Purchasing and Materials Management Practice Exam
Course Introduction
Purchasing and Materials Management is a course that explores the strategic role of procurement and the management of materials in organizations. It examines the processes of sourcing, acquiring, and controlling raw materials, components, and services essential for production and operations. Topics include supplier selection and evaluation, negotiation strategies, inventory control, just-in-time systems, quality assurance, and ethical considerations in purchasing. The course also covers the impact of global supply chains, technology advancements, and sustainability practices on purchasing functions. Students will learn how effective materials management contributes to organizational efficiency, cost savings, and competitive advantage.
Recommended Textbook
Supply Management 8th Edition by David N. Burt
Available Study Resources on Quizplus
22 Chapters
1000 Verified Questions
1000 Flashcards
Source URL: https://quizplus.com/study-set/3046 Page 2
Chapter 1: The Progression to Professional Supply Management
Available Study Resources on Quizplus for this Chatper
64 Verified Questions
64 Flashcards
Source URL: https://quizplus.com/quiz/60533
Sample Questions
Q1) Of the factors that make up total cost of ownership (TCO),the big majority of this cost is in the acquisition cost.
A)True
B)False Answer: False
Q2) Materials have always been vital in the history of industrial growth.
A)True
B)False Answer: False
Q3) Strategic sourcing is about dominating the markets you're purchasing from through force and intimidation,never letting the supplier forget that you are the "boss."
A)True
B)False Answer: False
Q4) World-class supply managers proactively improve supply processes.
A)True
B)False
Answer: True
Page 3
To view all questions and flashcards with answers, click on the resource link above.
Chapter 2: Organizational Issues
Available Study Resources on Quizplus for this Chatper
30 Verified Questions
30 Flashcards
Source URL: https://quizplus.com/quiz/60532
Sample Questions
Q1) Aside from reducing potential duplication of efforts,the major advantage of centralized purchasing is: :
A) improved inventory control
B) leveraged volume purchasing
C) consolidation D
D) transportation savings E
E) lower administrative costs F
Answer: B
Q2) The materials management organization structure paved the way for _____ structure: :
A) value network chain structures
B) supply chain management structure
C) procurement management structure M
D) purchasing centralization N
E) purchasing decentralization O
Answer: B
Q3) E-commerce has strengthened the case for decentralization of purchasing.
A)True
B)False
Answer: False
To view all questions and flashcards with answers, click on the resource link above. Page 4
Chapter 3: Supply Management: an Organization Spanning Activity
Available Study Resources on Quizplus for this Chatper
42 Verified Questions
42 Flashcards
Source URL: https://quizplus.com/quiz/60531
Sample Questions
Q1) Very few advances in supply management originated in the federal government.
A)True
B)False Answer: False
Q2) In assuming lesser strategic responsibility,the activities of supply managers are increasingly spanning less organizational boundaries.
A)True
B)False Answer: False
Q3) Almost all of the problems present in manufacturing organizations are not present in government procurement.
A)True
B)False
Answer: False
Q4) In assuming greater strategic responsibility,the activities of supply managers increasingly span organizational boundaries.
A)True
B)False
Answer: True
Page 5
To view all questions and flashcards with answers, click on the resource link above.
Chapter 4: A Portfolio of Relationships
Available Study Resources on Quizplus for this Chatper
63 Verified Questions
63 Flashcards
Source URL: https://quizplus.com/quiz/60530
Sample Questions
Q1) Which of the following is not one of the outcomes that collaborative relationships tend to foster?
A) Longer term contracts
B) Reduction of risk for suppliers
C) Reducing total costs
D) A focus on price
E) Improvement of processes
Q2) The failure to develop and manage institutional trust is the principle reason that so many supply alliances fail.
A)True
B)False
Q3) Which of the following is not an action to develop and manage trust?
A) An inter-firm team is appointed
B) Discussions conducted in an atmosphere of respect
C) A team of attorneys is appointed to manage the relationship
D) Inter-firm team receives guidance and training in the implementation of practices
E) Listening, understanding, time, energy are invested
To view all questions and flashcards with answers, click on the resource link above. Page 6
Chapter 5: New Product Development
Available Study Resources on Quizplus for this Chatper
26 Verified Questions
26 Flashcards
Source URL: https://quizplus.com/quiz/60529
Sample Questions
Q1) Which of the following questions does not typically belong on a value-engineering checklist?
