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BM2 2.01-3.01 Test Review

Total questions: 107

Worksheet time: 54mins

Name
Class
Date
1.
Which supply chain flow follows items as they progress from raw material to being consumed?
a)
financial
b)
information
c)
product
d)
technology
2.
The purpose of supply chain management is to:
a)
ensure the company has new products.
b)
ensure inventory is available to meet demand.
c)
ensure that vendors stay committed to the company.
d)
ensure the organization is always aware of what is happening.
3.
Trees Incorporated is a company that provides chopped-down trees to paper manufacturers. This company is an example of what common supply chain member?
a)
producer
b)
retailer
c)
supplier
d)
vendor
4.
One reason that companies strive to optimize their supply chain is to:
a)
lower costs.
b)
reduce defects.
c)
increase vendors.
d)
increase inventory.
5.
Which job is responsible for overseeing the process of getting products into the marketplace?
a)
line supervisor
b)
inventory manager
c)
chief financial officer
d)
supply chain manager
6.
Why would an organization hold finished goods inventory?
a)
to hide quality issues
b)
to look for hidden problems
c)
to execute production strategy needs
d)
to meet variation in production demand
7.
Gloves for workers to wear to protect their hands during the production process are examples of what type of inventory?
a)
retail
b)
transit
c)
work-in-process
d)
maintenance, repair, and operating goods
8.
A business orders 10% more widgets than it needs because the supply of and the demand for widgets have been difficult to forecast in recent months. Which type of inventory is the business using?
a)
buffer
b)
customary
c)
perpetual
d)
transit
9.
Sally drives a truck that transports Nike shoes from the production plant to retail stores. The goods on the truck are:
a)
safety inventory
b)
transit inventory
c)
work-in-process inventory
d)
maintenance and repair inventory
10.
Which type of inventory has a function in the input process?
a)
paint supplies
b)
finished goods
c)
defective items
d)
packing materials
11.
Why is a receiving procedure important to a business?
a)
to establish standards to govern the receiving process
b)
to receive transportation documentation from the driver
c)
to make sure that all the promised discounts are received
d)
to assign staff to ensure that all employees receive policies
12.
What is just-in-time inventory?
a)
Inventory held on hand that is over and above what is currently needed to meet demand.
b)
Items that are used to support and maintain the production process and its infrastructure.
c)
A balance of inventory holdings or carrying costs incurred from ordering or setting up supplies for the customers.
d)
A method of managing inventory that keeps a minimal amount of raw materials on hand to meet production needs.
13.
What are employees who are specially trained to inspect and record newly arrived merchandise called?
a)
accountants
b)
buyers
c)
managers
d)
receivers
14.
Which method of merchandise checking is used for products such as furniture, vases, and paintings?
a)
blind
b)
direct
c)
quality
d)
spot
15.
Maintaining an inventory of supplies helps a business to:
a)
locate vendors.
b)
operate efficiently.
c)
evaluate processes.
d)
establish marketing goals.
16.
Which type of risk is caused by electrical storms, floods, and earthquakes?
a)
economic
b)
human
c)
marketing
d)
natural
17.
To control the business’s level of risk, management needs to clearly communicate the business’s code of ethics to employees because:
a)
the government requires all businesses to provide in-depth ethics training programs.
b)
business policies tend to change in terms of what is considered ethical behavior.
c)
businesses neglect to address ethical issues in their employee handbooks.
d)
the employees’ personal ethics may differ from the business’s ethics.
18.
An example of an internal financial risk is:
a)
credit downgrades
b)
consumer buying power
c)
improper budgeting practices
d)
foreign exchange rate changes
19.
The impact of some business risks can be reduced if the business transfers the risk to another business by:
a)
purchasing insurance
b)
hiring a risk specialist
c)
installing burglar alarms
d)
employing security guards
20.
Technological innovations can increase the strategic risk for business by:
a)
causing interest rate growth
b)
making some products obsolete
c)
eliminating the convenience of buying in person
d)
