Question 1

Many firms try to not exceed more than 15 to 25 percent of any one supplier's capacity.

Accepted Answer

A) True 
 B)False  True

Question 2

A national source is defined by the textbook as a source headquartered within the country and has facilities in multiple regions throughout the country.

Accepted Answer

A) True 
 B)False  True

Question 3

An international source is defined as a firm headquartered outside of the buying firm's country.

Accepted Answer

A) True 
 B)False  True

Question 4

Which of the following is not a typical category where the opportunity to reduce costs is increased through early supplier involvement in design?

Accepted Answer

A)  Materials costs may decrease through use of alternative parts and components 
B)  Services costs improve through collaborative efforts 
C)  Technology inputs may improve through the collaborative efforts 
D)  More complex parts and components can be designed 
E)  Specifications and tolerances may be adjusted to improve productivity while maintaining quality 
A)  Materials costs may decrease through use of alternative parts and components 
B)  Services costs improve through collaborative efforts 
C)  Technology inputs may improve through the collaborative efforts 
D)  More complex parts and components can be designed 
E)  Specifications and tolerances may be adjusted to improve productivity while maintaining quality

Question 5

Which of the following is not a typical advantage of local buying?

Accepted Answer

A)  Shorter lead times reduce inventory 
B)  Rush orders are filled faster 
C)  Disputes are usually more easily resolved 
D)  Implied social responsibilities to the community are fulfilled 
E)  Economies of scale 
A)  Shorter lead times reduce inventory 
B)  Rush orders are filled faster 
C)  Disputes are usually more easily resolved 
D)  Implied social responsibilities to the community are fulfilled 
E)  Economies of scale

Question 6

Reverse auctions should only be used when:

Accepted Answer

A)  The materials are generic, i.e. standard shelf items. 
B)  All responding suppliers are fully qualified 
C)  All supplier materials are identical 
D)  The buyer does not need a long term relationship 
E)  All of the above 
A)  The materials are generic, i.e. standard shelf items. 
B)  All responding suppliers are fully qualified 
C)  All supplier materials are identical 
D)  The buyer does not need a long term relationship 
E)  All of the above

Question 7

Which of the following is a typical consideration in favor of single sourcing?

Accepted Answer

A)  Meet customer's volume requirements 
B)  Special tooling is required 
C)  When the customer is a small player in the market for a specific item 
D)  Avoid complacency on the part of a supplier 
E)  When the technology path is uncertain 
A)  Meet customer's volume requirements 
B)  Special tooling is required 
C)  When the customer is a small player in the market for a specific item 
D)  Avoid complacency on the part of a supplier 
E)  When the technology path is uncertain

Question 8

The selection of bidding or negotiation should be decided by using objective criteria,a total cost perspective and sound supply management logic.

Accepted Answer

A) True 
 B)False

Question 9

The increase in long-term collaborative relationships is highlighting the need to develop strategic sourcing plans.

Accepted Answer

A) True 
 B)False

Question 10

The two steps in two-step bidding are: 1.Negotiation over contract elements and 2.Price bidding by potential suppliers that passed the first step.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following is not a typical reason for utilizing ESI?

Accepted Answer

A)  To formalize the alliance arrangement 
B)  Get supplier inputs before the design is frozen 
C)  Capitalize on the latest technology 
D)  Save time since design cycles are getting shorter 
E)  Let the supplier know that it is part of the team 
A)  To formalize the alliance arrangement 
B)  Get supplier inputs before the design is frozen 
C)  Capitalize on the latest technology 
D)  Save time since design cycles are getting shorter 
E)  Let the supplier know that it is part of the team

Question 12

Which of the following is not a prerequisite to bidding?

Accepted Answer

A)  Specifications must be clear 
B)  Price is not the only important variable 
C)  Market must consist of an adequate number of sellers 
D)  Sellers must be qualified and want the contract 
E)  Time available must be sufficient 
A)  Specifications must be clear 
B)  Price is not the only important variable 
C)  Market must consist of an adequate number of sellers 
D)  Sellers must be qualified and want the contract 
E)  Time available must be sufficient

Question 13

Which of the following is not one of the conditions demanding negotiation?