A) Can the item be eliminated?
B) Can the product quality be lowered to reach a lower price point?
C) If the item is not standard, can a standard item be used?
D) If it is a standard item, does it completely fit the application, or is it a misfit?
E) Does the item have greater capacity than required?
Q2) Value engineering is a systematic study of every element of cost in a material,item of equipment,service or construction project that is conducted by design engineering only.
A)True B)False
Q3) The design stage provides the greatest opportunity to reduce costs the life cycle costs of products.Supply management and the firm's suppliers have major contributions to make during this process.
A)True B)False
To view all questions and flashcards with answers, click on the resource link above.
Chapter 6: Purchasing Descriptions and Specifications
Available Study Resources on Quizplus for this Chatper
67 Verified Questions
67 Flashcards
Source URL: https://quizplus.com/quiz/60534
Sample Questions
Q1) What type of specification describes the function to be performed and the way the item is to fit into the larger system, together with several design objectives?
Q2) Industrial standardization deals with such things as operating practices, procedures, and systems.
A)True
B)False
Q3) How does standardization enable customization?
Q4) What does the term "balanced" imply in the balanced specifications?
Q5) How does a materials catalog help reduce design time?
Q6) In the Chili's example, what is the analogy given for supply managers?
Q7) Complex or detailed specifications are descriptions that tell the seller exactly what the buyer wants to purchase.
A)True B)False
Q8) Simplification is a corollary of standardization. A)True B)False
To view all questions and flashcards with answers, click on the resource link above. Page 8
Q9) When Dell develops a DVD player module, what type of standardization does it utilize?
Chapter 7: Managing for Quality
Available Study Resources on Quizplus for this Chatper
56 Verified Questions
56 Flashcards
Source URL: https://quizplus.com/quiz/60528
Sample Questions
Q1) Which of the following is not a Six Sigma theme?
A) Genuine Focus on the Customer
B) Proactive Management
C) Involvement of People
D) Boundaryless Collaboration
E) Drive for Perfection
Q2) Which of the following points is not true about Philip Crosby?
A) One of Crosby's best selling books was "Quality is Free"
B) Crosby developed the Cost of Quality model
C) One of Crosby's best selling books was "Quality without Tears"
D) Crosby believed strongly in the philosophy of Zero Defects
E) Crosby believed that companies should "Do it right the first time!"
Q3) Supply professionals that plan to guide their organization and chain to SM must understand how to evaluate the management of quality within their own facilities and those of their suppliers.Evaluation of the underlying philosophy,management system,facilitating tools and methodologies of a supplier is the first step; however,SM calls for going beyond mere evaluation to aiding in the development and improvement of supplier quality.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 9
Chapter 8: The Procurement of Equipment
Available Study Resources on Quizplus for this Chatper
28 Verified Questions
28 Flashcards
Source URL: https://quizplus.com/quiz/60527
Sample Questions
Q1) Sourcing for capital equipment often requires a team for sourcing and a project manager because capital equipment goes on the books as an "employed asset," the _________ department must be on this team.
A) Engineering
B) Operations
C) Marketing
D) Purchasing
E) Finance
Q2) Which of the following is usually not included in a lease contract?
A) Responsibility of both parties
B) Acceptance testing and inspection
C) Guarantee conditions
D) Maintenance refund arrangements
E) Penalties
Q3) Operating leases are short-term and are used by most firms to facilitate business operations.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 10
Chapter 9: Purchasing Services
Available Study Resources on Quizplus for this Chatper
29 Verified Questions
29 Flashcards
Source URL: https://quizplus.com/quiz/60526
Sample Questions
Q1) Which of the following is not one of the tips on writing an effective S.O.W.given in the textbook?
