Question 1

All of the following are advantages of a categorical supplier evaluation system except _____.
A) easy to implement
B) requires minimal data
C) different personnel can contribute
D) low-cost system
E) greatest potential for long-range improvement

Accepted Answer

The other options listed are advantages of a categorical supplier evaluation system. Option E, however, is not an advantage but rather a limitation. While a categorical supplier evaluation system is easy to implement and requires minimal data, it also has limitations when it comes to providing opportunities for long-term improvement.

Question 2

Which of the following is a disadvantage of a cost-based supplier evaluation system?​
A) Least reliable.
B) Most complex so implementation costs are high.
C) Less frequent generation of evaluations.
D) Most subjective.
E) Tends to focus on unit price.

Accepted Answer

The answer of Which of the following is a disadvantage...

Question 3

All buyers are encouraged to engage in currency hedging activities, regardless of their level of experience.

Accepted Answer

Currency hedging requires a deep understanding of financial markets and is not suitable for all buyers, especially those with limited experience or knowledge in finance.

Question 4

_____ is the process of identifying how many and which suppliers a buyer will maintain.
A) Supply base optimization
B) Supply base rationalization
C) Six Sigma
D) Zero defects
E) Strategic sourcing

Accepted Answer

Supply base rationalization is the process of identifying how many suppliers a buyer will maintain. This process involves analyzing the current supplier base and determining which suppliers should be kept, decreased, or eliminated based on factors such as cost, quality, delivery, and strategic alignment. Supply base optimization, on the other hand, refers to the process of improving the overall performance of the supply base, while strategic sourcing is the process of identifying and selecting the best suppliers for a company's needs. Six Sigma and zero defects are quality improvement methodologies that are not directly related to supplier management.

Question 5

Few international shipments of merchandise require insurance coverage.

Accepted Answer

Most international shipments of merchandise require insurance coverage to protect against loss or damage during transport.

Question 6

The supplier performance index (SPI) equals (_____ plus _____) divided by _____.
A) Total Purchases….Nonperformance Costs….Total Purchases
B) Nonperformance Costs….Total Purchases….Nonperformance Costs
C) Total Purchases….Appraisal Costs….External Failure Costs
D) External Failure Costs….Internal Failure Costs….Total Purchases
E) TransportationCosts….Appraisal Costs….Prevention Costs

Accepted Answer

The answer of The supplier performance index (SPI) equals (_____...

Question 7

Which of the following is a disadvantage of a categorical supplier evaluation system?
A) Least reliable.
B) Cost accounting system required.
C) Less frequent generation of evaluations.
D) Most subjective.
E) Usually manual.

Accepted Answer

The answer of Which of the following is a disadvantage...

Question 8

Which of the following is not one of the typical uses of supplier measurement data?
A) Supporting supply base rationalization and optimization.
B) Identifying those highly capable suppliers that may qualify for consideration of longer-term partnerships or designation as preferred suppliers.
C) Identifying those suppliers that are not performing at expected levels so that appropriate remedial or development actions can be taken.
D) Deciding where to locate supplier facilities.
E) Determining a supplier's future purchase volume based on its past performance.

Accepted Answer

Deciding where to locate supplier facilities is not one of the typical uses of supplier measurement data. The other options listed are common uses of supplier measurement data.

Question 9

Sustainability reflects only the importance of strategic environmental practices of an organization's suppliers but not the management of social responsibility in the supply base.

Accepted Answer

Sustainability encompasses both environmental practices and social responsibility in the supply base. It is important for organizations to consider both aspects in their sustainability efforts.

Question 10

Overall reduction in material usage and disposal can be accomplished through engineering design changes and reuse and recycle programs.

Accepted Answer

Engineering design changes can lead to the use of less material or more sustainable materials, while reuse and recycle programs can avoid waste and promote resource efficiency. Therefore, both approaches can contribute to reducing material usage and disposal.

Question 11

In supplier measurement, the basic logic of the _____ is built around the calculation of a/an _____.
A) categorical system…supplier performance index
B) cost-based system…process capability index
C) weighted-point system…Q adjustment factor
D) weighted-point system…cost accounting system
E) cost-based system…supplier performance index (SPI)

Accepted Answer

The question is asking for the logic behind supplier measurement, which is built around the calculation of a supplier performance index (SPI) in a cost-based system. Therefore, the correct answer is E - cost-based system…supplier performance index (SPI).

