According to Cialdini, _____ is a principle that says we prefer to be consistent in our
beliefs and actions.
a. scarcity
b. liking
c. social proof
d. reciprocation
e. consistency
Supplier rationalization and optimization should be a one-time activity.
a. True
b. False
Which of the following is not a potential drawback of using a cross-functional sourcing
team?
a. Team process loss.
b. Reduced innovation.
c. Negative effects on individual members.
d. Poor team decisions.
e. Groupthink.
Fixed price contracts are the most complex and difficult for purchasing to manage
because there is a need for extensive auditing or additional input from the purchasing
side.
a. True
b. False
Traditional cost accounting systems are designed to systematically track and
consolidate indirect spend across an organization.
a. True
b. False
The most important benefit of a visibility system is not that the system is able to correct
a supply chain problem, but that it allows people to become aware of problems earlier
and thus take corrective actions more quickly that they would otherwise.
a. True
b. False
The key to good market intelligence is to _____ data, which means to explore, compare,
and contrast data from multiple sources before it can be validated.
a. triangulate
b. minimize
c. gather
d. collect
e. assemble
Most offshore organizations like dealing with the U.S. legal system and long contracts.
a. True
b. False
A _____ is an analytical tool that identifies the primary external forces that are causing
prices to either increase or decrease.
a. market analysis
b. total cost analysis
c. cost analysis
d. make-buy analysis
e. target price analysis
_____ are internationally recognized commercial terms that describe the responsibilities
of the buyer and seller in the arrangement of transportation and clarify when the
ownership of the merchandise takes place.
a. Incoterms
b. Duties
c. Letters of credit
d. Values
e. Tariffs
Capital equipment purchasing involves buying assets intended for use less than one
year.
a. True
b. False
Which of the following is not an example of points that should be considered when
evaluating a suppliers employee capabilities?
a. The degree to which employees are committed to quality and continuous
improvement.
b. The overall skills and abilities of the workforce.
c. Employee morale.
d. Workforce turnover.
e. Disclosure of environmental infractions.
Once a contract has been negotiated and signed, the real work is over.
a. True
b. False
When demand exceeds supply, a buyers market exists, and prices generally decrease.
a. True
b. False
Professional purchasers should become familiar with financial ratios because they can
provide quick and valuable insights into a suppliers financial health.
a. True
b. False
In the _____, the supplier establishes a price that will provide a profit margin that is a
predetermined percentage of the quoted price, i.e., not a percentage of cost.
a. rate-of-return pricing model
b. margin pricing model
c. market-share model
d. competition pricing model
e. target costing model
The _____ is an approach to estimating the different components that make up the
suppliers per unit price per unit of product or service, i.e., what the product or service
should cost in a theoretical world.
a. market skimming model
b. make-buy analysis
c. competition pricing model
d. rate-of-return model
e. Should-cost model
All of the following are common contingency management tools that can be effectively
used at the tactical level to assist the supply manager in identifying, analyzing,
reducing, and monitoring supply base risk except _____.
a. single sourcing
b. inventory
c. automated visibility and early warning systems
d. use of third party intermediaries
e. scenario analysis