LSCM Ch. 2 & 12, LSCM Ch. 4, LSCM Ch. 6, Ch 13 LSCM, Ch 11, ch 5 and 10 lscm, Logistics Ch. 9, LSCM Chapter 1, Logistics Final Ch. 7/8
The CBL Exam Company is attempting to locate a new plant to serve the Midwest. The company has two raw material sources and three market areas. You want to centrally locate a plant relative to all sources and markets based on transportation rates. The least cost location for the new plant is at the grid VERTICAL coordinate of:
3.95
Companies do not know their true costs for all of the following reasons EXCEPT: 1. In standard cost systems, fixed costs are often treated the same as variable costs. 2. Allocation of business costs common to multiple segments tend to be subjective and arbitrary. 3. Accounting systems tend to report in aggregate. 4. Accounting costs are computed to provide historical records. 5. All of the above are valid reasons.
5. All of the above are valid reasons.
The CBL Exam Company is attempting to locate a new plant to serve the Midwest. The company has two raw material sources and three market areas. You want to centrally locate a plant relative to all sources and markets based on transportation rates. The least cost location for the new plant is at the grid HORIZONTAL coordinate of:
7.11
Which is true regarding optimization models? A. Optimization models are based on precise mathematical procedures that are guaranteed to find the "best" solution for the problem under evaluation. B. Optimization models are able to accommodate broad problem definitions, rather than provide an optimum solution. C. The Grid Technique is a powerful optimization model. D. Optimization models will guarantee increased profits.
A. Optimization models are based on precise mathematical procedures that are guaranteed to find the "best" solution for the problem under evaluation.
In his book "The Wealth of Nations", Adam Smith stated that economies and companies could improve their wealth by A. allowing specialization of tasks. B. ensuring that logistics is used to gain advantage in the marketplace. C. becoming multi-national. D. moving production off shore.
A. allowing specialization of tasks.
economies and companies could improve their wealth by A. allowing specialization of tasks. B. ensuring that logistics is used to gain advantage in the marketplace. C. becoming multi-national. D. moving production offshore.
A. allowing specialization of tasks.
Vertical collaboration refers to A. collaboration among buyers and sellers in the supply chain. B. collaboration among carriers and shippers. C. collaboration that moves up the supply chain. D. collaboration with competitors.
A. collaboration among buyers and sellers in the supply chain.
packaging is: A. official to logistics B. critical to manufacturing C. official to product differential D. a factor in outsourcing
A. critical to logistics
Resource Requirements Planning (RRP) A. is a long-run, macro-level planning tool B. checks the feasibility of the master production schedule C. checks the feasibility of the materials requirement plan D. is a long-range materials plan that translates annual business plans
A. is a long-run, macro-level planning tool
The logistics/supply chain network transformation team A. must be aware of the firm's overall business and corporate strategies and the supply chain in which it participates. B. will not consider the potential involvement of third-party logistics suppliers as part of their responsibilities. C. includes workers from divisional levels only. D. should not include outside consultants.
A. must be aware of the firm's overall business and corporate strategies and the supply chain in which it participates.
Whether the relationship may or may not be with a provider of logistics services, today's supply chain relationships are most effective when collaboration occurs among the ____ who are involved. A. participants B. third party logistics providers C. customers D. Suppliers
A. participants
Approximately two-thirds of 3PL customers think their providers supply A. tactical or operational services. B. strategic or integrative services. C. trucking and warehouse services. D. a firm that can supply a competency that is not core to the firm.
A. tactical or operational services
The classic objective of a network design model has been A. to establish the number, location, and size of finished goods distribution centers and associated product flows. B. to find the best location for a forward facing warehouse. C. to examine the finished goods flow from the warehouse to the customer. D. to measure and control site locations.
A. to establish the number, location, and size of finished goods distribution centers and associated product flows.
Which are the major modes of international transportation? A. water and air B. water and rail C.rail and motor D. rail and air
A. water and air
As market forces continue to exert pressure on companies to improve profitability, the quest for lower-cost manufacturing has been a factor in the relocation of manufacturing from Mexico to ________ ? A. South America B. Asia C. Russia D. Canada
B. Asia
The "value-of-service" pricing approach establishes a lower limit of transportation prices or rates. A. True B. False
B. False
a project layout is: A. a floor plan of the production facility B. a fixed location layout where the product remains in place for the duration of production C. a product focused layout and which machines and workers are arranged according to the progressive sequence of operations
B. a fixed location layout where the product remains in place for the duration of production
A demand-driven system is also known as A. a supply chain. B. a pull system. C. a marketing system. D. a multi-echelon system.
B. a pull system.
A newly launched 21st-century addition to production strategy which leverages lean manufacturing strategies, six sigma best practices, and real time actionable intelligence from the factory floor is called: A. just in time inventory B. adaptive manufacturing C. machine flexibility D. capacity requirements planning
B. adaptive manufacturing
Heuristic models A. provide an optimum solution. B. are able to accommodate broad problem definitions. C. have fallen from use because of SAILS. D. are typically "seat of the pants" solutions.
B. are able to accommodate broad problem definitions.
WIP inventories A. not included on the balance sheet. B. are associated with manufacturing. C. are the same as VMI inventories. D. are not impacted by EOQ
B. are associated with manufacturing
The grid technique A. is a variation of SAILS. B. assumes that the raw materials sources and finished goods markets are fixed. C. assumes that the raw materials sources and finished goods markets are variable. D. assumes non-linear transportation rates.