Question 12

Which of the following is not a typical qualitative service factor in a supplier performance measurement system?
A) Problem resolution ability.
B) Technical ability.
C) Process capability.
D) Ongoing progress reporting.
E) Wavelength.

Accepted Answer

Process capability is typically a measure of quantitative performance, not a qualitative service factor. The other options are all typical qualitative factors in a supplier performance measurement system.

Question 13

The _____ supplier evaluation system seeks to identify and quantify the total cost of doing business with a given supplier, as the lowest purchase price may not always result in the lowest total cost for an item or service.
A) Six Sigma
B) zero defects
C) cost-based
D) categorical
E) weighted-point

Accepted Answer

This type of supplier evaluation system specifically takes into account the total cost of doing business with a supplier, rather than solely focusing on the purchase price of goods or services. This approach recognizes that there may be hidden costs associated with low-price suppliers, such as higher maintenance or replacement costs. Therefore, a cost-based evaluation system is more comprehensive and accurate in determining the best supplier for a particular item or service. The other options listed may be useful in other contexts, but do not address the issue of total cost in supplier evaluation.

Question 14

The _____ is a normalization factor for the supplier performance index (SPI) that eliminates high-dollar lot bias.
A) Cp
B) MRO
C) Q adjustment factor
D) Cpk
E) Rfx

Accepted Answer

The Q adjustment factor is a normalization factor that eliminates high-dollar lot bias in the supplier performance index (SPI). This ensures that the SPI reflects the supplier's true performance, rather than being skewed by the impact of high-dollar lots. Cp and Cpk are process capability indices used to evaluate the stability of a manufacturing process. MRO refers to maintenance, repair, and operations supplies, and Rfx is a term that can refer to a variety of procurement processes, such as request for proposals or request for quotes.

Question 15

_____ involves a detailed analysis of the supply base to ensure that only the most capable and highest performing suppliers are kept in the supply base after it is rationalized.
A) Supply base optimization
B) Outsourcing
C) Strategic sourcing
D) Supply base reduction
E) Supply base management

Accepted Answer

Supply base optimization involves analyzing and evaluating the suppliers in the supply base to identify the most capable and high-performing ones. This typically involves a thorough evaluation of suppliers' performance, capabilities, and potential to contribute to the organization's goals. After this analysis, the supply base can be optimized by retaining the highest-performing suppliers while reducing the number of lower performing ones.

Question 16

Which of the following is not one of the management uses for the data derived from a comprehensive cost-base supplier evaluation system?​
A) Such a system provides the necessary information that allows a buyer to justify buying from a preferred supplier despite a higher unit price.
B) The system allows a buyer to communicate the cost of specific nonperformance events to the originating supplier, which then helps identify improvement opportunities.
C) Quantifying nonconformance costs can result in a chargeback to the offending supplier for unplanned costs.
D) The system allows customized assignment of cost accounting codes depending on how much money is left in the annual budget.
E) A buyer can use this data to identify longer-term sources of supply based on a supplier's total cost performance history.

Accepted Answer

Option D is not a management use for the data derived from a comprehensive cost-base supplier evaluation system. While the other options provide management uses such as identifying improvement opportunities, justifying buying from a preferred supplier despite a higher unit price, quantifying nonconformance costs resulting in a chargeback to the offending supplier for unplanned costs, and identifying longer-term sources of supply based on a supplier's total cost performance history, option D is irrelevant and not a management use.

Question 17

Which of the following is a disadvantage of a weighted-point supplier evaluation system?
A) Tends to focus on unit price.
B) Most complex, so implementation costs are high.
C) Most subjective.
D) Least reliable.
E) Cost accounting system required.

Accepted Answer

The answer of Which of the following is a disadvantage...

Question 18

All of the following are advantages of a cost-based supplier evaluation system except _____.
A) total cost approach
B) specific areas of supplier nonperformance identified
C) objective supplier ranking
D) greatest potential for long-range improvement
E) good for firms with limited resources

Accepted Answer

A cost-based supplier evaluation system typically requires significant resources to accurately calculate total costs, including both direct and indirect costs associated with each supplier. This can be challenging for firms with limited resources, making it less advantageous for such firms. The other options (A, B, C, D) are generally considered advantages of using a cost-based approach.

Question 19

Certain risks, such as those arising from war, piracy, and losses attributable to delays in transit, are generally covered by standard insurance policies.

Accepted Answer

Standard insurance policies often exclude risks arising from war, piracy, and losses attributable to delays in transit, requiring additional coverage for these risks.

