In the _____, the supplier analyzes the market to find the combination of price per unit
and quantity of sales that maximizes its profit on the assumption that (1) lowering the
price per unit will result in more units being sold, and (2) greater volume will spread the
indirect cost over more units.
a. price volume model
b. sole sourcing model
c. market-share model
d. market skimming model
e. promotional pricing model
Purchasing can directly affect (positively or negatively) the long-term growth, revenue,
and operating outcomes and plans of stakeholders and business units.
a. True
b. False
The largest differences in communication styles across countries are message speed and
level of content.
a. True
b. False
Sustainable carbon footprint reductions should be measured at product suppliers but not
at service suppliers.
a. True
b. False
_____ is the process of determining what the external customer is willing to pay for a
product or service and then assigning specific cost targets to the components,
assemblies, and systems that make up the product or service.
a. Specific costing
b. Target pricing
c. Total cost analysis
d. Cost avoidance
e. None of the above.
The _____ clause of a contract specifies whether the buyer, if he or she becomes aware
of any technology or cost improvements of other products in the market, he or she can
share this information with the supplier, and how the supplier should act on this
information.
a. confidentiality
b. intellectual property
c. liability
d. technology improvements
e. governing law
Real-time updating refers to the process of downloading all data buckets into the main
system on a regularly scheduled basis.
a. True
b. False
The _____ clause of a contract defines all of the important terms contained within the
contract and is important so everyone understands exactly what each term means.
a. supply and delivery
b. specifications, quality, and health, safety, environment
c. scope of agreement
d. force majeure
e. definitions
Increasingly, purchasing is becoming more involved with expediting and inventory
control.
a. True
b. False
In the moderate development phase of supply management strategy development,
supply management councils or lead buyers may be responsible for entire classes of
commodities, and companywide databases by region may be developed to facilitate this
coordination.
a. True
b. False