In this approach to managing capacity, a firm subcontracts peak production so that internal production remains level and can be done cheaply.

In this approach to managing capacity, a firm subcontracts peak production so that internal production remains level and can be done cheaply.

A) Time flexibility from workforce
B) Use of subcontracting
C) Use of dual facilities-specialized and flexible
D) Use of seasonal workforce

Answer: B

In this approach to managing capacity, a firm uses a temporary workforce during the peak season to increase capacity to match demand.

In this approach to managing capacity, a firm uses a temporary workforce during the peak season to increase capacity to match demand.

A) Time flexibility from workforce
B) Use of subcontracting
C) Use of dual facilities-specialized and flexible
D) Use of seasonal workforce

Answer: D

In this approach to managing capacity, a firm uses flexible work hours by the workforce to manage capacity to better meet demand.

In this approach to managing capacity, a firm uses flexible work hours by the workforce to manage capacity to better meet demand.

A) Time flexibility from workforce
B) Use of seasonal workforce
C) Use of subcontracting
D) Use of dual facilities-specialized and flexible

Answer: A

A firm can vary supply of product by controlling

A firm can vary supply of product by controlling

A) revenue.
B) pricing.
C) demand.
D) capacity

Answer: D

A firm can vary supply of product by controlling

A firm can vary supply of product by controlling

A) inventory.
B) pricing.
C) demand.
D) revenue

Answer: A

______ variability is change in demand that can be forecasted.

______ variability is change in demand that can be forecasted. 

A) Capacity
B) Predictable
C) Inventory
D) Backlog

Answer: B

As the product margin declines, promoting during the peak demand period becomes

As the product margin declines, promoting during the peak demand period becomes

A) less profitable.
B) more profitable.
C) less of a risk.
D) more desirable.
E) none of the above

Answer: A

Promoting during a peak demand month may decrease overall profitability if

Promoting during a peak demand month may decrease overall profitability if

A) a small fraction of the demand increase results from a forward buy.
B) any of the demand increase results from a forward buy.
C) a significant fraction of the demand increase results from a forward buy.
D) none of the above
E) all of the above

Answer: C

Average inventory

Average inventory

A) increases if a promotion is run during the peak period.
B) increases if a promotion is run during the off-peak period.
C) decreases if a promotion is run during the peak period.
D) decreases if a promotion is run during the off-peak period.
E) both A and D

Answer: B

Offering a promotion during a peak period that has significant forward buying

Offering a promotion during a peak period that has significant forward buying 

A) creates a desirable demand pattern.
B) creates a demand pattern less costly to serve.
C) creates a demand pattern even more costly to serve.
D) shifts demand from the peak period to the slow period.
E) shifts demand to a more desirable period.

Answer: C

In general, as the fraction of increased demand coming from forward buying grows, offering the promotion during the peak demand period becomes

In general, as the fraction of increased demand coming from forward buying grows, offering the promotion during the peak demand period becomes

A) less attractive.
B) more attractive.
C) more profitable.
D) less significant.
E) none of the above

Answer: A

Customers moving up future purchases to the present is

Customers moving up future purchases to the present is

A) market growth.
B) stealing share.
C) forward selling.
D) forward buying.
E) none of the above

Answer: D

Customers substituting the firm's product for a competitor's product is

Customers substituting the firm's product for a competitor's product is

A) market growth.
B) stealing share.
C) forward selling.
D) forward buying.
E) none of the above

Answer: B

An increase in consumption of the product either from new or existing customers is

An increase in consumption of the product either from new or existing customers is

A) market growth.
B) stealing share.
C) forward selling.
D) forward buying.
E) none of the above

Answer: A

One key to successful collaboration when the supply chain is performing aggregate planning is

One key to successful collaboration when the supply chain is performing aggregate planning is

A) determining how losses will be allocated to different members of the supply chain.
B) determining how profits will be allocated to different members of the supply chain.
C) determining how labor will be allocated to different members of the supply chain.
D) determining how customers will be allocated to different members of the supply chain.
E) none of the above

Answer: B

When planning, the goal of all firms in the supply chain should be to maximize supply chain profits because

When planning, the goal of all firms in the supply chain should be to maximize supply chain profits because

A) this leaves them less profit to divide among themselves.
B) this leaves them more profit to divide among themselves.
C) this outcome leaves them more profit to pay tax on.
D) this outcome will increase their charitable giving.
E) none of the above

Answer: B

Pricing decisions based only on revenue considerations often result in

Pricing decisions based only on revenue considerations often result in

A) a decrease in overall profitability.
B) an increase in overall profitability.
C) a decrease in overall revenue.
D) a decrease in supply chain revenue.
E) an increase in supply chain profitability.

Answer: A

The promotion and pricing decisions made by marketing and sales typically have the objective of

The promotion and pricing decisions made by marketing and sales typically have the objective of

A) maximizing profitability.
B) minimizing profitability.
C) minimizing revenue.
D) maximizing revenue.
E) maximizing profitability across the supply chain.

Answer: D

The pricing and promotion decisions are often made by

The pricing and promotion decisions are often made by 

A) marketing and sales.
B) marketing and operations.
C) operations and sales.
D) marketing, operations, and sales.
E) marketing and operations without sales.

Answer: A

Supply chains can influence demand by using

Supply chains can influence demand by using

A) production capacity and inventory.
B) pricing and other promotions.
C) price promotions and inventory.
D) production capacity and inventory promotions.
E) production capacity and other promotions.

Answer: B