----------------
1-7
,CHAPTER 1 TEST QUESTIONS
True-False
1. The first decade of the twenty-first century was a period of rapid change for organizations,
especially businesses.
ANSWER: True, Page 5
2. A key element in Wal-Mart’s ability to discount brand name products was an understanding
of the criticality of efficiency in its logistics and supply chain system.
ANSWER: True, Page 6
3. Globalization has had little effect on consumers.
ANSWER: False, Page 7
4. Supply and demand has become less volatile as managers become more adept at controlling
the elements.
ANSWER: False, Page 8
5. Outsourcing is a fairly new concept.
ANSWER: False, Page 9
6. SAB should examine their off-shore purchasing policy, even though the products are sourced
from the U.S.
ANSWER: True, Page 9
7. It is expected that some or all of the BRIC countries (Brazil, Russia, India & china) will replace
the so-called VISTA countries (Vietnam, Indonesia, S. Africa, Turkey and Argentina)as low
cost producers of various products and services.
ANSWER: False, Page 9
8. The world economy still favors the United States and European countries, even though China
and India can participate in the global economy much more readily.
ANSWER: False, Page 10
9. It is predicted that social networks such as Facebook and Twitter will influence supply chains
because of their impact on customer demand and the speed of information transfers.
ANSWER: True, Page 10
10. The U.S. transportation system was deregulated in the 1930s and 1940s in response to
economic conditions and World War 2
ANSWER: False, Page 12
11. Even though there are references to supply chain management in the 1980s, SCM did not
capture the attention of senior-level management until the 1990s.
ANSWER: True, Page 15
12. Supply chain managers no longer need to worry about suboptimization in light of today’s
technology.
ANSWER: False, Page 19
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,Multiple Choice
13. Most retailers are essentially supply chain companies since
A. they dominate the consumer market.
b. own their warehouses and trucks.
c. they buy products produced by others.
d. engage in off-shore sourcing.
ANSWER: c, Page 6
14. Which of the below is not one of the external forces driving the rate of change
and shaping our economic and political landscape?
a. Government policy
b. Technology
c. Environmental concerns
d. Globalization
ANSWER: c, Page 7
15. Outsourcing involves
a. moving company facilities away from the home office.
b. hiring foreign nationals to manage parts of the business.
c. obtaining materials, parts, and products from other companies.
d. building a factory in another country.
ANSWER: c, Page 9
16. Some individuals describe the current consumer as the ―click here‖ generation
because
a. we all have Internet access.
b. we no longer wait for information to be “pushed out” to us.
c. we buy so much merchandise on line.
d. we take little time to make purchasing decisions.
ANSWER: b, Page 10
17. The demographics of our society has changed because
a. the ―Baby Boom‖ generation is now turning 60.
b. of the increase in two-career families and single-parent households.
c. of immigration.
d. birth rates have changed.
ANSWER: b, Page 12
18. The Supply Chain Concept
a. is very new and considered cutting edge technology.
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, b. is highly dependent of computerization.
c. is not always well understood by senior managers.
d. developed from the previous Physical Distribution concept.
ANSWER: d, Page 15
19. Logistics, in its simplest form,
a. is a military term, as it was developed originally to supply the battlefield.
b. combines inbound logistics with the outbound logistics of physical distribution.
c. is another term for transportation management.
d. does not involve customer service or other related functions.
ANSWER: b, Page 16
20. One of the major challenges of supply chain management is
a. forward buying.
b. maintaining the visibility of inventory.
c. building safety-stock inventory.
d. Pushing inventory back to vendors.
ANSWER: b, Page18
21. Which of these flows only one way as illustrated in Figure 1-4?
a. information
b. products and services
c. financials
d. None of these answers
ANSWER: d, Page 18
22. Traditionally, information has been viewed as flowing in the opposite direction of
products, that is, from the market/customer back to the wholesalers, manufacturers, and
vendors.
a. This is still true and has not changed.
b. Computerization has greatly increased the flow of information from the source.
c. The ―Big Box‖ stores have developed their own sources.
d. None of these answers
ANSWER: d, Page 21
23. One of the four supply chain flows in Figure 1 – 8 that has received increased attention
from supply chain managers due to the growth in technology is:
a. Product flow
b. Information flow
c. Cash flow
1-7
1-7
,CHAPTER 1 TEST QUESTIONS
True-False
1. The first decade of the twenty-first century was a period of rapid change for organizations,
especially businesses.
ANSWER: True, Page 5
2. A key element in Wal-Mart’s ability to discount brand name products was an understanding
of the criticality of efficiency in its logistics and supply chain system.
ANSWER: True, Page 6
3. Globalization has had little effect on consumers.
ANSWER: False, Page 7
4. Supply and demand has become less volatile as managers become more adept at controlling
the elements.
ANSWER: False, Page 8
5. Outsourcing is a fairly new concept.
ANSWER: False, Page 9
6. SAB should examine their off-shore purchasing policy, even though the products are sourced
from the U.S.
ANSWER: True, Page 9
7. It is expected that some or all of the BRIC countries (Brazil, Russia, India & china) will replace
the so-called VISTA countries (Vietnam, Indonesia, S. Africa, Turkey and Argentina)as low
cost producers of various products and services.
ANSWER: False, Page 9
8. The world economy still favors the United States and European countries, even though China
and India can participate in the global economy much more readily.
ANSWER: False, Page 10
9. It is predicted that social networks such as Facebook and Twitter will influence supply chains
because of their impact on customer demand and the speed of information transfers.
ANSWER: True, Page 10
10. The U.S. transportation system was deregulated in the 1930s and 1940s in response to
economic conditions and World War 2
ANSWER: False, Page 12
11. Even though there are references to supply chain management in the 1980s, SCM did not
capture the attention of senior-level management until the 1990s.
ANSWER: True, Page 15
12. Supply chain managers no longer need to worry about suboptimization in light of today’s
technology.
ANSWER: False, Page 19
1-7
,Multiple Choice
13. Most retailers are essentially supply chain companies since
A. they dominate the consumer market.
b. own their warehouses and trucks.
c. they buy products produced by others.
d. engage in off-shore sourcing.
ANSWER: c, Page 6
14. Which of the below is not one of the external forces driving the rate of change
and shaping our economic and political landscape?
a. Government policy
b. Technology
c. Environmental concerns
d. Globalization
ANSWER: c, Page 7
15. Outsourcing involves
a. moving company facilities away from the home office.
b. hiring foreign nationals to manage parts of the business.
c. obtaining materials, parts, and products from other companies.
d. building a factory in another country.
ANSWER: c, Page 9
16. Some individuals describe the current consumer as the ―click here‖ generation
because
a. we all have Internet access.
b. we no longer wait for information to be “pushed out” to us.
c. we buy so much merchandise on line.
d. we take little time to make purchasing decisions.
ANSWER: b, Page 10
17. The demographics of our society has changed because
a. the ―Baby Boom‖ generation is now turning 60.
b. of the increase in two-career families and single-parent households.
c. of immigration.
d. birth rates have changed.
ANSWER: b, Page 12
18. The Supply Chain Concept
a. is very new and considered cutting edge technology.
1-7
, b. is highly dependent of computerization.
c. is not always well understood by senior managers.
d. developed from the previous Physical Distribution concept.
ANSWER: d, Page 15
19. Logistics, in its simplest form,
a. is a military term, as it was developed originally to supply the battlefield.
b. combines inbound logistics with the outbound logistics of physical distribution.
c. is another term for transportation management.
d. does not involve customer service or other related functions.
ANSWER: b, Page 16
20. One of the major challenges of supply chain management is
a. forward buying.
b. maintaining the visibility of inventory.
c. building safety-stock inventory.
d. Pushing inventory back to vendors.
ANSWER: b, Page18
21. Which of these flows only one way as illustrated in Figure 1-4?
a. information
b. products and services
c. financials
d. None of these answers
ANSWER: d, Page 18
22. Traditionally, information has been viewed as flowing in the opposite direction of
products, that is, from the market/customer back to the wholesalers, manufacturers, and
vendors.
a. This is still true and has not changed.
b. Computerization has greatly increased the flow of information from the source.
c. The ―Big Box‖ stores have developed their own sources.
d. None of these answers
ANSWER: d, Page 21
23. One of the four supply chain flows in Figure 1 – 8 that has received increased attention
from supply chain managers due to the growth in technology is:
a. Product flow
b. Information flow
c. Cash flow
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