1. Which of the following statements is true regarding the leverage of supply-chain savings?
A) Supply chain leverage is about the same for all industries.
B) Supply chain savings exert more leverage as the firm's purchases are a smaller percent of sales.
C) Supply chain savings exert more leverage as the firm has a lower net profit margin.
D) Supply chain leverage depends only upon the percent of sales spent in the supply chain.
E) None of the above is true.
2. What term has been created to describe the return of business activity to the purchasing firm?
A) Renewal
B) Backsourcing
C) Reversal
D) Reversesourcing
E) In-sourcing
3. A grocery store is trying to find a new vendor for carrots. Its three criteria are 1. Freshness, 2. Lot Size, and 3. Cost with factor weights of .6, .1, and .3 respectively. What would a vendor with ratings of 6, 8, and 10 in the three respective categories score as a weighted total?
A) 24
B) 1
C) 7.4
D) 9.8
E) None of the above
4. Which of the following is not a typical inspection point?
A) Upon receipt of goods from your supplier
B) When production or service is complete
C) Before the product is shipped to the customer
D) At the supplier's plant while the supplier is producing
E) After a costly process
5. A production manager at a pottery factory has noticed that about 70 percent of defects result from impurities in raw materials, 15 percent result from human error, 10 percent from machine malfunctions, and 5 percent from a variety of other causes. This manager is most likely using
A) a Pareto chart
B) a scatter diagram
C) a Taguchi loss function
D) a cause-and-effect diagram
E) a flowchart
6. A Three Sigma program has how many defects per million?
A) 34
B) 3
C) 3 times the standard deviation
D) 2700
E) 1500