B. assumes that the raw materials sources and finished goods markets are fixed.
Collaboration occurs when: A. a firm seeks advantages by sourcing with critical partners B. companies leverage each other on an operational basis so that together they preform better than they did separately C. many logistics or supply chain improvements can be made within one firm by eliminating "stovepipes" D. senior executives focus on supply chain economies to improve their firm's financials
B. companies leverage each other on an operational basis so that together they preform better than they did separately
Which is NOT a manufacturing method? A. make to stock B. delayed differentiation C. build to order D. assemble to order
B. delayed differentiation
which of these is NOT a production method? A. make-to-stock B. delayed differentiation C. build to order D. assemble to order
B. delayed differentiation
processes that can produce a range of products are said to have: A. economies of scale B. economies of scope C. routing flexibility D. work centers
B. economies of scope
While available evidence supports the fact that the president or CEO and the finance executive are often involved with the identification of the need for logistic services, A. customers are demanding a change. B. executives from other areas in the firms are also aware of such needs but to a lesser degree. C. a 4PL will suggest greater collaboration. D. off shore sourcing will point to greater need.
B. executives from other areas in the firms are also aware of such needs but to a lesser degree.
The manufacturer must lead the channel design process regardless of the relative market power and financial strength of the members of the supply chain A. true B. false
B. false
"Water Cruisers is located in Jacksonville, Florida, and makes small yachts and luxury pontoon boats for customers on the East coast of the United States. Each boat requires thousands of parts purchased from over 1,000 vendors. A number of boats are in production at any one time, so a large number of parts constantly arrive and are stored. Once a boat is finished, it is sailed up the coast to a convenient port for customer delivery. Which type of logistics system does Water Cruisers use? A. balanced system B. heavy inbound C. heavy outbound D. reverse system
B. heavy inbound
For most firms, the MOST important measure of customer service is: A. profitability of the particular channel of distribution B. inventory availability within a specified order cycle time C. the length of the oder cycle D.
B. inventory availability within a specified order cycle time
Which is true regarding the facility/supply chain network design decision? A. the facility's impact on other functional areas should be considered, but it is not as important B. it should be coordinated closely with the corporate and overall business strategies that may be in place C. global locations should not be considered D. generally, qualitative criteria are considered first
B. it should be coordinated closely with the corporate and overall business strategies that may be in place
The biggest and best known example of a regional trade agreement (RTA) is the: A. World Trade Organization (WTO) B. General Agreement on Tariffs and Trade (GATT) C. European Union (EU) D. Customs Trade Partnership Against Terrorism (C-TPAT)
C. European Union (EU)
Which of the following is NOT a part of how world class collaboration skills are developed A. define the benefits of collaboration B. make the investment C. determine how the benefits will be shared D. dedicate "A" players
C. determine how the benefits will be shared
which is NOT a major challenge for many established manufactures? A. competition B. customer demand C. expanding product life styles D. pressure for efficiency
C. expanding product life styles
What is the effect of tapering rates on facility location? A. pushes the raw materials sources toward the location B. pulls the facility toward the location C. pulls the location toward the source or the market D. makes the optimum location at the midpoint between raw material sources and the marketplace
C. pulls the location toward the source or the market
which of the following is not a reactive capabilities strategy? A. machine flexibility B. routing flexibility C. resource requirements planning D. offshoring
C. resource requirements planning
Globalization was initially driven by countries A. seeking new territories. B. outside the U.S. seeking to establish plants in the U.S. C. seeking materials and goods not available in their own land. D. sponsoring trading missions.
C. seeking materials and goods not available in their own land
"Traditionally, information has been viewed as flowing in the opposite direction of products, that is, from the market/customer back to the wholesalers, manufacturers, and vendors. a.This is still true and has not changed. b.Computerization has greatly increased the flow of information from the source. c.The ""Big Box"" stores have developed their own sources. d.None of these answers
D. None of these answers
The grid technique is used to determine a fixed facility location that represents the least-cost center for moving incoming materials and outbound product within a geographic grid. This least cost center is also referred to as A. a zero point. B. a source point. C. a breakeven point. D. a center of gravity.
D. a center of gravity.
The weighted moving average method assigns A. a value in each period being averaged. B. a weight greater than 1. C. information based on a simple average. D. a weight to each previous period.
D. a weight to each previous period
What type of change may suggest a need to reevaluate and/or redesign a firm's logistics network? A. change in customer service requirements B. change in corporate ownership C. shifting locations of customer and/or supply markets D. all of these
D. all of these
The macro approach that locates a warehouse or distribution center at a point that minimizes transportation costs for products moving between a manufacturing plant and the markets, and is relatively simplistic: A. Weber's model B. Hoover's model C. none of these are macro location approaches D. center of gravity approach E. Von Thunen's model
D. center of gravity approach
All of the following are advantages of containers in international distribution EXCEPT: A. costs due to loss or damage are reduced B. labor costs in freight handling are reduced C. containers are more easily stored and transported than other types of shipments D. containers are only available in one size
D. containers are only available in one size
The Supply Chain should A. manage all aspects of transportation, selecting the least cost when possible. B. seek to maximize profits. C. use the same techniques internationally that it uses domestically. D. manage materials and products, information, financials, and demand.
D. manage materials and products, information, financials, and demand.
The least-frequently used IT-based services by customers of 3PLs are: A. transportation management (execution) B. warehouse/distribution management C. global trade management and transport sourcing D. strategic and customer-related
D. strategic and customer-related
Form utility drives the need for A. supply chain capabilities only B. time utility and place utility C. place utility only D. supply chain capabilities, time utility, and place utility
D. supply chain capabilities, time utility, and place utility
A push based strategy works well for supply chains that focus on A. lean production B. the anticipation of demand or without knowledge of customer orders C. work centers and offshore sourcing D. the immediate delivery of off-the-shelf, low-cost, standardized goods
D. the immediate delivery of off-the-shelf, low-cost, standardized goods
ALL of the following have affected international logistics EXCEPT: A. currency fluctuations B. deregulation of the U.S. open liner industry C. trade policies D. the passage of the Sarbanes-Oxley act by the United States E. intermodalism
D. the passage of the Sarbanes-Oxley act by the United States
Other things being equal, HIGH inventory carrying costs will tend to lead to: A. use of a slower mode of transportation, such as railroads B. reducing customer service levels by lowering safety stock C. use of a more expensive mode of transportation such as motor carriers or airlines D. ordering more frequently E. B., C. and D.
E. B,C,D
Many industry initiatives have attempted to create efficiency and effectiveness through the integration of supply chain activities and processes. Among the various initiatives is/are a. QR b. VMI c. ECR d. All of the above
QR, VMI, ECR (All of the above)
Logisticians seek cost trade-offs. A "positive" cost trade-off is a situation where:
Some costs increase, some decrease, and the net effect is that total costs decrease.
10. Seasonal stocks are NOT influenced by a. EOQ b. weather c. transportation d. holidays Page 297 in the 10th Edition
a. EOQ
3. There are four steps in the Managing Sourcing and Procurement Processes. Which does not belong? a. Examine off shore and e-procurement suppliers b. Evaluate the effectiveness of the strategic sourcing process c. Determine the necessary levels of investment d. Determine the type of purchase Pages 145 in the 10th Edition
a. Examine off shore and e-procurement suppliers
Methods of decreasing inventory related costs include all of the following measures EXCEPT: a. Increasing the number of expedited orders b. decreasing the number of backorders c. purging obsolete stock from the system d. reduction of transshipments of inventory
a. Increasing the number of expedited orders
9. A warehouseperson may offer REDUCED rates to the user of a public warehouse if the user: a. Stores goods regularly. b. Stores higher valued goods. c. Stores goods with low density. d. Reduces the amount of packaging on fragile goods. e. All of the above.
a. Stores goods regularly.
24. For most shippers, in the selection of a specific transport mode or carrier, consistency of service is much more important than time-in-transit. a. True b. False page 449 in 10th edition
a. True
An "executive dashboard" is: a. a small number (usually less than five) of KPIs. b. a trend that has only recently developed. c. a metric used by the Board of Directors. d. used by senior management to track profits.
a. a small number (usually less than five) of KPIs.
3. Economic deregulation sparked competition among carriers in several areas. Which of these is not an area of competition? a. accessibility b. pricing c. performance d. services Page 421 in the 10th Edition
a. accessibility
The SCOR model provides suggested metrics a. across multiple dimensions for each of the five Level One processes. b. to segment customers. c. for proving a base for ABC costing. d. that allow marketing to evaluate channel selection.
a. across multiple dimensions for each of the five Level One processes.
Recycling and environmental concerns a. are often related to regulatory policy at the local, state, and federal levels. b. have led to waste steams being managed by 3PLs. c. require the review of the feasibility of the materials requirement plan. d. have led to green laws.
a. are often related to regulatory policy at the local, state, and federal levels.
2. Dependent demand relates to a. demand for another inventory item or product b. the spare parts needed to fill the order c. VMI inventories d. the cost of capital for the firm Page 313 in the 10th Edition
a. demand for another inventory item or product
Which of the following is the "marketing mix"? a. distribution, price, product, promotion b. price, finace, management, customer service c. product, enginerring, research, and design d. profit, accounting, distribution, reatiling e. promotion, wholesaling, warehousing, purchasing
a. distribution, price, product, promotion
22. Air carriers were historically looked upon as a. emergency only carriers b. having equipment shortages c. a fringe participant d. insignificant Page 427 in the 10th Edition
a. emergency only carriers
Traditional customer profitability analyses would start with ______ less returns and allowances (net sales) and subtracts the cost of goods sold. a. gross sales b. back orders c. the forecast d. gross margin
a. gross sales
10. INCREASING the number of warehouses will __________ the warehousing and inventory costs, but may __________ transportation costs. a. increase, decrease b. decrease, decrease c. increase, increase d. decrease, increase
a. increase, decrease
The internal balancing method deals with a. inventory and production flexibility. b. price and lead time. c. functional silos. d. channel selection.
a. inventory and production flexibility.
Exponential smoothing a. is one of the most commonly used techniques. b. uses primarily weighted averages to compensate for errors. c. is used to determine random variations. d. is used to reduce channel fluctuations
a. is one of the most commonly used techniques.
A DRP system is usually coupled with a _______ system in an attempt to manage the flow and timing of both inbound materials and outbound finished goods. a. MRP b. JIT c. Kan Ban d. VMI/ Consignment Page 343 in the 10th Edition
a. mrp
6. The primary facility operations focus is a. on the movement and storage of product b. inventory control and personnel issues c. making sure KPIs are fulfilled d. the WMS system Page 390 in the 10th Edition
a. on the movement and storage of product
11. In selecting a transport mode or carrier, the most important factor for most shippers would be: a. on-time pickups and deliveries b. carrier reputation c. quality of carrier sales force d. lowest freight rate e. satisfactory insurance coverage Page 448 in the 10th Edition
a. on-time pickups and deliveries
An inbound-to-operations logistics system is also referred to as a. physical supply. b. physical distribution. c. dedicated fulfillment. d. demand management.
a. physical supply
In the SCOR Model there are five major categories of metrics that need to be used to measure the performance of Process D1: reliability, ___________, agility, costs, and asset management. a. responsiveness b. cash to cash cycle c. ROA d. supply chains
a. responsiveness
17. Which of these is NOT a freight document? a. routing guide b. bill of lading c. freight bill d. freight claim form Page 446-447 in the 10th Edition
a. routing guide
Strategic sourcing as a process is far more broad and comprehensive than procurement. Overall, the process starts with the formation of a a. steering committee. b. a list of vendors. c. a decision as whether to make or buy. d. a list of criticals.
a. steering committee.
