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1. BUS 230 Week 11 Quiz – Strayer
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Quiz Chapter 16 and 17
Other Supply Responsibilities
113. Investment recovery is often assigned to:
a. supply managers because they have knowledge supply markets and price
trends.
b. salespeople because they have contact with buyers who may use the material.
c. marketing managers because they have information on internal users.
d. engineers who can suggest possible uses of the material within the
organization.
e. financial analysts because they set the target return on all investments.
114. Efforts to deal with hazardous waste include a focus on:
a. highly visible sources of pollution, e.g. smoke stacks.
b. less visible uncontrolled sites, e.g. buried waste.
c. recycling.
d. substitution of non-hazardous materials for hazardous materials.
e. all of the above.
115. The potential benefits of having accounts payable report to the same executive as
supply include:
a. familiarity with the supplier
b. familiarity with the order.
c. opportunities to reduce transaction costs and headcount.
d. the ability for supply to ensure that payments for suppliers are made on time.
e. all of the above.
116. Reducing the obsolescence and waste of maintenance, repair, and operating
(MRO) supplies through better materials and inventory management will:
a. reduce the costs of disposing of MRO items that are obsolete or waste.
b. reduce carrying cost by lowering inventory levels, especially of obsolete
items.
c. improve environmental performance by reducing waste that goes into landfills
or incinerators.
d. simultaneously reduce costs and improve environmental performance.
e. have little impact because MRO is a small percentage of annual spend and the
items usually have low environmental low-impact.
117. Warehousing and inventory storage:

2. a. can either be an internal function or outsourced to a third-party logistics firm.
b. typically has little communication with supply management.
c. may have direct responsibility for organizational purchasing decisions.
d. outsourcing decisions typically are made by the finance department.
e. is seldom outsourced.
118. One of the reasons why companies are paying more attention to the effective,
efficient, and profitable recovery and disposal of scrap, surplus, obsolete, and waste
materials is that:
a. consumers overwhelmingly demand environmental responsibility.
b. it is easy to administer and highly profitable.
c. most organizations generate little scrap, surplus, obsolete and waste materials.
d. disposal costs are rising and environmental legislation is strengthening.
e. disposal is a fairly simple problem that is easily resolved.
119. The role and importance of investment recovery in an organization is driven in
large part by the:
a. CEO’s perspective on environmental issues.
b. Chief Purchasing Officer’s clout or leverage with other executives.
c. projected dollar value of the potential revenue recovery or cost reduction.
d. salespeople who encourage the inclusion of buy-back programs of key
materials.
e. internal level of knowledge about disposal channels and suppliers.
120. Coordinating inbound and outbound transportation:
a. has little application in an effective and efficient supply organization.
b. is done by cross-functional teams in most organizations.
c. helps to reduce costs and improve utilization of related assets and resources.
d. provides the basic elements of a global supply network.
e. is used extensively in Europe, but has not migrated to the U.S.
121. Production planning:
a. focuses on long-term schedules to control inventory and production.
b. requires coordinating the delivery and storage of key raw materials.
c. cannot involve supply because of fears of undue influence from suppliers.
d. relies heavily on forecasts from purchasing and supply management.
e. is a discrete activity with little coordination with other functions.
122. Supply can contribute to the organization’s environmental management program
by:
a. developing sourcing and usage alternatives for hazardous materials.
b. focusing on substitution of non-hazardous materials for hazardous materials.

3. c. encouraging and participating in designing products that do not use or
generate hazardous waste.
d. a and b.
e. a, b and c.
True and False
1. Production planning relies heavily on forecasts from operations to anticipate
demand for products and services..
2. To ensure maximum return for its investment, the process and procedures for
selling scrap and surplus must cover a broad range of activities including segregation
and storage, weighing and measuring, delivery, negotiation, supplier selection, and
payment.
3. If material has been declared surplus, the only option is to sell it.
4. Obsolete is in the eyes of the beholder. Something that has been declared obsolete
in one organization may be perfectly acceptable and useable in another.
5. It makes no sense to assign responsibility for disposal to the supply management
function because the personnel usually have no selling experience.
6. The total cost of hazardous waste for a company does not include the costs of new
plant and equipment to reduce waste and deal with contaminated plants.
7. Escalator clauses in contracts for scrap disposal are necessary because the prices of
primary metals fluctuate.
8. An organization’s Enterprise Resource Planning (ERP) system may be used to
develop a national or global database for company personnel at different locations to
post and purchase spare parts, obsolete materials, and surplus.
9. Waste is created when a change in the production process occurs, or when a better
material is substituted for the material originally used.
10. As more people come to believe that it makes economic sense to practice
environmentally sound operations, business and government may be able to work
together for common goals.
CHAPTER 17
SUPPLY FUNCTION EVALUATION AND TRENDS
123. Research on the supply management process focuses on:

4. a. developing a strategy to reduce cost or ensure supply.
b. improving buyer-seller relationships.
c. deciding whether to single or multiple source.
d. conducting cost analysis to identify unnecessary costs.
e. increasing efficiency by automating where possible.
124. Purchasing performance benchmarking attempts to:
a. analyze a firm's own internal trends.
b. provide industrywide standards for overall firm performance.
c. determine what results have been achieved by purchasing and supply
activities.
d. determine how an organization achieves results in purchasing and supply.
e. provide baseline metrics to compare companies’ supply performance.
125. The budget which begins with an estimate of expected operations, based on sales
forecasts and plans, is called the:
a. operating budget.
b. capital budget.
c. cash flow budget.
d. materials purchase budget.
e. organizational budget.
126. When cross-functional teams are used to conduct research, it is best if:
a. the team has strong leadership.
b. the team has total autonomy to decide objectives and set expectations.
c. team members are randomly selected from departments.
d. performance evaluation and reward systems foster individual contributions.
e. each team member develops time management skills to handle the
assignment.
127. In terms of measuring and validating supply savings:
1. information systems easily capture savings.
2. static markets, technologies, and volumes facilitate the process.
3. in many cases there is an inability to convert savings into profit.
4. management usually recognizes cumulative savings.
5. there is a universal definition of supply savings.
128. Supply can play a leadership role in corporate social responsibility (CSR) by:
1. instituting third party workplace audits of suppliers in developing countries.
2. knowing the providence of products in the supply chain.
3. considering the organization’s carbon footprint in supply decisions.
4. designing closed loop supply chains.
5. all of the above.
129. The assessment of a supplier’s financial capacity:

5. 1. enables the development of risk minimization strategies.
2. predicts the probability of the supplier encountering financial problems.
3. is done primarily to ensure the supplier has the cash to pay its bills.
4. usually is unnecessary if the supplier has been in business for more than 5
years.
5. is required before a contract can be ratified.
130. A comprehensive commodity study should result in a(n):
a. thorough analysis of sources used over time.
b. strategy to lower cost and assure supply.
c. review of past predictions and variances from actual prices paid.
d. assessment of the performance of the commodity manager.
e. trend analysis of volume requirements over time.
131. Trends in supply organization and leadership include:
a. more chief purchasing officers with extensive supply experience.
b. less emphasis on teams.
c. global projects requiring cross-cultural skills.
d. merging of strategic and tactical roles in supply.
e. emphasis on “hard skills” such as finance.
132. An efficiency-oriented performance metric:
a. evaluates the quality of supplier relationships.
b. measures end customer satisfaction.
c. measures direct contributions to profit.
d. calculates the average dollar cost of a purchase order.
e. measures number of defects caused by poor incoming quality.
True and False
1. The perceptions that non-supply managers have of supply are shaped by
interactions with and observations of supply, tangible experiences with supply on a
day-to-day basis, and the extent to which supply is seen as contributing to the firm's
mission.
2. Value engineering is done on purchased items used in the ongoing production
process, while value analysis is done in the design stage where items are being
specified.
3.Triple bottom line reporting refers to an organization’s social, environmental, and
financial performance.

6. 4. Effectiveness metrics which emphasize price may lead to behavior that drives up
total cost of ownership.
5. The supply planning process is initiated by the supply manager’s assessment of the
supply base.
6. Industry benchmarking allows an individual company to compare itself to its major
competitor.
7. Financial efficiency is indicated by the asset and inventory turnover ratios.
8. Supplier performance management systems should be designed to capture and
communicate the failures of suppliers so penalties can be assessed.
9. Supply management’s contribution may be measured along three dimensions:
revenue enhancement, asset management, and cost management.
10. Internal validation of supply’s financial contribution increases joint ownership of
goals and outcomes.