Entrepreneurship Lesson 4.02 Review

What are three types of purchasing?

• Buying for resale, Buying for make-or-buy decisions, and Buying for retailers

• Buying for resale, Buying for transformation, and Buying for retailers

• Buying for transformation, Buying for business use, and Buying for wholesalers

• Buying for resale, Buying for transformation, and Buying for business use

John purchases sterling silver jewelry from Native American artisans and then sells the items to gift shops. What kind of buyer is John?

• Wholesale

• Retail

• Industrial

• Business Use

Sydney purchase sporting goods from several different manufacturers and sells the items in her shop. What kind of buyer is she?

• Wholesale

• Retail

• Industrial

• Business Use

The Purchasing Specialist for which of the following companies is most likely to buy for transformation?

• American Eagle

• Target

• Ford

• Walmart

Why should purchasing specialists develop positive relationships with their suppliers?

• To prevent supplier theft

• To increase the ratio of material cost to finished product cost

• To eliminate the need for a backup supplier

• To ensure the supplier will follow through as promised

Which of the following is a way in which a buyer plays an important role in the success of a business

• Forecasting sales

• Providing a flow of goods

• Determining price of finished products

• Planning company's cash flow

Which of the following is the first step of the purchasing process?

• Selecting supplier

• Evaluating suppliers performance

• Identifying needs

• Negotiating with supplier

Which of the following is NOT an action taken by a buyer when selecting a supplier?

• Negotiating

• Reviewing credentials

• Sign a purchasing contract

• Search for a supplier

Which of the following is a reason why purchasing is important as a business function?

• Helps with new product development

• Part of strategic planning

• Provides needed goods and services

• Determines goals and objectives for company

If a buyer discusses potential issues and ways to resolve them with a supplier prior to making a purchase, what are the buyer and supplier doing?

• Forecasting

• Bidding

• Negotiating

• Transforming