10. The "value-of-service" pricing approach establishes an upper limit of transportation prices or rates. a. True. b. False. Page 469 in the 10th edition
a. true
14. EOQ models exist that include adjustments for volume transportation rates and for quantity discounts. a. True b. False Page 317 in the 10th Edition
a. true
5. Cross-docking bypasses the storage activity by transferring items directly from the receiving dock to the shipping dock. a. True b. False
a. true
21. Trade imbalances affect a. water carriers b. motor carriers c. railroads d. pipeline
a. water carriers
15. Transportation terms of sale establish a. when ownership and title of the goods passes from seller to buyer b. what must be shown on the bill of lading. c. which transportation mode must be used d. who handles freight claims Page 435 in the 10th Edition
a. when ownership and title of the goods passes from seller to buyer
When a firm "sources strategically," it is a. working together with customers and suppliers in a creative, positive way. b. seeking least cost vendors. c. matching product and raw material flows to minimize transportation costs. d. reacting to current competitive situations.
a. working together with customers and supplies in a creative, positive way
What vendor selection criteria are described by production capability, labor relations, and operating controls?a.capability b.quality c.reliability d.financial
a.capability
Which type of strategic global logistics channel intermediary provides expert advice to small international shippers, consolidates small shipments, and performs routine actions that shipments require?a.foreign freight forwarder b.NVOCC c.customs house broker d.export packer
a.foreign freight forwarder
Using Wilson's EOQ formula, what will happen to the average inventory level (Q*/2) if unit cost is INCREASED by 4.1% and annual demand is DECREASED by 4.1% at the same time? a. (Q*/2) will increase. b. (Q*/2) will decrease. c. (Q*/2) will remain the same.
b. (Q*/2) will decrease
Transportation may account for as much as ___ percent of the cost of reverse flow. a. 20 b. 25 c. 40 d. 50
b. 25
23. When a traffic manager reduces the number of carriers used, market power is decreased. a. True. b. False.
b. False.
9. When a traffic manager increases the number of carriers used, market power is increased. a. True. b. False.
b. False.
19. All of the following are reasons for holding inventory EXCEPT: a. Inventories enable specialization in manufacturing. b. Inventories eliminate the variation in supply and demand. c. Inventories enable the firm to achieve economies of scale. d. Inventories provide protection from uncertainties in demand in the order cycle. e. Inventories act as a buffer between critical interfaces within the channel of distribution. Page 313 in the 10th Edition
b. Inventories eliminate the variation in supply and demand.
7. The type of functional inventory that helps a firm from being out of stock due to unexpected increases in demand is: a. Cycle stock. b. Safety stock. c. Promotional stock. d. Speculative stock. e. Transit stock. Page 395 in the 10th edition
b. Safety stock.
A warehouseperson may offer HIGHER rates to the user of a public warehouse if the user: a. Stores goods regularly. b. Stores higher valued goods. c. Stores goods with high density. d. Increases the amount of packaging on fragile goods.
b. Stores higher valued goods.
1. As the number of warehouses DECREASES: a. Transport costs will decrease; inventory costs and costs of lost sales will increase b. Transport costs and cost of lost sales will increase; inventory costs will decrease c. Transport costs and inventory costs will decrease; cost of lost sales will increase d. Transport costs and cost of lost sales will decrease; inventory costs will increase e. Transport cost, inventory costs, and cost of lost sales will all decrease
b. Transport costs and cost of lost sales will increase; inventory costs will decrease
Each of following is an inventory holding cost EXCEPT: a. Warehouse cost. b. Accounting cost. c. Obsolescence. d. Interest opportunity cost. e. Inventory shrinkage.
b. accounting cost
The decision to alter the supply chain process is essentially ___________ issue. a. a management b. an optimization c. a supply chain d. a customer satisfaction
b. an optimization
Order management system represents the principal means by which a. price and lead time add value b. buyers and sellers communicate information relating to individual orders of product c. orders are handled inside the company d. customers are segmented by profitability
b. buyers and sellers communicate information relating to individual orders of product
9. In the Execute Sourcing Strategy step, the most important thing is to a. appoint the sourcing committee members from the affected groups. b. choose a supplier or suppliers, depending on the objectives of the sourcing decision. c. verify which vendors are either TQM or ISO 9000. d. determine which vendors have the lowest prices. Page 145 in the 10th Edition
b. choose a supplier or suppliers, depending on the objectives of the sourcing decision.
