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Online multiple choice question 4, 6, 9, 11, 10, 12, 14, 15 Chapter 4 1. All except one are factors which can affect Supply Chain Network design: a) Corporate ownership b) Locate of customer and/ or supply markets c) Climate and weather conditions d) Cost pressure 2.

___ ____ is a combination of suppliers, production locations, distribution centres, wholesalers and retailers a) Logistics management b) Supply chain network c) Supply chain management d) Inventory management

3.

All except one are competitive advantages of warehouse network: a) Freight consolidation b) Total inventory increases at the increasing rate c) Lower total cost or faster to destination service d) Cross-dock sortation

4.

Supply chain network design decisions are concerned with a) Where the facilities should be located and what processes should be performed at each facility. b) How much capacity should be allocated to each facility c) What markets each facility should serve and which supply sources should feed each facility d) Where the facilities should be located e) Where the facilities should be located and how much capacity should be allocated to each facility

5.

Supply Chain network design decision pertaining to facility location is a) Both a strategic and tactical decision b) a tactical decision c) a strategic decision d) both a strategic and an operational system e) an operational decision

6.

the optimization model is based on a) rule of thumb approaches b) precise mathematical procedures c) broad problem definitions d) sampling experiments

7.

Heuristic models a) Provide an optimum solution b) Are able to accommodate broad problem definitions c) Have fallen from use because of SAILs d) Are typically “seat of pants” solutions

8.

Simulation models a) Search directly for the best warehouse configuration b) Allow the decision maker to test the effects of alternative locations c) Guarantee optimum solutions d) Generate SAILS report

9.

The classic objective of a network design model has been a) To find the best location for a forward-facing warehouse b) To establish the number, location, and size of finished goods distribution centres and associated product flows c) To examine the finished goods flow from the warehouse to the customer d) To measure and control site locations

10. The grid technique a) Assumes that the raw materials sources and finished goods markets are variable b) Is a variation of Sails c) Assumes that the raw materials and sources and finished goods markets are fixed d) Assumes non-linear transportation rates 11. Which is an advantage of the grid technique for facility location? a) It considers topographic conditions in choosing the optimum location b) It establishes the final determination of the best site c) It is a dynamic approach with solutions remaining optimum d) Computationally, it is relatively easy to use 12. Application of the grid technique to the location of a city warehouse a) Considers the costs of moving raw materials into the facility and moving finished goods to the customers b) Incorporates a blanket rate structure that applies the same rate from an origin to any point within the city or commercial zone c) Is no different from applying it in any other situation d) Accounts for information like highway access and facility availability within the grid coordinates 13. Which is correct regarding tapering rates a) Uses transportation simplifications to recommend facility locations b) In a one-source, one market situation, the impact of the tampering rate will pull the location toward a point midway between the source and the market c) The principle is based on the carrier’s ability to spread certain fixed shipments costs over a greater number of miles d) The transportation rates increase with distance directly in proportion to the distance 14. Which is correct regarding the transit privilege a) It results in only an end point, either an origin or destination being the optimum location b) It permits the shipper to stop the shipment in transit and physically change the product’s characteristic c) It magnifies those geographic disadvantages that companies associate with a producer’s location d) It is normally available at any location and commodity 15. What is the effect of tapering rates on Facility location? a) Pushes the raw materials sources toward the location b) Pulls the facility toward the location c) Pulls the location toward the source or the market d) Makes the optimum location at the midpoint between raw material sources and the marketplace 16. In the short run, the firm’s network is ___ while in the long run it is _____ a) Variable, reversible b) Reversible, fixed c) Adaptation, reversible d) Fixed, variable

17. When a blanket rate structure is used, which factor is eliminated as a location determinant? a) Labour rate b) Transportation rate c) Raw material rate d) Market sources 18. What advantages does the transit privilege give to shipper located at intermediate locations? a) Allows importer to enter a product and hold it without paying duties b) A lower, long- distance through rate charged for the shipment c) The right to change consignees during shipment d) Avoidance of terminal charges for each intermediate stop 19. What type of change may suggest a need to revaluate and/or redesign a firm’s logistics network? a) Shifting locations of customer and/or supply markets b) Change in customer service requirements c) Change in corporate ownership d) All of these 20. Which is true regarding the facility/supply chain network design decision? a) It should be coordinated closely with the corporate ad overall business strategies that may be in place b) Generally, qualitative criteria are considered first c) Global locations should not be considered d) The facility’s impact on other functional areas should be considered but it is not as important 21. Which is not True regarding logistics network design? a) The logistic audit provides members of the transformation team with a comprehensive perspective on the firm’s logistics process b) The implementation plan serves as a useful road map for moving from the current logistics network to the desired one c) “What if” types of analysis can be conducted later, after the final network design has been established d) The logistics/supply chain network transformation team is responsible for all elements of the logistics network design process 22. The logistics/supply chain network transformation team a) Includes workers from divisional levels only b) Should not include outside consultants c) Must be aware of the firm’s overall business and corporate strategies and the supply chain in which it participates d) Will no consider the potential involvement of third party logistics suppliers as part of their responsibilities? 23. Which major locational determinant considers locating near the competition a) Labour climate b) Company preference c) Supplier network d) Quality of life 24. Which is true regarding optimization models? a) Optimization models will guarantee increased profits b) Optimization models are based on precise mathematical procedures that are guaranteed to find the best solution for problem under evaluation c) The grid technique is a powerful optimization model d) Optimization models are able to accommodate broad problem demands definitions, rather than provide an optimum solution

