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1、Chapter 13Sourcing Decisions in a Supply ChainTrue/False1. Purchasing, also known as procurement, is the process used to rate supplier performance.Answer: FalseDifficulty: Moderate2. Sourcing processes include the selection of suppliers, design of supplier contracts, product design collaboration, pr

2、ocurement of material, and evaluation of supplier performance.Answer: TrueDifficulty: Moderate3. For many firms, price has traditionally been the only dimension that suppliers have been compared on.Answer: TrueDifficulty: Moderate4. There are many supplier characteristics other than price, such as l

3、ead time, reliability, quality, and design capability that impact the total cost of doing business with a supplier.Answer: TrueDifficulty: Easy5. A good supplier scoring and assessment process will primarily track performance along the price dimension when evaluating a supplier.Answer: FalseDifficul

4、ty: Moderate6. It is crucial that suppliers be actively involved during design, because about 20 percent of the cost of a product is determined at this stage.Answer: FalseDifficulty: Hard7. Design collaboration ensures that any design changes are communicated effectively to all parties involved with

5、 designing and manufacturing the product.Answer: TrueDifficulty: Moderate8. The goal of procurement is to enable orders to be placed and delivered on schedule regardless of cost.Answer: EasyDifficulty: Moderate9. The role of sourcing planning and analysis is to analyze spending across various suppli

6、ers and component categories to identify opportunities for decreasing the total cost.Answer: TrueDifficulty: Easy10. Cost of Goods Sold (COGS) represents less than 20 percent of sales for most major manufacturers.Answer: FalseDifficulty: Easy11. Effective sourcing processes within a firm can improve

7、 profits for the firm and total supply chain surplus in a variety of ways.Answer: True Difficulty: Moderate12. When designing a sourcing strategy, it is important for a firm to be clear on the factors that have the least influence on performance and target improvement on those areas.Answer: FalseDif

8、ficulty: Moderate13. Supplier performance must be rated on several factors other than purchase price because they all impact the total supply chain cost.Answer: TrueDifficulty: Moderate14. As the replenishment lead time from a supplier grows, the amount of safety inventory that needs to be held by t

9、he buyer also grows in direct proportion to the replenishment lead time.Answer: FalseDifficulty: Hard15. A reliable supplier has low variability of lead time, whereas an unreliable supplier has high variability.Answer: TrueDifficulty: Moderate16. The less flexible a supplier is, the less lead time v

10、ariability he will display as order quantities change.Answer: FalseDifficulty: Moderate17. As the replenishment lot size grows, the cycle inventory at the firm grows, thus increasing the cost of holding inventory.Answer: TrueDifficulty: Easy18. Quality has little effect on the lead time taken by the

11、 supplier to complete the replenishment order or the variability of this lead time.Answer: FalseDifficulty: Moderate19. Sourcing a product overseas may have lower product cost but will generally incur a higher inbound transportation cost.Answer: TrueDifficulty: Easy20. Quantity discounts lower the u

12、nit cost and tend to increase the required batch size.Answer: FalseDifficulty: Easy21. The value of better information coordination will be linked to the amount of variability introduced into the supply chain as a result of the bullwhip effect.Answer: TrueDifficulty: Hard22. Good design collaboratio

13、n for manufacturability and supply chain can also increase required inventories and transportation cost.Answer: FalseDifficulty: Easy23. Exchange rates, taxes, and duties can be significant for a firm with a global manufacturing and supply base.Answer: TrueDifficulty: Easy24. Supplier viability can

14、be especially important if the supplier is providing mission-critical products and they would be easy to find a replacement for.Answer: FalseDifficulty: Moderate25. Supplier performance should be compared based on their impact on total cost.Answer: TrueDifficulty: Easy26. Single sourcing is used to

15、ensure a degree of competition and guarantee the possibility of a backup should a source fail to deliver.Answer: FalseDifficulty: Moderate27. Having multiple sources ensures a degree of competition and also the possibility of a backup should a source fail to deliver.Answer: TrueDifficulty: Moderate2

16、8. Unless each supplier has a somewhat different role, it is very likely that a firms supply base is too small.Answer: FalseDifficulty: Moderate29. Unless adding a supplier with a unique and valuable capability clearly adds to total cost, the firms supply base may be too small.Answer: TrueDifficulty

17、: Moderate30. To improve overall profits, the supplier must design a contract that requires the buyer to share in some of the suppliers demand uncertainty.Answer: FalseDifficulty: Moderate31. Buyback contracts counter double marginalization by lowering the cost of overstocking for the retailer.Answe

18、r: TrueDifficulty: Easy32. Revenue-sharing contracts counter double marginalization by decreasing the cost per unit charged to the retailer, thus effectively decreasing the cost of understocking.Answer: FalseDifficulty: Moderate33. Quantity flexibility contracts counter double marginalization by giv

19、ing the retailer the ability to modify the order based on improved forecasts closer to the point of sale.Answer: TrueDifficulty: Easy34. Quantity discounts can coordinate supply chain costs if the supplier has large fixed costs per lot.Answer: TrueDifficulty: Moderate35. Two-part tariffs and thresho

