_____ involves a formal invitation to potential suppliers to submit written, sealed bids.

_____ involves a formal invitation to potential suppliers to submit written, sealed bids.

a. Closed bidding

b. Open bidding

c. On-line bidding

d. E-commerce

e. Comparative bidding

Answer: A

Which of the following are questions that must be addressed when determining responses to a competitor's threat?

Which of the following are questions that must be addressed when determining responses to a competitor's threat?

a. If you respond, is the competitor willing and able to lower their price again?

b. Is our position in other markets at risk if the competitor gains market share?

c. Is there a response that would cost you more than the preventable sales loss?

d. All of the above.

e. Only (a) and (b).

Answer: E

Which of the following are reasons why followers into a market often find lower costs than the pioneer firm?

Which of the following are reasons why followers into a market often find lower costs than the pioneer firm?

a. The use of more current production technologies.

b. Experience of suppliers leads to cost reductions.

c. Learning from the pioneer's mistakes.

d. All of the above.

e. Only (b) and (c).

Answer: D

Which of the following are useful to business marketers trying to gauge competitive responses to pricing?

Which of the following are useful to business marketers trying to gauge competitive responses to pricing?

a. Examining the cost structure and strategy of direct competitors.

b. Examination of annual reports and other public records.

c. Identifying which markets competitors deem as important.

d. All of the above.

e. Only (a) and (c).

Answer: D

Examples of typical add-on benefits include:

Examples of typical add-on benefits include:

a. joint working relationships.

b. commitment.

c. supplier flexibility.

d. All of the above.

e. Only (a) and (b).

Answer: D

_____ are those attributes that are not typically required but that can ultimately lead to a supplier being selected by a customer over other qualified suppliers.

_____ are those attributes that are not typically required but that can ultimately lead to a supplier being selected by a customer over other qualified suppliers.

a. Core benefits

b. Add-on benefits

c. Supplier personality traits

d. Customer values

e. Elasticities of demand

Answer: B

____ represents a business customer's overall assessment of the utility of a relationship with a supplier based on the benefits received and sacrifices made.

____ represents a business customer's overall assessment of the utility of a relationship with a supplier based on the benefits received and sacrifices made.

a. Core benefits

b. Add-on benefits

c. Customer value

d. Relationship commitment

e. Total cost analysis

Answer: C

____ features a design-to-cost philosophy that begins by examining market conditions.

____ features a design-to-cost philosophy that begins by examining market conditions.

a. Target costing

b. ABC costing

c. Value-based segmentation

d. Total cost costing

e. Penetration pricing

Answer: A

A skimming strategy is appropriate when:

A skimming strategy is appropriate when:

a. there is high price elasticity of demand.

b. strong threat of imminent competition.

c. the firm has a distinctly new product in a monopoly period.

d. All of the above.

e. Only (b) and (c).

Answer: C

____ refers to the rate of percentage change in quantity demanded attributable to change in price.

____ refers to the rate of percentage change in quantity demanded attributable to change in price.

a. Cost/benefit analysis

b. Customer demand

c. Price elasticity of demand

d. Perceived value

e. Competitive edge

Answer: C

____ costs include financing, storage, and inspection costs.

____ costs include financing, storage, and inspection costs.

a. Acquisition

b. Possession

c. Usage

d. None of the above

Answer: B

If competitors are likely to continue to pursue price cutting, the best strategy for the defender is to:

If competitors are likely to continue to pursue price cutting, the best strategy for the defender is to:

a. allow the competitor to win where it is least damaging to profitability.

b. create barriers that make it more difficult for competitors to reach less price-sensitive customer segments.

c. center reactive price cuts on a particular geographic region.

d. all of the above.

e. (a) and (b) only.

Answer: E

General plant overhead is an example of _____ costs.

General plant overhead is an example of _____ costs.

a. direct traceable

b. indirect traceable

c. general

d. attributable

Answer: B

Which of the following statements regarding competitive threats is incorrect?

