Practice Test Supply Chain Exam 2

The application of ethical principles in business situations is known as?

Business Ethics

Which Lean related process can be described as a strategy to increase the level of services to consumers through close cooperation among retailers, wholesalers, and manufacturers?

Efficient Consumer Response

An effective supplier certification program may increase the time spent on incoming inspections

False

ISO 14000 is a widely accepted management and quality certification standard

False

In a Spend Analysis, purchases that involve items representing a low percentage of the firm's total spend and having very little supply risk, are categorized as Leverage Purchases

False

Products with short product life cycles, volatile demand, high-profit margins, and relatively little competition, are known as Functional Products.

False

The concept of Distributive Negotiations refers to both sides work together to maximize the outcome or create a win-win result

False

While paperless transactions are now possible through e-procurement and Web-based services, these would NOT be considered sustainable business practices.

False

Benefits of implementing an effective supplier certification program include all of the following EXCEPT?

Increasing supplier base

The process commonly utilized in continuous improvement is known as?

Plan, Do, Check, Act

The process of requiring pre-qualifying suppliers to enter a website and at pre-designated time and date to try to underbid one another is known as?

Reverse auction

The quality management philosophy that focuses on improving the overall quality of process outputs by identifying and removing the causes of defects and minimizing variability in manufacturing and business processes, is known as?

Six Sigma

Which of the following is NOT one of the Seven Tools of Quality Control?

Small Batch Scheduling

Total Cost of Ownership is the sum of the cost elements Quality, Service, Delivery, and Price

True

Which of the following is TRUE?

VMI stands for Vendor-Managed Inventory

The manufacturing strategy in which the product is designed, engineered, and built to specifications only after the order has been received is called what? It is used when products are unique and extensively customized for the specific needs of individual customers.

Engineer-to-Order (ETO)

Products with low profit margin, relatively stable demand, and high levels of competition, are known as Innovative Products

False

Which one of the following is NOT part of the seven (7) tools of Quality Control?

LEAN Layouts

In public purchasing in the government & non-profit business sector, bidders (i.e., potential suppliers) are generally required to furnish bonds as an incentive to ensure that the successful bidder will fulfill the contract awarded. Which type of bond provides protection against 3rd party liens (i.e., debts) not fulfilled by the bidder?

Payment Bonds

Costs incurred in the process of establishing specifications for incoming materials, processes, products, and services, are categorized as which of the following?

Prevention costs

The e-Procurement process has many advantages. Which one of those listed below is NOT one of these advantages?

Segmentation

Lean is a disciplined, statistical-based, data-driven methodology for identifying and removing the causes of defects and minimizing variability in manufacturing and in business processes

True

Sourcing Sustainability is described as the ability to meet the current needs of the supply chain without costing the company any additional time or money.

True

The Profit-Leverage Effect states that a decrease in purchasing expenditures will directly increase profits

True

The Weighted-Criteria Evaluation System is typically used to select a supplier or to evaluate the performance of a supplier?

True

The process to evaluate a supplier's capabilities, and their capacity to supply a product or service to the buyer, is known as Supplier Certification.

True

a key supplier's activities to help the buyer's company reduce cost, improve quality, and reduce new product development time beginning with the initial design phase, are known as?

Value engineering

The key characteristics to consider in the development and implementation of a Supplier Relationship Management System, include all of the following EXCEPT?

Detachment

Duties, taxes, or customs imposed by the host country for imported or exported goods, are known as Tariffs

True

A proposal or quotation submitted in response to a solicitation from a contracting authority is known as what?

Bid

Which Statistical Tool of Six Sigma is used to determine the frequency of a specific problems?

Check Sheet

A purchase order is legally binding once issued by the buyer

False

In the context of Total Cost of Manufacturing (TCM), in general terms, procurement, manufacturing, inventory, warehousing, and transportation per unit costs each go down as volume goes up.

False

What company originated the concept of Six Sigma?

Motorola

The purchasing tool described as "A standard business process whose purpose is to collect written information about the capabilities of various suppliers", is known as?

Request for Information

In which item category would the sourcing strategies of ensuring availability of supply, focusing on relationship building, encouraging process integration and innovation, frequent communications, and establishing mutually agreeable supplier performance criteria, be appropriate?

Strategic items

An organization's process for evaluating the quality systems of key suppliers in an effort to eliminate incoming inspections can be referred to as?

Supplier Certification

A Supplier Code of Conduct is intended to inform suppliers of ethical sourcing expectations and is typically a condition for becoming an approved supplier.

True

The purchasing function is one of the most value-enhancing functions in any organization, however, it is still necessary to periodically monitor the purchasing function's performance against a set of standards or industry benchmarks.

True

The best supplier candidates for Supplier Relationship Management (SRM) include all of the following EXCEPT?

Developmental suppliers that need to make improvements