20、ld contracts can be used to counter double marginalization and increase agent effort in a supply chain.Answer: TrueDifficulty: Moderate36. Design collaboration with suppliers can help a firm reduce cost, improve quality, and decrease time to market.Answer: TrueDifficulty: Moderate37. The procurement

21、 process for direct materials should focus on decreasing the transaction cost for each order.Answer: FalseDifficulty: Moderate38. The procurement process for indirect materials should focus on decreasing the transaction cost for each order.Answer: TrueDifficulty: Moderate39. Supplier performance ana

22、lysis should be used to build a portfolio of suppliers with similar strengths.Answer: FalseDifficulty: ModerateMultiple Choice1. The process by which companies acquire raw materials, components, products, services, and other resources from suppliers to execute their operations isa. procurement.b. so

23、urcing. c. supplier scoring and assessment.d. supplier selection.e. none of the aboveAnswer: aDifficulty: Moderate2. The entire set of business processes required to purchase goods and services isa. procurement.b. sourcing. c. supplier scoring and assessment.d. supplier selection.e. none of the abov

24、eAnswer: bDifficulty: Moderate3. The process used to rate supplier performance isa. procurement.b. sourcing. c. supplier scoring and assessment.d. supplier selection.e. none of the aboveAnswer: cDifficulty: Easy4. Using the output from supplier scoring and assessment to identify the appropriate supp

25、lier(s) isa. procurement.b. sourcing. c. supplier scoring and assessment.d. supplier selection.e. none of the aboveAnswer: dDifficulty: Moderate5. The selection of suppliers, design of supplier contracts, product design collaboration, procurement of material, and evaluation of supplier performance a

26、re a part ofa. procurement.b. sourcing. c. supplier scoring and assessment.d. supplier selection.e. none of the aboveAnswer: bDifficulty: Moderate6. Price has traditionally been the only dimension that suppliers have been compared on during the process ofa. procurement.b. sourcing. c. supplier scori

27、ng and assessment.d. supplier selection.e. none of the aboveAnswer: cDifficulty: Moderate7. Supplier characteristics such as lead time, reliability, quality, and design capability that impact the total cost of doing business with a supplier should be considered during the process ofa. procurement.b.

28、 sourcing. c. supplier scoring and assessment.d. supplier selection.e. none of the aboveAnswer: cDifficulty: Moderate8. Design collaboration is important becausea. about 80 percent of the cost of a product is determined during design.b. it ensures that any design changes are communicated effectively

29、 to all parties involved with designing and manufacturing the product.c. the supplier sends product in response to orders placed by the buyer.d. all of the abovee. a and b onlyAnswer: eDifficulty: Moderate9. The goal of procurement isa. to analyze spending across various suppliers and component cate

30、gories to identify opportunities for decreasing the total cost.b. to analyze spending across various suppliers and component categories to identify opportunities for increasing the total cost.c. to enable orders to be placed and delivered on schedule at the lowest possible overall cost.d. to enable

31、orders to be placed and delivered on schedule regardless of cost.e. none of the aboveAnswer: cDifficulty: Moderate10. The role of sourcing planning and analysis isa. to analyze spending across various suppliers and component categories to identify opportunities for decreasing the total cost.b. to an

32、alyze spending across various suppliers and component categories to identify opportunities for increasing the total cost.c. to enable orders to be placed and delivered on schedule at the lowest possible overall cost.d. to enable orders to be placed and delivered on schedule regardless of cost.e. non

33、e of the aboveAnswer: aDifficulty: Moderate11. Cost of Goods Sold (COGS) representsa. less than 20 percent of sales for most major manufacturers.b. less than 50 percent of sales for most major manufacturers.c. well over 50 percent of sales for most major manufacturers.d. well over 80 percent of sale

34、s for most major manufacturers.e. none of the aboveAnswer: cDifficulty: Hard12. Effective sourcing processes within a firm can a. improve profits for the firm and total supply chain surplus.b. reduce profits for the firm and total supply chain surplus.c. reduce total supply chain surplus.d. reduce p

35、rofits for the firm.e. none of the aboveAnswer: aDifficulty: Moderate13. Which of the following is not a benefit of effective sourcing decisions?a. Better economies of scale can be achieved if orders within a firm are aggregated.b. More efficient procurement transactions can significantly reduce the

36、 overall cost of purchasing.c. Sequential design results in products that are easier to manufacture and distribute, resulting in lower overall costs.d. Good procurement processes can facilitate coordination with the supplier and improve forecasting and planning.e. All of the above are benefits of ef

37、fective sourcing decisions.Answer: cDifficulty: Moderate14. Which of the following is not a benefit of effective sourcing decisions?a. Appropriate supplier contracts can allow for the sharing of risk, resulting in higher profits for both the supplier and the buyer.b. Better economies of scale can be

38、 achieved if orders within a firm are disaggregated.c. Design collaboration can result in products that are easier to manufacture and distribute, resulting in lower overall costs.d. Firms can achieve a lower purchase price by increasing competition through the use of auctions.e. All of the above are