decreasing the supply of people seeking employment
21.
What is a negative consequence for a business that neglects to manage risk by failing to implement an ethics training program for employees?
a)
decreased conflict
b)
damaged reputation
c)
inflated profit margin
d)
increased credit rating
22.
A good source of information about a business’s retroactive risks would be a/an:
a)
environmental scan
b)
purchasing manager
c)
business incident log
d)
local weather forecast
23.
What type of risk is an earthquake?
a)
operational
b)
pure
c)
speculative
d)
strategic
24.
The two dimensions of risk are:
a)
impact and avoidance
b)
probability and impact
c)
probability and avoidance
d)
mitigation and acceptance
25.
Risks that are caused by changes in the market and affect the production and distribution of products are called:
a)
human risks
b)
economic risks
c)
marketing risks
d)
environmental risks
26.
Which is an example of an economic risk?
a)
competition
b)
dishonesty
c)
perishability
d)
tornado
27.
Which term refers to the process of coordinating all the steps involved in producing and delivering a product?
a)
Operations management
b)
Supply chain management
c)
Human resources management
d)
Financial management
28.
What is a supplier?
a)
A company that purchases goods from consumers
b)
A company that provides raw materials or components to another business
c)
A retailer that sells goods directly to customers
d)
A middleman between two distributors
29.
Which term describes a company that sells products directly to end consumers?
a)
Manufacturer
b)
Distributor
c)
Retailer
d)
Producer
30.
What is logistics in the context of business?
a)
The process of hiring and training employees
b)
The process of managing how resources are acquired, stored, and transported
c)
The design of advertisements and marketing materials
d)
The financial planning of business projects
31.
What is inventory turnover?
a)
The number of new employees hired to manage inventory
b)
The rate at which inventory is sold and replaced over a period of time
c)
The number of damaged items found in a warehouse
d)
The cost of storing goods for one year
32.
The total cost of storing, handling, and maintaining goods in stock is called:
a)
Carrying cost
b)
Production cost
c)
Variable cost
d)
Retail price
33.
What is safety stock?
a)
Products kept in storage for emergencies or unexpected demand
b)
Merchandise returned by customers for refunds
c)
Goods that have been recalled due to safety issues
d)
The number of items damaged during transit
34.
Which term refers to goods that are currently being produced but are not yet completed?
a)
Finished goods
b)
Work-in-process inventory
c)
Maintenance supplies
d)
Raw materials
35.
What is procurement?
a)
The process of creating marketing materials
b)
The process of obtaining goods and services from suppliers
c)
The storage of products in a warehouse
d)
The packaging and labeling of merchandise
36.
What does the term invoice mean?
a)
A document that lists goods shipped, quantities, and prices for payment
b)
A receipt given to customers after purchase
c)
A quality inspection form used at receiving
d)
A tracking label for delivery vehicles
37.
What is a purchase order?
a)
A customer’s request for refund
b)
A legal document sent by a buyer to a supplier to confirm a purchase
c)
A company’s record of past purchases
d)
A checklist for damaged items
38.
What does quality control mean in the receiving process?
a)
Measuring employee performance
b)
Ensuring that products meet required standards before acceptance
c)
Recording the amount of inventory received
d)
Organizing items by size and weight
39.
What is risk management?
a)
The process of eliminating all business risks
b)
The process of identifying, assessing, and controlling potential threats
c)
The act of purchasing insurance for a business
d)
The process of analyzing market trends
40.
What does mitigation mean in risk management?
a)
Avoiding any risky situation
b)
Transferring all risk to another company
c)
Taking steps to reduce the impact or likelihood of a risk
d)
Ignoring low-probability risks
41.
What is liability?
a)
The total profit earned by a business
b)
The amount a business owes for borrowed funds
c)
The legal responsibility for damages or loss
d)
The insurance coverage amount
42.
What is hazard risk?
a)
Risk caused by natural events or accidents
b)
Risk caused by poor financial planning
c)
Risk caused by market competition
d)
Risk caused by unethical decisions
43.

If your company sells a thing to a customer, your company most likely has a __________.

a)

supply chain

b)

warehouse

c)

physical location

d)

customer database

44.

Supply chain management isn't just the management of products — it's also the management of ____________________.

a)

information, time, and money

b)

customers, sales, and marketing

c)

products, services, and logistics

d)

people, places, and things

45.

Managing your product supply when your suppliers are sourcing their suppliers is called:

a)

Supply Logistics

b)

Inventory Management

c)

Tier II Supplier Managment

d)

Chain Management

46.

____________ includes the cost of goods negotiations, on-time delivery management, quality audits and management, new product development.

a)

operations management

b)

product supply

c)

logistics

d)

supplier management

47.

_____________ is the management of the movement of goods.

a)

supplier management

b)

logistics

c)

supply chain

d)

product relocation

48.

You need to have enough _________ on hand to supply your customers what they want, when they want it — but you can't have too much __________ on hand or you will have paid (possibly) too much money out of pocket.

a)

supply

b)

cash

c)

inventory

d)

production

49.

All of these are reasons why a business could end up with too much inventory, except for:

a)

you sold too many of an item

b)

minimum order quantities

c)

something changed in the marketplace

d)

you thought you would sell more of an item

50.

___________ functions as the voice of the customer at your company. What shipping method does your customer want? What size boxes do you need to pack your product in and how many units per pack?

a)

logistics

b)

sales and marketing

c)

customer service

d)

product acquisition

51.

Supply chain management is optimized when you are delivering _______ your customers want, ________ they want it, and doing that by spending as _______ money as possible.

a)

what, when, little

b)

the products, where, much

c)

who, how, little

d)

what, when, much

52.

___________ is a part of supply chain management, but it's not the totality of all that supply chain management.

a)

purchasing

b)

manufacturing

c)

selling

d)

timing

53.

What is provider of goods or services or a seller with whom the buyer does business called?

a)

supplier

b)

vendor

c)

producer

d)

customer

54.

A __________ receives services, materials, supplies, energy, and components to use in creating finished products, such as dress shirts, packaged dinners, air-planes, electric power, legal counsel, or guided tours

a)

vendor

b)

producer

c)

supplier

d)

customer

55.

A _____________ receives shipments of finished products to deliver to its customers, who wear the shirts, eat the packaged dinners, fly the planes, or turn on the lights.

a)

customer

b)

vendor

c)

supplier

d)

producer

56.

A person who sells food items on the street is an example of a __________.

a)

vendor

b)

producer

c)

customer

d)

supplier

57.

A person who supplies the vegetables needed for a vender to sell items on the street is an example of a __________.

a)

vendor

b)

supplier

c)

producer

d)

customer

58.

The person who is responsible for purchasing the merchandise for a store

a)

Buyer

b)

Inventory Control

c)

Stock Turnover

d)

Vendor

59.

A business from which merchandise is purchased

a)

Stock Turnover

b)

Vendor

c)

Stock

d)

Physical Inventory System

60.

The amount of goods a business has, including goods in the backroom and on the sales floor.

a)

Inventory

b)

Invoice

c)

Stock Turnover

d)

Vendor

61.

Another term for inventory

a)

Physical Inventory System

b)

Inventory Control

c)

Stock

d)

Stock Turnover

62.

The vendor's bill for stock purchased.

a)

Physical Inventory System

b)

Invoice

c)

Just-in-time Inventory Control System

d)

Vendor

63.

The management of the merchandise a store has for sale.

a)

Inventory Control

b)

Just-in-time Inventory Control System

c)

Open-to-buy

d)

Physical Inventory System

64.

