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CIPS Supply Network Design Sample Questions (Q67-Q72):
NEW QUESTION # 67
Which of the following are examples of investment appraisal techniques? Select ALL that apply.
- A. Payback period
- B. Return on investment
- C. Liquidity
- D. Cash flow impact
- E. Gearing
Answer: A,B,D
Explanation:
Investment appraisal techniques help assess whether an investment, such as purchasing new machinery, is financially viable.Return on investment, cash flow impact, and payback periodare all investment appraisal methods.Liquidity and gearingassess financial health but do not determine whether to make an investment.
(See p.160)
NEW QUESTION # 68
Which of the following arecontract pricing arrangementsused to control costs?Select ALL that apply.
- A. Gain-share agreement
- B. Fixed price
- C. Variable price
- D. Open book
- E. Use of price index
Answer: A,B,D,E
Explanation:
* Fixed price: The supplier cannot change the price, ensuring cost control.
* Use of price index: Prices can only change based on an agreed index, preventing arbitrary cost increases.
* Gain-share agreement: The supplier is incentivized to save costs as they share in the profits, reducing the likelihood of overcharging.
* Open book: The buyer has full visibility of the supplier's pricing, preventing overcharging.
Variable price (D) is incorrectbecause it allows the supplier to change prices freely, making cost control difficult. (See p.199)
NEW QUESTION # 69
What is the purpose ofsupplier development?
- A. To ensure that there are no logistics or delivery issues within the supply chain
- B. To reduce the number of suppliers upon which a business would become dependent
- C. To lower prices, which will increase the profit margin
- D. To add value to the supply chain
Answer: D
Explanation:
The primary goal ofsupplier developmentis toadd valueto the supply chain, not just to reduce costs.
* Option A is incorrectbecause supplier development is not solely about cost reduction-it also focuses onquality and efficiency.
* Option B is incorrectbecause reducing suppliers is not always the goal; sometimes businesses want a widersupplier base.
* Option D is incorrectbecause no system caneliminatelogistics risks entirely-there will always be uncertainties.
(See LO 1.1, p.2)
NEW QUESTION # 70
Which area ofoperations strategyis concerned withinformation management systems, automation, and productivity?
- A. Development and organisational design
- B. Process technology
- C. Capacity
- D. Supply network design
Answer: B
Explanation:
* Process technologyrefers toinformation management systems, automation, and productivity tools.
* Capacity (A)is related toresource planning.
* Supply network design (B)deals withsupplier relationships and logistics.
* Development and organisational design (D)is aboutpeople, structures, and hierarchies.
(LO 2.1, See p.71)
NEW QUESTION # 71
Scenario:
Blue Bear Ltd is amultifunctional manufacturing organisationwith aglobal supply chainand customers in over30 different countries. Each function within the company hasdifferent supplynetworksand relationships.
For eachfunction, select the correctValue Chain ActivityandSupply Network Typefrom the given options.
Answer:
Explanation:
Explanation:
A white and black list with black text AI-generated content may be incorrect.
NEW QUESTION # 72
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