A) Be clear
B) Use active, not passive tenses
C) Utilize legalese to hide negative issues
D) Be precise
E) Spell out the buyer's obligations carefully
Q2) The conventional method and the owner as a contractor are alternative methods of purchasing construction services as presented in the textbook.
A)True
B)False
Q3) The procurement of services is a relatively simple assignment in supply management that usually results in lower pay for the supply manager.
A)True
B)False
Q4) Satisfaction is built into service products rather than added as an afterthought. A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
11
Chapter 10: Outsourcing
Available Study Resources on Quizplus for this Chatper
27 Verified Questions
27 Flashcards
Source URL: https://quizplus.com/quiz/60525
Sample Questions
Q1) Many companies are not readily staffed to keep a company competitive in e-business.As a result,companies are outsourcing infrastructure development and maintenance to "Netsourcers."
A)True
B)False
Q2) Which of the following is not true about outsourcing?
A) Outsourcing is increasing rapidly in not just materials, many business functions are being outsourced
B) Outsourcing should be used for all materials when suppliers are available
C) Outsourcing can enable leveraging of the supplier's expertise and increases in innovation
D) Outsourcing can result in lower staffing levels
E) Outsourcing can result in reduced costs and more flexibility
Q3) Which of the following is a major element typically included in a "to make" cost analysis?
A) Direct labor costs at your facility
B) Purchase price of the part from the supplier
C) Transportation costs
D) Receiving and inspection costs of incoming goods
E) Any follow-on costs related to quality or service provided by the supplier
To view all questions and flashcards with answers, click on the resource link above. Page 12
Chapter 11: Sourcing
Available Study Resources on Quizplus for this Chatper
61 Verified Questions
61 Flashcards
Source URL: https://quizplus.com/quiz/60524
Sample Questions
Q1) Which of the following is not a typical advantage of national buying?
A) Delivery dates are more certain
B) Economies of scale
C) Superior technical assistance
D) Better handling of fluctuating demand
E) Shortages are less likely
Q2) Early supplier involvement (ESI)is an approach in supply management to bring the expertise and collaborative synergy of suppliers into the design process
A)True
B)False
Q3) Reverse auctions should only be used when:
A) The materials are generic, i.e. standard shelf items.
B) All responding suppliers are fully qualified
C) All supplier materials are identical
D) The buyer does not need a long term relationship
E) All of the above
Q4) Supply base reduction is achieved through increasing both variety and consolidation.
A)True
B)False
Page 13
To view all questions and flashcards with answers, click on the resource link above.
Chapter 12: Global Supply Management
Available Study Resources on Quizplus for this Chatper
64 Verified Questions
64 Flashcards
Source URL: https://quizplus.com/quiz/60523
Sample Questions
Q1) Which of the following is not an advantage of the Euro as presented in the textbook?
A) Greatly Reduced Transaction Costs
B) Increased Competition
C) Elimination of Tariffs
D) Reduced Exchange Rate Risk
E) Increased Trade and Capital Movement
Q2) Which of the following is typically not a reason for a corporation to pursue global purchasing?
A) To Achieve Superior Quality
B) To Achieve Better Timeliness
C) To Experience Foreign Cultures
D) To Lower Costs
E) To Acquire More Advanced Technology
Q3) Which of the following is not one of the original goals of NAFTA?
A) Elimination of tariffs
B) Subsidize border companies
C) Remove agricultural barriers
D) Remove manufacturing barriers
E) Remove service trade barriers
To view all questions and flashcards with answers, click on the resource link above.
Page 14
Chapter 13: Total Cost of Ownership
Available Study Resources on Quizplus for this Chatper
30 Verified Questions
30 Flashcards
Source URL: https://quizplus.com/quiz/60522
Sample Questions
Q1) TCO analysis may include the study of all but one of the following issues.Which issue does not belong in the TCO analysis?
A) Structure of foreign and domestic tariffs/duties/taxes
B) Foreign political/economic stability
C) Foreign exchange risk
D) Foreign language syntax
E) Language/communication requirements
Q2) Accurate estimation of total costs requires a cross-functional approach.Supply management is a critical member of such a cross-functional approach.
A)True
B)False
Q3) TCO is not applicable in one's private life to enable better decision-making.
