REVIEW SUPPLY CHAIN MANAGEMENT COURSE
1. Predictable variablity is
c. price promotions and inventory
a. change in demand that can be forecast
d. production capacity and inventory
promotions
b. change in demand that cannot be
forecast
c. change in demand that has been
planned
d. change in demand that has been
scheduled
2. Which statement is most accurate
with regard to seasonal demand?
5. The capacity management approach
where a firm builds facilities to produce
a relatively stable output of products
over time in a very efficient manner,
and facilities to produce a widely
varying volume and variety of
products, but at a higher unit cost, is
a. time flexibility from workforce
a. Seasonal demand can be met by
maintaining
enough
manufacturing
capacity to meet demand in any period
b. the use of seasonal workforce
b. Seasonal demand can be met by
building up inventory during the off
season to meet demand during peak
seasons
d. the use of dual facilities – specialized
and flexible
c. Seasonal demand can be met by
offering a price promotion during periods
of low demand to shift some of the
demand into a slow period
d. All of the above statements
3. A firm can vary supply of product by
controlling
a. demand
c. the use of subcontracting
6. Which of the following is an
approach that firms can use when
managing
inventory
to
meet
predictable demand variability?
a. time flexibility from workforce
b. use of seasonal workforce
c. using common components across
multiple products
d. use of subcontracting
b. pricing
7. Supply chain can influence demand
by using
c. inventory
a. production capacity and inventory
d. revenue
b. pricing and other promotions
4. A firm can vary supply of product by
controlling
c. price promotions and inventory
a. production capacity and inventory
b. production
promotions
capacity
and
price
d. production capacity and inventory
promotions
8. Pricing decisions based only on
revenue considerations often result in
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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
9. Customers substituting the firm’s
product for a competitor’s product is
known as
d. decreases if a promotion is run during
the off-peak period
13. Which factor favors promotion
during low-demand periods?
a. high margin
b. high ability to steal market share
c. low margin
a. market growth
d. high ability to increase overall market
b. stealing share
14. Coordinating the management of
both supply and demand across the
supply chain
c. forward selling
d. forward buying
10. Customers moving up future
purchases to the present is
a. market growth
b. stealing share
c. forward selling
d. forward buying
a. should be avoided at all costs.
b. leads to increased costs all round.
c. requires large amounts of human
capital.
d. enables predictable variablity to be
handled in a way that maximizes profits
11. Offering a promotion during a peak
period that has significant forward
buying
15. Which of the following is needed
when coordination between groups
requires them to act against their
traditional operating methods
a. creates a desirable demand pattern
a. good supplier relations
b. creates a demand pattern less costly to
serve
b. round table meetings
c. creates a demand pattern even more
costly to serve
d. everyone having the same goals
c. high level support
d. shifts demand from the peak period to
the slow period
16. In general, traditional brick and
mortar retail sales outperform online
sales along the dimension of
12. Average inventory
a. product variety
a. increases if a promotion is run during
the peak period
b. request fulfillment
b. increases if a promotion is run during
the off-peak period
d. order status tracking
c. time to market for a new product
c. decreases if a promotion is run during
the peak period
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17. In order to reap the greatest return
from the online channel for physical
goods, firms should
bypassing the retailer (who takes the
order and initiates the delivery
request)?
a. maximize the return for each distinct
supply chain member
a. Manufacturer storage with direct
shipping
b. minimize interations between the buyer
and the other supply chain members
b. Manufacturer storage with direct
shipping and in-transit merge
c. integrate it with their existing supply
chain networks
c. Distributor storage with package carrier
delivery
d. ensure that they have total ownershop
of the supply chain
d. Distributor storage with last mile
delivery
18. Where does distribution occur in
the supply chain?