An index: a. is any quantitative output of an activity or process b. combines two or more metrics into a single indicator c.is complex to define, usually involves a calculation and is often in the form of a ratio d. is easily defined with no calculations and with simple dimensions
b. combines two or more metrics into a single indicator
6. exist for basic raw materials such as grain, oil, and sugar. a. price lists b. commodity markets c. negotiations d. price quotes Pg 149 10th edition
b. commodity markets
20. If demand and lead time are constant, only___________ is necessary. a. associated stock b. cycle stock c. safety stock d. speculative stock e. seasonal stock Page 294 in the 10th Edition
b. cycle stock
16. Inventory and the GDP grew by ______ amounts between 1994 and 2010. a. the same b. different c. inversely proportional d. exponential Page 291-292 in the 10th Edition
b. different
"A ____ analysis examines a logistics system over a long time period or range of output. A. cost center analysis B. dynamic C. link node analysis D. least cost analysis
b. dynamic
Four types of forecast error measures can be used. Which one of the following is NOT one of the four types? a. cumulative sum of forecast errors b. exponential smoothing for trends c. mean squared error d. mean absolute deviation
b. exponential smoothing for trends
17. Increasing inventory turns from 10 to 15 has a greater impact than increasing inventory turns from 1 to 2. a. True b. False Page 313 in the 10th Edition
b. false
5. Management will automatically achieve least total cost logistics by minimizing inventory carrying costs. a. True b. False Page 293 in the 10th Edition
b. false
If a firm concentrates on reducing the individual costs of each separate logistics function or activity, overall logistics costs will ALWAYS be reduced. a. True b. False
b. false
8. What vendor selection criteria are described by price and financial stability? a. capability b. financial c. quality d. reliability Page 150 in the 10th Edition
b. financial
Green laws have a. are still being evaluated b. had a major impact on firms c. started reverse flows d. only recently been enacted
b. had a major impact on firms
Assuming the cost to place an order is constant, all other things remaining the same, DECREASING the order quantity (Q*) causes total ANNUAL ordering costs to: a. Decrease. b. Increase. c. Remain the same. d. Cannot be determined
b. increase
Capital cost focuses on the cost of capital tied up in ________and the resulting lost opportunity from investing that capital elsewhere. a. plants b. inventory C. distribution centers D. WIP
b. inventory
The internal balancing method deals with a. price and lead time. b. inventory and production flexibility. c. functional silos. d. channel selection.
b. inventory and production flexibility
7. Which of the following would NOT be a typical transportation management function? a. selecting the best modes of transportation b. keeping track of inventory in the warehouse(s) c. auditing freight bills d. negotiating rates with carriers e. choosing specific carriers Pages 419-422 in the 10th edition
b. keeping track of inventory in the warehouse(s)
13. Which management area in an organization does not normally have transportation responsibility? a. marketing b. manufacturing c. procurement d. logistics Page 435 in the 10th Edition
b. manufacturing
4. All the following are goals of purchasing EXCEPT: a. provide an uninterrupted flow of materials, supplies and services required to operate the organization b. maximize the number of public warehouses utilized in order to avoid the high fixed costs of plant warehouses c. keep inventory investment and loss at a minimum d. maintain adequate quality standards e. find or develop new and existing suppliers Page 142 in the 10th edition
b. maximize the number of public warehouses utilized in order to avoid the high fixed costs of plant warehouses
Scorecard and key performance indicators (KPIs) refer to a. measuring output. b. metrics to manage logistics operations c. sporting events. d. management's evaluation of supply chain staff.
b. metrics to manage logistics operations
The demographics of our society has changed because a. the "Baby Boom" generation is now turning 60. b. of the increase in two-career families and single-parent households. c. of immigration. d. birth rates have changed.
b. of the increase in two-career families and single-parent households.
Customer relationship management is the art and science of a. demand management. b. positioning customers to improve the profitability of the organization. c. management discipline. d. customer profitability.
b. positioning customers to improve the profitability of the organization.
An organization selling its products *FOB destination* holds the title to the goods until: a. picked up by the trucker b. products reach the customer's facility c. customer is invoiced d. customer receives the goods into their inventory system
b. products reach the customer's facility
Logistics creates which utility through production forecasting, production scheduling and inventory control? a. form utility b. quantity utility c. time utility d. possession utility
b. quantity utility
An important sustainability issue that has received much more scrutiny in recent years is the: a. focus on adequate inventory levels b. reduction in packaging waste by using alternate materials c. effort to move warehouse storage closer to consumers d. emphasis on materials handling and warehouse design
b. reduction in packaging waste by using alternate materials
"When a specific point in time, or level of production, is chosen and costs are developed for the various logistics cost centers, it is called A. least cost analysis. B. short run analysis. C. cost center analysis. D. link node analysis.
b. short run analysis
"Which of the following is not part of the Supply Chain network? a.plants b.stores c.terminals d.distribution centers
b. stores
When a firm "customizes" their supply chain, it is a. trying to improve asset utilization b. tailoring the chain to be responsive to the needs of individual customer segments c. responding to competitive situations d. revising supply chain in light of current economic conditions
b. tailoring the chain to be responsive to the needs of individual customer segments
8. All the following are inventory risk costs EXCEPT: a. obsolescence b. taxes c. damage d. shrinkage e. relocation costs Page 301 in the 10th Edition
b. taxes
The first facility consideration is to determine a. how close to source it should be b. the size of each operation within the network c. how close to the customer it should be d. where competitors are located
b. the size of each operation within the network
"What is often the largest component of logistics costs? A. inventory costs B. transportation costs C. shipper-related costs D. administrative costs
b. transportation costs
"One of the major challenges of supply chain management is a.forward buying. b.maintaining the visibility of inventory. c.building safety-stock inventory. d.Pushing inventory back to vendors.
b.maintaining the visibility of inventory.
Companies with 10,000 purchase transactions or more per year should consider a.strategic sourcing solutions. b.transactional procurement solutions. c.business-to-business transactions. d.collaboration tools.
b.transactional procurement solutions
Some individuals describe the current consumer as the ""click here"" generation because a.we all have Internet access. b.we no longer wait for information to be ""pushed out"" to us. c.we buy so much merchandise on line. d.we take little time to make purchasing decisions.
b.we no longer wait for information to be ""pushed out"" to us.
