Companies on a growth pattern fueled by ______________ acquire new equipment to
expand into a newly introduced product line. Investment in capital equipment for
expansion purposes should increase incremental revenue.
A. innovation
B. competition
C. increased sales
D. technology
E. customer demand
Purchasing can give the firm advantages over its competitors. In essence, firms must
design their __________________ to emphasize the competitive strategy.
A. plans
B. purchasing manual
C. policies
D. purchasing actions
E. marketing program
Customers place orders based on _________. Sometimes the _________ is called the
“drop dead date.â€
A. shipping dates / shipping date
B. seasonal dates / seasonal date
C. preferred dates / preferred date
D. drop shipment dates / drop shipment date
E. need dates / need date
We hear so much about quality that it may come as a surprise that even experts
don’t agree about how to achieve it. Fortune recently asked the gurus of industrial
quality to define it and to assign responsibility for quality.
•To some, quality is a design matter. It has to do with engineering—both the
process technology and product design.
•To others, quality is an evaluation that utilizes sampling to achieve process control
and make certain that inferior quality material isn’t shipped from the plant.
•There is a third view—that quality depends upon perception. This means making a
slogan a rallying cry—“Zero Defects†or “Quality is Free.â€
A. True
B. False
The supply management system is driven by eliminating fast-moving supplies and by
implementing a full-service distribution service for most of the hospitals in the system;
and changing the attitudes and behavior of the nursing staff and physicians.
A. True
B. False
There are five primary functions of inventories. One of the following is incorrect.
Which one?
A. Safety stocks
B. Seasonal inventories
C. Cycle stocks
D. Coupling
E. Pipeline inventory
The three types of purchasing authority are ________ authority, ________ authority,
and __________ authority.
A. granted / line / functional
B. implied / staff / emergency
C. line / staff / implied
D. express / implied / emergency
E. functional / staff / emergency
Each of the (transportation) modes has specific operating and cost characteristics and
the buying professional must weigh them in selecting the most appropriate
transportation mode. The most basic selection decision is the trade-off between
_______________.
A. quality, flexibility, and price
B. cost, flexibility, and speed
C. flexibility, reliability, and speed
D. cost, reliability, and speed
E. efficiency, cost, and speed
It takes time to ___________ of the workforce and _____________ relationships with
suppliers.
A. change habits / improve
B. change attitudes / nurture long-term
C. improve the attitudes / build
D. change old habits / nurture long-term
E. change attitudes / maintain short-term
____________ (statistical inventory control) techniques are based on the assumption of
uniform requirements per unit time. If this assumption of the demands is unrealistic,
these techniques can lead to inappropriate inventory decisions.
A. Reorder point
B. Order-point
C. Order control
D. SICT
E. Telzon
JIT purchasing facilitates reduction in _____________ and the associated
_____________ costs.
A. the cost of materials / storage
B. the cost of shipping / holding
C. the cost of inventory / storage
D. inventory levels / materials’
E. inventory levels / inventory holding
Strategic components are the most critical parts in a project or platform and require
more extensive quality assurance requirements. Strategic components generally meet
___________ of the following criteria:
1> Supplier participation in the designing of the component part.
2> A high level of systems integration required for a complex component part.
3> An expensive component part.
4> Long lead time for the component part.
5> Component parts that require extensive testing.
6> Parts with critical characteristics.
7> Component parts with complex legal implications.
A. all
B. #1 and #7 only
C. #1, #2, and #5 only
D. one or more
E. #5, #6, and #7 only
One model that explains supply chain relationship management includes which of the
following behavioral dimensions?
A. counterproductive (lose-lose) / competitive (win-lose)
B. counter-cooperative (lose-win) / counter-collaborative (win-lose)
C. collaborative (win-win) relationships / cooperative (win-win)
D. All of the above
E. “A†and “C†only
(Most) of the (global risk) issues are ____________________________.