22. Which of the following is an
advantage of manufacturer storage
with direct shipping?
a. Between production and the retailer
b. Everywhere
production
downstream
from
c. Between every pair of stages
d. Between suppliers and retailers
19. Which of the following would NOT
be the result of a poor/inappropriate
distribution network?
a. High profitability
b. Unsatisfactory customer experience
c. Increased cost
d. Poor profitablity
20. The ability of the customer to track
their order from placement to delivery
is
a. customer experience
b. order visibility
c. product availability
d. response time
21. In which distribution network
design is product shipped directly from
the manufacturer to the end customer,
a. Transportation costs are low because
the average outbound distance to the end
consumer is small and package carriers
are used to shipping the product
b. Supply chains save on the fixed cost of
facilities, because the need for other
warehousing space in the supply chain has
been eliminated
c. Response times tend to be small
because the order has to be transmitted
from the retailer to the manufacturer.
d. Order tracking is easy to implement
because of the complete integration of
information systems at both the retailer
and the manufacturer.
23. The main advantage of in-trasit
merge over drop-shipping is
a. the ability to reduce cost of inventory
by centralizing inventories at the
manufacturer
b. supply chains save on the fixed cost of
facilities, because the need for other
warehousing space in the supply chain has
be eliminated
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c. somewhat lower transportation cost and
improved customer experience
a. Response time
d. order tracking is easy to implement
because of the complete integration of
information systems at both the retailer
and the manufacturer
c. Customer experience
24. Which of the following is a
disadvantage of distributor storage
with last mile delivery?
a. Transportation cost is higher than any
other distribution option
b. Informtion cost is similar to distributor
storage with package carrier delivery
c. Customer experience is very good,
particularly for bulky items
d. Returnability is easier to implement
than other options
25. Distributors add value to a supply
chain between a supply stage and a
customer stage
b. Product variety
d. Time to market
27. Which of these statements about
channel activity is most accurate?
a. Product is usually exchanged via the
same channel as funds
b. The three flows usually occur in three
different channels during the same
transaction
c. Information is usually exchanged via
the same channel as product
d. Funds are usually exchanged via the
same channel as information
28. Online sales increase ________
when compared to the performance of
traditional brick and mortar retail
stores
a. if there is a small number of customers
requiring a large amount of product
a. outbound transportation costs
b. if there is a large number of customers
requiring a large amount of product
c. the cost of builiding and maintaining
facilities in a supply chain network
c. if there are many small players at the
customer stage, each requiring a small
amount of the product at a time
d. overall supply chain costs.
d. if there are a few large players at the
customer stage, each requiring a large
amount of the product at a time
26. _______is a service factor
performance
characteristic
of
manufacturer or distributor storage
with customer pickup that is lower than
other options because of the lack of
home delivery. Experience is very
sensitive to capability of pickup
location
b. the inventory holding cost
29. An online grocery store has a
distinct advantage over a traditional
model in the area of
a. processing costs.
b. transportation costs
c. facility costs
d. information costs
30. Which of these statements about
distribution networks is most accurate?
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a. A manufacturer that owns their own
distribution network cannot control the
network’s actions
34. The ______ is the party that moves
or transports the product
b. Customers are willing to have a
relationship built around high value,
specialized products
b. producer
c. Distribution networks that have
identical physical flows but different
ownership structures have identical
performance
d. consumer
d. It is important to have static distribution
networks
a. Air
31. Serving a low density of customers
at a long distance is best done using
c. Rail
a. shipper
c. carrier
35. ______ carriers offer a very fast and
fairly expensive mode of transportation
for cargo
b. Truck
a. a less than truckload (LTL) carrier
d. Water
b. a cross-dock distribution center with
milk runs
36. Which mode of transportation is the
most expensive?
c. a package carrier
a. Rail
d. a private fleet with milk runs
b. Truck
32. The key players in any
transportation that takes place within a
supply chain are
c. Air
d. Water
b. the shipper and the supplier
37. Which mode of transportation is the
dominant form of domestic freight
transportation?
c. the shipper and the manufacturer
a. Air
d. the shipper and the carrier
b. Truck
33. Which of the following uses
transportation to minimize the total
cost
(transportation,
inventory,
information, and facility) while
providing and appropriate level of
responsiveness to the customer?
c. Rail
a. The shipper
b. Truck
b. The supplier
c. Rail
c. The manufacturer
d. Water
a. the shipper and the reeiver
d. Water
38. Which mode of transportation is the
least expensive?
a. Air
d. The carrier
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39. When infrastructure is publicly
owned, it is important to price usage to
reflect
a. the cost of rebuilding the infrastructure
once it is fully depreciated
b. the incremental profit from the use of
the infrastructure
d. a private fleet with milk runs
43. The competnet supply chain
manager decided to aggregate all
inventories and, as required, use fast
mode of transportant for filling
customer orders of his
a. high-value and high-demand product
c. the marginal impact on the cost of
society
b. high-value and low-demand product
d. the market clearing price
d. low-value and low-demand product
40. Which transportation network
design option has the elimination of
intermediate warehouses and its
simplicity
of
operation
and
coordination as its major advantage?
44. Managers should ensure that a
firm’s transportation strategy
a. Direct shipping network
c. supports its competitive strategy
b. Direct shipping with milk runs
d. is separate from competitive strategy
c. All shipping via central distribution
center (DC)
45. The total amount paid to various
carriers for moving products to
customers is
d. Shipping via distribution center (DC)
using milk runs
c. low-value and high-demand product
a. involves cost minimization
b. involves profit maximization
a. transportation cost
41. Temporal aggregation
b. inventory cost.
a. is the process of combining orders
across multiple locations
c. facility cost
b. increases a firm’s responsiveness
d. processing cost
c. decreases transportation costs because
of economies of scale
46. The entire set of business processes
required to purchase goods and
services is
d. is purely a theoretical concept: no
practical business examples of this exist.
a. procurement
42. Serving a high density of customers
at a long distance is best done using
c. supplier scoring and assessment
b. sourcing
a. a less than truckload carrier
d. supplier selection
b. a cross-dock distribution center with
milk runs
47. Effective sourcing processes within
a firm can
c. a package carrier
a. improve profits for the firms and total
supply chain surplus
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b. reduce profits for the firm and total
supply chain surplus
c. reduce total supply chain surplus
d. reduce profits for the firm.
48. The selection of suppliers, design of
supplier contracts, product design
collaboration,
procurement
of
material, and evaluation of supplier
performance are a part of
a. procurement.
b. sourcing
c. supplier scoring and assessment
d. supplier selection
49. The role of sourcing, planning, and
analysis is
a. to analyze spending across various
suppliers and component categories to
identify opportunities for decreasing the
total cost.
b. to analyze spending across various
suppliers and component categories to
identify opportunities for increasing the
total cost.
c. to enable orders to be placed and
delivered on schedule at the lowest
possible overall cost.
d. to enable orders to be placed and
delivered on schedule regardless of cost.
50. The procurement process for direct
materials should primarily focus on
a. improving coordination and visibility
with the supplier
b. decreasing the transaction cost for each
order
c. consolidation of orders to take
advantage of economies of scale and
quantity discounts.
d. minimizing communication with the
supplier
51. The procurement process for
indirect materials should primarily
focus on
a. improving coordination and visibility
with the supplier
b. decreasing the transaction cost for each
order.
c. consolidation of orders to take
advantage of economies of scale and
quantity discounts.
d. minimizing communication with the
supplier
52. Sales efforts and orders peak near
the end of any month, quarter, or other
evaluation period. This is commonly
referred to as
a. the hockey stick phenomenon
b. the student syndrome
c. Murphy’s Law
d. the Centra; Limit Theorem
53. Understanding the impact of
incentives on the actions of a supply
chain partner is especially important
when
a. there are two or more members in the
supply chain
b. the third part’s actions are not fully
observable
c. more than two firms are competing for
the same poll of customers
d. the supply chain uses outsourcing
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54. A contract that allows a retailer to
return unsold inventory up to a
specified amount, at an agreed-upon
price, is a
a. buyback or returns contract.
b. revenue-sharing contract
c. quantity flexibility contract
d. quantity discount contract
58. Which of the following is a
traditional logistics driver of sourcing?
a. Pricing
b. Inventory
c. Sourcing
d. Information
59. Sourcing a product overseas may
have
55. A contract where the buyer pays a
minimal amount for each unit
purchased from the supplier, but
shares a fraction of the revenue for
each unit sold is a
a. higher product cost and will generally
incur a higher inbound transportation cost
a. buyback or returns contract.
c. lower product cost and will generally
incur a lower inbound transportation cost
b. revenue-sharing contract
b. higher product cost but will generally
incur a lower inbound transportation cost.
d. quantity discount contract
d. lower product cost but will generally
incur a higher inbound transportation
cost.
