Ch11 Global Supply Chain Procurement And Complete Test Bank - Operations and Supply Chain Management 10th Edition Test Bank by Roberta S. Russell. DOCX document preview.

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Ch11 Global Supply Chain Procurement And Complete Test Bank

Chapter 11:
Global Supply Chain Procurement and Distribution

True/False

  1. Outsourcing is a relatively new phenomenon used strictly by multinationals.

Difficulty: Moderate

Learning Objective: LO 1

  1. Outsourcing and sourcing have the same meaning and are often used interchangeably.

Difficulty: Easy

Learning Objective: LO 1

  1. _________ involves sourcing from an outside supplier goods and services that were previously produced in-house.
    1. Sourcing
    2. Outsourcing
    3. Procurement
    4. Continuous replenishment

  1. Companies use outsourcing as a strategic move to transfer their core competencies to their suppliers.

Difficulty: Moderate

Learning Objective: LO 1

  1. Which of the following is NOT an advantage of outsourcing?
    1. Outsourcing firm can focus on core competencies
    2. Greater flexibility
    3. Expertise to do all things well
    4. Provide more control
  2. Outsourcing supports vertical integration of a firm's supply chain.

Difficulty: Moderate

Learning Objective: LO 1

  1. Many companies are outsourcing in countries where higher prices for supplies are offset by lower quality.

Difficulty: Moderate

Learning Objective: LO 1

  1. Procurement involves the selection of a supplier.

Difficulty: Moderate

Learning Objective: LO 1

  1. Which of the following is best defined as the purchasing of goods and services from suppliers?
    1. outsourcing
    2. procurement
    3. continuous replenishment
    4. sourcing

Difficulty: Easy

Learning Objective: LO 1

  1. Purchasing can be classified according to two broad categories: direct (manufacturing inputs) and indirect (operating inputs).

Difficulty: Hard

Learning Objective: LO 2

  1. ________ is often used to purchase indirect products that support production.
    1. E-procurement
    2. Outsourcing
    3. Reverse auction
    4. E-auction

Difficulty: Moderate

Learning Objective: LO 2

  1. In a reverse auction a customer posts contracts for products available for bids from potential suppliers on the Internet.

Difficulty: Moderate

  1. E-marketplaces are sites on the Internet where companies can find new business partners.

Difficulty: Moderate

Learning Objective: LO 2

  1. Distribution includes all of the following EXCEPT
    1. warehousing
    2. transportation
    3. storing products and materials
    4. production

  1. Logistics includes distribution and transportation activities within a supply chain.

Difficulty: Easy

Learning Objective: LO 3

  1. In today's competitive environment, speed is often the most important factor in logistics.

Difficulty: Moderate

Learning Objective: LO 3

  1. Box retailers are some of the largest facilities in the United States.

Difficulty: Moderate

Learning Objective: LO 3

  1. Distributors deal only in very large quantities providing infrequent deliveries.

Difficulty: Moderate

Learning Objective: LO 3

  1. _______________ are often used to run the day-to-day operations of a distribution center.
    1. Warehouse management systems
    2. Transportation management systems
    3. Production management systems
    4. Order management systems
  2. Postponement moves some manufacturing steps into the warehouse or distribution center.

Difficulty: Moderate

Learning Objective: LO 3

  1. A transportation management system controls activities at a facility's dock and schedules appointments.

Difficulty: Hard

Learning Objective: LO 3

  1. Cross-docking allows a distribution center to direct incoming shipments from one shipping dock to another within 48 hours to fill outgoing orders.