Accepted Answer

A)  Impossible to estimate costs with a high degree of certainty 
B)  Price is not the only important variable 
C)  Market must consist of an adequate number of sellers 
D)  Purchasing firm anticipates a need to make changes in the specification 
E)  Special tooling of setup costs are major factors 
A)  Impossible to estimate costs with a high degree of certainty 
B)  Price is not the only important variable 
C)  Market must consist of an adequate number of sellers 
D)  Purchasing firm anticipates a need to make changes in the specification 
E)  Special tooling of setup costs are major factors

Question 14

Which of the following is not a typical advantage of national buying?

Accepted Answer

A)  Delivery dates are more certain 
B)  Economies of scale 
C)  Superior technical assistance 
D)  Better handling of fluctuating demand 
E)  Shortages are less likely 
A)  Delivery dates are more certain 
B)  Economies of scale 
C)  Superior technical assistance 
D)  Better handling of fluctuating demand 
E)  Shortages are less likely

Question 15

Supply base reduction is achieved through both reducing variety and increasing consolidation.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following is a typical consideration in favor of single sourcing?

Accepted Answer

A)  Protect the buyer during bad times 
B)  Maintain competition 
C)  Provide a back-up source 
D)  Lower total cost results from higher volume 
E)  Meet local content requirements 
A)  Protect the buyer during bad times 
B)  Maintain competition 
C)  Provide a back-up source 
D)  Lower total cost results from higher volume 
E)  Meet local content requirements

Question 17

Early supplier involvement (ESI)is an approach in supply management to bring the expertise and collaborative synergy of suppliers into the design process

Accepted Answer

A) True 
 B)False

Question 18

According to the textbook,many firms try to not exceed more than 65 to 75 percent of any one supplier's capacity.

Accepted Answer

A) True 
 B)False

Question 19

Competitive bidding tends to result in sacrifices in product quality,development efforts,and other vital services.

Accepted Answer

A) True 
 B)False

Question 20

The decrease in long-term collaborative relationships is highlighting the need to develop alternative sourcing plans.

Accepted Answer

A) True 
 B)False

Exam 11: Sourcing

Many firms try to not exceed more than 15 to 25 percent of any one supplier's capacity.

A national source is defined by the textbook as a source headquartered within the country and has facilities in multiple regions throughout the country.

An international source is defined as a firm headquartered outside of the buying firm's country.

Which of the following is not a typical category where the opportunity to reduce costs is increased through early supplier involvement in design?

Which of the following is not a typical advantage of local buying?

Reverse auctions should only be used when:

Which of the following is a typical consideration in favor of single sourcing?

The selection of bidding or negotiation should be decided by using objective criteria,a total cost perspective and sound supply management logic.

The increase in long-term collaborative relationships is highlighting the need to develop strategic sourcing plans.

The two steps in two-step bidding are: 1.Negotiation over contract elements and 2.Price bidding by potential suppliers that passed the first step.

Which of the following is not a typical reason for utilizing ESI?

Which of the following is not a prerequisite to bidding?

Which of the following is not one of the conditions demanding negotiation?

Which of the following is not a typical advantage of national buying?

Supply base reduction is achieved through both reducing variety and increasing consolidation.

Which of the following is a typical consideration in favor of single sourcing?

Early supplier involvement (ESI)is an approach in supply management to bring the expertise and collaborative synergy of suppliers into the design process

According to the textbook,many firms try to not exceed more than 65 to 75 percent of any one supplier's capacity.

Competitive bidding tends to result in sacrifices in product quality,development efforts,and other vital services.

The decrease in long-term collaborative relationships is highlighting the need to develop alternative sourcing plans.

The Progression to Professional Supply Management

Organizational Issues

Supply Management: an Organization Spanning Activity

A Portfolio of Relationships

New Product Development

Purchasing Descriptions and Specifications

Managing for Quality

The Procurement of Equipment

Purchasing Services

Outsourcing

Global Supply Management

Total Cost of Ownership

Price and Cost Analysis

Methods of Compensation

Negotiation

Contract Formation and Legal Issues

Contact and Relationship Management

Ethics and Social Responsibilities

Production and Inventory Control

Demand Management and Logistics

Implementing Value Network Management

Filters