Which of the following statements regarding competitive threats is incorrect?

a. Matching a price cut will be an ineffective strategy if the competitor simply reestablished the differential by a further price reduction.

b. A single response is rarely enough to stop price moves by competitors that are struggling to establish a market position.

c. If a price response is required, the strategist should focus the firm's competitive retaliation on those actions that are most cost-effective for the firm.

d. All of the above.

Answer: D

_____ are those that support a number of activities that cannot be objectively assigned to a product on the basis of a direct physical relationship.

_____ are those that support a number of activities that cannot be objectively assigned to a product on the basis of a direct physical relationship.

a. Indirect traceable costs

b. Attributable costs

c. General costs

d. none of the above.

Answer: C

The buyer's price sensitivity increases to the degree that:

The buyer's price sensitivity increases to the degree that:

a. buyers can switch from one supplier to another without incurring additional costs.

b. organizational buyers can easily shop around and assess the relative performance and price of alternatives.

c. the product represents one for which it is difficult to make price comparisons.

d. all of the above.

e. (a) and (b) only.

Answer: E

Since higher costs are incurred in providing higher levels of performance on one or more of the attributes, the strategists should assess the:

Since higher costs are incurred in providing higher levels of performance on one or more of the attributes, the strategists should assess the:

a. relative importance of the attributes to different market segments.

b. strength of the firm's offering on each of the importance attributes vis-a-vis competitors.

c. costs associated with the experience effect.

d. (a) and (b) only.

e. (b) and (c) only.

Answer: D

Examples of pricing objectives include:

Examples of pricing objectives include:

a. channel relationships.

b. achieving a market-share goal.

c. achieving a target return on investment.

d. all of the above.

e. (b) and (c) only.

Answer: D

Pertinent considerations for pricing industrial products or services include:

Pertinent considerations for pricing industrial products or services include:

a. competition.

b. demand determinants.

c. cost determinants.

d. all of the above.

e. (b) and (c) only.

Answer: D

The successful implementation of value-based strategies requires close coordination between the _____and _____ units in the firm.

The successful implementation of value-based strategies requires close coordination between the _____and _____ units in the firm.

a. product

b. sales

c. service

d. all of the above.

e. (b) and (c) only

Answer: D

In hypercompetitive environments,

In hypercompetitive environments,

a. leading-edge firms are reluctant to lower prices because they enjoy attractive margins.

b. successful firms sustain quality but drive to the next lower price point to enjoy a burst of volume and an expansion of market share.

c. successful firms are reluctant to disrupt the equilibrium of the market.

d. successful firms look for the first opportunity to raise prices.

e. both (a) and (c).

Answer: B

Pine River Equipment has developed a distinctly new product that offers considerable promise. By exploiting the experience effect, management believes that there are opportunities for a substantial reduction in production costs as volume expands. While the market is quite large, there is a strong threat of imminent competition. The firm should likely use:

Pine River Equipment has developed a distinctly new product that offers considerable promise. By exploiting the experience effect, management believes that there are opportunities for a substantial  reduction in production costs as volume expands. While the market is quite large, there is a strong threat  of imminent competition. The firm should likely use:

a. product differentiation.

b. a skimming approach to pricing.

c. a penetration approach to pricing.

d. a bid price policy.

e. a life cycle costing pricing policy.

Answer: C

Which of the following statements concerning target costing is(are) accurate?

Which of the following statements concerning target costing is(are) accurate?

a. Japanese managers who pioneered the approach view target costing as a profit-management tool.

b. The approach is designed to reach market segments comprised of buyers who consistently select the lowest-priced alternative.

c. Target costing tends to move product developers toward products that include only the bare essentials.

d. All of the above.

e. None of the above.

Answer: A

Before preparing a bid for any potential contract, the industrial firm should first:

Before preparing a bid for any potential contract, the industrial firm should first:

a. estimate the profitability of the potential contract.

b. assess the probability of winning the contract.

c. carefully define their objectives.

d. conduct a preliminary analysis of their expected costs in performing the potential contract.

e. evaluate the strength of potential competing bidders.

