Unless the parties specify differently, the term FOB delineates the point at which the
supplier is responsible for freight charges and where the purchaser assumes title to the
shipment.
a. True
b. False
In collaborative relationships, buyers and suppliers can work together to mutually share
the benefits of learning curves and productivity improvements.
a. True
b. False
A/An _____ can be changed or canceled at any time by the buyer without the sellers
consent.
a. irrevocable letter of credit
b. Incoterm
c. revocable letter of credit
d. CISG
e. switch trade
If suppliers are not forthcoming with labor and material cost data, cost models can be
developed to improve the buyers negotiating position using material/labor ratios
available from industry databases.
a. True
b. False
_____ is a negotiation tactic that is a test of acceptability.
a. Take-it-or-leave-it
b. Best and final offer
c. Price increase
d. Trial balloon
e. Honesty and openness
Although there is a trend toward less reliance on competitive bids and more on
negotiated longer-term agreements, many contracts are still awarded through the
competitive bid process.
a. True
b. False
After the buyer-supplier relationship has been established, buyers no longer need to
track supplier performance over time.
a. True
b. False
An effective supplier quality manual will contain all of the following except _____.
a. documentation control
b. testing and acceptance procedures
c. metrics and measurement protocols
d. basic responsibilities of both the buyer and the supplier
e. approved accounting expenses
The doctrine of _____ holds that if one or more parties made a promise, even orally, he
or she cannot renege on that promise if the other party acted on reliance on the promise.
a. caveat emptor
b. promissory estoppel
c. anticipatory breach
d. consideration
e. None of the above.
Which of the following is not one of Porters five forces?
a. Buyer bargaining power.
b. Switching costs.
c. Threat of new entrants.
d. Market internal competition.
e. Supplier bargaining power.
Suppliers of critical nonstandard commodities are involved much later in the product
development initiative.
a. True
b. False
The ability to plan material requirements accurately increases as order-cycle time
lengthens.
a. True
b. False