Question 20

All of the following are advantages of a weighted-point supplier evaluation system except _____.
A) flexible system
B) supplier ranking allowed
C) moderate implementation costs
D) total cost approach
E) quantitative and qualitative factors combined into a single system

Accepted Answer

A weighted-point supplier evaluation system does not inherently ensure a total cost approach. This system focuses on scoring suppliers based on various criteria, which may or may not include all cost factors.

Quiz 9: Supplier Management and Development: Creating a World-Class Supply Base

All of the following are advantages of a categorical supplier evaluation system except _____.

Which of the following is a disadvantage of a cost-based supplier evaluation system?

All buyers are encouraged to engage in currency hedging activities, regardless of their level of experience.

_____ is the process of identifying how many and which suppliers a buyer will maintain.

Few international shipments of merchandise require insurance coverage.

The supplier performance index (SPI) equals (___ plus _) divided by ___.

Which of the following is a disadvantage of a categorical supplier evaluation system?

Which of the following is not one of the typical uses of supplier measurement data?

Sustainability reflects only the importance of strategic environmental practices of an organization's suppliers but not the management of social responsibility in the supply base.

Overall reduction in material usage and disposal can be accomplished through engineering design changes and reuse and recycle programs.

In supplier measurement, the basic logic of the _ is built around the calculation of a/an _.

Which of the following is not a typical qualitative service factor in a supplier performance measurement system?

The _____ supplier evaluation system seeks to identify and quantify the total cost of doing business with a given supplier, as the lowest purchase price may not always result in the lowest total cost for an item or service.

The _____ is a normalization factor for the supplier performance index (SPI) that eliminates high-dollar lot bias.

_____ involves a detailed analysis of the supply base to ensure that only the most capable and highest performing suppliers are kept in the supply base after it is rationalized.

Which of the following is not one of the management uses for the data derived from a comprehensive cost-base supplier evaluation system?

Which of the following is a disadvantage of a weighted-point supplier evaluation system?

All of the following are advantages of a cost-based supplier evaluation system except _____.

Certain risks, such as those arising from war, piracy, and losses attributable to delays in transit, are generally covered by standard insurance policies.

All of the following are advantages of a weighted-point supplier evaluation system except _____.

Quiz 9: Supplier Management and Development: Creating a World-Class Supply Base

All of the following are advantages of a categorical supplier evaluation system except _____.

Which of the following is a disadvantage of a cost-based supplier evaluation system?​

All buyers are encouraged to engage in currency hedging activities, regardless of their level of experience.

_____ is the process of identifying how many and which suppliers a buyer will maintain.

Few international shipments of merchandise require insurance coverage.

The supplier performance index (SPI) equals (_____ plus _____) divided by _____.

Which of the following is a disadvantage of a categorical supplier evaluation system?

Which of the following is not one of the typical uses of supplier measurement data?

Sustainability reflects only the importance of strategic environmental practices of an organization's suppliers but not the management of social responsibility in the supply base.

Overall reduction in material usage and disposal can be accomplished through engineering design changes and reuse and recycle programs.

In supplier measurement, the basic logic of the _____ is built around the calculation of a/an _____.

Which of the following is not a typical qualitative service factor in a supplier performance measurement system?

The _____ supplier evaluation system seeks to identify and quantify the total cost of doing business with a given supplier, as the lowest purchase price may not always result in the lowest total cost for an item or service.

The _____ is a normalization factor for the supplier performance index (SPI) that eliminates high-dollar lot bias.

_____ involves a detailed analysis of the supply base to ensure that only the most capable and highest performing suppliers are kept in the supply base after it is rationalized.

Which of the following is not one of the management uses for the data derived from a comprehensive cost-base supplier evaluation system?​

Which of the following is a disadvantage of a weighted-point supplier evaluation system?

All of the following are advantages of a cost-based supplier evaluation system except _____.

Certain risks, such as those arising from war, piracy, and losses attributable to delays in transit, are generally covered by standard insurance policies.

All of the following are advantages of a weighted-point supplier evaluation system except _____.

Which of the following is a disadvantage of a cost-based supplier evaluation system?

The supplier performance index (SPI) equals (___ plus _) divided by ___.

In supplier measurement, the basic logic of the _ is built around the calculation of a/an _.

Which of the following is not one of the management uses for the data derived from a comprehensive cost-base supplier evaluation system?