A usually computerized method of inventory control that involves linking a store to its suppliers through a computer system that purchases new inventory automatically as sales are made.

a)

Just-in-time Inventory Control System

b)

Inventory Control

c)

Stock

d)

Perpetual Inventory System

65.

An inventory system that makes use of periodic counts of stock to ascertain stock levels.

a)

Inventory Control

b)

Perpetual Inventory System

c)

Inventory

d)

Physical Inventory System

66.

Inventory system that maintains a continual record of inventory purchased and sold

a)

Vendor

b)

Just-in-time Inventory Control System

c)

Perpetual Inventory System

d)

Open-to-buy

67.

A tool that measures how often stock is sold during a given time period.

a)

Stock Turnover

b)

Physical Inventory System

c)

Invoice

d)

Inventory Control

68.

The term risk is used in business to refer to the

a)

possibility of loss or gain

b)

chances that consumers take

c)

uncontrollable possibility of danger

d)

mistakes that employees make

69.

An earthquake is an example of a _________________ risk.

a)

strategic

b)

operational

c)

speculative

d)

pure

70.

What do risk managers need to do to help their company successfully launch a new product?

a)

Evaluate the potential gains and losses of the launch

b)

Ignore risks the company has encountered in the past

c)

Develop fail-proof risk management strategies

d)

Act quickly to beat the company's competition

71.

Which of the following is an example of a hazard risk?

a)

Tornadoes

b)

Product Shortages

c)

Inflation

d)

Competition

72.

An example of an internal financial risk is

a)

foreign exchange rate changes

b)

improper budgeting practices

c)

consumer buying power

d)

credit downgrades

73.

Poor product development, unreliable manufacturing equipment, and product shortages are examples of __________ risks.

a)

strategic

b)

hazard

c)

financial

d)

operational

74.

What category of risk typically has the most impact on a business's ability to reach its goals and objectives?

a)

Strategic

b)

Hazard

c)

Financial

d)

Operational

75.

Technological innovations can increase strategic risk for business by

a)

decreasing the supply of people seeking employment

b)

causing interest rate increases

c)

making some products obsolete

d)

eliminating the convenience of buying in person

76.

A good source of information about a business's retroactive risks would be a(n)

a)

environmental scan

b)

business incident log

c)

local weather forecast

d)

purchasing manager

77.

Which of the following statements accurately explains the nature of prospective risks?

a)

They have not happened before but could occur in the future

b)

They are typically more common than retroactive risks

c)

They are usually easier to identify than retroactive risks

d)

They occurred in the past and could occur again in the future

78.

The two dimensions of risks are

a)

mitigation and acceptance

b)

probability and avoidance

c)

probability and impact

d)

impact and avoidance

79.

Which of the following is often used to measure and rate potential risks?

a)

Contingency and fallback plans

b)

Transference strategies

c)

an environmental scan

d)

A risk impact/probability chart

80.

If a business chooses not to do something that it considers risky, it is ______________ the risk.

a)

accepting

b)

avoiding

c)

mitigating

d)

transfering

81.

A common transference device is a(n)

a)

smoke alarm

b)

risk checklist

c)

insurance policy

d)

contingency plan

82.

A business is most likely to mitigate a risk that is ___________ to eliminate completely.

a)

easy and inexpensive

b)

difficult and expensive

c)

easy and expensive

d)

difficult and inexpensive

83.

Businesses typically accept a risk's consequences if

a)

there is a clear way to avoid the risk

b)

there is absolutely no chance of loss

c)

the potential payoff is guaranteed

d)

the potential payoff is higher than the losses

84.

Businesses are most likely to prepare contingency and fallback plans for risks that they choose to

a)

transfer

b)

accept

c)

mitigate

d)

avoid

85.

Hospitals, fire and rescue services, and police departments, which attempt to avoid risk as much as possible, are usually risk - _____________ organizations.

a)

seeking

b)

speculative

c)

averse

d)

tolerant

86.