Answer: C

The competitive bidding approach that may include deliberations with suppliers throughout the bidding process is referred to as:

The competitive bidding approach that may include deliberations with suppliers throughout the bidding process is referred to as:

a. closed bidding.

b. open bidding.

c. contractual bidding.

d. institutional bidding.

Answer: B

During the innovative firm's monopoly period, a _____ is optimal if there is a relatively high repeat purchase rate for nondurable goods or if a durable good's demand is characterized by diffusion.

During the innovative firm's monopoly period, a _____ is optimal if there is a relatively high repeat purchase rate for nondurable goods or if a durable good's demand is characterized by diffusion.

a. life cycle costing pricing policy

b. skimming policy

c. penetration policy

d. time segmentation policy

e. bid price policy

Answer: C

During the innovative firm's monopoly period, a _____ is optimal if the demand curve is stable over time (no diffusion) and production costs decline with accumulated volume.

During the innovative firm's monopoly period, a _____ is optimal if the demand curve is stable over time (no diffusion) and production costs decline with accumulated volume.

a. life cycle costing pricing policy

b. skimming policy

c. penetration policy

d. time segmentation policy

e. bid price policy

Answer: B

A penetration policy is appropriate when there is:

A penetration policy is appropriate when there is:

a. a strong threat of imminent competition.

b. inelastic demand.

c. an opportunity for a substantial reduction in production costs as volume expands.

d. all of the above

e. (a) and (c) only

Answer: E

The policy of using a skimming pricing approach when a product is introduced, followed by penetration pricing as the product matures, is referred to by Joel Dean as:

The policy of using a skimming pricing approach when a product is introduced, followed by penetration pricing as the product matures, is referred to by Joel Dean as:

a. product differentiation.

b. market segmentation.

c. time segmentation.

d. price administration.

e. life cycle pricing.

Answer: C

Motorola introduced a new personal communicator priced at a significant premium over competing models. Initially, Motorola will concentrate on the business user but the firm plans to reduce the price later and capture a share of the consumer market. This policy of beginning with a high price and then moving to a lower price is referred to as:

Motorola introduced a new personal communicator priced at a significant premium over competing models. Initially, Motorola will concentrate on the business user but the firm plans to reduce the price later and capture a share of the consumer market. This policy of beginning with a high price and then moving to a lower price is referred to as:

a. product differentiation.

b. market segmentation.

c. price administration.

d. time segmentation.

e. life cycle pricing.

Answer: D

The degree of latitude that an industrial firm has in setting prices above those offered by competitors is dependent upon:

The degree of latitude that an industrial firm has in setting prices above those offered by competitors is dependent upon:

a. the firm's objectives.

b. the cost of producing the product.

c. the level of differentiation that the product enjoys in the perceptions of organizational buyers.

d. the size of the firm's promotional budget.

e. both (a) and (b)

Answer: C

Concerning pricing and the competitive environment, which of the following statements is(are) accurate?

Concerning pricing and the competitive environment, which of the following statements is(are) accurate?

a. Competition establishes an upper limit on price.

b. Late entrants to the market often enjoy potential cost advantages over the pioneering firm.

c. Competitors will be more sensitive toward price reductions that threaten market segments  that they deem important.

d. all of the above

e. (a) and (b) only

Answer: D

Those costs, fixed or variable, that can be traced to a product, customer, or sales territory (for example, general plant overhead may be indirectly assigned to a product) are called:

Those costs, fixed or variable, that can be traced to a product, customer, or sales territory (for example, general plant overhead may be indirectly assigned to a product) are called:

a. direct traceable costs.

b. indirect traceable costs.

c. assignable costs.

d. general costs.

e. administrative overhead.

Answer: B

Successful pricing strategies are:

Successful pricing strategies are:

a. value based.

b. proactive.

c. profit-driven.

d. all of the above.

e. only a and c.

Answer: D

If the business marketer's product input assumes an insignificant role in the final product's total cost, demand is likely:

If the business marketer's product input assumes an insignificant role in the final product's total cost, demand is likely:

a. elastic.

b. price sensitive.

c. inelastic.

d. small.

Answer: C

The business marketer will find that total revenue will ____ if the price is decreased and demand is price inelastic.