Difficulty: Moderate

Learning Objective: LO 3

  1. Distribution outsourcing allows companies to focus on their core competencies.

Difficulty: Easy

Learning Objective: LO 3

  1. Transportation involves the movement of a product within a warehouse or distribution center.

Difficulty: Moderate

Learning Objective: LO 3

  1. Information technology is an enabler of globalization for middle-tier companies.

Difficulty: Moderate

Learning Objective: LO 3

  1. Globalization decreases the need for a well-planned domestic supply chains.

Difficulty: Easy

Learning Objective: LO 3

  1. Which of the following is best defined as the movement of some manufacturing steps into the distribution center?
    1. postponement
    2. cross-docking
    3. delayed differentiation
    4. make-to-order
  2. Cross docking is one of the reasons Wal-Mart has such an efficient supply chain.

Difficulty: Moderate

Learning Objective: LO 3

  1. Which of the following transportation modes is the most expensive?
    1. Package delivery
    2. Air
    3. Intermodal
    4. Pipeline
  2. The combination of several modes of transportation is called intermodal transportation.

Difficulty: Moderate

Learning Objective: LO 4

  1. _______ is best suited to fast and reliable shipments of small items.
    1. Air
    2. Trucking
    3. Package delivery
    4. Intermodal
  2. Which of the following is NOT an obstacle to global supply chain management?
    1. Ever-changing regulations
    2. Excessive shipping modes
    3. Trade groups
    4. Different business practices
  3. A value-added tax is based on the total cost of producing a product and not the value added by the supply chain partner.

Difficulty: Moderate

Learning Objective: LO 5

  1. International trading is viewed as business as usual for any sized firm.

Difficulty: Moderate

Learning Objective: LO 5

  1. The proliferation of nation trading groups has increased tariffs and decreased duties.

Difficulty: Moderate

Learning Objective: LO 5

  1. Most favored-nation (MFN) status is an agreement where members of the WTO extend to other members the most favorable treatment given to any trade partner.

Difficulty: Easy

Learning Objective: LO 5

  1. Landed cost includes the cost of storing and transporting a product, but not the cost of producing it.

Difficulty: Moderate

Learning Objective: LO 5

  1. International trade specialists help firms overcome obstacles associated with importing products.

Difficulty: Hard

Learning Objective: LO 5

Multiple Choice Questions

  1. What a company does best is often referred as the firm’s core
  2. capabilities
  3. activities.
  4. competencies.
  5. competitiveness.

Difficulty: Easy

Learning Objective: LO 1

  1. Requiring suppliers to deliver goods when demanded by the customer is called

periodic delivery.

continuous delivery.

on-demand delivery.

All of these answer choices are correct.

Difficulty: Moderate


Learning Objective: LO 1


39. Companies use ______________ teams to facilitate communication and information sharing and to coordinate processes between suppliers and customers.

    1. customer-care
    2. cross-enterprise
    3. supplier-enhancement
    4. None of these answer choices is correct.

Difficulty: Moderate

Learning Objective: LO 1

  1. The purchasing of goods and services from suppliers is called
    1. sourcing.
    2. outsourcing.
    3. procurement.
    4. None of these answer choices is correct.

Difficulty: Easy

Learning Objective: LO 1

  1. The selection of suppliers is called
    1. sourcing.
    2. outsourcing.
    3. procurement.
    4. None of these answer choices is correct.

Difficulty: Easy

Learning Objective: LO 1

  1. The decision to purchase goods and services that were produced in-house from an outside supplier is called
    1. sourcing.
    2. outsourcing.
    3. procurement.
    4. None of these answer choices is correct.

Difficulty: Easy

Learning Objective: LO 1

  1. The three main categories of goods and services that a company tend to outsource include all the following except
    1. original equipment manufacturer (OEM).
    2. maintenance, repair, and operation (MRO).
    3. corporate services.
    4. everyday equipment (EDE).

Difficulty: Easy

Learning Objective: LO 1

  1. Supplying orders in a short period of time according to a predetermined schedule is called
    1. periodic delivery.
    2. continuous delivery.
    3. on-demand delivery.
    4. All of these answer choices are correct.