A. distance and communication
B. time value of money and quality issues
C. pipeline problems and staffing issues
D. competition
E. all of the above
The use of outsourcing has quickly become _____________ for an increasing number
of businesses.
A. necessary
B. a major strength
C. an advantage
D. a competitive weapon
E. a way of operating
When the buying firm is buying from sellers that service firms similar to the buying
firm’s markets, the prices will more than likely increase.
A. True
B. False
Phase Implementation and Evaluation
In this phase, a thorough indoctrination of the company with long range strategy,
implementation of current procedures, monitoring of marketing activities, feedback
mechanism for evaluation, and refinement of sourcing processes is conducted.
A. True
B. False
E-Procurement benefits by category are: Indirect, Direct, and __________
A. Centralized
B. Decentralized
C. Resourcing
D. Sourcing
E. Low cost
The level of resistance also is assumed to be related to the minimum necessary share.
As a bargainer concedes toward his/her minimum necessary share, (his/her) resistance
should increase. It also can be predicted that for a given offer, the lower the minimum
necessary share, the greater the resistance.
A. True
B. False
RFID tags can be read through snow, fog, ice, paint, and crusted grime, unlike the
barcode system. The tag also can be programmed to hold information such as the
item’s serial number, color, size, manufacture date, and current price, as well as a
list of all distribution points the item reaches as it moves before arriving at a store.
A. True
B. False
The ability to identify errors before they occur recycles scrap material, improves
downstream inspections, and will promote profitability.
A. True
B. False
Global business process outsourcing alone has surpassed the US$________ mark. A
recent Booz Allen report posits the expectation that U.S. business process outsourcing
will continue to grow at about _____ percent per year in the near term.
A. 9 trillion / 12
B. 5 trillion / 9
C. 4 trillion / 11
D. 6 trillion / 8
E. 6 trillion / 10
Perhaps the most important factor associated with the purchasing decision is the
_____________ and the ______________ between the buying and supplying firms.
A. business environment / power imbalance
B. economy / relationship
C. economy / power relationship
D. economic environment / power relationship
E. business economy / power imbalance
Direct ____________ is increasing in the manufacturing sector as manufacturing
flexibility allows more customized design.
A. competition
B. internet connectivity
C. customer contact
D. service
E. shipments
When the dollar has a weak performance over the life of a contract, a firm can realize
savings through the exchange rates.
A. True
B. False
Phase Sourcing Audit
The sourcing audit is used as a planning process that identifies opportunities for
increased profitability.
A. True
B. False
A complete transfer means that the ______________________________ and other
assets are no longer maintained internally once the business process is outsourced.
A. people, plants, warehouses, headquarters,
B. facilities, equipment, machinery,
C. people, facilities, equipment,
D. people, facilities, equipment, technology,
E. people, facilities, technology,
The original purpose of _____________ involvement (in transportation) was to protect
both the customer and the carrier from unhealthy competition. In today’s business
environment, this involvement is criticized.
A. federal government
B. executive management
C. state agency
D. department of commerce
E. the Consumers’ Union
The associated qualitative risk profiles of _____________________ in some foreign
countries must be evaluated.
A. the impact of national interest
B. the ethical consequences of “sweat shop†labor
C. hazardous working conditions
D. all the above
E. “B†and “C†only
_____________ must be developed to determine the disposition of a lot of raw
materials on component parts. If a batch of parts is inferior, it should be rejected and
returned to the supplier.
A. Specifications
B. Warranties
C. Guarantees
D. Return policies
E. Acceptance plans
A final point on the effects of power concerns the ultimate ______________ of the
supply chain members as well as the supply chain itself.
A. profitability
B. performance and subsequent profitability
C. cost reductions and subsequent profitability
D. productivity and profitability
E. performance
For each $___ reduction of material cost, there is a $___ increase in profit. The ratio is
____.
A. 1 / 1 / 1:1
B. 1 / 4 / 1:4
C. 1 / 2 / 1:2
D. 1 / 5 / 1:5
E. 1 / 3 / 1:3