The business marketer will find that total revenue will ____ if the price is decreased and demand is price inelastic.

a. rise a little

b. rise sharply

c. remain the same

d. fall

Answer: D

The price elasticity of demand:

The price elasticity of demand:

a. is not the same at all prices.

b. varies by industrial market segment.

c. is relatively easy to measure in the industrial market.

d. all of the above

e. (a) and (b) only

Answer: E

____ is the variable cost of moving products from origin to destination, including any terminal and accessory charges.

____ is the variable cost of moving products from origin to destination, including any terminal and accessory charges.

a. Speed of service

b. Transportation cost

c. Cost of service

d. Fixed cost

e. None of the above.

Answer: C

____ is the variable cost of moving products from origin to destination, including any terminal and accessory charges.

____ is the variable cost of moving products from origin to destination, including any terminal and accessory charges.

a. Speed of service

b. Transportation cost

c. Cost of service

d. Fixed cost

e. None of the above.

Answer: C

Common elements of logistics service include:

Common elements of logistics service include:

a. delivery time.

b. order accuracy.

c. cost-per-unit.

d. All of the above.

e. Only (a) and (b).

Answer: E

When compared to logistics management, supply chain management is:

When compared to logistics management, supply chain management is:

a. broader.

b. less integrative.

c. is focused on moving and storing activities.

d. All of the above.

e. Only (a) and (b).

Answer: A

For a supply chain partnership to succeed, which of the following are true?

For a supply chain partnership to succeed, which of the following are true?

a. Partners need to clearly define their strategic objectives.

b. Managers in both organizations need to fairly divide decision-making responsibilities.

c. Use performance metrics that are tied to chosen strategies.

d. All of the above.

e. Only (a) and (c).

Answer: E

The key to maintaining a competitive advantage through supply chain strategies is to:

The key to maintaining a competitive advantage through supply chain strategies is to:

a. the ability to adapt to changes.

b. the ability to maintain low cost relationships with partners.

c. the ability to continuously develop successful new products.

d. continue purchasing the most advanced supply chain software and technologies.

Answer: A

The final stage in the adoption of supply chain management where companies have successfully aligned both their internal and external processes is called:

The final stage in the adoption of supply chain management where companies have successfully aligned both their internal and external processes is called:

a. the Expanded Enterprise stage.

b. Internal Process Integration stage.

c. the Informal stage.

d. the Functional stage.

e. the Customer Relationship Management stage.

Answer: A

_____ is the integration of business processes from end user through original suppliers that provides products, services, and information that add value for customers.

_____ is the integration of business processes from end user through original suppliers that provides products, services, and information that add value for customers.

a. Customer relationship management

b. Supply chain management

c. Logistics management

d. A marketing plan

e. Order processing

Answer: B

As a controllable element in the logistics system, _____ ensures that information exchanged in the distribution process guides the activities of the logistics system.

As a controllable element in the logistics system, _____ ensures that information exchanged in the distribution process guides the activities of the logistics system.

a. customer service

b. order processing

c. logistics communications

d. inventory control

e. production planning

Answer: C

As a controllable element in the logistics system, _____ relates to the effectiveness of creating time and place utility.

As a controllable element in the logistics system, _____ relates to the effectiveness of creating time and place utility.

a. customer service

b. order processing

c. inventory control

d. production planning

e. logistics communication

Answer: A

As a controllable element in the logistics system, _____ ensures that products are available for inventory in the correct assortment and quantity.

As a controllable element in the logistics system, _____ ensures that products are available for inventory in the correct assortment and quantity.

a. production planning

b. plant and warehouse location

c. customer service

d. inventory control

e. logistics communication

Answer: A

A firm that is able to lower costs by minimizing duplication, harmonizing operations, and enhancing quality is addressing which of the following supply chain management goals?

A firm that is able to lower costs by minimizing duplication, harmonizing operations, and enhancing quality is addressing which of the following supply chain management goals? 

a. Waste reduction.

b. Time compression.

c. Flexible response.

d. Inventory reduction.

e. Transportation cost reduction.