56. Which of the following is a
traditional logistics driver of sourcing?
60. Revenue-sharing contracts usually
result in
a. Pricing
b. Inventory
a. the supply chain producing to consumer
demand
c. Sourcing
b. higher cost of returns
d. Information
c. lower retailer profit
57. When designing a sourcing
strategy, it is important for a firm to
d. lower retailer effort.
c. quantity flexibility contract
a. develop a process that will procure
materials at the lowest possible cost.
b. maintain a record of all contracts,
receipts, issues, and other transactions in
the event of lawsuits.
c. maximize the profitablity of the
distributor within the supply chain
d. be clear on the factors that have the
greatest influence on performance and
target improvement on those areas.
61. Cycle inventory exists because
producing or purchasing in large lots
allows a stage of the supply chain to
a. exploit economies of scale and raise
cost
b. exploit economies of scale and lower
cost
c. exploit customers and raise cost
62. The price paid per unit is referred
to as
a. the material cost and is denoted by C.
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b. the fixed ordering cost and is denoted
by S.
c. the holding cost and is denoted by H.
67. The practice where a firm charges
differential prices to maximize profits
is
d. the purchase price and is denoted by P.
a. lot pricing
63. The cost of carrying one unit in
inventory for a specified period of time,
usually one year, is referred to as
b. marginal pricing
a. the material cost and is denoted by C.
68.
Replenishment
orders
in
multiechelon supply chains should be
b. the fixed ordering cost and is denoted
by S
c. the holding cost and is denoted by H
d. the purchase price and is denoted by P
64. Inventory holding costs would
include which of the following?
a. Obsolescence cost
b. Buyer time
c. Transportation cost
d. Receiving cost
65. A key to reducing cycle inventory is
a. the reduction of holding cost
b. the reduction of manufacturing cost
c. the reduction of lot size
d. the reduction of warehouse space
c. price incrimination
d. price discrimination
a. synchronized to increase
inventory and order costs.
cycle
b. synchronized to facilitate supplier
evaluation and selection
c. synchronized to keep cycle inventory
and order costs low
d. separated to increase cycle inventory
and order costs
69.
Manufacturers
use
trade
promotions to offer a discounted price
to retailers and
a. try to get greater discounts from
retailers
b. guarantee to buy back any stock that is
left
66. Quantity discounts lead to
c. try to meet the expected upturn in
demand
a. a significant buildup of cycle inventory
in the supply chain
d. set a time period over which the
discount is effective
b. a slight buildup of cycle inventory in
the supply chain
70. The key goals (from the
manufacturer’s perspective) of a trade
promition are
c. a decrease in cycle inventory in the
supply chain
d. minor fluctuations of cycle inventory in
the supply chain
a. to induce retailers to use price discounts
b. to show the competition you are
winning suppliers
c. to select a new marketing plan
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d. to show retailers your product range.
71. A forward buy helps reduce the
retailer’s future
shifting it from peak to low-demand
periods
c. it decreases their own total cost
a. storage needs
d. the first and third options above
b. cost of goods for product sold after the
promotion ends
76. Which factor has proven LEAST
successful
in
encouraging
sustainability?
c. delivery and purchase intentions
d. reliance on a supplier
72. A key to reducing lot size is the
a. good relations with the suppliers
b. ability to reduce the number of orders
c. need to find new suppliers
d. reduction of the fixed cost incurred per
lot.