Walt's World of Winter ski shop manages existing risks as appropriate, but it does not take risks on new products, new markets, or new equipment. Walt's is a risk _______________ organization.

a)

speculative

b)

tolerant

c)

averse

d)

seeking

87.

When monitoring and controlling risk, businesses must

a)

increase the probability that existing risks will result in loss

b)

consider new as well as existing risks

c)

increase the impact of existing risks

d)

implement control processes before measuring new risks.

88.

People who go into business know that the business may not succeed. This possibility is referred to as business

a)

Risk

b)

Retention

c)

Downsizing

d)

Economizing

89.

The general classifications of business risks are

a)

Competitive, strategic, financial and operational

b)

Production, hazard, operational, and strategic

c)

Hazard, operational, strategic, and financial

d)

Strategic, production, competitive, and hazard

90.

A hurricane that destroys a business is an example of a(n) risk.

a)

Operational

b)

Financial

c)

Strategic

d)

Hazard

91.

A garden store customer tripped over a plant, fell, and sued the store for damages. This is an example of a(n) risk.

a)

Strategic

b)

Operational

c)

Hazard

d)

Financial

92.

A union strike that stops production at a manufacturing plant is a(n) risk.

a)

Financial

b)

Operational

c)

Strategic

d)

Hazard

93.

What category of business risk includes production problems and incompetent employees?

a)

Operational

b)

Hazard

c)

Strategic

d)

Financial

94.

When a rival's product on the market reduces sales of your company's product, your company is experiencing strategic risk cause by

a)

Regulatory and political issues

b)

Changing customer needs

c)

Obsolescence

d)

Competition

95.

Financial loss from investing time and money to comply with accounting standards is an example of which strategic risk?

a)

Reputation damage

b)

Regulatory and political issues

c)

Changing customer needs

d)

Obsolescence

96.

Which of the following is a pure business risk:

a)

Robbery

b)

Obsolescence

c)

Competition

d)

Inflation

97.

Which of the following is an example of a business risk that cannot be covered by insurance:

a)

Goods lost in transit

b)

Destruction of building by fire

c)

Increase in interest rates

d)

Injury of employee on the job

98.

The act of reducing or removing risk by shifting the risk factor to another person or business is referred to as risk.

a)

Retaining

b)

Transferring

c)

Avoiding

d)

Controlling

99.

Having well-planned buildings and providing effective employee training are ways that businesses can ? risk.

a)

Transfer

b)

Insure against

c)

Retain

d)

Prevent or control

100.

Management decides to hold its annual meeting in one U.S. city rather than another because of crime in that city. This is an example of ? the risk.

a)

Retaining

b)

Preventing or controlling

c)

Avoiding

d)

Transferring

101.

Carefully selecting goods or services to sell is an example of handling business risks by ? the risk.

a)

Avoiding

b)

Transferring

c)

Retaining

d)

Preventing or controlling

102.

If a risk is small in terms of money, a business may decide to ? the risk.

a)

Tranfer

b)

Avoid

c)

Control

d)

Retain

103.

Contractual agreements such as guarantees, surety bonds, and leases are examples of business risk being handled through

a)

Management

b)

Transfer

c)

Avoidance

d)

Prevention or controll

104.

Businesses can protect themselves from risk associated with lost shipments by

a)

Inspecting shipment of goods

b)

Purchasing transportation insurance

c)

Training receiving personnel

d)

Selecting resale items carefully

105.

Careful screening of credit customers is an example of handling business risks through

a)

Prevention

b)

Management

c)

Training

d)

Retention

106.

When a business keeps a risk because management is unaware of it, the business is ? the risk.

a)

Avoiding

b)

Preventing or contolling

c)

Retaining

d)

Transferring

107.

Requiring a contractor to purchase a surety bond is an example of handling business risk by the risk.

a)

Transferring

b)

Retaining

c)

Reducing

d)

Preventing

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