Answer: A

A firm that is able to accomplish production and logistics processes in less time is addressing which of the following supply chain management goals?

A firm that is able to accomplish production and logistics processes in less time is addressing which of the following supply chain management goals?

a. Waste reduction.

b. Time compression.

c. Flexible response.

d. Unit cost reduction.

e. Transportation cost reduction.

Answer: B

Inventories are needed in business channels because:

Inventories are needed in business channels because:

a. production and demand are perfectly matched.

b. operating deficiencies in logistical system often result in product unavailability.

c. business customers can predict their product needs with certainty.

d. all of the above.

e. (a) and (c) only.

Answer: B

The mechanism to trace the cost of performing logistics services to the customer that use these services is called:

The mechanism to trace the cost of performing logistics services to the customer that use these services is called:

a. ABC

b. JIT

c. TCO

d. SCM

Answer: A

Which of the following is false regarding supply chain management?

Which of the following is false regarding supply chain management?

a. The focus of logistics is the flow of product through the supply chain.

b. Timely information drives the entire supply chain process.

c. Product flow in the reverse direction is an important aspect of supply chain management.

d. The formation close relationships among participants is an inherent need of SCM.

e. All of the above are true statements.

Answer: E

Which of the following statements is false regarding the relationship of the Internet and SCM?

Which of the following statements is false regarding the relationship of the Internet and SCM?

a. The Internet promotes efficiency across the supply chain.

b. The Internet promotes effectiveness across the supply chain.

c. The Internet permits suppliers to gain real-time knowledge of their customer's needs for materials and components.

d. The use of the Internet as a part of supply chain management has allowed business marketers develop new products in a more timely manner.

e. The Internet has provided companies the opportunities to increase channel inventories.

Answer: E

The Internet has allowed business marketers to realize several supply chain related benefits, including more timely:

The Internet has allowed business marketers to realize several supply chain related benefits, including more timely:

a. product development.

b. access to new customer segments.

c. reduction in communication and customer support costs.

d. all of the above.

e. (b) and (c) only.

Answer: D

Waste reduction throughout the supply chain is accomplished by minimizing:

Waste reduction throughout the supply chain is accomplished by minimizing:

a. duplication.

b. harmonizing operations and systems.

c. quality defects.

d. all of the above.

e. (a) and (b) only.

Answer: D

The underlying premise of SCM is that waste reduction and enhanced supply chain performance will exist when there is both intrafirm and interfirm:

The underlying premise of SCM is that waste reduction and enhanced supply chain performance will exist when there is both intrafirm and interfirm:

a. functional integration.

b. sharing.

c. cooperation.

d. all of above.

e. (b) and (c) only.

Answer: D

Which of the following statements is false regarding supply chain management?

Which of the following statements is false regarding supply chain management?

a. SCM seeks to create an overlap among participants in the supply chain.

b. Traditional supply chains openly share information across the supply chain.

c. Non-integrated approaches to managing product and information flows are expensive and time consuming.

d. Aligning both internal and external processes is the ultimate goal of SCM.

Answer: B

Supply chains should manage _____ in an integrated manner across organizational borders.

Supply chains should manage _____ in an integrated manner across organizational borders.

a. relationships

b. information

c. material flow

d. all of the above.

e. (b) and (c) only.

Answer: D

Which of the following statements are false regarding Supply Chain Management?

Which of the following statements are false regarding Supply Chain Management?

a. SCM is one of the predominant management approaches driving many organizations.

b. The supply chain increasingly is seen as the main conduit for getting products from its source to the ultimate customer.

c. The supply chain touches almost every function within the organization.

d. The supply chain has the greatest impact on customer satisfaction and the greatest potential for improving the bottom line and enabling competitive advantage.

e. All of the above are true statements.

