Designing Effective Supply Chains

Pages: 22 (4989 words) Published: May 30, 2014
Chapter
9

Designing Effective Supply Chains

TRUE/FALSE

1. The purpose of supply chain management is to synchronize a firm’s processes with those of its suppliers and customers. Answer: True
Reference: Supply Chains for Services and Manufacturing
Difficulty: Easy
Keywords: supply chain management

2. Supply chain management tries to match the flow of materials, services and information with demand. Answer: True
Reference: Supply Chains for Services and Manufacturing
Difficulty: Easy
Keywords: supply chain management

3. The purpose of supply chain design is to shape a firm’s supply chain to meet the competitive priorities of its operations strategies. Answer: True
Reference: Supply Chains for Services and Manufacturing
Difficulty: Moderate
Keywords: supply chain design

4. Supply chain design for a service provider is driven primarily by the need to control the materials it consumes as it delivers its various services. Answer: False
Reference: Supply Chains for Services and Manufacturing
Difficulty: Moderate
Keywords: supply chain design

5. The fundamental purpose of supply chain design for a manufacturer is to control inventories by managing the flow of materials. Answer: True
Reference: Supply Chains for Services and Manufacturing
Difficulty: Moderate
Keywords: supply chain design

6. While it is important to manufacturing firms, little can be done to improve supply chain strategy in most service organizations. Answer: False
Reference: Supply Chains for Services and Manufacturing
Difficulty: Moderate
Keywords: supply chain strategy

7. The finished goods of one firm may actually be the raw materials for another firm. Answer: True
Reference: Supply Chains for Services and Manufacturing
Difficulty: Moderate
Keywords: finished good, raw material

8. The primary reason for keeping inventories low is that inventory represents a temporary monetary investment in goods on which a firm must pay interest. Answer: True
Reference: Inventory and Supply Chains
Difficulty: Easy
Keywords: inventory, investment

9. One component of the holding cost of inventory is interest. Answer: True
Reference: Inventory and Supply Chains
Difficulty: Moderate
Keywords: holding cost, inventory, interest

10. One component of the ordering cost of inventory is shrinkage. Answer: False
Reference: Inventory and Supply Chains
Difficulty: Moderate
Keywords: ordering cost, shrinkage

11. A stockout occurs when an item that is typically stocked is not available to satisfy a demand the moment it occurs. Answer: True
Reference: Inventory and Supply Chains
Difficulty: Moderate
Keyword: stockout

12. A backorder occurs when a customer order cannot be filled when it is placed, but is instead filled later. Answer: True
Reference: Inventory and Supply Chains
Difficulty: Moderate
Keywords: backorder, fill

13. Setup cost is independent of order size.
Answer: True
Reference: Inventory and Supply Chains
Difficulty: Moderate
Keywords: setup cost

14. Reducing setup costs will increase the pressure to keep larger inventories. Answer: False
Reference: Inventory and Supply Chains
Difficulty: Moderate
Keywords: setup cost

15. Increasing inventory levels can sometimes help a firm reduce both its inbound and outbound transportation costs. Answer: True
Reference: Inventory and Supply Chains
Difficulty: Moderate
Keywords: pressure for large inventories

16. A quantity discount is attractive because there is a drop in the price per unit when the order is sufficiently large. Answer: True
Reference: Inventory and Supply Chains
Difficulty: Moderate
Keywords: quantity discount

17. Repeatability is an undesirable feature of some orders because they must be repeated until the order is filled correctly. Answer: False
Reference: Inventory and Supply Chains
Difficulty: Moderate
Keyword: repeatability

18. The primary lever to reduce anticipation inventory is to place orders closer to...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Supply chain Management Essay
  • Designing and Managing the Supply Chain Essay
  • Designing and Managing the Supply Chain Essay
  • supply chain Essay
  • Essay on supply chain management of Walmart
  • Supply Chains
  • Essay about Sustainable Supply Chain Management
  • Supply Chain Management revised Essay

Become a StudyMode Member

Sign Up - It's Free