Operations and supply chain management final exam

Final Exam - Integrated Supply Chain Mgmt

ASCM 631 – Integrative Supply Chain Management – Final Examination

6

Multiple Choice . Choose the one alternative that best answers the question.

1) When a firm places orders in lot sizes that are much larger than the lot sizes in which demand arises, 1) _______

A) variability of orders is magnified up the supply chain.

B) suppliers gain better visibility of consumer demand.

C) suppliers gain a more stable demand pattern.

D) variability of orders is minimized up the supply chain.

E) none of the above

2) Which of the following managerial actions in the supply chain will not increase total supply chain profits and moderate the bullwhip effect? 2) _______

A) Building partnerships and trust

B) Aligning of goals and incentives

C) Designing pricing strategies to stabilize orders

D) Improving operational performance

E) Increasing information inaccuracy

3) Forward buying results in 3) _______

A) small orders during the promotion period followed by large orders after that.

B) small orders during the promotion period followed by very small orders after that.

C) a stabilized buying pattern.

D) large orders during the promotion period followed by very small orders after that.

E) none of the above

4) Which of the following is not a key step in designing effective supply chain partnerships? 4) _______

A) Creating effective contracts

B) Devoting resources to coordination

C) Assessing the value of the relationship

D) Identifying operational roles and decision rights for each party

E) Designing effective conflict resolution mechanisms

5) There are 5 major obstacles listed in the text to coordination in a supply chain. Which of the following is NOT one of these major obstacles? 5) _______

A) Behavioral obstacles B) Incentive obstacles

C) Pricing obstacles D) Quality obstacles

6) A key to reducing cycle inventory is 6) _______

A) the reduction of holding cost. B) the reduction of lot size.

C) the reduction of manufacturing cost. D) the reduction of warehouse space.

7) When the retailer decides to pass through very little of the promotion to customers but purchase in greater quantity during the promotion period to exploit the temporary reduction in price, the result is 7) _______

A) a lowering of the price of the product for the end customer.

B) an increase in the amount of inventory held at the retailer.

C) increased purchases and thus increased sales for the entire supply chain.

D) all of the above

8) Trade promotions lead to a significant ________ in lot size and cycle inventory because of forward buying by the ________. 8) _______

A) decrease, supplier B) increase, retailer

C) increase, supplier D) decrease, retailer

9) In a supply chain where each stage of the supply chain independently makes its pricing decisions with the objective of maximizing its own profit, 9) _______

A) supply chain profit is about the same as a coordinated solution.

B) supply chain profit will be maximized.

C) supply chain profit is higher than a coordinated solution.

D) supply chain profit is lower than a coordinated solution.

10) Safety inventory is carried because 10) ______

A) adequate supplies are available. B) excess product was manufactured.

C) demand forecasts are accurate. D) demand forecasts are uncertain.

11) Both ________ and ________ increase as the safety inventory is increased. 11) ______

A) reorder point, lead time B) fill rate, lead time

C) fill rate, cycle service level D) lead time, cycle service level

12) The issue of product availability and the level of safety inventory is particularly significant in industries where 12) ______

A) product life cycles are short and demand is stable.

B) product life cycles are long and demand is stable.

C) product life cycles are short and demand is very volatile.

D) product life cycles are long and demand is very volatile.

13) Which of the following is not a major disadvantage of aggregating all inventory in one location? 13) ______

A) Increase in forecast accuracy of customer demand.

B) Increase in transportation cost to customer.

C) Increase in response time to customer order.

D) All of the above are disadvantages.

14) ________ may reduce overall profits for a firm if a single product contributes the majority of the demand. 14) ______

A) Postponement B) Shortened forecasting window

C) Tailored sourcing D) Quick response

15) Whether the optimal level of product availability is high or low depends on where a particular company believes they can 15) ______

A) maximize revenue. B) maximize product availability.

C) maximize profits. D) minimize cost.

16) ________ is the set of actions a supply chain takes to reduce the replenishment lead time. 16) ______

A) Lengthened forecasting window B) Quick response

C) Tailored sourcing D) Postponement

17) Which mode of transportation is the dominant form of freight transportation? 17) ______

A) Truck B) Water C) Rail D) Air E) Pipeline

18) The ________ is the party that moves or transports the product. 18) ______

A) shipper B) carrier C) consumer D) producer

19) The text states that the effectiveness of carriers is influenced by infrastructure. Which of the following would not fall into this category? 19) ______

A) Ports B) Airports

C) Roads D) Effective management

20) Single sourcing for a product is used to 20) ______

A) ensure a degree of competition.

B) ensure the possibility of a backup should a source fail to deliver.

C) guarantee the supplier sufficient business when the supplier has to make a significant buyer-specific investment.

D) all of the above

21) Which of the following is not a benefit of effective sourcing decisions? 21) ______

A) Sequential design results in products that are easier to manufacture and distribute, resulting in lower overall costs.

B) More efficient procurement transactions can significantly reduce the overall cost of purchasing.

C) Good procurement processes can facilitate coordination with the supplier and improve forecasting and planning.

D) Better economies of scale can be achieved if orders within a firm are aggregated.

22) Successful revenue management requires 22) ______

A) a quantification of the impact of various tactics on consumer behavior.

B) a proper understanding of customer preferences.

C) a clear focus on profitability.

D) A and B only

23) The tactic of overbooking or overselling the available asset is suitable where 23) ______

A) customers are unable to cancel orders and the value of the asset drops significantly after a deadline.

B) customers are able to cancel orders and the value of the asset drops significantly after a deadline.

