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39) With respect to e-procurement, Coca-Cola, Sara Lee, Kraft, PepsiCo, P&G, and several other
companies joined forces to form a ________ called Transora to use their combined leverage to
obtain lower prices for raw materials.
A) manufacturer's co-op
B) supplier's co-op
C) middleman group
D) buying alliance
E) buying cabal
40) Plastics.com allows plastics buyers to search the best prices among thousands of plastics
sellers. Plastics.com is an example of a(n) ________.
A) buying alliance
B) barter market
C) systems seller
D) vertical market
E) auction site
41) On an online ________, prices change by the minute.
A) buying alliance
B) barter market
C) systems seller
D) spot market
E) catalog site
42) With respect to e-procurement, which of the two types of e-hubs are Web sites organized
around?
A) vertical and horizontal hubs
B) vertical and functional hubs
C) functional hubs and organizational hubs
D) supplier and user hubs
E) manufacturer and supplier hubs
43) Praxair Limited is a supplier of synthetic graphite to a number of electrode manufacturers in
the U.S. Its customers have shifted their ordering responsibilities to Praxair and the company
regularly monitors its customer's inventory levels and has taken responsibility for replenishing
the supplies automatically through continuous replenishment programs. Which of the following
systems do Praxair and its customers follow with respect to order-routine specification?
A) Supplier Added Value Effort ($AVE)
B) Vendor Managed Inventory (VMI)
C) Direct Concentrated Buying (DCB)
D) Supplier Performance Management (SPM)
E) Product Value Analysis (PVA)
44) Which of the following methods is most likely to be used by buyers to review the
performance of chosen suppliers?
A) the buyer may contact different suppliers and ask for their evaluations
B) the buyers may rate the end-users on several criteria using a weighted-score method
C) the buyer might aggregate the cost of poor performance to come up with adjusted costs of
purchase, including price
D) the buyers may aggregate the opinions of various competitors and come up with the adjusted
cost of supply
E) the buyers might adopt the Supplier Added Value Effort technique to calculate supplier
efficiency
45) A ________ establishes a long-term relationship in which the supplier promises to resupply
the buyer as needed, at agreed-upon prices, over a specified period of time.
A) stockless purchase plan
B) direct stock purchase plan
C) defined contribution plan
D) stock purchase plan
E) share purchase plan
46) In the ________ category of buyer-supplier relationships, competition rather than
cooperation is the dominant form of governance.
A) basic buying and selling
B) bare bones
C) contractual transaction
D) customer supply
E) collaborative
47) Which of the following relationships is characterized by much trust and commitment leading
to a true partnership?
A) mutually adaptive
B) collaborative
C) basic buying and selling
D) customer supply
E) cooperative systems
48) Value Central has a partnership of high trust and commitment with certain suppliers and
gives them access to its sophisticated and detailed daily, individual store-based sales data. In
exchange, those suppliers are responsible for managing Value Central's inventory of their
products. This relationship is best described as ________.
A) basic buying and selling
B) contractual transaction
C) collaborative
D) customer supply
E) customer is king
49) The relationship between a company and its office supplies vendor where competition rather
than cooperation is the dominant form of governance is probably best described as ________.
A) basic buying and selling
B) contractual transaction
C) collaborative
D) customer supply
E) customer is king
50) In the ________ category of buyer-supplier relationship, although bonded by a close,
cooperative relationship, the seller adapts to meet the customer's needs without expecting much
adaptation or change on the part of the customer in exchange.
A) contractual transaction
B) cooperative system
C) collaborative
D) mutually adaptive
E) customer is king
51) According to research studies, the closest relationships between customers and suppliers
arise when ________.
A) supply is important to the customer and there were procurement obstacles
B) procurement is simple
C) there are many undifferentiated vendors in the marketplace
D) the customer is highly price sensitive
E) the suppliers charge a premium for their products
52) ________ investments are those expenditures tailored to a particular company and value
chain partner.
A) Diversified
B) Pooled
C) Specific
D) Umbrella
E) General
53) Which of the following is a form of cheating or undersupply relative to an implicit or explicit
contract which usually takes place when buyers cannot easily monitor supplier performance?
A) Institutional sale
B) Business buying
C) Opportunism
D) Vertical integration
E) Contractual transactionism
54) The ________ market consists of schools, hospitals, nursing homes, prisons, and other
institutions that must provide goods and services to people in their care.
A) vertical
B) nonprofit
C) spot
D) secondary business
E) institutional
55) In most countries, ________ are the major buyers of goods and services. They typically
require suppliers to submit bids and often award the contract to the lowest bidder.
A) consumer packaged-goods companies
B) government organizations
C) health services vendors
D) educational institutions
E) households
56) Organizational buying is the decision-making process by which formal organizations
establish the need for purchased products and services and identify, evaluate, and choose among
alternative brands and suppliers.
57) The business market consists of all the organizations that acquire goods and services used in
the production of other products or services that are sold, rented, or supplied to others.
58) The business marketer normally deals with far fewer, much larger buyers than the consumer
marketer does.
59) The total demand for many business goods and services is inelastic that is, not much
affected by price changes.
60) The buyer in a straight rebuy usually changes product specifications, prices, delivery
requirements, or other terms.
61) Most business buyers reject what is called systems buying from one seller.
62) Sellers benefit from systems contracting through lower operating costs as a result of steady
demand and reduced paperwork.
63) With respect to the buying center, approvers are people who have the power to prevent
sellers or information from reaching members of the buying center.
64) Influencers influence the buying decision by helping define specifications and providing
information for evaluating alternatives.
65) In the buying center, several people can occupy a given role such as user or influencer, and
one person may play multiple roles.
66) Small sellers concentrate on multilevel in-depth selling instead of reaching the key buying
influencers.
67) A performance review is the first step in the buygrid framework.
68) The buying process begins when someone places an order with a sales representative.
69) Product value analysis is an approach to efficiency that studies whether components can be
redesigned or made by more efficient methods of production without adversely impacting
product performance.
70) In buying alliances, participants offer to trade goods or services.
71) Companies are increasingly reducing the number of suppliers they utilize, and there is a trend
toward single sourcing.
72) Corporate credibility depends on corporate expertise, corporate trustworthiness, and
corporate likability.
73) The "customer is king" category of buyer-seller relationship is relatively simple, and one in
which routine exchanges with moderately high levels of cooperation and information exchange
occur.
74) Contracts are always sufficient to govern supplier transactions and prevent supplier
opportunism.
75) A good illustration of a member of the institutional market would be Boeing because it is a
member of the aviation institution structure.
76) Business markets have several characteristics that contrast sharply with those of consumer
markets. Name and briefly characterize five of those characteristics.
77) What is the composition of the buying center?
78) What are the methods available to the buyer to review the performance of the chosen
supplier? What advantage does performance review offer to the buyer?
79) Researchers have found that buyer-supplier relationships differed according to four factors:
availability of alternatives; importance of supply; complexity of supply; and supply market
dynamism. Based on these four factors, they classified buyer-supplier relationships into eight
different categories. What are those categories?
80) Explain the term opportunism with respect to business relationships.