Answer: E

Despite the advantages, some firms are reluctant to use third party logistics firms because:

Despite the advantages, some firms are reluctant to use third party logistics firms because:

a. of the diminished direct contact with customers.

b. they lose direct control of the logistics process.

c. of the problems associated with terminating internal operations.

d. all of the above

e. (b) and (c) only

Answer: D

The advantages of third-party warehouses are that they allow the business marketing firm to:

The advantages of third-party warehouses are that they allow the business marketing firm to:

a. increase or decrease warehouse space in a given market.

b. replace the distributor channel when the sales function can be performed by a direct sales force or by manufacturers' representatives.

c. reduce expenditures on company-owned warehouses.

d. all of the above

e. (a) and (c) only

Answer: D

An emerging development in performing the logistics process is the utilization of third-party logistics firms. Third-party logistics firms can:

An emerging development in performing the logistics process is the utilization of third-party logistics firms. Third-party logistics firms can:

a. perform the warehousing function.

b. perform the transportation function.

c. perform the entire logistics process from production scheduling to delivery of finished goods to the customer.

d. all of the above.

e. (a) and (b) only.

Answer: D

The use of slower modes of transportation within the logistical network results in:

The use of slower modes of transportation within the logistical network results in:

a. lower variable costs for product movement.

b. higher customer service levels.

c. higher investments in inventory.

d. all of the above

e. (a) and (c) only

Answer: E

The "best" mode of transportation to use in moving industrial products to customers is:

The "best" mode of transportation to use in moving industrial products to customers is:

a. rail.

b. air.

c. truck.

d. barge.

e. dependent upon cost, service and investment tradeoffs.

Answer: E

A business marketer who shifts from rail to air in the logistical system would likely generate:

A business marketer who shifts from rail to air in the logistical system would likely generate:

a. higher variable costs associated with product movement.

b. lower customer investments in inventory.

c. a higher customer service level.

d. all of the above

e. (a) and (c) only

Answer: D

Concerning speed of service in the logistical system, which of the following is(are) accurate?

Concerning speed of service in the logistical system, which of the following is(are) accurate?

a. The longer the delivery time, the more inventory customers must maintain to service their needs while the shipment is in transit.

b. The slower modes of transportation involve higher variable costs for product movement.

c. The faster modes of transportation result in the need for higher investments in inventory by customers.

d. all of the above

e. both (b) and (c)

Answer: A

_____ is typically the largest logistics expense.

_____ is typically the largest logistics expense.

a. Warehousing

b. Inventory control

c. Transportation

d. Order processing

e. Materials handling

Answer: C

The use of faster modes of transportation within the logistical network results in:

The use of faster modes of transportation within the logistical network results in:

a. lower variable costs for product movement.

b. higher customer service levels.

c. higher investments in inventory.

d. all of the above

e. (a) and (c) only

Answer: B

The warehouse circumvents the need for premium transportation (for example, air freight) and costly order processing by keeping products readily available in local markets. Which type of warehousing involves no capital investment and offers the advantage of flexibility--the firm can increase or decrease its use of space in a given market?

The warehouse circumvents the need for premium transportation (for example, air freight) and costly order processing by keeping products readily available in local markets. Which type of warehousing  involves no capital investment and offers the advantage of flexibility--the firm can increase or decrease its  use of space in a given market?

a. merchant

b. mobile

c. fixed

d. third party

e. private

Answer: D

A business marketer that provides erratic delivery service to industrial distributors:

A business marketer that provides erratic delivery service to industrial distributors:

a. increases the distributor's inventory carrying costs.

b. creates stockouts at the distributor level.

c. damages channel relations.

d. all of the above

e. (a) and (c) only

Answer: D

In regard to logistical service, the business marketer should:

In regard to logistical service, the business marketer should:

a. provide the same level of logistical service to all customers.

b. adjust the level of logistical service for different segments based on requirements of the product type.

c. adjust the level of logistical service for different segments based on requirements of the customer.

d. all of the above.

e. (b) and (c) only.