25. Which of these is not a trend in today’s logistics environment that may have significant effects on decisions involving logistics facility location? a) Addition of many wholesaler distributor operations b) Strategically located cross-docking facilities c) Customer-direct delivery d) Use of third part logistics services 26. The grid technique is used to determine a fixed facility location that represents the least-cost centre for moving incoming material and outbound product within a geographic grid. The least cost centre is also referred to as a) A zero point b) A break-even point c) A source point d) A centre of gravity Chapter 6 1. Resource requirements planning (RRP) a) Is a long run, macro level planning tool b) Is a long-range materials plans that translate annual business plans c) Checks the feasibility of the materials requirement plan d) Check the feasibility of the master production schedule 2.

Which of these is NOT a production method? a) Assemble to order b) Build to order c) Delayed differentiation d) Make-to- stock

3.

A project layout is a) a process-focused layout that groups together similar equipment or functions b) a fixed location layout where the product remains in place for the duration of production c) a floor plan of the production facility d) a product focused layout in which machines and workers are arranged according to the progressive sequence of operations

4.

From utility drives the need for a) Supply chain capabilities only b) Supply chain capability, time utility and place utility c) Time utility and place utility d) Place utility

5.

Packaging is a) Critical to logistics b) Critical to manufacturing c) A factor in outsourcing d) Critical to product differential

6.

A newly launched twenty-first century addition to production strategy which leverages lean manufacturing strategies, Six Sigma best practices, and real time actionable intelligence from the factor floor is called a) Adaptive manufacturing b) Just in time inventory c) Capacity requirements planning d) Machine flexibility

7.

The assemble-to-order production, a) The finished product is generally a combination of common components and a limited number of options or accessories made available to the customer b) The finished product is a combination of standard and customer designed components that meet unique needs of a specific customer c) Customer orders are filled from finished goods inventories and production orders are used to replenish finished goods inventories d) Highly tailored products are created for the customer whose specification require unique engineering design or significant customization

8.

Processes that can product a range of products are said to have a) Economies of scale b) Routing flexibility c) Work centres d) Economies of scope

9.

Which is NOT a major challenge for many established manufacturers? a) Expanding product life cycles b) Competition c) Customer demand d) Pressure for efficiency

10. A push-based strategy works well for supply chains that focus on a) Work centres and offshore sourcing b) The immediate delivery of off-the-shelf, low-cost, standardized goods c) The anticipation of demand or without knowledge of customer orders d) Lean production 11. Lean production relies on a) The Toyota production system (TPS) b) Pull-based systems c) Push based systems d) Just In Time system 12. Which of the following is not a reactive capability strategy? a) Routing flexibility b) Machine flexibility c) Resources requirements planning d) offshoring 13. Capacity is a) The maximum amount of square footage available for inventory storage in a facility b) Determined by raw material flows c) Determines by lean manufacturing d) The maximum amount of work that an organization is capable of completing in a given period of time

Chapter 9 1. a) b) c) d)

Which of the following statements is best about inventory management? Inventory and production must be managed together Inventory is not important at the production planning level Inventory are usually insignificant on the balance sheet Inventory does not cost much to carry

2. a) b) c) d)

What are materials used in the production process but do not become part of the product? Raw materials Work in progress Finished goods Maintenance, repair and operating supplies

3.

Which of the following company objectives are in conflict? a) Maximum customer service and low inventory cost b) Low cost plant operations and cash flow c) Maximum inventory investment and customer service d) Cash flow and profitability

4.

Which of the following are cost of carrying inventory? a) Capital cost and advertising cost b) Capital cost and storage cost c) Purchasing and transport cost d) Production control cost and purchasing cost

5.

Which of the following costs are relevant to inventory management decisions? a) Run time and cost b) Marketing cost c) Factory overhead d) Storage cost

6.

If the order quantity is increased, which of the following occurs? a) The cost of carrying in inventory deceased and the cost of ordering increases b) The cost of carrying inventory increases and the costs of ordering decreases c) The cost of carrying inventory increases and the cost of ordering increases d) The cost of carrying inventory decreases, and the cost of ordering decreases

7.

Safety stock will depend on which of the following a) Variability of demand b) Cost of carrying inventory c) Cost of placing an order d) Product obsolescence

8.

If the annual cost of goods sold (CGS) is $100 million and the average inventory is $25 million, what are the inventory days ? a) 60 days b) 90 days c) 120 days d) 150. Days

9.

