creates a nearly error-free production process.
D) It reduces the costs related to inventory holding which creates a larger budget for product
enhancement.
E) It reduces the need to write off excess unsold inventory against earnings.
95) The drawback of a just-in-time inventory system is that it
A) increases the total capital required by a firm.
B) leaves a firm without a buffer stock of inventory.
C) increases inventory holding costs, such as warehousing and storage costs.
D) is less efficient than traditional system in spotting and fixing defective inputs.
E) lowers a company’s profitability as measured by return on capital invested.
96) One way to reduce the risks for a business that operates on just-in-time principles is to
A) depend on one supplier for an important input.
B) outsource the production of inputs only to advanced countries.
C) hold an excess buffer stock of inventory.
D) source inputs from several suppliers located in different countries.
E) avoid using electronic data interchange.
97) Companies rely on an EDI system to
A) pinpoint the right customer base.
B) minimize manufacturing mistakes.
C) assess the skills of job applicants.
D) exchange data between two or more companies.
E) control the return of product.
98) Ride Inc., a manufacturer of car components, wants to set up a system that will send invoices to
its customers once orders for input supply are placed. What should the company use to perform
this function?
A) computer-aided design system
B) lean production
C) just-in-time inventory system
D) electronic data interchange
E) social networking
99) The ________ operational objective refers to integrating a control system across global supply
chain functions to eliminate global supply chain disruptions.
A) shipment consolidation
B) variance reduction
C) quality
D) life-cycle support
E) responsiveness
100) James works in the after-market service department of All-Grain Food Products. He recently
worked on a product recall for one of the company’s most popular brands. Which operational
objective is James responsible for within the global supply chain?
A) responsiveness
B) shipment consolidation
C) life-cycle support
D) variance reduction
E) inventory reduction
101) What are two important strategic objectives of an international firm’s production and logistics
functions?
102) Describe the members of the upstream and the downstream portions of the global supply
chain.
103) Explain W. Edwards Deming’s philosophy of total quality management.
104) Production and supply chain functions must be able to accommodate demands for local
responsiveness. Explain where these demands originate and how a company can accommodate
these demands.
105) How do location externalities affect a country’s attractiveness as a manufacturing base?
Provide an example.
106) Define minimum efficient scale of output. How does this influence the location decisions of
production activities?
107) Describe flexible manufacturing and mass customization and explain how they affect the
costs and efficiency of a company.
108) Explain which two product features affect the location decision of a company.
109) Discuss the two basic strategies for locating production facilities. When is it most appropriate
to centralize production?
110) Compare and contrast the six different types of strategic roles associated with a foreign
factory.
111) Discuss the elements that favor a make decision in a company.
112) Describe the five strategic levels that can be undertaken by a global company.
113) Discuss the three general forms of packaging and their purpose.
114) What is the role of information technology and the Internet in modern materials
management?