The emphasis of the _____ is on obtaining sufficient current revenue to pay for
operating cost rather than on profit.
a. price volume model
b. promotional pricing model
c. revenue pricing model
d. market skimming model
e. competition pricing model
Which of the following is not an example of questions that should be asked when
evaluating a suppliers management capability?
a. Has management committed the supplier to TQM and continuous improvement?
b. Is management customer focused?
c. What is the willingness of employees to contribute to improved operations?
d. Does management put a priority on supply chain management?
e. What is the history of labor/management relations?
Which of the following is not an advantage of using a 3PL?
a. Economies of scale and increased flexibility.
b. Improve service performance levels.
c. Loss of dedicated in-house managed staff.
d. Release capital from sale of assets.
e. Concentrate on core business activities.
Which of the following is not one of the important factors to consider when building a
TCO model?
a. Focus on the small and easily measurable costs first.
b. Building a TCO can be a costly and time-intensive activity.
c. Work in a team.
d. Make sure to obtain senior management buy-in before embarking on a full-fledged
TCO.
e. When considering global sourcing, consider all of the relevant labor, quality,
logistics, and import costs associated with the total supply chain.
Economic conditions seldom determine whether a market is favorable to the seller or to
the purchaser.
a. True
b. False
Even when there is no contract, most transactions are covered by a gap filler known as
the Uniform Commercial Code.
a. True
b. False
_____ is a negotiation tactic that often signals the end of a negotiation on a given issue.
a. Venue
b. Silence
c. Planned concessions
d. Trial balloon
e. Best and final offer
Packaging issues together risks undermining an entire negotiation if the parties reach
impasse on a single issue within the linked proposal.
a. True
b. False
In the manufacturing sector, the percentage of purchases to sales averages 55 percent.
a. True
b. False
The advantage of center-led organizations is their ability to garner savings on common
purchases yet allow local purchasing decisions on unique items.
a. True
b. False
Which of the following is not one of the factors to be considered when implementing an
organizations supply structure?
a. The firms overall business strategy.
b. What foreign competitors are doing.
c. The similarity of purchases.
d. Total purchase dollar expenditures.
e. The overall philosophy of management.
According to Ohno and Toyota, _____ is a category of waste that includes any wasted
motion by man or machine.
a. overproduction
b. unnecessary transport
c. unnecessary movement
d. defect
e. None of the above.
_____ is the process of analyzing each individual cost element (i.e., material, labor
hours and rates, overhead, general and administrative costs, and profit) that together add
up to the final price.
a. Price analysis
b. Cost analysis
c. Cost analysis
d. Total cost analysis
e. Make-buy analysis
The administrative cost of maintaining 5,000 suppliers will be dramatically lower than
the cost of maintaining a core group of 500 highly qualified suppliers.
a. True
b. False
As organizations continue to focus more and more on their internal core competencies
and outsource non-core activities, they have come to recognize that many of their
necessary transportation and logistics services can, and should be, outsourced to expert
companies specializing in transportation and logistics services.
a. True
b. False
_____ involves a detailed analysis of the supply base to ensure that only the most
capable and highest performing suppliers are kept in the supply base after it is
rationalized.
a. Supply base optimization
b. Outsourcing
c. Strategic sourcing
d. Supply base reduction
e. Supply base management