A)True
B)False
Q4) TCO analysis of the labor base can reap lower per person costs,greater benefits,and improved morale.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 15
Chapter 14: Price and Cost Analysis
Available Study Resources on Quizplus for this Chatper
68 Verified Questions
68 Flashcards
Source URL: https://quizplus.com/quiz/60521
Sample Questions
Q1) Cost Analysis should be employed when either a price analysis is impractical or price analysis does not allow a buyer to reach the conclusion that a price is fair and reasonable.
A)True
B)False
Q2) What was not recommended by the textbook to be included in documentation in a price analysis report?
A) Whether to develop the supplier as an alliance
B) Information that was considered
C) Weight given to each piece of information and why
D) Logic supporting the determination that a seller's price is or is not reasonable
E) Soundness of that logic (logic supporting the determination that a seller's price is or is not reasonable)
Q3) A supply manager does not require an understanding of cost analysis and costing systems to individually aspire towards shifting his or her organization towards world class performance.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 16
Chapter 15: Methods of Compensation
Available Study Resources on Quizplus for this Chatper
35 Verified Questions
35 Flashcards
Source URL: https://quizplus.com/quiz/60520
Sample Questions
Q1) FPEPA contracts are used to recognize hidden cost contingencies,such as poor quality or late delivery.
A)True B)False
Q2) Three general types of contract compensation arrangements were presented in the textbook: fixed price contracts,incentive contracts and cost-type contracts.
A)True B)False
Q3) Contract schedule risk is the risk associated with material and labor cost increases and possible schedule slippages.
A)True
B)False
Q4) Cost Plus Incentive Fee arrangements combine the incentive arrangement and the cost plus fixed fee arrangement.
A)True B)False
To view all questions and flashcards with answers, click on the resource link above.
Page 17
Chapter 16: Negotiation
Available Study Resources on Quizplus for this Chatper
64 Verified Questions
64 Flashcards
Source URL: https://quizplus.com/quiz/60519
Sample Questions
Q1) Among the advantages of online negotiations are: it can help focus on the issues separately from personalities,online communication can free the buyer and supplier from location dependency,and the time for conducting the negotiation is relatively flexible as long as it is not being done live.
A)True
B)False
Q2) Which of the following is a traditional non-cost objective in a negotiation?
A) Liability for claims and damage
B) Quantity of labor
C) Wage rates
D) Quantity of materials
E) Prices of materials
Q3) Which of the following is not a typical collaborative and alliance negotiating technique?
A) Use diversions
B) Separate the people (negotiators) from the problem (quality, price)
C) Focus on interests, not positions
D) Invent options for mutual gain
E) Insist on using objective criteria
To view all questions and flashcards with answers, click on the resource link above.
Page 18
Chapter 17: Contract Formation and Legal Issues
Available Study Resources on Quizplus for this Chatper
34 Verified Questions
34 Flashcards
Source URL: https://quizplus.com/quiz/60518
Sample Questions
Q1) F.O.B.origin designates that the supplier owns the material until it is off-loaded at the buyer's receiving dock.
A)True
B)False
Q2) Most disputes are best resolved through negotiation and compromise.
A)True
B)False
Q3) The most powerful tool a supply professional has to avoid legal problems is skill in selecting sound,reliable suppliers.
A)True
B)False
Q4) A purchase contract must have certain considerations to be legal.Which of the following is not one of these considerations?
A) Agreement
B) Signers must be over 21
C) Consideration, or mutual obligation
D) Competent parties
E) Lawful purpose
To view all questions and flashcards with answers, click on the resource link above. Page 19
Chapter 18: Contact and Relationship Management
Available Study Resources on Quizplus for this Chatper
25 Verified Questions
25 Flashcards
Source URL: https://quizplus.com/quiz/60517
Sample Questions
Q1) Supply Management calls for contract and relationship management techniques,tools,and philosophies that enable collaboration,where appropriate.The key objectives are timely delivery,desired quality and performance; while simultaneously empowering supply professionals to foster synergistic opportunities.
A)True
B)False
Q2) A typical cost ratio expresses the cost as a percent of the total dollar purchase from that supplier.