Which defines JIT. a) JIT is a business philosophy focused on elimination of waste b) JIT means having product always ready for the customer c) JIT means getting the goods to the customer as fast as possible at all cost d) JIT is concern with adding cost to the product

10. All of the following are critical input to JIT production except a) Steady production b) Flexible workforce c) Small inventory d) Extremely high quality 11. In ABC inventory classification system, class A items may a) Require higher safety stock b) Require frequent deliveries c) Require a periodic inventory system d) Require batch updating of inventory records 12. Dependent demand relates to a) Demand for another inventory item or product b) The spare parts needed to fill the order c) VMI inventories d) The cost of capital for the firm 13. An organisation selling its product FOB destination hold the title to the goods until a) Picked by the trucker b) Product reach the customer’s facility c) The customer is involved d) The customer receives the goods into their inventory system 14. JIT is a ___ system a) Push b) Pareto’s law c) MRP d) Pull 15. A DRP system is usually coupled with a ____ system in an attempt to manager the flow and timing of both inbound materials and outbound finished goods a) Kan Ban b) VMI/ Consignment c) MRP d) JIT 16. Which of the following is not included in inventory risk cost a) Insurance b) Damage c) Theft d) Obsolescence 17. Which of the following is not an assumption relevant to the EOQ model a) There is no inventory in transit b) The planning horizon is infinite c) All inventory parts are independent of each other d) The item purchase price is dependent on the amount ordered

18. Which of the following is most likely to be a pull inventory model? a) Economic order quantity b) Distribution requirements planning c) Material requirements planning d) Kanban 19. The relationship between customer service level and inventory investment is a) Positive exponential b) Asymptotic c) Inversely proportional d) Negative exponential 20. Inventory as an asset on the balance sheet and a ____ on the income statement a) Liability b) Footnote c) Statement d) Variable expense 21. Inventory and the GDP grew by ____ amounts between 1994 and 2010 a) The same b) Different c) Inversely proportional d) Exponential 22. Batching economies or cycle stocks usually arise from three sources. Which of these is not a source a) Procurement b) Transportation c) Production d) Demand 23. WIP inventories a) Not included on the balance sheet b) Are associated with manufacturing c) Are the same as VMI inventories d) Are not impacted by EOQ 24. Seasonal stocks are not influenced by a) EOQ b) Weather c) Transportation d) Holidays 25. Which department does not have any impact on inventory a) Finance b) Manufacturing c) Corporate governance d) Marketing 26. Capital cost focuses on the cost of capital tied up in ___ and the resulting lost opportunity from investing that capital elsewhere a) Plants b) Inventory c) Distribution centres d) WIP 27. Ordering cost refers to the expense of placing an order and a) Includes the cost of capital b) Relates to the material management concept

c) Does not include the cost of the product d) Not receiving it 28. In the event of a stockout one of the things that could happen is a) The vendor’s plants shut down b) The cost of capital is increase c) The SCOR process would come into play d) Extra shipping cost may be incurred

Chapter 10 1. Ten manufacturers are supplying their products directly to ten customers. If they involve just one distribution in the process, the number of transactions among them will reduce from 100 to a) 20 b) 30 c) 40 d) 50 2. Which of the following statements is true? a) Manufactures typically produce a small quantity of a wide variety of goods b) Consumers typically purchase a limited quantity of a wide variety of goods c) Consumers typically purchase a large quantity of a limited variety of goods d) None of these statements are true 3.

All except one are efficient methods of consolidation. Which one is not ? a) Using larger rather than smaller vehicle b) Containerisation and palletisation c) Reducing the frequency of movements d) Expending the number of locations where loading and unloading is done

4.

The first facility consideration is to determine a) How close to source it should be b) The size of each operation within the network c) How close to the customer it should be d) Where competitors are located

5.

The primary facility operations focus is a) On the movement and storage of product b) Inventory control and personnel issues c) Making sure KPI’s are fulfilled d) The WMS system

6.

Which of these is not a support function? a) Inventory control b) Safety, maintenance and sanitation c) Information technology d) Movement and storage

7.

Asset utilization is a very important aspect of a) KPIs b) 3Pl distribution facilities c) Commercial distribution facilities

d) Private distribution facilities 8.

9.

The roles of the distribution centre include ____ a) Balancing supply and demand b) Protecting again uncertainty and promoting transportation economies c) Promoting transport economies d) Balancing supply and demand, protecting again uncertainty and promoting transportation economies Distribution facilities can provide number services, depending on the requirements of the supply chain. Which of these is not a typical service? a) Assortment b) Accumulation c) Allocation d) Activity

10. One important interaction that must be considered is the trade-off between distribution and ____ a) Transportation b) Finance c) Marketing d) Services 11. The primary trade-offs and relationships between resources include the following a) Space vs equipment b) Equipment vs people c) People vs space d) All of these 12. Potential labour problems for distribution centres may be result of a) Low pay and long hours b) Competition from nearby firms c) The graying of Australia d) Awareness of these job opportunities 13. Certain raw materials can be stored a) Outside b) Only in a 3PL facility c) Upside down d) Anywhere 14. A downside of direct shipping is a) That it takes product flow away from the distribution centre b) Can create higher transportation charges c) That customer may not like this method d) The product may not lend itself to this method 15. The drawback of centralized inventory is a) That it undercuts the dispersed distribution concept b) That it increases the amount of inventory required c) Strains the ability of the carrier network d) That it extends lead time...