Question 1

A channel of distribution is controlled by the marketing department, which selects the physical structures and intermediaries through which the product(s) flow.

Accepted Answer

False

Question 2

Labor-intensive industries place significant emphasis on the availability and cost of labor.

Accepted Answer

Labor-intensive industries require a large amount of labor for their operations, so labor availability and cost are important factors for these industries.

Question 3

Which major locational determinant considers locating near the competition?
A) Labor climate
B) Quality of life
C) Company preference
D) Supplier networks

Accepted Answer

Locating near the competition can be a strategic decision based on the principle that being close to competitors can attract more customers who are interested in that particular market or industry, benefiting all businesses involved. This is often seen in industries where comparison shopping is common, such as car dealerships or fashion retail. It's a company preference to decide whether the benefits of being near competitors—such as increased foot traffic and easier market comparison for consumers—outweigh the potential downsides.

Question 4

One impact that the transit privilege has on facility location is that intermediate locations can be optimum.

Accepted Answer

The transit privilege allows for easier access to transportation, which means that intermediate locations can be more optimal for facility location. This is because goods and materials can be easily transported to and from these locations, reducing transportation costs and improving efficiency.

Question 5

The grid technique determines the highest cost facility location in an area.

Accepted Answer

The grid technique is typically used to evaluate multiple potential facility locations based on factors such as proximity to customers, transportation costs, and labor availability. It does not determine the highest cost facility location, but rather the most optimal location based on multiple criteria.

Question 6

The quality of life locational determinant is most important to companies that must attract and retain an unskilled, static work force.

Accepted Answer

The quality of life locational determinant may be important to companies that aim to attract and retain a skilled and mobile workforce due to factors such as housing, healthcare facilities, schools, recreation opportunities, and cultural amenities. However, for companies in industries where the workforce is mostly unskilled and local, factors such as labor costs, transportation infrastructure, and proximity to suppliers and customers may be more significant.

Question 7

What type of change may suggest a need to reevaluate and/or redesign a firm's logistics network?
A) Change in customer service requirements
B) Change in corporate ownership
C) Shifting locations of customer and/or supply markets
D) All of these answers

Accepted Answer

All of the choices could suggest a need to reevaluate and/or redesign a firm's logistics network. A change in customer service requirements could require a different logistics strategy. A change in corporate ownership could result in the need to integrate different logistics systems. Shifting locations of customer and/or supply markets could change transportation routes, distribution centers, and warehouse locations. Therefore, all of these changes could impact the design of a logistics network.

Question 8

As the number of stocking points (DCs) is decreased in a distribution network, fixed costs will _____ and variable costs will _____.
A) decrease; decrease
B) decrease; increase
C) increase; increase
D) increase; decrease

Accepted Answer

As the number of stocking points (DCs) is decreased in a distribution network, fixed costs will decrease (due to the elimination of costs associated with maintaining and operating the DCs) and variable costs will increase (due to the increased transportation costs associated with shipping products from a smaller number of DCs).

Question 9

Logistics facilities and their locations are relatively variable and easily modified in the short term.

Accepted Answer

Logistics facilities and their locations are typically fixed in the short term due to the significant investment in infrastructure, equipment, and systems, making them difficult and costly to modify or relocate quickly.

Question 10

This type of fulfillment model has the manufacturer delivering its products directly to the retailers' stores.
A) Outsourced
B) Store-fulfillment
C) Flow-through
D) Integrated
E) None of these answers

Accepted Answer

The answer of This type of fulfillment model has the...

Question 11

Corporate reengineering is often a reason for examining the firm's current logistics/supply chain network.

Accepted Answer

Corporate reengineering involves restructuring a company's operations to improve efficiency and reduce costs. This often involves reevaluating the logistics/supply chain network to identify areas for improvement and optimization. Therefore, examining the firm's current logistics/supply chain network is often a reason for corporate reengineering.

Question 12

The grid technique will evaluate all transportation rates equally.

Accepted Answer

The grid technique evaluates transportation rates by breaking down the total cost into fixed and variable components, allowing for a more nuanced comparison that does not treat all rates equally.

Question 13

The efficiency and effectiveness of a logistics/supply chain operation are constrained by the location of plants and warehouses in its overall network.

Accepted Answer

The location of plants and warehouses plays a critical role in determining the efficiency and effectiveness of a logistics/supply chain operation. Improper placement can lead to increased transportation costs, longer lead times, and poor customer service. Therefore, it is essential to strategically plan the network layout to optimize the overall performance of the supply chain.

Question 14

As the length and complexity of a supply chain increases, a firm's inventory levels:
A) increase.
B) decrease.
C) stay the same.
D) can't be determined.