2. Private warehouses are generally advantageous when: (A) demand does not fluctuate; (B) greater control is necessary; (C) throughput is low and sporadic; (D) investment capital is scarce; (E) promotional items need to be stored. a. (A) and (C) b. (A),(D) and (E) c. (A) and (B) d. (A),(B) and (D) e. (B) only
c. (A) and (B)
Which is not a mode of transportation? a. truck b. air c. 3pl d. pipeline
c. 3pl
________ is a set of international standards that establish the minimum requirements for all organization's quality system. a. Deming Award b. Malcolm Baldrige National Quality Award c. ISO 9000 d. ISO 14000 e. Supplier Certification Award Program
c. ISO 9000
If you were to "manage" Wilson's EOQ as a means of reducing your company inventories, which variable of Wilson's EOQ would make the most sense to change. a. Inventory Carrying Cost. b. Unit Price. c. Ordering Cost. d. Annual Demand.
c. Ordering Cost
12. EXCESSIVE inventory levels will always lower corporate return on net worth by: a. Increasing out-of-pocket costs associated with research and design activities. b. Increasing asset turnover. c. Tying up cash that could be used for other investment opportunities and/or reducing debt. d. Increasing sales. Page 298 in the 10th edition
c. Tying up cash that could be used for other investment opportunities and/or reducing debt.
18. The global logistics channel intermediary that supervises the movement of goods through customs and ensures that the documentation accompanying a shipment is complete and accurate is known as a. a foreign freight forwarder b. an export packer c. a customs house broker d. a foreign trade specialist
c. a customs house broker
Full collaboration is the dynamic combination of a. buyers, sellers, retailers, and 3PLs. b. buyers, sellers, retailers, 3PLs, and appropriate government agencies. c. both vertical and horizontal collaboration. d. buyers and sellers only.
c. both vertical and horizontal collaboration.
14. Desirability refers to a. performance reporting and scorecarding b. attractive packaging choices c. characteristics that influence modal selection d. ride quality Page 442 in the 10th Edition
c. characteristics that influence modal selection
The essence of demand management is to estimate and manage ___________ and use this information to make operating decisions. A. channel orders B. vendors and suppliers C. customer demand D. SO&P processes
c. customer demand
11. Ordering cost refers to the expense of placing an order and a. includes the cost of capital. b. relates to the material management concept. c. does not include the cost of the product. d. not receiving it. Page 303 in the 10th Edition
c. does not include the cost of the product.
Which of the below is not one of the external forces driving the rate of change and shaping our economic and political landscape? a. Government policy b. Technology c. Environmental concerns d. Globalization
c. environmental concerns
12. Which of the following would be considered a nontraditional service being offered by carriers? a. claims handling b. contract carriage c. facility location analysis d. pickup and delivery e. rating (pricing) Page 435 in the 10th edition
c. facility location analysis
It can be argued that _ is the second language of logistics and supply chain management. a. quality b. manufacturing c. finance d. sales
c. finance
Information and _______ are important dimensions in reverse logistics and closed loop supply chains. a. transportation b. flow c. financials d. direction
c. financials
Security legislation a. has created unnecessary restrictions of legitimate trade. b. has caused some firms to stop offshore sourcing. c. has caused expense issues for carriers. d. has not had much impact on transportation carriers.
c. has caused expense issues for carriers.
Each of the following functional areas would typically be included within logistics EXCEPT: a. transportation b. customer service c. human resources/personnel management d. order processing
c. human resources/personnel management
8. Automated storage and retrieval systems (AS/RS) have many advantages, BUT a disadvantage of such systems is: a. higher operating costs b. actual increase in space required (rather than a decrease) c. initial capital costs d. increases in manpower required e. lessened control over inventory
c. initial capital costs
"The challenge to develop and sustain an efficient and effective supply chain(s) requires organizations to address a number of issues. Which is not included? a.complexity b.inventory deployment c.inventory carrying costs d.technology
c. inventory carrying costs
A(n) _______ relationship generally exists between the cost of lost sales and inventory cost. a. reverse b. proportional c. inverse d. non linear
c. inverse
26. Benefits to a carrier of improved routing and scheduling include all of the following EXCEPT: a. greater vehicle utilization b. higher levels of customer service c. lessening of competition d. lower transportation costs e. reduced capital investment in equipment Page 445 10th edition
c. lessening of competition
10. Which of the following is NOT a savings associated with volume buying? a. reduction in purchase price b. reduction in administrative costs c. lower capital costs associated with the inventory investment d. supports JIT purchasing e. lower per unit margins to suppliers due to higher volume Page 144 in the 10th edition
c. lower capital costs associated with the inventory investment
4. Railroads fall into a group called a. nonintegrated carriers b. intermodal operators c. natural monopolies d. service challenged carriers Page 425 in the 10th Edition
c. natural monopolies
Which of the following is NOT an element of Order Management? a. reducing stockouts b. reducing order processing times c. optimizing mode mix d. optimizing order fill rate
c. optimizing mode mi
Which of these is NOT a form of purchasing? a. procurement b. sourcing c. process improvement d. purchasing
c. process improvement
16. The main strategy behind routing guides is to a. maintain exact control b. comply with or enforce FOB terms c. promote supply chain excellence d. select between modes Page 445 in the 10th Edition
c. promote supply chain excellence
The product's dollar value typically affects the cost of logistics activities. Which is NOT one of these costs? a. warehousing costs b. transportation costs c. promotion costs d. packaging costs
c. promotion costs
25. Which of the following is NOT a result (directly or indirectly) of the Motor Carrier Act of 1980? a. increasing competition b. overall number of TL motor carriers has increased c. service levels provided by carriers have declined d. the number of negotiated shipper-carrier agreements has increased e. the influence of rate bureaus on carrier pricing has declined Page 464 in the 10th Edition
c. service levels provided by carriers have declined
From a business and supply chain perspective, ______________ are usually based upon a recognition that industrial systems need to be in harmony with nature by not depleting resources beyond their replacement or regeneration rate. a. life cycle practices b. ecological practices c. sustainability practices
c. sustainability practices
Those customers who are in the "Danger Zone" segment are a. likely to switch to a competitor b. have been a customer for less than a year c. the least profitable. d. are using ABC to drive down the price
c. the least profitable.
