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Q:
(p. 449) Acquisition costs include which of the following costs?
A. Quality costs
B. Maintenance and repair costs
C. Environmental costs
D. Supply chain costs
E. Customer dissatisfaction costs
Q:
(p. 449) Ownership costs are incurred after the initial purchase and are associated with the ongoing use of the product or material. Which of the following is not an ownership cost listed in the text?
A. Financing costs
B. Energy costs
C. Taxes
D. Maintenance and repair costs
E. Supply network costs
Q:
(p. 447) The six-step process for green sourcing includes which of the following?
A. Provide a press release to local (and perhaps national) media.
B. Include members of environmental groups in the decision
C. Notify the state and federal environmental agencies of your plans
D. Perform an environmental impact study
E. Develop the sourcing strategy
Q:
(p. 446) The six-step process for green sourcing does not include which of the following?
A. Assess the opportunity
B. Assess the supply base
C. Confer with environmental groups
D. Engage sourcing agents
E. Institutionalize the sourcing strategy
Q:
(p. 442) Which of the following is one of the strategic characteristics to consider when deciding how supplier relationships should be structured on the continuum between vertical integration (do not outsource) to arm's length relationships (outsource)?
A. Cost
B. Location
C. Investment
D. Coordination
E. Control
Q:
(p. 441) Which of the following is not an improvement-driven reason to outsource?
A. Improve risk management
B. Increase commitment in a non-core area
C. Shorten cycle time
D. Improve quality and productivity
E. Obtain expertise, skills and technologies that are otherwise not available
Q:
(p. 438) Which of the following of Fisher's product categories includes fashionable clothing, personal computers and other products that typically have a very brief life cycle?
A. Functional products
B. Dysfunctional products
C. Innovative products
D. Bullwhip products
E. Value density products
Q:
(p. 439) Which is the most challenging kind of supply chain to manage according to Hau Lee?
A. Agile supply chain
B. Efficient supply chain
C. Risk-hedging supply chain
D. Erratic supply chain
E. Responsive supply chain
Q:
(p. 444) When considering outsourcing, what should firms be sure to avoid?
A. Losing control of non-core activities which don't distinguish the firm
B. Allowing outsourcing to develop into a substitute for innovation
C. Giving the outsourcing partner opportunities to become a strong competitor
D. Allowing employees transferred to the outsourcing partner to rejoin the firm
E. Adverse corporate tax implications of asset transfers to the outsourcing partner
Q:
(p. 441) Which of the following is not an improvement-driven reason for outsourcing?
A. Improve quality and productivity
B. Enhance effectiveness by focusing on what you do best
C. Improve risk management
D. Obtain expertise, skills and technologies not otherwise available
E. Improve credibility and image by associating with superior providers
Q:
(p. 441) Which of the following is an improvement-driven reason for outsourcing?
A. Shorten cycle time
B. Improve effectiveness by focusing on what the firm does best
C. Increase product and service value by improving response to customer needs
D. Turn fixed costs into variable costs
E. Reduce costs through a lower cost structure
Q:
(p. 441) Which of the following is not an organizationally-driven reason for outsourcing?
A. Improve effectiveness by focusing on what the firm does best
B. Improve flexibility to meet changing demand for products and services
C. Increase product and service value by improving response to customer needs
D. Improve credibility and image by associating with superior providers
E. All of the above are organizationally-driven reasons for outsourcing
Q:
(p. 441) Which of the following is an organizationally-driven reason for outsourcing?
A. Improve effectiveness by focusing on what the firm does best
B. Turn fixed costs into variable costs
C. Reduce costs through lowered cost structure and increased flexibility
D. Improve risk management
E. Improve credibility and image by associating with superior providers
Q:
(p. 440) In outsourcing which of the following internal activities and decision responsibilities cannot be transferred to outside contractors?
A. Activities involving people
B. Activities involving facilities
C. Activities involving equipment
D. Activities involving shareholders
E. Activities involving technology
Q:
(p. 437) The effect of the lack of synchronization among supply-chain members is referred to as which of the following?
