A valuable method of assessing supplier performance is to use a supplier performance index. This index is calculated by:

Question

Quizplus · Accepted Answer

The supplier performance index is calculated as the total supplier costs divided by the total purchase price. This gives us a ratio of the costs incurred from the supplier compared to the total expenditure. A higher index indicates better supplier performance, as the supplier is able to deliver goods and services at a lower cost. Therefore, option B is the correct choice, which is total supplier costs F1F1F1S1F1F1F10 total purchase price.

A Valuable Method of Assessing Supplier Performance Is to Use ÷\div÷

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