Difficulty: Moderate

Learning Objective: LO 1

  1. Partnerships between customers and suppliers are beneficial because they
    1. provide security and stability.
    2. reduce the need for global suppliers.
    3. enhance competition in the supply chain.
    4. require suppliers to build facilities near the customer.

Difficulty: Moderate

Learning Objective: LO 1

46. Partnerships between customers and suppliers require suppliers to provide

    1. higher quality.
    2. prompt delivery.
    3. lower prices.
    4. All of these answer choices are correct.

Difficulty: Moderate

Learning Objective: LO 1

47. Companies often outsource to

    1. focus on core competencies.
    2. achieve greater flexibility.
    3. reduce costs.
    4. All of these answer choices are correct.

Difficulty: Moderate

Learning Objective: LO 1

48. Benefits of e-procurement include all of the following except

a) lower prices.

b) faster delivery.

c) fewer transactions.

d) reduced labor.

Difficulty: Moderate

Learning Objective: LO 2

49. E-procurement is most often used for

    1. direct products.
    2. indirect products.
    3. finished products.
    4. international products.

Difficulty: Moderate


Learning Objective: LO 2

  1. The products that go directly into the production process of a product are called
    1. direct products.
    2. indirect products.
    3. finished products.
    4. None of these answer choices is correct.

Difficulty: Easy


Learning Objective: LO 2

  1. Companies that purchase ___________________ over the Internet tend to do it with suppliers with whom they have an established relationship.
    1. direct products
    2. indirect products
    3. finished products
    4. international products

Difficulty: Moderate


Learning Objective: LO 2

  1. ______________ is a formal process of collecting, analyzing, cleansing, and classifying spending data.
    1. Spend analysis
    2. Budget analysis
    3. Spend classifying
    4. Budget classifying

Difficulty: Moderate


Learning Objective: LO 2

  1. Spend analysis is a formal process for __________________________ spending data.
  2. collecting
  3. cleansing
  4. classifying
  5. All of these answer choices are correct.

Difficulty: Moderate


Learning Objective: LO 2

  1. Spend analysis strives to
  2. reduce procurement costs.
  3. improve the efficiency of the procurement process.
  4. reduce procurement costs and improve the efficiency of the procurement process.
  5. None of these answer choices is correct.

Difficulty: Moderate

Learning Objective: LO 2

  1. _________ are websites where companies and suppliers conduct business-to-business activities.
  2. E-procurements
  3. E-marketplaces
  4. Reverse auctions
  5. None of these answer choices is correct.

Difficulty: Moderate

Learning Objective: LO 2

  1. With _________, customers posts contracts for items it want to purchase so that suppliers can bid on.
  2. e-procurement
  3. e-marketplaces
  4. reverse auctions
  5. None of these answer choices is correct.

Difficulty: Moderate


Learning Objective: LO 2

  1. Distribution includes all of the following activities except
    1. packaging.
    2. storing.
    3. shipping.
    4. sourcing.

Difficulty: Moderate

Learning Objective: LO 3

  1. The primary focus of distribution in terms of what it accomplishes is
    1. logistics.
    2. order fulfillment.
    3. customer service.
    4. maintaining inventories.

Difficulty: Moderate

Learning Objective: LO 3

  1. _________________ is the process of ensuring on-time delivery of customers’ orders.
    1. Logistics
    2. Order fulfillment
    3. Customer service.
    4. Maintaining inventories

Difficulty: Moderate


Learning Objective: LO 3

  1. Distribution and transportation are often referred to as
    1. logistics.
    2. order fulfillment.
    3. customer service.
    4. maintaining inventories.

Difficulty: Moderate

Learning Objective: LO 3

  1. Distribution centers generally ship products to
    1. retailers.
    2. customers.
    3. suppliers.
    4. warehouses.

Difficulty: Easy


Learning Objective: LO 3

  1. The driving force behind transportation and distribution in a highly competitive environment is
    1. quality.
    2. cost.
    3. flexibility.
    4. speed.

