SC exam #3 Multiple Choice

1. What is the primary goal of supply chain network design?
A. Maximize market share
B. Minimize supplier lead time
C. Optimize cost and responsiveness through facility decisions
D. Increase employee productivity

C

2. Which of the following is NOT typically a factor in supply chain network design?
A. Facility location
B. Supplier stock options
C. Capacity allocation
D. Product-market assignment

B

3. Which type of facility offers higher adaptability but may be more expensive?
A. Dedicated facility
B. Flexible facility
C. Offshore facility
D. Strategic hub

B

4. A gravity model is used to:
A. Analyze labor market dynamics
B. Calculate transportation costs based on location and demand
C. Determine the amount of inventory to hold
D. Track supplier performance

B

5. What is a key trade-off in network design?
A. Inventory vs. advertising
B. Transportation vs. tax rates
C. Facility costs vs. responsiveness
D. Inventory vs. HR training

C

1. What is one benefit of globalization in supply chains?
A. Lower taxes
B. Faster product development
C. Higher revenue and lower costs
D. Better warehouse lighting

C

2. Which of the following is NOT a global supply chain risk?
A. Logistics complexity
B. Weather
C. Labor cost
D. Exchange rate changes

C

3. Why is it risky to only consider unit cost in offshoring?
A. You might underestimate total supply chain costs
B. Unit cost includes taxes
C. It lowers product variety
D. It affects packaging only

A

4. What does supply chain flexibility help manage?
A. Marketing budgets
B. Demand and uncertainty
C. Office design
D. Team morale

B

5. What is the main reason to use a decision tree?
A. To predict customer reviews
B. To draw organizational charts
C. To evaluate decisions under uncertainty
D. To count total factories

C

6. When is offshoring most attractive?
A. Small volume, high variety products
B. Large volume, low variety, high labor products
C. Services with high tech needs
D. Expensive-to-ship products

B

1. What does aggregate planning focus on?
A. Company profits
B. Long-term marketing
C. Exact product color
D. Production and capacity over time

D

2. What is the main goal of aggregate planning?
A. Maximize worker overtime
B. Reduce taxes
C. Match supply with demand
D. Track every SKU

C

3. Which strategy changes workforce size as demand changes?
A. Hybrid strategy
B. Chase strategy
C. Level strategy
D. Flexibility strategy

B

4. What is a downside of the chase strategy?
A. Poor morale from constant hiring and layoffs
B. High fixed costs
C. Too much product variety
D. Too much inventory

A

5. When is the level strategy useful?
A. When hiring is fast
B. When labor is cheap
C. When demand is unpredictable
D. When inventory and backlog costs are low

D

6. Why do you need to include safety inventory or capacity?
A. To avoid stockouts from forecast errors
B. To improve marketing
C. Because suppliers ask for it
D. To reduce taxes

A

1. What is predictable variability?
A. Short-term random demand changes
B. Long-term inventory decline
C. Demand changes that can be forecasted
D. Changes caused by stockouts

C

2. Which of the following is a supply-side way to manage predictable variability?
A. Price discounts
B. Social media marketing
C. Subcontracting
D. Packaging design

C

3. What is one effect of promotions that only shifts demand timing?
A. Forward buying
B. Stealing market share
C. Market growth
D. New customer acquisition

A

4. Why might promoting during a peak month hurt profits?
A. Lower customer satisfaction
B. Too many competitors
C. Forward buying raises costs
D. Increase in transportation speed

C

5. When is promoting during peak demand more profitable?
A. When forward buying is high
B. When product margins are low
C. When customers increase total consumption
D. When costs are unpredictable

C

6. What is a benefit of building early alerts into S&OP?
A. Lower taxes
B. Less need for forecasting
C. Faster order processing
D. Better response to demand changes

D