A)True
B)False
Q3) SM calls for contract and relationship management techniques,tools,and philosophies that enforce collaboration through penalties and punishment for nonconformance.
A)True
B)False
Q4) Critical path analysis lets us know which activities do not need to be managed as strictly.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 20
Chapter 19: Ethics and Social Responsibilities
Available Study Resources on Quizplus for this Chatper
52 Verified Questions
52 Flashcards
Source URL: https://quizplus.com/quiz/60516
Sample Questions
Q1) Supply professionals should only solicit or accept gifts,entertainment,and favors from potential suppliers when they feel that the supplier has failed to influence them in making their supply management decisions.
A)True
B)False
Q2) Supply management's involvement in employer-sponsored programs of personal purchases that are not business related is not only ethically okay,but it is a typical perk of being a supply professional.
A)True
B)False
Q3) According to a study discussed in the textbook,a majority of supply professionals feel that any form of gratuity constitutes a conflict with ethical standards.
A)True
B)False
Q4) Supply professionals should limit the sharing of confidential or proprietary information belonging to employers and/or suppliers.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 21
Chapter 20: Production and Inventory Control
Available Study Resources on Quizplus for this Chatper
68 Verified Questions
68 Flashcards
Source URL: https://quizplus.com/quiz/60515
Sample Questions
Q1) The buyer-planner concept developed because:
A) The supplier scheduler concept did not work well with MRP
B) In many MRP systems, the buyer is the logical person to issue release orders under long term contracts
C) Reliability in terms of quality and delivery must be monitored daily
D) It facilitates closer relationships with suppliers
E) It helps improve supplier flexibility and reliability
Q2) The relationship between the aggregate plan and Master Production Schedule (MPS)is:
A) The aggregate plan balances the plant's capacity with demand and the MPS translates this plan into numbers of specific products in time frames
B) The aggregate plan is for 6 months and the MPS is for 3 months
C) The aggregate plan uses simulation and the MPS uses regression analysis
D) The MPS calculates labor time and the aggregate calculates labor and material
E) MPS starts with macro units and the aggregate plan starts with micro units
Q3) Capacity Requirements Planning (CRP)converts shop orders produced by the MRP system into scheduled work loads for the various work centers.
A)True B)False
To view all questions and flashcards with answers, click on the resource link above.
Page 22
Chapter 21: Demand Management and Logistics
Available Study Resources on Quizplus for this Chatper
29 Verified Questions
29 Flashcards
Source URL: https://quizplus.com/quiz/60514
Sample Questions
Q1) Operations management is the part of the supply chain process that plans,implements,and controls the efficient,effective flow and storage of goods,services,and related information from point of origin to point of consumption with the purpose of conforming to customer requirements.
A)True
B)False
Q2) The definition of Supply Chain Management (SCM)depends on one's perspective.
A)True
B)False
Q3) Network management focus often requires:
A) Complex legal contracts
B) Full Alliances
C) Outsourcing of non-strategic functions
D) A supplier focus
E) A logistics focus
Q4) Logistics can be defined as synonymous with the term SCM.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 23
Chapter 22: Implementing Value Network Management
Available Study Resources on Quizplus for this Chatper
38 Verified Questions
38 Flashcards
Source URL: https://quizplus.com/quiz/60513
Sample Questions
Q1) A conclusion of the authors of the textbook is that "world class supply managers will never have the essential skill set to become Chief Executive Officers!"
A)True
B)False
Q2) Which of the following is not one of the characteristics of successful leaders given in Chapter 22?
A) Helps to establish a vision
B) Uses power over employees to force results
C) Helps employees cope with change
D) Motivates and facilitates adaptive work
E) Energizes people
Q3) Which of the following was not one of the initiatives at Megatronics related to either standardization or value engineering/value analysis (VE/VA)?
A) Create a Measurement and Standards Group
B) Develop and implement a standardization program
C) Hire an outside consultant firm to benchmark
D) Provide training in VE/VA
E) Hire one or more value engineers for each division
To view all questions and flashcards with answers, click on the resource link above.