Accepted Answer

As the length and complexity of a supply chain increases, it becomes more difficult for firms to accurately predict demand and lead times, resulting in an increase in safety stock and overall inventory levels to ensure that they can fulfill orders in a timely manner.

Question 15

Which of these is NOT a trend in today's logistics environment that may have significant effects on decisions involving logistics facility location?
A) Strategically located cross-docking facilities
B) Use of third-party logistics services
C) Customer-direct delivery
D) Addition of many wholesaler/distributor operations

Accepted Answer

The addition of many wholesaler/distributor operations is not a trend in today's logistics environment, as it is not specific to the current era and has been a common practice for a long time. Therefore, it may not have significant effects on decisions involving logistics facility location. The other options listed are current trends that can impact logistics facility location decisions.

Question 16

In the short run, the firm's network is _____ while in the long run it is _____.
A) fixed; variable
B) adoptable; reversible
C) variable; reversible
D) reversible; fixed

Accepted Answer

In the short run, the firm's network is fixed because it cannot be easily changed or adapted without incurring significant costs. However, in the long run, it is variable as the firm can choose to invest in new technology or infrastructure to improve its network capabilities.

Question 17

In a commercial zone, the same transportation rate is applied from an origin to any point in the zone.

Accepted Answer

In a commercial zone, usually, a flat transportation rate is applied from an origin to any point within the zone. This is done to simplify the pricing system and make it easier for customers to understand.

Question 18

Which of the following is true regarding optimization models?
A) Optimization models are based on precise mathematical procedures that are guaranteed to find the "best" solution for the problem under evaluation.
B) Optimization models are able to accommodate broad problem definitions, rather than provide an optimum solution.
C) The grid technique is a powerful optimization model.
D) Optimization models will guarantee increased profits.

Accepted Answer

Optimization models are based on mathematical procedures that enable decision-makers to find the "best" solution to a problem. These solutions are often subject to constraints and are based on objective functions that are designed to maximize or minimize a particular outcome. While optimization models are not always guaranteed to produce the absolute best solution due to the complexity of real-world problems, they are able to provide highly accurate solutions that can significantly improve business operations.

Question 19

Facilities may sometimes be located where senior officers prefer.

Accepted Answer

This is true, as senior officers have a higher level of decision-making authority and may have more influence on the location of facilities.

Question 20

The grid technique is used to determine a fixed facility location that represents the least-cost center for moving incoming materials and outbound product within a geographic grid. This least cost center is also referred to as a:
A) zero point.
B) source point.
C) break-even point.
D) center of gravity.

Accepted Answer

The center of gravity is the fixed facility location that represents the least-cost center for moving incoming materials and outbound product within a geographic grid. It is determined using the grid technique. Therefore, option D is the correct answer. Option A (zero point) and option B (source point) are not correct, as they do not accurately describe the least-cost center concept. Option C (break-even point) also does not accurately describe the concept of the least-cost center.

Quiz 4: Distribution and Omni Channel Network Design

A channel of distribution is controlled by the marketing department, which selects the physical structures and intermediaries through which the product(s) flow.

Labor-intensive industries place significant emphasis on the availability and cost of labor.

Which major locational determinant considers locating near the competition?

One impact that the transit privilege has on facility location is that intermediate locations can be optimum.

The grid technique determines the highest cost facility location in an area.

The quality of life locational determinant is most important to companies that must attract and retain an unskilled, static work force.

What type of change may suggest a need to reevaluate and/or redesign a firm's logistics network?

As the number of stocking points (DCs) is decreased in a distribution network, fixed costs will _ and variable costs will _.

Logistics facilities and their locations are relatively variable and easily modified in the short term.

This type of fulfillment model has the manufacturer delivering its products directly to the retailers' stores.

Corporate reengineering is often a reason for examining the firm's current logistics/supply chain network.

The grid technique will evaluate all transportation rates equally.

The efficiency and effectiveness of a logistics/supply chain operation are constrained by the location of plants and warehouses in its overall network.

As the length and complexity of a supply chain increases, a firm's inventory levels:

Which of these is NOT a trend in today's logistics environment that may have significant effects on decisions involving logistics facility location?

In the short run, the firm's network is _ while in the long run it is _.

In a commercial zone, the same transportation rate is applied from an origin to any point in the zone.

Which of the following is true regarding optimization models?

Facilities may sometimes be located where senior officers prefer.

The grid technique is used to determine a fixed facility location that represents the least-cost center for moving incoming materials and outbound product within a geographic grid. This least cost center is also referred to as a: