, Question 1
A firm experiences demand with a consistent upward trend and strong
seasonality. Which forecasting method is most appropriate to capture both
components simultaneously?
A. Simple moving average
B. Exponential smoothing with trend and seasonality adjustments
C. Weighted moving average
D. Naive approach
Correct Answer: B - Exponential smoothing with trend and
seasonality adjustments
RATIONALE
Exponential smoothing with trend and seasonality (e.g., Holt-Winters)
explicitly models both trend and seasonal patterns, making it suitable
for data with both components. Simple and weighted moving averages
do not capture trend or seasonality, and the naive approach ignores all
patterns.
Question 2
When evaluating suppliers, a firm considers quality, delivery, cost, and
flexibility. Which procurement strategy best balances these criteria for a
critical component with high supply risk?
A. Single sourcing to maximize volume discounts
B. Multiple sourcing to ensure competition
C. Strategic partnership with a key supplier
D. Spot purchasing to leverage market prices
Correct Answer: C - Strategic partnership with a key supplier
Page 2
, RATIONALE
A strategic partnership fosters collaboration, joint problem-solving,
and long-term alignment, which is crucial for critical components with
high supply risk. Single sourcing may increase risk, multiple sourcing
can dilute relationships, and spot purchasing is unsuitable for critical
items.
Question 3
A company uses a continuous review (Q, R) inventory system. If demand
during lead time is normally distributed with mean 200 and standard deviation
40, what reorder point ensures a 95% service level? (z=1.645)
A. 200
B. 266
C. 240
D. 280
Correct Answer: B - 266
RATIONALE
Reorder point = mean demand during lead time + z * standard
deviation = 200 + 1.645*40 = 265.8 266. Other options ignore safety
stock or use incorrect z-values.
Question 4
Which of the following best describes the primary role of a 3PL provider in a
supply chain?
A. Manufacturing of core components
B. Outsourcing of logistics activities such as transportation and
warehousing
C. Retail sales and customer service
D. Product design and development
Correct Answer: B - Outsourcing of logistics activities such as
Page 3
, transportation and warehousing
RATIONALE
Third-party logistics (3PL) providers specialize in outsourced logistics
services like transportation, warehousing, and distribution. They do
not typically engage in manufacturing, retail, or design.
Question 5
In the context of supply chain integration, which technology is most critical for
real-time information sharing and visibility across partners?
A. Electronic Data Interchange (EDI)
B. Radio Frequency Identification (RFID)
C. Enterprise Resource Planning (ERP) with cloud-based platforms
D. Blockchain
Correct Answer: C - Enterprise Resource Planning (ERP) with
cloud-based platforms
RATIONALE
Cloud-based ERP systems enable real-time data integration and
visibility across the supply chain by centralizing information. EDI and
RFID are valuable but narrower in scope, and blockchain is emerging
but not yet the most critical for general visibility.
Question 6
A retailer classifies items using ABC analysis. Which statement correctly
reflects the typical inventory policy for 'A' items?
A. They account for a large percentage of inventory value and require
tight control.
B. They represent high volume but low value and can be managed with
simple rules.
C. They are moderately important and require periodic review.
D. They are obsolete items to be phased out.
Page 4
A firm experiences demand with a consistent upward trend and strong
seasonality. Which forecasting method is most appropriate to capture both
components simultaneously?
A. Simple moving average
B. Exponential smoothing with trend and seasonality adjustments
C. Weighted moving average
D. Naive approach
Correct Answer: B - Exponential smoothing with trend and
seasonality adjustments
RATIONALE
Exponential smoothing with trend and seasonality (e.g., Holt-Winters)
explicitly models both trend and seasonal patterns, making it suitable
for data with both components. Simple and weighted moving averages
do not capture trend or seasonality, and the naive approach ignores all
patterns.
Question 2
When evaluating suppliers, a firm considers quality, delivery, cost, and
flexibility. Which procurement strategy best balances these criteria for a
critical component with high supply risk?
A. Single sourcing to maximize volume discounts
B. Multiple sourcing to ensure competition
C. Strategic partnership with a key supplier
D. Spot purchasing to leverage market prices
Correct Answer: C - Strategic partnership with a key supplier
Page 2
, RATIONALE
A strategic partnership fosters collaboration, joint problem-solving,
and long-term alignment, which is crucial for critical components with
high supply risk. Single sourcing may increase risk, multiple sourcing
can dilute relationships, and spot purchasing is unsuitable for critical
items.
Question 3
A company uses a continuous review (Q, R) inventory system. If demand
during lead time is normally distributed with mean 200 and standard deviation
40, what reorder point ensures a 95% service level? (z=1.645)
A. 200
B. 266
C. 240
D. 280
Correct Answer: B - 266
RATIONALE
Reorder point = mean demand during lead time + z * standard
deviation = 200 + 1.645*40 = 265.8 266. Other options ignore safety
stock or use incorrect z-values.
Question 4
Which of the following best describes the primary role of a 3PL provider in a
supply chain?
A. Manufacturing of core components
B. Outsourcing of logistics activities such as transportation and
warehousing
C. Retail sales and customer service
D. Product design and development
Correct Answer: B - Outsourcing of logistics activities such as
Page 3
, transportation and warehousing
RATIONALE
Third-party logistics (3PL) providers specialize in outsourced logistics
services like transportation, warehousing, and distribution. They do
not typically engage in manufacturing, retail, or design.
Question 5
In the context of supply chain integration, which technology is most critical for
real-time information sharing and visibility across partners?
A. Electronic Data Interchange (EDI)
B. Radio Frequency Identification (RFID)
C. Enterprise Resource Planning (ERP) with cloud-based platforms
D. Blockchain
Correct Answer: C - Enterprise Resource Planning (ERP) with
cloud-based platforms
RATIONALE
Cloud-based ERP systems enable real-time data integration and
visibility across the supply chain by centralizing information. EDI and
RFID are valuable but narrower in scope, and blockchain is emerging
but not yet the most critical for general visibility.
Question 6
A retailer classifies items using ABC analysis. Which statement correctly
reflects the typical inventory policy for 'A' items?
A. They account for a large percentage of inventory value and require
tight control.
B. They represent high volume but low value and can be managed with
simple rules.
C. They are moderately important and require periodic review.
D. They are obsolete items to be phased out.
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