MGT 382 Week 4 Quiz | Mercer University

MGT 382 Week 4 Quiz | Mercer University

Quiz Module 4, Chapters 11-13


Question 1

The supply chain for a brewery would include raw ingredients such as hops and barley as well as manufactured goods such as bottles and cans. 

·         True 

·         False


Question 2

A firm that employs a low-cost strategy should minimize inventory throughout the supply chain.  

·         True  

·         False


Question 3

Which of the following would NOT typically be considered as part of a manufacturing firm's supply chain?  

·         landscaping contractors  

·         wholesalers 

·         suppliers 

·         retailers 

·         distributors


Question 4

In most manufacturing industries, which of the following would likely represent the largest cost to the firm? 

·         purchasing 

·         insurance 

·         financing  

·         transportation 

·         advertising



Question 5

Which of the following statements is TRUE regarding the leverage of supply chain savings?  

·         Supply chain savings exert more leverage as the firm's purchases are a smaller percent of sales.  

·         Supply chain leverage depends only upon the percent of sales spent in the supply chain.  

·         Supply chain leverage is about the same for all industries.  

·         None of these is true.  

·         Supply chain savings exert more leverage as the firm's net profit margin decreases.


Question 6

Which of the following is NOT a primary supplier selection criterion for a firm pursuing a response strategy?  

·         flexibility    

·         cost  

·         capacity  

·         All of these are primary supplier selection criteria for the firm.  

·         speed


Question 7


·         All of these are true of outsourcing.  

·         transfers traditional internal activities to outside vendors. 

·         utilizes the efficiency that comes with specialization.  

·         allows the outsourcing firm to focus on its key success factors.  

·         None of these is true of outsourcing.


Question 8

Which sourcing strategy is particularly common when the products being sourced are commodities? 

·         many suppliers 

·         virtual companies 

·         few suppliers 

·         keiretsu 

·         vertical integration


Question 9

When Daimler and BMW pooled resources to develop standardized auto components, the sourcing strategy could best be described by which of the following?  

·         joint venture 

·         virtual companies  

·         few suppliers 

·         keiretsu 

·         vertical integration


Question 10

A blanket order is a long-term purchase commitment to a supplier for items that are to be delivered against short-term releases to ship. 

·         True  

·         False


Question 11

Drop shipping:   

·         is a good reason to find a new firm to ship your products.  

·         means the supplier will ship directly to the end consumer, rather than to the seller. 

·         is equivalent to cross-docking. 

·         is the same thing as keiretsu. 

·         is the opposite of a blanket order.


Question 12

Which of the following is NOT a typical benefit of centralized purchasing?  

·         leverage purchase volume for better pricing  

·         reduce the duplication of tasks  

·         develop specialized staff expertise 

·         reduce lead times 

·         promote standardization


Question 13

What term is used to describe the outsourcing of logistics?  

·         e-logistics

·         third-party logistics (3PL)  

·         shipper-managed inventory (SMI)  

·         hollow logistics 

·         sub-logistics



Question 14

Warehouses sometimes perform certain other functions besides storing goods. Which of the following is NOT typically one of those functions? 

·         purchasing 

·         postponement 

·         cross-docking 

·         break-bulk activities 

·         consolidation point


Question 15

Distribution management focuses on which of the following?  

·         setting dividend rates  

·         balancing an assembly line  

·         incoming materials   

·         the outbound flow of products  

·         allocation of demand among suppliers


Question 16

Consider a firm with an annual net income of $20 million, revenue of $60 million and cost of goods sold of $20 million. If the balance sheet amounts show $2 million of inventory and $500,000 of property, plant & equipment, what is the inventory turnover?   

·         40  

·         30 

·         12.50 

·         10 

·         8



Question 17

A major challenge in inventory management is to maintain a balance between inventory investment and customer service. 

·         True  

·         False


Question 18

The purpose of safety stock is to:  

·         decrease the likelihood of a stockout.  

·         replace failed units with good ones.  

·         eliminate the likelihood of a stockout due to erroneous inventory tally.  

·         eliminate the possibility of a stockout. 

·         protect the firm from a sudden decrease in demand.


Question 19

What is the typical time horizon for aggregate planning?  

·         less than a month  

·         over 5 years  

·         over one year  

·         up to 3 months 

·         3 to 18 months


Question 20

In aggregate planning, which one of the following is NOT a basic option for altering demand?  

·         personal selling  

·         back ordering  

·         promotion  

·         pricing  

·         subcontracting


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