Difficulty: Moderate

Learning Objective: LO 3

  1. Retailers expect suppliers to make frequent delivery of merchandise that includes a mix of different products in small quantities in what is called a
    1. mixed pallet.
    2. partial pallet.
    3. mixed truckload.
    4. partial truckload.

Difficulty: Moderate


Learning Objective: LO 3

  1. With ________________, some of the manufacturing activities are moved into the warehouse or distribution center.
    1. postponement
    2. vendor managed inventories
    3. cross docking
    4. None of these answer choices is correct.

Difficulty: Moderate


Learning Objective: LO 3

  1. Rival companies pooling their distribution resources to reduce cost are engaging in
    1. collaborative logistics.
    2. distribution outsourcing.
    3. cross docking.
    4. None of these answer choices is correct.

Difficulty: Moderate


Learning Objective: LO 3

  1. The trend in distribution that allows companies to focus on their core competencies is called
    1. collaborative logistics.
    2. distribution outsourcing.
    3. cross docking.
    4. None of these answer choices is correct.

Difficulty: Moderate

Learning Objective: LO 3

  1. Which of the following is not a feature of a warehouse management system?
    1. warehouse optimization
    2. order tracking
    3. vendor management
    4. custom labeling and packaging

Difficulty: Moderate

Learning Objective: LO 3

  1. With vendor-managed inventory,
    1. distributors generate orders.
    2. retailers place orders.
    3. customers place orders.
    4. manufacturers place orders.

Difficulty: Moderate

Learning Objective: LO 3

  1. Which mode of transportation transports products in liquid form?
  2. pipeline
  3. ocean by ship
  4. pipeline and ocean by ship
  5. airline

Difficulty: Moderate

Learning Objective: LO 4

  1. The most common mode of transporting products is
    1. railroad.
    2. trucking.
    3. package delivery.
    4. water.

Difficulty: Easy

Learning Objective: LO 4

  1. The mode of transportation that utilizes the most containers is
    1. water.
    2. intermodal.
    3. trucking.
    4. rail.

Difficulty: Easy

Learning Objective: LO 4

  1. Long life, high capital cost, and low operating costs are associated with which mode of transportation?
    1. pipeline
    2. trucking
    3. airline
    4. None of these answer choices is correct.

Difficulty: Moderate


Learning Objective: LO 4

  1. In a supply chain, __________________ is the movement of a product from one location to another as it makes its way to the final customer.
  2. distribution
  3. transportation
  4. material handling
  5. None of these answer choices is correct.

Difficulty: Moderate


Learning Objective: LO 4

  1. For some manufacturing companies, transportation can run as much as _____________ of total production cost, and run as high as _____________ of revenue.
  2. 20 percent, 6 percent
  3. 30 percent, 10 percent
  4. 40 percent, 14 percent
  5. None of these answer choices is correct.

Difficulty: Moderate


Learning Objective: LO 4

  1. Which mode of transportation is the most cost effective for transporting raw materials?
  2. Pipeline
  3. Railroad
  4. Trucking
  5. Intermodal

Difficulty: Easy

Learning Objective: LO 4

  1. Internet transportation exchanges bring together shippers who post __________ and carriers that post __________ in order to arrange shipments.
  2. loads, capacity
  3. capacity, loads
  4. loads, loads
  5. capacity, capacity

Difficulty: Easy

Learning Objective: LO 4

  1. Intermodal combines several modes of shipment. The most common intermodal combination globally is
  2. truck-water-rail-truck
  3. truck-rail-truck-water
  4. rail-water-rail-truck
  5. None of these answer choices is correct.

Difficulty: Moderate


Learning Objective: LO 4

  1. Factors driving globalization of the supply chain include all of the following except
    1. international trade agreements.
    2. advances in information technology.
    3. lower-cost transportation.
    4. government intervention.

Difficulty: Moderate

Learning Objective: LO 5

  1. Landed cost includes
    1. value added tax.
    2. duties.
    3. customs.
    4. All of these answer choices are correct.

Difficulty: Moderate

Learning Objective: LO 5

  1. Which of the following is not an obstacle to global supply chain management?
    1. increased documentation
    2. differences in communication technology
    3. decreased delivery times
    4. different business practices

Difficulty: Easy

Learning Objective: LO 5

  1. International trade specialists include all of the following except
    1. export packers.
    2. finance brokers.
    3. purchasing agents.
    4. duty specialists.

Difficulty: Hard

Learning Objective: LO 5

  1. Which of the following countries is not an important U.S. trading partner?
    1. Canada
    2. Mexico
    3. China
    4. Russia

Difficulty: Easy

Learning Objective: LO 5

  1. Which of the following factors are responsible for the creation and expansion of a global marketplace?
    1. The dissolution of Communism in Eastern Europe and the creation of the European Union.
    2. Emerging markets in China and growing Asian export-driven economies.
    3. Falling trade barriers and the establishment of new trade agreements.
    4. All of these answer choices are correct.

Difficulty: Moderate

Learning Objective: LO 5

  1. Nations have joined together to form trading groups with no
    1. import tax.
    2. tariffs.
    3. duties.
    4. All of these answer choices are correct.

Difficulty: Easy


Learning Objective: LO 5

  1. _________________ companies use web-based technologies that directly link to customers’ websites to eliminate obstacles to global trade.
    1. International trade logistics (ITL)
    2. Global trade facilitators (GTF)
    3. International trade solutions (ITS)
    4. None of these answer choices is correct.

Difficulty: Easy

Learning Objective: LO 5

  1. United States companies usually adhere to which of the following models for doing business in China?
    1. Employ local third party trading agents.
    2. Develop a wholly owned foreign enterprise.
    3. Develop their own international procurement offices.
    4. All of these answer choices are correct.

Difficulty: Easy


Learning Objective: LO 5

  1. Moving production related operations from foreign countries back to domestic locations is called
    1. reverse globalization.
    2. inverse trade agreements.
    3. The Nationalization of trade movement.
    4. None of these answer choices is correct.

Difficulty: Easy

Learning Objective: LO 5

  1. The _________________, also known as the 10+2 initiative, reduces terrorism by utilizing the latest tracking and tracing, and communication and reporting technologies.
    1. security within initiative
    2. secure freight initiative
    3. secure borders initiative
    4. None of these answer choices is correct.

Difficulty: Easy

Learning Objective: LO 5

Short Answers

  1. Explain the difference between procurement and sourcing? Between sourcing and outsourcing?

Difficulty: Moderate

Learning Objective: LO 1

  1. List several of the advantages associated with outsourcing.

Difficulty: Moderate

Learning Objective: LO 1

  1. What are the advantages associated with e-procurement?

Difficulty: Moderate

Learning Objective: LO 2

  1. List and explain the major components of a warehouse management system.

Order management - orders received on-line, added, modified, or canceled in real time Labor management - plans, manages and reports on performance of warehouse personnel

Warehouse optimization - optimizes placement of items

Transportation management systems - consolidates and builds economical loads and select carriers

Order tracking - track inbound and outbound shipments yard management - schedules dock appointments

Custom labeling and packaging - special packaging; bar coding

Difficulty: Moderate

Learning Objective: LO 3

  1. List and discuss the seven different modes of transportation.

Rail - low value, high-density, bulk products, raw materials and intermodal containers: not as economical for small loads, slower less flexible than trucking

Trucking - main mode of transport in the US, small loads based on point to point service, flexible; more reliable less damage than rails, more expensive than rails for long distance Air - most expensive and fastest mode, lightweight and small packages, high value, perishable goods, less theft

Package delivery - small packages, fast and reliable, increased as result of e-business Water - low cost shipping mode, primary means of international shipping, slowest Intermodal - combines truck, water and rail; uses containers

Pipeline - transports products in liquid form; high capital cost and economical use, long life and low operating cost

Difficulty: Moderate

Learning Objective: LO 4

  1. List and discuss some of the forces driving globalization.

Improvements in transportation information technology

Internet

World Trade Organization

Regional Trade Agreements (NAFTA, EU)

Dissolution of communism

Spread of free-market systems

Difficulty: Moderate

Learning Objective: LO 5

  1. Identify some of the obstacles to global supply chain management.

Difficulty: Moderate

Learning Objective: LO 5

  1. Explain the concept of landed cost and discuss how it is used to make global sourcing decisions.

landed cost - the total cost of producing, storing, shipping, transporting, duties and value added taxes, customs, etc.

knowing landed cost allows a firm to make more informed decisions and help avoid sticker shock, compare to domestic source

Difficulty: Moderate

Learning Objective: LO 5

97. Which of the following choices is not true about reverse auctions?

a) They are also known as e-auctions.

b) The roles of buyer and seller are reversed.

c) They are open for a specified time frame, and vendors can bid once in that time frame.

d) They are sometimes used by companies only to determine the lowest price, without any intention of awarding a contract.

98. A warehouse management system (WMS) __________.

a) facilitates cross-docking

b) places each item in storage in a specific location

c) locates an item out of storage, packs the item, and ships it

d) All of the above choices are correct.

99. Which of the following choices is not true about cross-docking?

a) It is facilitated by a warehouse management system.

b) It is a system originated in Japan.

c) It allows a distribution center to eliminate costly putaway and picking operations.

d) It entails goods crossing from one dock to another usually in 48 hours or less.

100. Which of the following choices is not true about vendor-managed inventory?

a) It allows rival companies to collaborate in distribution.

b) It is a form of role reversal, in which the responsibility for planning shifts to the manufacturer.

c) It is usually an integral part of supply chain collaboration.

d) It makes forecasting by manufacturers easier.

101. Collaborative logistics __________.

a) shifts the responsibility of planning to the manufacturer

b) allows rival companies to collaborate in distribution

c) makes forecasting by manufacturers easier

d) is usually an integral part of supply chain collaboration

102. Which of the following choices is not true about postponement?

a) It allows lead times to be reduced so that demand can be met more quickly.

b) It usually means that a distributor must stock a large number of inventory items at the warehouse.

c) It flows the orders through an order management system.

d) It can create higher inventory-carrying costs.

103. Which of the following choices is not true about spend analysis?

a) It attempts to answer the questions: How much is being spent? With which suppliers? Is the promised value being realized?

b) It allows companies to focus on their core competencies.

c) It is a formal process of collecting, cleansing, classifying, and analyzing spending data.

d) Its goal is to improve the efficiency of the procurement process.

104. Which of the following choices is not true about continuous replenishment?

a) Goods and services are provided as they are needed.

b) For the supplier, it means more large-batch orders.

c) It allows companies to minimize its inventory levels.

d) It improves the customer’s flexibility to deal with sudden market changes.

105. Which of the following choices is not true about e-marketplaces?

a) They are also known as e-hubs.

b) They are websites in which companies and suppliers conduct business-to-business activities.

c) They provide a neutral ground on the Internet where companies can streamline supply chains and find new business partners.

d) Currently they don’t offer request-for-quote services because of the lack of a common platform.

106. Which of the following choices is true about distribution centers and warehousing?

a) Distribution centers are typically separated from warehousing and storage.

b) Because of the Internet, companies have added more frequent orders in smaller amounts to the way they distribute goods.

c) Retailers have pushed inventory and storage and final configuration downstream the supply chain.

d) The annual cost of warehousing in the US exceeds $847 billion.

Document Information

Document Type:
DOCX
Chapter Number:
11
Created Date:
Aug 21, 2025
Chapter Name:
Chapter 11 Global Supply Chain Procurement And Distribution
Author:
Roberta S. Russell

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