The recent increased focus on reverse flows is attributable to a. pressure from environmental groups b. increases in the price of oil c. the significant increase in volume of reverse flows d. new environmental legislation
c. the significant increase in volume of reverse flows
20. Piggyback is a form of intermodal transportation that primarily involves the following two transport modes: a. air and rail b. water and pipeline c. truck and rail d. air and water Page 432 in the 10th edition
c. truck and rail
While interest has traditionally focused more on the overall length of the OTC cycle, recent attention has been centered on a. the use of the SCOR process. b. the use of the ABC process. c. variability or consistency within this process. d. customer segmentation.
c. variability or consistency within this process.
3. The key financial consideration in choosing between private and 3PL distribution options is a. warehouse location(s) b. competency of in-house staff c. volume of product being moved d. type of product being handled Page 384 in the 10th Edition
c. volume of product being moved
5. Which of the following is NOT a source of price? a. price lists b. price quotation c. wholesale price index d. negotiation Pages 165 in the 10th Edition
c. wholesale price index
Which of the following does not belong in the list of the seven principles of supply chain management? a.Segment Customers Based on Service Needs b.Adopt Channel-Spanning Performance Measures c.Develop an outsourcing strategy to maximize asset utilization d.Differentiate Products Closer to the Customer
c.Develop an outsourcing strategy to maximize asset utilization
"Cost/Value refers to a.getting the best value for the money spent. b.U.S. firms competing in the global arena. c.the importance of cost and value at the very end of the supply chain. d.product variety.
c.the importance of cost and value at the very end of the supply chain.
"Logistics, in its simplest form, a.is a military term, as it was developed originally to supply the battlefield. b.combines inbound logistics with the outbound logistics of physical distribution. c.is another term for transportation management. d.does not involve customer service or other related functions.
combines inbound logistics with the outbound logistics of physical distribution.
2. Reasons for engaging in forward buying include: a. delay the impact of rising costs b. decreases the firm's average cost of capital in the short run c. provides protection against future anticipated shortages d. A. and C. only e. A., B., and C. Page 144 in the 10th Edition
d. A, C only
Which of the following is NOT a supply chain decision area regarding ROAimprovement? a. Channel Structure Management b. Inventory Management c. Order Management d. Information Management
d. Information Management
18. Pareto Analysis may be used to classify parts, customers, or activities. When determining the Pareto segments to classify parts, you should: a. Identify 80% of the total value of all the parts as these will represent exactly 20% of the part numbers. b. Identify 20% of the inventory value as this will represent exactly 80% of the part numbers. c. Identify 80% of the number of parts as these will represent exactly 20% of the inventory value. d. There will rarely be a clean break at the 80% (or 20%) point so your cut-off is subjective; however the general 80-20 relationship still holds. e. Identify 20% of the part numbers as these will represent exactly 80% of the inventory value. Page 348 in the 10th edition
d. There will rarely be a clean break at the 80% (or 20%) point so your cut-off is subjective; however the general 80-20 relationship still holds.
6. The distances in today's global supply chains produce a. higher cost b. longer transit time c. more disruptions d. all of these Page 421 in the 10th Edition
d. all of these
Customer service can be defined as: a. making the right product for the customer b. order fulfillment c. the SCOR model d. anything that touches the customer
d. anything that touches the customer
4. The roles of the distribution center include __________ a. balancing supply and demand b. protecting against uncertainty and promoting transportation economies c. promoting transportation economies d. balancing supply and demand, protecting against uncertainty, and promoting e. transportation economies Page 373 in the 10th Edition
d. balancing supply and demand, protecting against uncertainty, and promoting
A closed loop system deals with a. green laws b. recycling c. waste flow d. both forward and reverse flows
d. both forward and reverse flows
19.Transportation efficiency promotes __________ in the supply chain. a. intermodal demand b. KPIs c. capacity d. competition Page 419 in the 10th Edition
d. competition
5. Transportation efficiency promotes __________ in the supply chain. a. intermodal demand b. KPIs c. capacity d. competition Page 419 in the 10th Edition
d. competition
8. Challenges for the trucking industry include a. lack of flexibility b. limited equipment options c. oversupply of qualified drivers d. competition. Page 424 in the 10th Edition
d. competition.
Which is NOT part of dependability? a. cycle time b. safe delivery c. correct orders d. consistent pricing
d. consistent pricing
"Marketers have begun to recognize the strategic value of place in the marketing mix, as well as the benefits resulting from high-quality logistical services. As a result, which has been recognized as the interface activity between marketing and logistics? A. product B. promotion C. price D. customer service
d. customer service
9. Batching economies or cycle stocks usually arise from three sources. Which of these is NOT a source? a. procurement b. transportation c. production d. demand Page 294 in the 10th Edition
d. demand
One of the four supply chain flows in Figure 1 - 7 that has received increased attention from supply chain managers due to the growth in technology is: a. Product flow b. Information flow c. Cash flow d. Demand flow
d. demand flow
The Supply Chain Concept a. is very new and considered cutting edge technology b. is highly dependent of computerization c. is not always well understood by senior managers d. developed from the previous Physical Distribution concept.
d. developed from the previous Physical Distribution concept.