73. Other ways to achieve aggregation
include
a. having a single delivery coming from
multiple suppliers
b. having multiple deliveries into one
warehouse
a. Increased revenue for sustainability
initiatives
b. Customer demand
c. Attracting
sustainability
customer
who
value
d. Reducing risk and improving the
financial performance of the supply chain
77. Almost 40% of ______ could be
achieved at negative marginal costs,
meaning that investing in these options
would generate postive economic
returns over their life cycle.
a. greenhouse gas abatement
b. fuel consumption initiatives
c. using the company’s own transport
c. increased customer base
d. requiring all suppliers to communicate
d. improved company reputation
74. When considering fixed costs, one
cannot ignore the
78. Which of these statements is most
accurate?
a. internal administration costs
a. Benefits and costs of sustainability
programs fall equally across all supply
chain members throughout most
initiatives
b. human resource cost
c. company strategy
d. receiving or loading costs.
75. The retailer can justify forward
buying when
a. they have inadvertenly built up a lot of
excess inventory
b. the forward buy allows the
manufacturer to smooth demand by
b. Customers tend to be vocal about
sustainability and back up those words
with their puschaase decisions.
c. It is more diffult to maintain a focus on
sustainability for a supply chain than for
an individual firm.
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d. Sustainability programs typically offer
a clear and substantive return on
investment (ROI) figure throghout their
development and deployment.
79. In the short to medium term, an
improved focus on sustainability
provides benefits that
a. are shared but costs that may be local to
a firm
b. are local to firms but a cost that is
global.
c. are shared and costs that are global.
d. are local and costs that are global.
80. _______ is a mechanism that
constrains the aggregate emissions by
creating a limited number of tradable
emission allowances, which emission
sources must be secure and surrender
in proportion to their emissions.
c. absolute
d. statistical
83. In the context of greenhous gas
emission, direct emissions
a. are controlled by the reporting entity
b. are created through waste disposal.
c. come from utility-based services.
d. come frome employee business travel.
84. The disadvantage of using
a(n)________measure is that a drop in
supply chain sales and production (for
example in a downturn) will show an
improved absolute measure of energy
comsumption
even
though
the
company may not have changed
anything
a. scope
b. relative
a. Command-and-control
c. absolute
b. Cap-and-trade
d. statistical
c. Cap-and-control
d. Emissions tax
85. Which is an example of balancing
peak-load demand?
81. Corporate social responsibility
(CSR)reports
typically
contain
this/these metrics:
a. Car dealers offer rebates in July and
August, just before the next year’s models
are shipped to their lots.
a. Revenue
b. An assisstant dean signs all of the
course substitution requests on Friday
afternoon.
b. Social and historical
c. Environmental and staffing
d. Social and environmental
82.
A(n)________
measure
of
performance is more effective at
capturing sustainability improvement.
a. scope
c. Aire conditioners and freezers are
turned on across a chain of convenience
stores at staggered intervals.
d. The insurance agent sends in all claim
forms on the last working day of the
monthe.
b. relative
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86. What type of inventory is one of the
most damaging from a sustainability
perspective?
c. the fear exists that remanufactured
products will be purchased instead of
newly-produced products.
a. Raw materials
d. two distinct segments of demand exist
for the product: one for new and one for
old products.
b. Work in process
c. Finished goods
d. Landfill
87. The goal of every supply chain
should be to track its
a. water consumption
b. transportation utilization
c. landfill inventory
d. invoices
88. Remanufacturing helps improve
profits as long as
a. the comparatively low margin of
remanufactured
to
newly-produced
products exists.
b. the comparatively high cost of
remanufacturing to newly-produced
products exists.
89. ______tend to be significant
consumers of energy and water and
emitters of waste and greenhouse gases,
and thus offer significant opportunities
for profitatble improvement.
a. Employees
b. Shareholders
c. Facilities
d. Vehicles
90. Arguably, the most significant
waste in any supply chain occurs when
a. the doors to the buildings are open
repeatedly.
b. a product is thrown into a landfill.
c. products sit on store shelves waiting to
be purchased.
d. employees are terminated.
Exercises Chapter 7 [1,2,3,4,5,6,7,8] – page 234 - Chopra, S. and Meindl P. (2016).
Supply Chain Management, Strategy, Planning, and Operation, 6th edition, Pearson
Exercises Chapter 11 – [1,2,4,10,13,14,16] - Chopra, S. and Meindl P. (2016).
Supply Chain Management, Strategy, Planning, and Operation, 6th edition, Pearson
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