A. Forward buying
B. Continuous replenishment
C. Bullwhip effect
D. Metcalf's Law
E. Being out of step
Q:
(p. 439) In Hau Lee's uncertainty framework to classify supply chains, a supply chain for innovative products with a stable supply process is called which of the following?
A. Efficient
B. Forward looking
C. Agile
D. Risk hedging
E. Responsive
Q:
(p. 439) In Hau Lee's uncertainty framework to classify supply chains, a supply chain for innovative products with an evolving supply process is called which of the following?
A. Efficient
B. Forward looking
C. Agile
D. Risk hedging
E. Responsive
Q:
(p. 439) In Hau Lee's uncertainty framework to classify supply chains, a supply chain for functional products with a stable supply process is called which of the following?
A. Efficient
B. Forward looking
C. Agile
D. Risk hedging
E. Responsive
Q:
(p. 439) In Hau Lee's uncertainty framework to classify supply chains, a supply chain for functional products with an evolving supply process is called which of the following?
A. Efficient
B. Forward looking
C. Agile
D. Risk hedging
E. Responsive
Q:
(p. 451) If the average aggregate inventory value is $100,000 and the cost of goods sold is $450,000, which of the following is inventory turnover?
A. 19.23
B. 4.5
C. 0.8654
D. 0.2222
E. None of the above
Q:
(p. 451) If the average aggregate inventory value is $1,200,000 and the cost of goods sold is $600,000, which of the following is inventory turnover?
A. 60
B. 10.4
C. 2
D. 0.5
E. None of the above
Q:
(p. 451) If the average aggregate inventory value is $1,200,000 and the cost of goods sold is $600,000, which of the following is weeks of supply?
A. 1,040
B. 606
C. 104
D. 60.6
E. 2.0
Q:
(p. 451) If the average aggregate inventory value is $45,000 and the cost of goods sold is $10,000, which of the following is weeks of supply?
A. 45,000
B. 234
C. 120
D. 23.4
E. 4.5
Q:
(p. 451) The total value of all items held in inventory for the firm valued at cost is which of the following?
A. Cost of goods to be sold
B. Average aggregate inventory value
C. Weeks supply of goods
D. Inventory turnover
E. None of the above
Q:
(p. 451) The inventory turnover ratio used in measuring supply-chain efficiency is found by the ratio of which of the following?
A. Cost of goods sold/Average aggregate inventory value
B. Fixed costs/Variable costs
C. Sales costs/Marketing costs
D. Cost of goods sold/Cost to sell goods
E. Operations flow costs/Suppliers flow costs
Q:
(p. 443) Capability Sourcing refers to outsourcing the functions that they do best to trusted key partners.
Q:
(p. 443) A firm that controls most of the activities in its supply chain is said to be vertically integrated.
Q:
(p. 450) In conducting a Total Cost of Ownership analysis, it is probably best to use a team representing the key functional areas.
Q:
(p. 448) Overemphasis on purchase price frequently results in failure to address other significant costs.
Q:
(p. 449) The total cost of ownership (TCO) can be categorized into three areas: acquisition costs, ownership costs, and post-ownership costs.
Q:
(p. 448) The total cost of ownership (TCO) is an estimate of the cost of an item that includes all the costs related to the procurement and use of an item, but does not include any of the costs related to disposing of the item after it is no longer useful.
Q:
(p. 447) Green sourcing requires incorporating new criteria for evaluating alternatives.
Q:
(p. 445) An important opportunity in green sourcing is waste reduction opportunities.
Q:
(p. 445) Green sourcing is only about finding new environmentally friendly technologies and increasing the use of recyclable materials.
Q:
(p. 451) Inventory turnover and weeks of supply are mathematically the inverse of one another.
Q:
(p. 438) Firms producing functional products are forced to introduce a steady stream of innovations in order to survive.
Q:
(p. 438) A stable supply process is one where the manufacturing process and the underlying technology are mature and the supply base is well established.