In the Item Procurement Importance Matrix, what item is described as high risk, low value? a. Generics b. Commodities c. Criticals d. Distinctives Page 143 in the 10th Edition
d. distinctives
4. In the event of a "stockout" at your location, one of the things that could happen is a. the vendor's plant shuts down b. the cost of capital is increased c. the SCOR process would come into play d. extra shipping cost may be incurred Page 307 in the 10th Edition
d. extra shipping cost may be incurred
The term functional silos refers to: a. product storage for physical supply. b. the non communication between customers and vendors. c. a technique to secure corporate marketing strategies. d. lack of coordination between departments.
d. lack of coordination between departments.
Performance measurement is important because a. it allows firms to rate competitors. b. without it, managers would not know how the global economy is doing. c. companies presently operating in the European Economic Community need to understand how its competitors are doing. d. lower-level metrics in an organization must connect directly to the high-level performance to achieve goals.
d. lower-level metrics in an organization must connect directly to the high-level performance to achieve goals.
An outbound-to-customer logistics system is also referred to as a. integrated fulfillment. b. dedicated fulfillment. c. store fulfillment. d. physical distribution.
d. physical distribution.
An outbound-to-customer logistics system is also referred to as A. integrated fulfillment. B. dedicated fulfillment. C. store fulfillment. D. physical distribution.
d. physical distributionapp
3. JIT is a _______ system. a. push b. Pareto's Law c. MRP d. pull Page 314 in the 10th Edition
d. pull
7. The drawback of centralized inventory is: a. that it undercuts the consolidated distribution concept. b. that it increases the amount of inventory required. c. that it is more difficult to manage. d. that it extends lead times and results in higher transportation costs Page 382 in the 10th Edition
d. that it extends lead times and results in higher transportation costs
Which of the answers below is an example of the creation of form utility by a logistics activity? a. when lumber is cut and made into a chair b. when a firm's finance manager approves customer purchases on a credit basis c. when Dell combines components with software to produce a computer to a customer's specifications d. the breaking bulk and repackaging at a distribution center
d. the breaking bulk and repackaging at a distribution center
The transportation activity adds _______ utility to products. a. form and place b. possession c. time d. time and place e. all of the above utilities would be added by transportation Page 419 in 10th edition
d. time and place
7. The concept that represents the sum of all costs associated with making and delivering products to the point where they are needed is called a. purchase/acquisition cost b. strategic sourcing costs c. life cycle costs d. total landed cost Page 153 in the 10th Edition
d. total landed cost
Inventory as an asset on the balance sheet and a ____ on the income statement. a. liability b. footnote c. statement d. variable expense
d. variable expense
"Complexity in the supply chain is caused by a.the number of SKUs. b.locations of customers and suppliers. c.transportation requirements. d.All of these answers.
d.All of these answers.
What vendor selection criteria are described by vendor attitude, cultural compatibility, training aids, packaging, and repair service?a.quality b.financial considerations c.reliability d.desirable capabilities
d.desirable capabilities
15. The objective of inventory management is to: a. Stockpile all types of inventory. b. Minimize all types of inventory. c. Eliminate all overage inventory. d. Maximize all types of inventory. e. Increase corporate profitability. Page 290 in the 10th Edition
e. Increase corporate profitability.
6. Which of the following statements about just-in-time (JIT) is FALSE? a. JIT helps to reduce manufacturing cycle times. b. JIT has been defined as a philosophy that centers on the elimination of waste in the manufacturing process. c. JIT seeks to eliminate non-value-added activities. d. JIT helps a firm to reduce its overall material costs. e. JIT programs usually do not impact inventory turnover rates. Page 314 in the 10th Edition
e. JIT programs usually do not impact inventory turnover rates.
13. Which of the following is NOT a principle reason for holding finished goods inventory? a. Production economies of scale. b. Speculative investments in perishable raw materials. c. Improvement of customer service. d. Transportation economies. e. Prevention of production shutdowns due to parts shortages. Page 307 in the 10th Edition
e. Prevention of production shutdowns due to parts shortages.
If demand INCREASES by 13% and the value of each unit INCREASES by 13%, what will happen to the EOQ? (Assume that everything else remains the same). a. the EOQ will increase by 13%. b. the EOQ will increase by 26%. c. the EOQ will decrease by 13%. d. the EOQ will decrease by 26%. e. the EOQ will remain the same.
e. the EOQ will remain the same.
Both economic and safety regulation of the US transportation industry have been declining since the onset of deregulation in the late 1970s. true/false
false
Most customers place more value on speed of delivery in filling orders than on order reliability and/or order consistency.
false
Please read the following statements: Statement I. All logistics budgets are dynamic. Statement II. Some logistics costs are static State whether the statement(s) are true or false
first statement is false, second is true
Applying Internet technology to the order management process has allowed organizations to not only take time out of the process but also to
increase the velocity of cash back to the selling organization
The term functional silos refers to:The term functional silos refers to: A. product storage for physical supply. B. the non communication between customers and vendors. C. a technique to secure corporate marketing strategies. D. lack of coordination between departments.
lack of coordination between departments
The traditional role of customer service at the interface between marketing and logistics manifests itself through the ______ dimension of the marketing mix
place
What are the steps in the CRM process?
segment customer base, identify service/package, then measure service and improve
The term replenishment cycle refers to
the acquisition of additional inventory
Those customers who are in the "Danger Zone" segment are
the least profitable
The terms purchasing and procurement can often be used interchangeably, however procurement has a broader meaning, and includes purchasing, traffic, warehousing, and receiving inbound materials. 1. True. 2. False.
true