C) there is no clear date beyond which the asset loses a lot of its value.

D) there is a clear date beyond which the asset loses a lot of its value.

24) Which of the following is not listed as an important trend that will affect IT in the supply chain? 24) ______

A) Increased availability of real-time data

B) Growth as software as a service

C) Improved speed of hardware and software

D) Increased use of mobile technology

25) The emergence of supply chain management has broadened the scope across which companies make decisions to 25) ______

A) the entire supply chain. B) the enterprise.

C) the customer. D) the supplier.

26) From an environmental perspective, there are four important categories that all firms should measure and report. Which of the following is not one of these? 26) ______

A) Energy consumption B) Water consumption

C) CO2 emissions D) Waste generation

27) In the context of greenhouse gas emission, the GHG protocol initiative defines levels of scope. This level refers to indirect emissions from grid-sourced electricity and other utility services of heat, steam and cooling. 27) ______

A) Scope 1 B) Scope 2 C) Scope 3 D) Scope 4

28) Information distortion is exaggerated by the fact that 28) ______

A) supply chains today produce a small amount of product variety.

B) different stages of supply chains send excessive data.

C) the telephone effect is extreme in situations where technology is in use.

D) supply chains today produce a large amount of product variety.

E) none of the above

29) The lack of supply chain coordination on various measures of performance has costs associated with it. Which of the following is one of these costs? 29) ______

A) Quality B) Pricing C) Manufacturing D) Reliability

30) Cycle inventory exists in a supply chain because different stages exploit economies of scale to 30) ______

A) synchronize the supply chain. B) improve reliability.

C) raise quality. D) lower total cost.

31) Which approach to aggregation requires an information system that allows access to current inventory records from each location? 31) ______

A) Component commonality B) Information centralization

C) Product substitution D) Specialization

32) A supply chain needs to achieve a balance between the level of availability and the cost of inventory that 32) ______

A) maximizes supply chain profitability. B) maximizes supply chain revenues.

C) minimizes supply chain costs. D) maximizes supply chain availability.

33) Which of the following is not a factor that affects carrier decisions? 33) ______

A) Quantity-related cost B) Transportation cost

C) Vehicle-related cost D) Fixed operating cost

34) Sourcing a product overseas may have 34) ______

A) higher product cost and will generally incur a higher inbound transportation cost.

B) lower product cost and will generally incur a lower inbound transportation cost.

C) lower product cost but will generally incur a higher inbound transportation cost.

D) higher product cost but will generally incur a lower inbound transportation cost.

35) The amount of the asset reserved for the higher price segment is such that 35) ______

A) the expected marginal revenue from the higher priced segment equals the price to the lower price segment.

B) the expected marginal revenue from the higher priced segment is less than the price to the lower price segment.

C) the expected marginal revenue from the higher priced segment is more than the price to the lower price segment.

D) all orders from the lower priced segment will be accepted and filled.

36) To be of the right kind, information needs to be 36) ______

A) irrelevant. B) meaningless. C) useful. D) B and C only

37) Much less success for sustainability initiatives has been driven by 37) ______

A) reduced risk and improving the financial performance of the supply chain.

B) customer demand.

C) attracted customers who value sustainability.

D) increased revenue for sustainability initiatives.

38) When a single stage controls replenishment decisions for the entire chain, coordination is achieved because 38) ______

A) the manufacturer is aware of the retailer's promotion plans to achieve coordination.

B) the problem of multiple forecasts is eliminated.

C) each stage views its role as one of replenishing orders placed by the next stage.

D) all of the above

E) A and B only

39) Which of the following would not be included in holding cost? 39) ______

A) Cost of capital

B) Cost that results from the product becoming obsolete

C) Cost of manufacturing

D) Cost of physically storing the inventory

40) Which of the following is not a suggested method for estimating and managing safety inventory in practice? 40) ______

A) Focus on increasing safety inventories

B) Monitor service levels

C) Use simulation to test inventory policies

D) Adjust inventory policies if demand is seasonal

41) ________ allows a firm to increase profits and better match supply and demand if the firm produces a large variety of products whose demand is unpredictable, not positively correlated, and is of about the same size. 41) ______

A) Tailored sourcing B) Quick response

C) Shortened forecasting window D) Postponement

42) Which of the following uses transportation to minimize the total cost (transportation, inventory, information, and facility) while providing an appropriate level of responsiveness to the customer? 42) ______

A) The manufacturer B) The supplier

C) The shipper D) The carrier

43) The process by which companies acquire raw materials, components, products, services, and other resources from suppliers to execute their operations is 43) ______

A) procurement. B) sourcing.

C) supplier selection. D) supplier scoring and assessment.

44) Revenue management may be defined as 44) ______

A) the use of differential pricing based on customer segment, time of use, and product or capacity availability to decrease supply chain surplus.

B) the use of differential costing based on customer segment, time of use, and product or capacity availability to increase profitability.

C) the use of differential costing based on product or capacity availability to decrease supply chain cost.

D) the use of differential pricing based on customer segment, time of use, and product or capacity availability to increase supply chain surplus.

45) Information is 45) ______

A) the key to the success of a supply chain.

B) the supply chain driver that serves as the glue allowing the other three drivers to work together to create an integrated, coordinated supply chain.

C) crucial to supply chain performance.

D) all of the above

Short Answer Questions . Write your answer in the space provided or on a separate sheet of paper. 5 points each.

46) Describe the impact of behavioral obstacles on supply chain coordination.

47) Discuss the characteristics of a successful multi-echelon supply chain.