Q:
(p. 438) A stable supply process is one where product volumes are high, demand is predictable and there is a long product life.
Q:
(p. 441) A financially-driven reason for outsourcing is that it can help gain access to new markets, especially in developing countries.
Q:
(p. 441) An improvement-driven reason for outsourcing is that it can increase product and service value, customer satisfaction, and shareholder value.
Q:
(p. 441) A financially-driven reason for outsourcing is that it can reduce costs through a lower cost structure.
Q:
(p. 441) An organizationally-driven reason for outsourcing is that it can transform the organization.
Q:
(p. 441) An organizationally-driven reason for outsourcing is that it can improve effectiveness by focusing on what the firm does best.
Q:
(p. 441) A financially-driven reason for outsourcing is that it can shorten cycle time.
Q:
(p. 441) A financially-driven reason for outsourcing is that it can turn fixed costs into variable costs.
Q:
(p. 440) Logistics is a term that refers to the management functions that support the complete cycle of material flow, from the purchase and internal control of production materials; to the planning and control of work-in-process; to the purchasing, shipping, and distribution of the finished product.
Q:
(p. 440) Logistics is a term indicating transportation choices for goods produced internationally but consumed domestically.
Q:
(p. 440) Outsourcing allows a firm to achieve an improved focus on its core competencies.
Q:
(p. 440) Outsourcing is the act of moving some of a firm's internal activities and decision responsibility to outside providers.
Q:
(p. 439) The best strategy for innovative products is to use either a responsive or an agile supply-chain.
Q:
(p. 439) The optimal strategy for innovative products is to use an efficient supply-chain.
Q:
(p. 439) The optimal strategy for functional products is to use a responsive supply-chain.
Q:
(p. 439) The optimal strategy for functional products is to use an efficient supply-chain.
Q:
(p. 437) Functional products include staples that people buy in a wide range of retail outlets, such as grocery stores and gas stations.
Q:
(p. 437) The phenomenon that magnifies the variability in order quantities for goods as orders move through the supply-chain from the customer to the producer is called the bullwhip effect.
Q:
(p. 436) Retailer behavior when stocking up during promotion periods (where the prices of goods are reduced) is called backward buying.
Q:
(p. 451) Inventory turn values that are considered good differ by industry and the type of products being handled.
Q:
(p. 451) Two common measures to evaluate supply-chain efficiency are the inventory turnover and weeks-of-supply ratios.
Q:
(p. 451) Two common measures to evaluate supply-chain efficiency are the consumer price index and the beta flow system.
Q:
(p. 434) Strategic sourcing is the development and management of supplier relationships to acquire goods and services in a way that aids in achieving the immediate needs of the business.
Q:
(p. 443) When a firm controls most of the activities in its supply chain it is called what? ___________________________________
Q:
(p. 404) As lean production methods reduce changeover and setup times and thus enable smaller economic lot sizes and less work-in-process inventory, is the importance of quality increased or decreased? Why?
Q:
(p. 404) Name Fujio Cho's seven prominent types of waste to be eliminated. 1) ___________________
2) ___________________
3) ___________________
4) ___________________
5) ___________________
6) ___________________
7) ___________________
Q:
(p. 416) In setting up a kanban control system and you need to determine the number of kanban card sets needed. If the expected demand during lead time is 50 per hour, the safety stock is 20% of the demand during lead time, the container size is 4. If the lead time to replenish an order is 2 hours, what number of kanban card sets is needed?
Q:
(p. 416) In setting up a kanban control system you need to determine the number of kanban card sets needed. If the expected demand during lead time is 24 per hour, safety stock is 10% of the demand during lead time, the container size is 5. If the lead time to replenish an order is 5 hours, what number of kanban card sets is needed? ___________________
Q:
(p. 405) Which of the following is not listed in the textbook as a component of a lean supply chain?
A. Lean customers
B. Lean Management
C. Lean logistics
D. Lean warehousing
E. Lean procurement
Q:
(p. 419) Which of the following is a lean production technique that has been successfully applied in service firms?
