Management MCQ: Management Chapter 11

Outsourcing:

A) transfers traditional internal activities to outside vendors.
B) utilizes the efficiency that comes with specialization.
C) allows the outsourcing firm to focus on its key success factors.
D) All of the above are true of outsourcing.
E) None of the above is true of outsourcing.

Answer: D

Which of the following is NOT one of the five parts of the Supply Chain Operations Reference (SCOR) model?

A) Make
B) Sell
C) Plan
D) Source
E) Return

Answer: B

Consider a firm with an annual net income of $20 million, revenue of $60 million and cost of goods sold of $25 million. If the balance sheet amounts show $2 million of inventory and $500,000 of property, plant & equipment, how many weeks of supply does the firm hold?

A) 12.50
B) 5.20
C) 2.60
D) 0.08
E) 4.16

Answer: E

Consider a firm with an annual net income of $20 million, revenue of $60 million and cost of goods sold of $25 million. If the balance sheet amounts show $2 million of inventory and $500,000 of property, plant & equipment, what is the inventory turnover?

A) 12.50
B) 10.00
C) 42.00
D) 4.16
E) 20.00

Answer: A

Which of the following is NOT true about reverse logistics as compared to forward logistics?

A) Inventory management is not consistent.
B) Distribution costs are less directly visible.
C) Pricing is dependent upon many factors.
D) Speed is often very important.
E) Forecasting is more uncertain.

Answer: D

What term describes a supply chain that is designed to optimize both forward and reverse flows?

A) closed-loop supply chain
B) full-journey supply chain
C) circular supply chain
D) network supply chain
E) recycled supply chain

Answer: A

In supply chain management, ethical issues:

A) are particularly important because of the enormous opportunities for abuse.
B) may be guided by company rules and codes of conduct.
C) become more complex the more global is the supply chain.
D) may be guided by the principles and standards of the Institute for Supply Management.
E) All of the above are true.

Answer: E

The Institute for Supply Management:

A) establishes laws and regulations for supply management.
B) is an agency of the United Nations charged with promoting ethical conduct globally.
C) publishes the principles and standards for ethical supply management conduct.
D) prohibits backward integration into developing economies.
E) grants Ph.D. degrees in purchasing.

Answer: C

Which of the following statements does NOT accurately explain what occurs when the number of facilities in a distribution network increases?

A) response time decreases
B) profit first increases, then decreases
C) total logistics costs first decrease, then increase
D) inventory costs increase
E) response time first decreases, then increases

Answer: E

As the number of facilities increases, total logistics costs tend to follow a curve that first declines, then rises. Why?

A) Transportation and inventory costs first decline steeply, then rise, while facility costs always rise.
B) Transportation costs always decline, but eventually the rise in facility and inventory costs outweigh the declining transportation costs.
C) Facility costs first decline steeply, then rise, while transportation and inventory costs always rise.
D) Transportation costs first decline steeply, then rise, while facility and inventory costs always rise.
E) Inventory costs first decline steeply, then rise, while transportation and facility costs always rise.

Answer: D

What three logistics-related costs are relevant when analyzing the choice of number of facilities in a distribution network?

A) inventory costs, production costs, and transportation costs
B) inventory costs, production costs, and facility costs
C) inventory costs, transportation costs, and facility costs
D) facility costs, production costs, and transportation costs
E) facility costs, inventory costs, and marketing costs

Answer: C

Designing distribution networks to meet customer expectations suggests what three criteria?

A) rapid response, service, and cost
B) rapid response, product choice, and service
C) product choice, cost, and service
D) cost, process choice, and service
E) rapid response, cost, and process choice

Answer: B

Distribution management focuses on which of the following?

A) the outbound flow of products
B) incoming materials
C) allocation of demand among suppliers
D) setting dividend rates
E) balancing an assembly line

Answer: A

Warehouses sometimes perform certain other functions besides storing goods. Which of the following is NOT typically one of those functions?

A) purchasing
B) postponement
C) break-bulk activities
D) consolidation point
E) cross-docking

Answer: A

While freight rates are often based on very complicated pricing systems, in general, the primary freight price factor is based on which of the following attributes?

A) damage record
B) on-time delivery
C) door-to-door service
D) speed of shipment
E) consolidation capabilities

Answer: D

By which distribution system is more than 90 percent of U.S. coal shipped?

A) railroads
B) trucks
C) waterways
D) pipelines
E) none of the above

Answer: A

Which one of the following distribution systems offers speed and reliability when emergency supplies are needed overseas?

A) trucking
B) railroads
C) airfreight
D) waterways
E) pipelines

Answer: C

What term is used to describe the outsourcing of logistics?

A) e-logistics
B) shipper-managed inventory (SMI)
C) hollow logistics
D) sub-logistics
E) third-party logistics (3PL)

Answer: E

In what type of auction does a buyer initiate the process by submitting a description of the desired product or service?

A) traditional
B) buyer
C) Dutch
D) French
E) Mexican

Answer: C

Which of the following is NOT a typical benefit of centralized purchasing?

A) leverage purchase volume for better pricing
B) develop specialized staff expertise
C) reduce the duplication of tasks
D) reduce lead times
E) promote standardization

Answer: D