39、 benefits of effective sourcing decisions.Answer: bDifficulty: Moderate15. When designing a sourcing strategy, it is important for a firm toa. develop a process that will procure materials at the lowest possible cost.b. maintain a record of all contracts, receipts, issues and other transactions in t

40、he event of lawsuits.c. maximize the profitability of the distributors within the supply chain.d. be clear on the factors that have the greatest influence on performance and target improvement on those areas.e. none of the aboveAnswer: dDifficulty: Hard16. Which of the following is not a factor that

41、 must be considered when scoring and assessing suppliers?a. quoted priceb. replenishment lead timec. on-time performanced. supply affabilitye. delivery frequency/minimum lot sizeAnswer: dDifficulty: Moderate17. Which of the following is not a factor that must be considered when scoring and assessing

42、 suppliers?a. supply flexibilityb. supply qualityc. inbound transportation costd. information instigation capabilitye. pricing termsAnswer: dDifficulty: Easy18. Which of the following is not a factor that must be considered when scoring and assessing suppliers?a. purchase pricingb. sales performance

43、c. design collaboration capabilityd. exchange rates, taxes, and dutiese. supplier viabilityAnswer: bDifficulty: Moderate19. Supplier performance must be rated on many different factors because a. they impact the total supply chain cost.b. they minimize the supply chain involvement.c. they reduce the

44、 impact of price.d. they maximize the supply chain price.e. none of the aboveAnswer: aDifficulty: Moderate20. Scoring the performance of suppliers in terms of replenishment lead time thus allows the firm to evaluate the impact each supplier has ona. the cost of holding cycle inventory.b. the cost of

45、 holding replacement inventory.c. the purchase price of material.d. the cost of salvaging inventory.e. the cost of holding safety inventory.Answer: eDifficulty: Moderate21. On-time performance affects the variability of the lead time, becausea. a reliable supplier has high variability of lead time.b

46、. a reliable supplier has low variability of lead time.c. an unreliable supplier has high variability of lead time.d. an unreliable supplier has low variability of lead time.e. b and c onlyAnswer: eDifficulty: Moderate22. The amount of variation in order quantity that a supplier can tolerate without

47、 letting other performance factors deteriorate isa. supply capability.b. supply flexibility.c. supply integrity.d. supply significance.e. supply variance.Answer: cDifficulty: Moderate23. Supply flexibility thus impacts the level ofa. customer transactions at the distributor.b. cycle inventory that t

48、he firm will have to carry.c. replacement inventory that the firm will have to carry.d. safety inventory that the firm will have to carry.e. none of the aboveAnswer: dDifficulty: Hard24. The delivery frequency of a supplier can be converted into the cost of holdinga. cycle inventory.b. safety invent

49、ory.c. both cycle and safety inventory.d. neither cycle and safety inventory.e. none of the aboveAnswer: cDifficulty: Hard25. Each suppliers quality level can be converted to thea. required cycle inventory and the associated holding cost.b. required safety inventory and the associated holding cost.c

50、. potential for new sales.d. potential for reducing cost.e. all of the aboveAnswer: bDifficulty: Moderate26. Sourcing a product overseas may havea. higher product cost and will generally incur a higher inbound transportation cost.b. higher product cost but will generally incur a lower inbound transp

51、ortation cost.c. lower product cost and will generally incur a lower inbound transportation cost.d. lower product cost but will generally incur a higher inbound transportation cost.e. none of the aboveAnswer: dDifficulty: Easy27. Quantity discounts lower the unit costa. but tend to increase the requ

52、ired batch size and as a result, reduce the cycle inventory.b. but tend to increase the required batch size and as a result the cycle inventory.c. and tend to reduce the required batch size and as a result the cycle inventory.d. and tend to reduce the required batch size and as a result, increase th

53、e cycle inventory.e. none of the aboveAnswer: bDifficulty: Hard28. Good information coordination will not result ina. better replenishment planning.b. a decrease in the inventory carried as well as the sales lost because of lack of availability.c. a decrease in the bullwhip effect.d. a decrease in t

54、he sales lost because of lack of availability.e. lower production and transportation costs.Answer: cDifficulty: Hard29. Good design collaboration for manufacturability and supply chain cana. reduce product cost.b. increase required inventories.c. increase transportation cost.d. decrease manufacturab

55、ility.e. none of the aboveAnswer: aDifficulty: Moderate30. The viability of suppliers is especially important for suppliers whoa. provide mission-critical products that would be easy to replace.b. provide mission-critical products that would be difficult to replace.c. provide non-critical products t

56、hat would be difficult to replace.d. provide non-critical products that would be easy to replace.e. none of the aboveAnswer: bDifficulty: Moderate31. Supplier performance should be compared based ona. purchase price alone.b. their impact on total cost.c. the suppliers quality of material.d. the ability of the supplier to coordinate forecasting and planning.e. the design collaboration capability of the supplier.Answer: bDifficulty: Hard32. Single sourcing for a product is used toa. guarantee the supplier sufficient business when the supplier has to make a significant buy

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