Answer: E

In the management of logistical activities, the performance variable(s) of prime interest (is) are:

In the management of logistical activities, the performance variable(s) of prime interest (is) are:

a. number of products handled.

b. total distribution costs.

c. inventory movement per warehouse facility.

d. the level of logistical service provided to customers.

e. both (a) and (d)

Answer: D

In applying the total cost approach to logistical management, management:

In applying the total cost approach to logistical management, management:

a. seeks to minimize the cost associated with each logistical activity in the firm.

b. attention centers on minimizing transportation costs.

c. attention centers on minimizing inventory costs.

d. recognizes that a decision made for one logistical variable affects all or some of the other logistics variables.

e. recognizes the importance of minimizing fixed facility (warehouse) costs.

Answer: D

As a controllable element in the logistics system, ____ triggers the logistics process and directs the activities necessary to deliver products to customers.

As a controllable element in the logistics system, ____ triggers the logistics process and directs the activities necessary to deliver products to customers.

a. order processing

b. customer service

c. production planning

d. inventory management

e. information management

Answer: A

In serving JIT customers, business marketers find that:

In serving JIT customers, business marketers find that:

a. the typical order size shrinks.

b. more frequent deliveries are required.

c. relationships with JIT customers are longer lasting and often formalized with a written contract that may span up to five years.

d. all of the above

e. (b) and (c) only

Answer: D

Many U.S. manufacturers have adopted the just-in-time (JIT) purchasing principle. Concerning this trend, all of the following statements are accurate except:

Many U.S. manufacturers have adopted the just-in-time (JIT) purchasing principle. Concerning this trend, all of the following statements are accurate except:

a. One objective of a JIT system is to eliminate waste of all kinds from the production process.

b. Because JIT attempts to relate purchases to production requirements, the typical order size increases.

c. A significant effect of JIT purchasing has been the drastic reduction in the number of suppliers utilized by manufacturers.

d. Suppliers find that relationships with JIT customers are longer lasting.

e. both (b) and (c)

Answer: B

In contrast to "innovative" products, the supply chain for functional products is designed to:

In contrast to "innovative" products, the supply chain for functional products is designed to:

a. minimize logistics and inventory costs.

b. assure low-cost manufacturing.

c. adapt production capacity to uncertain demand patterns.

d. all of the above

e. (a) and (b) only

Answer: E

The supply chains for products that could be categorized as "innovative" (e.g., high-tech products) differ from the supply chains for functional products because:

The supply chains for products that could be categorized as "innovative" (e.g., high-tech products) differ from the supply chains for functional products because:

a. demand is less predictable for innovative products.

b. attention centers on capturing high profits during peak demand periods for the innovative product.

c. minimizing inventory costs is not a major concern with innovative products.

d. all of the above

e. (a) and (b) only

Answer: D

The most commonly reported benefits for firms that adopt supply chain management are:

The most commonly reported benefits for firms that adopt supply chain management are:

a. higher profit margins.

b. enhanced cash flow.

c. higher order-to-delivery cycle time.

d. all of the above.

e. (a) and (b) only.

Answer: E

A firm that can respond to a customer's unique requirements for packaging and order size in a cost-effective manner is addressing which of the following supply chain goals?

A firm that can respond to a customer's unique requirements for packaging and order size in a cost-effective manner is addressing which of the following supply chain goals?

a. time compression

b. waste reduction

c. unit cost reduction

d. flexible response

e. inventory reduction

Answer: D

Supply chain management seeks to achieve which of the following goals?

Supply chain management seeks to achieve which of the following goals?

a. waste reduction

b. unit cost reduction

c. flexible response

d. all of the above

e. (a) and (b) only

Answer: D

To integrate activities across the supply chain, supply chain management often:

To integrate activities across the supply chain, supply chain management often:

a. requires that firms in the supply chain share sensitive and proprietary information about customers and corporate plans.

b. creates excess inventory in the pipeline leading to the customer.

c. involves higher transportation and handling costs.

d. all of the above.

e. (b) and (c) only

Answer: A

The supply chain includes a variety of firms, ranging from those that process raw materials to make component parts to those engaged in wholesaling. Included also are organizations engaged in:

The supply chain includes a variety of firms, ranging from those that process raw materials to make component parts to those engaged in wholesaling. Included also are organizations engaged in:

a. warehousing.

b. transportation.

c. materials handling.

d. all of the above.

e. (a) and (b) only.

Answer: D