Supply Chain Management 4th edition



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Chapter 3 Supply Chain Drivers and Metri
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Chapter 3
Supply Chain Drivers and Metrics

True/False





  1. The major drivers of supply chain performance are facilities, inventory, transportation, and information.

Answer: True
Difficulty: Moderate



  1. The major drivers of supply chain performance are customers, facilities, inventory, transportation, and information.

Answer: False
Difficulty: Moderate



  1. The two major types of facilities are production sites and storage sites.

Answer: True
Difficulty: Moderate



  1. The two major types of facilities are distribution sites and storage sites.

Answer: False
Difficulty: Moderate



  1. Inventory is an important supply chain driver because changing inventory policies can dramatically alter the supply chain’s efficiency and responsiveness.

Answer: True
Difficulty: Moderate



  1. Information is potentially the biggest driver of performance in the supply chain as it directly affects each of the other drivers.

Answer: True
Difficulty: Easy



  1. Information is potentially the biggest driver of performance in the supply chain even though it has little impact on each of the other drivers.

Answer: False
Difficulty: Easy



  1. A facility with little excess capacity will likely be more efficient per unit of product it produces than one with a lot of unused capacity.

Answer: True
Difficulty: Easy



  1. A facility with little excess capacity will likely be no more or less efficient per unit of product it produces than one with a lot of unused capacity.

Answer: False
Difficulty: Easy



  1. The high utilization facility will have difficulty responding to demand fluctuations.

Answer: True
Difficulty: Easy



  1. The high utilization facility will have no more difficulty responding to demand fluctuations than one with a lot of unused capacity.

Answer: False
Difficulty: Easy



  1. Stock keeping unit (SKU) storage is the warehousing methodology that uses a traditional warehouse to store all of one type of product together.

Answer: True
Difficulty: Moderate



  1. Warehouse unit storage is the warehousing methodology that uses a traditional warehouse to store all of one type of product together.

Answer: False
Difficulty: Moderate



  1. The components of inventory decisions include cycle inventory, safety inventory, seasonal inventory, and sourcing.

Answer: True
Difficulty: Easy



  1. The components of inventory decisions include capacity, cycle inventory, safety inventory, seasonal inventory, and sourcing.

Answer: False
Difficulty: Easy



  1. Cycle inventory is inventory that is built up to counter predictable variability in demand.

Answer: False
Difficulty: Easy



  1. Seasonal inventory is inventory that is built up to counter predictable variability in demand.

Answer: True
Difficulty: Moderate



  1. Companies using seasonal inventory will build up inventory in periods of low demand and store it for periods of high demand when they will not have the capacity to produce all that is demanded.

Answer: True
Difficulty: Moderate



  1. Companies using seasonal inventory will maintain a level inventory increase rate of production for periods of high demand.

Answer: False
Difficulty: Easy



  1. A company’s ability to find a balance between responsiveness and efficiency that best matches the needs of the customer it is targeting is the key to achieving strategic fit.

Answer: True
Difficulty: Moderate

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