Industrial Engineering Supply Chain Management Answer Key Part 3

60. A factor that makes it desirable for business organizations to actively manage their supply chains is: A. more potential vendors B. increasing globalization C. downsizing D. the internet E. RFID's Globalization is making supply chain management more important. 61. Which of the following is not a benefit of effective supply chain management? A. lower inventory costs B. higher productivity C. shorter lead times D. greater customer loyalty E. larger number of suppliers Supply chain management often results in fewer suppliers. 62. Which of the following is not a measure of the reliability of the supply chain? A. supply chain response time B. on-time delivery C. fill rate D. lead time variability E. improving e-fulfillment statistics Response time is a measure of supply chain effectiveness. 63. The automatic identification of material is part of/facilitated by: A. holding costs B. RFID C. working capital reduction D. net present value calculations E. vendor analysis RFID facilitates the automatic identification of material. 64. Which of the following is not an application of E-business? A. internet buying and selling B. e-mail C. order and shipment tracking D. electronic data interchange (EDI) E. universal product codes Universal product codes are not part of E-business. 65. Which of the following is an advantage of E-business? (I) reduction of transaction costs (II) shortened supply chain response time (III) greater customer loyalty A. I B. II C. I and II D. II and III E. I, II, and III Gaining and maintaining customer loyalty is even more difficult once a firm is involved in E-business. 66. Which of the following is a barrier to integration of separate organizations in the supply chain? (I) conflicting objectives of the companies in the chain. (II) different level of capacity of the companies in the chain. (III) reluctance of the organizations in the chain to allow other organizations access to their data. A. I only B. I and II C. II and III D. I and III E. I, II and III Capacity imbalances can be overcome, but conflicting objectives and mistrust are substantial barriers. 67. _________ has helped business concentrate on their core business. A. Supply Chains B. Scheduling C. Outsourcing D. ERP E. Lean Production Outsourcing enables firms to focus on what they do, or should do, best. 68. Outsourcing followed by __________ is not simple. A. Integration B. Unionization C. Backsourcing D. Computerization E. Just-in-time Backsourcing is difficult to implement effectively if outsourcing has been done. 69. The interface between the firm and its suppliers is: A. purchasing B. production C. distribution D. engineering E. accounting The purchasing function bridges the organization and its suppliers. 70. The two types of decisions that are relevant to supply chain management are: A. Short, long term B. Domestic, international C. Location, layout D. In-source, out-source E. Tactical, operational Decision-making in supply chain management falls into either tactical or operational areas. 71. One important objective of purchasing is to: A. set quality standards for purchased items B. be knowledgeable about new products C. maintain numerous sources of supply D. obtain the lowest prices on all purchased items E. determine the processes that should be used Purchasing can play a crucial role by helping solidify the supplier base for a new product. 72. The purchasing cycle begins with: A. selecting a supplier B. placing an order C. evaluating potential vendors D. conducting a value analysis E. receiving a requisition The requisition notes what is needed, in what quantity, and when it is needed. 73. Examination of the sources of supply for purchased parts or materials in order to improve performance is called: A. vendor analysis B. value analysis C. negotiated purchasing D. reverse engineering E. disintegration Performance can be evaluated with respect to price, quality, reputation or service. 74. Vendor analysis has the greatest potential for savings for items which have: A. low cost per unit B. low annual cost-volume C. high cost per unit D. high annual usage E. high annual cost-volume These represent the bulk of purchasing costs. 75. Which of the following is not true of vendor analysis? A. It involves an examination of the function of purchased parts or raw materials. B. Its purpose is to reduce costs and/or improve performance of purchased goods or services. C. It is usually performed only periodically. D. Representatives from design and operations may work with purchasing. E. If improvements are identified, purchasing implements those that purchasing agrees are justified. The function of purchased parts or raw materials would be done by the procuring department. 76. Which of the following is not a performance driver? A. Quality B. Cost C. Stability D. Velocity E. Flexibility Stability is not a performance driver. 77. Which of the following would not usually be a main factor in selecting a vendor? A. location B. price C. quality D. inventory turnover E. vendor services Turnover would only rarely be associated with the vendor that is selected. 78. Which of the following is part of the purchasing cycle? (I) Purchasing selects a supplier. (II) Orders from vendors are received. (III) Purchasing receives a requisition. A. II and III B. I, II, and III C. I only D. I and II E. I and III These are all part of the purchasing cycle. 79. Which of the following is least likely to be a key consideration when a company chooses a supplier? A. lead time and on-time delivery B. reputation and financial stability C. value analysis D. quality and Quality assurance E. flexibility of design change All the others are highly likely to be considered in supplier selection. 80. Which of the following is not a benefit of centralized purchasing? A. potential for quantity discounts B. better service from suppliers C. quick response to local needs D. potential for use of purchasing specialists E. supplier research Quick response to local needs is a benefit of decentralized purchasing. 81. The purchasing perspective of the supplier as a partner is characterized by: A. an emphasis on low prices B. one or a few suppliers C. low flexibility D. 100% inspection for quality E. low volume Fewer suppliers enhance the chances of building real partnerships. 82. Vendor Analysis is the examination of the _________ of purchased materials. A. Function B. Source C. Quality D. Cycle E. Quantity Sources of supply are evaluated in vendor analysis. 83. Last quarter, a retailer sold 8,000 t-shirts, 7,000 of which were sold directly from onhand inventory. This retailer's ________ was 88%. A. fill rate B. inventory yield C. profit margin D. inventory turnover E. none of the above This retailer's fill rate was 88%. 84. Which of the following is a principle required for ethical behavior in purchasing? A. loyalty to employer. B. justice to those you deal with. C. faith in your profession. D. all of the above. E. none of the above. All of these are ethical principles in purchasing. 85. The activity which begins with a request from within the organization is: A. Outsourcing search B. Purchasing cycle C. Supplier selection D. Order receipt E. Supply chain management The purchasing cycle begins with a requisition. 86. Our organization can obtain visibility to potential trading partners on the internet by using: A. C2C B. B2C C. B2B D. C2B E. None of the above B2B helps the organization let the market know of the organization's needs. 87. Real time information about product movement on store shelves could benefit from the use of: A. batch processing B. economic order quantities C. statistical process control D. radio frequency identification tags E. infrared remote scanners RFID facilitates real-time data gathering. 88. The website and order fulfillment are essential features of: A. delayed differentiation B. e-commerce C. internet service providers D. inventory balancing E. market segmentation These are front-end and back-end facets of e-commerce. 89. A given inventory item has a per-year holding cost of $500. One method of shipping this item is three days faster than the other, but it is $2.50 more per unit. Using the slower method would be __________ more expensive overall than using the faster method. A. $1.08 B. $1.16 C. $2.37 D. $2.73 E. $1.61 Multiply the holding cost by the speed differential, then divide by 365. Compare this to the actual shipping cost difference.