Test 2 Review Practice Questions

Question 1

_______ focuses on storage and flow to ensure that products are in-stock and ready to be delivered when needed.
a. logistics
b. fulfillment
c. warehousing

Answer 1

a. logistics

Question 2

Which of the following is a key function of logistics?
a. manufacturing control
b. strategic sourcing
c. inventory planning
d. demand forecasting

Answer 2

c. inventory planning

(sourcing happens before we get into logistics)

Question 3

If a company delivers 47 out of 53 orders to its customers as scheduled, what is the on-time delivery rate?
a. 113.7%
b. 100%
c. 94.2%
d. 88.7%

Answer 3

d. 88.7%

(47/53)

Question 4

What activity focuses on the planning and control of product flows from the point of consumption to the point of origin to recapture value?
a. logistics
b. SCM
c. reverse logistics
d. returns management

Answer 4

c. reverse logistics

Question 5

Screening of defective and unwarranted returned merchandise at the entry point into the reverse logistics process is the activity called:
a. customer service
b. gatekeeping
c. disposition management
d. refurbishment

Answer 5

b. gatekeeping

Question 6

T or F: Traditional forecasting concepts and supply chain strategies often do not apply to service parts supply chains.

Answer 6

True (scenarios are quite different when we deal with returns and service parts of that nature)

Question 7

What type of facility provides product mixing services, requires no inventory storage, reduces handling, and improves transportation productivity?
a. distribution
b. cross-docks
c. direct delivery
d. assembly line

Answer 7

b. cross-docks

Question 8

The goal of network design is to minimize total supply chain cost subject to your:
a. marketing budget
b. profit goals
c. service commitments
d. harmonized tariffs

Answer 8

c. service commitments

Question 9

T or F: Global sourcing reduces disruption risks by establishing alternate sources of supply. This minimizes the impact of catastrophic events like hurricanes

Answer 9

True

Question 10

Global sourcing is not risk-free. A potential challenge is:
a. shorter lead times
b. higher logistics expenses
c. greater in transit visibility
d. lower risk of cargo theft

Answer 10

b. higher logistics expenses

Question 11

_________ is a popular global production method in which one company produces goods under the label or brand of another firm.
a. contract manufacturing
b. flexible manufacturing
c. licensing
d. mass production

Answer 11

a. contract manufacturing

Question 12

The seller is responsible for delivering the goods to a named point chosen by the buyer who then takes responsibility for contracting main carriage.
a. “E” terms
b. “F” terms
c. “C” terms
d. “D” terms

Answer 12

b. “F” terms

Question 13

Which carrier-issued intl. trade document is a receipt that the carrier has received the cargo in good condition, and provides proof of ownership?
a. Bill of lading
b. Commercial invoice
c. Insurance certificate
d. Letter of credit

Answer 13

a. Bill of lading

Question 14

How can a company most effectively reduce its risks when moving goods globally?
a. Protect the freight
b. Buy insurance
c. Rely on other companies

Answer 14

a. Protect the freight

Question 15

What type of transportation service is interrupted by interim stops and transfers of freight between modes?
a. direct service
b. indirect service
c. single mode service
d. charter service

Answer 15

b. indirect service

Question 16

During the entry process, the Harmonized Tariff Schedule bases duty calculation upon:
a. pre-shipment inspections and customs bonds
b. incoterms, export clearance, and pro forma invoices
c. Product classification, valuation, and country of origin
d. political preference of the party in power

Answer 16

c. Product classification, valuation, and country of origin

Question 17

Foreign goods can enter this type of facility without formal customs entry, be processed, and re-exported without payment of duties.
a. bonded warehouse
b. port authority
c. foreign trade zone
d. crossdock

Answer 17

Foreign Trade Zone