A. Decision trees
B. Leveling the facility load
C. Linear programming
D. Fully utilizing capacity
E. Backflushing
Q:
(p. 413) An activity where the parts that go into each unit of a product are periodically removed from inventory and accounted for based on the number of units produced. is called which of the following?
A. Frozen window
B. Backflush
C. Level schedule
D. Group Technology
E. Kanban
Q:
(p. 418) Which of the following is a lean production technique that is not reported in the textbook to have been successfully applied in service firms?
A. Organize problem-solving groups
B. Upgrade housekeeping
C. Upgrade quality
D. Freeze windows
E. Eliminate unnecessary activities
Q:
(p. 420) In a lean production system we expect to see which of the following?
A. No extra inventory
B. Extra inventory of critical parts held "just-in-case"
C. More parts and fewer standardized product configurations
D. Managers being held responsible for quality of the work turned out
E. Closer management-labor relationships
Q:
(p. 417) Imagine comparing a manufacturing operation using regular lot-sizing and the same operation with a Kanban/lean production approach. What would be your expectations of the difference between the total cost (i.e., inventory holding costs + setup/ordering costs) of each?
A. Inventory holding cost will increase non-linearly with inventory
B. Total costs will be lower for the regular lot-size operation
C. Total costs will be lower for the Kanban/lean production operation
D. The order quantity will be larger for the Kanban/lean production approach
E. As long as the total quantity is the same, total costs will be the same
Q:
(p. 402) To develop a lean manufacturing system a firm might do which of the following?
A. Eliminate anything that does not add value for the customer
B. Standardize product configurations
C. Process design with product design
D. Adopt a kaizen philosophy
E. Implement top-down management controls
Q:
(p. 417) To implement a flow process in developing a lean system a firm might do which of the following?
A. Improve capacity utilization
B. Build product in anticipation of demand
C. Reduce setup/changeover time
D. Eliminate some fixed costs
E. Implement groupware
Q:
(p. 418) In implementing a lean production system you should work with suppliers to do which of the following?
A. Calculate lead times
B. Quality circles
C. Freeze windows
D. Make frequent deliveries
E. Achieve bottom-round management
Q:
(p. 418) In implementing a lean production system you should work with suppliers to do which of the following?
A. Open facilities near your factory
B. Focus workstation capacities
C. Backflush
D. Provide quality at the source
E. Reduce lead times
Q:
(p. 413) To implement lean production schedules a firm would do which of the following?
A. Have excess capacity
B. Force demand
C. Hire a consultant
D. Bottom-up management
E. Implement kanban groups
Q:
(p. 413) When implementing a lean production system a stabilized schedule is achieved using which of the following?
A. Level scheduling
B. Demand pull
C. Freeze window
D. Reduced lot sizes
E. Bottom-round management
Q:
(p. 411) In designing a lean production facility layout a designer should do which of the following?
A. Design for work flow balance
B. Locate flexible workstations off line
C. Link operations through a push system
D. Balance capacity using job shop analysis
E. Always keep operations on a single floor of the factory
Q:
(p. 416) You have been called in as a consultant to set up a Kanban control system. The first thing you do is to determine the number of Kanban card sets needed. Your research shows that the expected demand during lead time for a particular component is 1,200 per hour. You estimate the safety stock should be set at 5% of the demand during lead time. The tote trays used as containers can hold 2 units of stock and the lead time to replenish an order is 10 hours. Which of the following is the number of Kanban card sets necessary to support this situation?
A. 5,000
B. 5,500
C. 6,300
D. 6,500
E. 7,000
Q:
(p. 416) You have been called in as a consultant to set up a Kanban control system. The first thing to do is to determine the number of Kanban card sets needed. Your research shows that the expected demand during lead time for a particular component is 150 per hour. You estimate the safety stock should be set at 25% of the demand during lead time. The tote trays used as containers can hold 8 units of stock and the lead time it takes to replenish an order is 2 hours. Which of the following is the number of Kanban card sets necessary to support this situation?
A. 42
B. 47
C. 68
D. 89
E. 94