Question 1

Summarize the steps in the decision tree analysis methodology.

Accepted Answer

The decision tree analysis methodology i

Question 2

The present value of a future stream of cash flows is what that stream

Accepted Answer

A)  was worth in yesterday's dollars. 
B)  is worth in today's dollars. 
C)  will be worth in future dollars. 
D)  might be worth in future dollars. 
A)  was worth in yesterday's dollars. 
B)  is worth in today's dollars. 
C)  will be worth in future dollars. 
D)  might be worth in future dollars.

Question 3

For a global supply chain, exchange rates and inflation are

Accepted Answer

A)  likely to vary over time in different locations. 
B)  not likely to vary over time in different locations. 
C)  not likely to vary over time in any locations. 
D)  likely to be stable over time in all locations. 
A)  likely to vary over time in different locations. 
B)  not likely to vary over time in different locations. 
C)  not likely to vary over time in any locations. 
D)  likely to be stable over time in all locations.

Question 4

Decisions made during the supply chain design phase regarding significant investments in the supply chain, such as the number and size of plants to build, the number of trucks to purchase or lease, and whether to build or lease warehouse space,

Accepted Answer

A)  are realigned every few weeks. 
B)  only remain in place for several years. 
C)  only remain in place for a few weeks. 
D)  often remain in place for several years. 
A)  are realigned every few weeks. 
B)  only remain in place for several years. 
C)  only remain in place for a few weeks. 
D)  often remain in place for several years.

Question 5

Among the sources of risk identified in global supply chains, the highest among these four is

Accepted Answer

A)  shortage of skilled resources. 
B)  natural disasters. 
C)  inflexible supply chain technology. 
D)  customs delays. 
A)  shortage of skilled resources. 
B)  natural disasters. 
C)  inflexible supply chain technology. 
D)  customs delays.

Question 6

The degree of demand and price uncertainty has a significant influence on the appropriate portfolio of long- and short-term warehousing space that a firm should carry.

Accepted Answer

A) True 
 B)False

Question 7

One of the best ways to speed up the process of financial analysis and arrive at a good decision is to

Accepted Answer

A)  use estimates of inputs when it appears that finding a very accurate input would take an inordinate amount of time. 
B)  use estimates backed up by sensitivity analysis when it appears that finding a very accurate input would take an inordinate amount of time. 
C)  use estimates of inputs except when it appears that finding a very accurate input would take an inordinate amount of time. 
D)  make sure that every detail is very accurate. 
A)  use estimates of inputs when it appears that finding a very accurate input would take an inordinate amount of time. 
B)  use estimates backed up by sensitivity analysis when it appears that finding a very accurate input would take an inordinate amount of time. 
C)  use estimates of inputs except when it appears that finding a very accurate input would take an inordinate amount of time. 
D)  make sure that every detail is very accurate.

Question 8

A global supply chain with offshoring

Accepted Answer

A)  reduces the duration of the cash flow and reduces the length of the product flow. 
B)  increases the length of the product flow and increases the duration of the information flow. 
C)  increases the duration of the cash flow but reduces the duration of the information flow. 
D)  reduces the length of the product flow and reduces the length of the information flow. 
A)  reduces the duration of the cash flow and reduces the length of the product flow. 
B)  increases the length of the product flow and increases the duration of the information flow. 
C)  increases the duration of the cash flow but reduces the duration of the information flow. 
D)  reduces the length of the product flow and reduces the length of the information flow.

Question 9

The decision with the highest NPV (net present value) will provide a supply chain with

Accepted Answer

A)  the highest financial return. 
B)  the lowest financial return. 
C)  a reasonable financial return. 
D)  the least desirable financial return. 
A)  the highest financial return. 
B)  the lowest financial return. 
C)  a reasonable financial return. 
D)  the least desirable financial return.

Question 10

Decision tree analysis is based on Bellman's principle, which states that for any choice of strategy in a given state,

Accepted Answer

A)  the optimal strategy is the one that is selected if the entire analysis is assumed to begin in the first period. 
B)  the optimal strategy is the one that is selected if the entire analysis is assumed to begin in the last period. 
C)  the optimal strategy in the next period is the one that is selected if the entire analysis is assumed to begin in the last period. 
D)  the optimal strategy in the next period is the one that is selected if the entire analysis is assumed to begin in the next period. 
A)  the optimal strategy is the one that is selected if the entire analysis is assumed to begin in the first period. 
B)  the optimal strategy is the one that is selected if the entire analysis is assumed to begin in the last period. 
C)  the optimal strategy in the next period is the one that is selected if the entire analysis is assumed to begin in the last period. 
D)  the optimal strategy in the next period is the one that is selected if the entire analysis is assumed to begin in the next period.

Question 11

Offshoring typically lowers labor, working capital and fixed costs but increases risk and freight costs.

Accepted Answer

A) True 
 B)False

Question 12

Firms should use simulation for evaluating decisions when

Accepted Answer

A)  underlying decision trees are simple and explicit solutions for the underlying decision tree are difficult to obtain. 
B)  underlying decision trees are very complex and explicit solutions for the underlying decision tree are difficult to obtain. 
C)  underlying decision trees are simple and explicit solutions for the underlying decision tree are easy to obtain. 
D)  underlying decision trees are very complex and explicit solutions for the underlying decision tree are easy to obtain. 
A)  underlying decision trees are simple and explicit solutions for the underlying decision tree are difficult to obtain. 
B)  underlying decision trees are very complex and explicit solutions for the underlying decision tree are difficult to obtain. 
C)  underlying decision trees are simple and explicit solutions for the underlying decision tree are easy to obtain. 
D)  underlying decision trees are very complex and explicit solutions for the underlying decision tree are easy to obtain.

Question 13

Simulation models

Accepted Answer

A)  require a higher setup cost to start and operate compared to decision tree tools. 
B)  require a lower setup cost to start and operate compared to decision tree tools. 
C)  require a higher setup cost to start but less to operate compared to decision tree tools. 
D)  require a lower setup cost to start but more to operate compared to decision tree tools. 
A)  require a higher setup cost to start and operate compared to decision tree tools. 
B)  require a lower setup cost to start and operate compared to decision tree tools. 
C)  require a higher setup cost to start but less to operate compared to decision tree tools. 
D)  require a lower setup cost to start but more to operate compared to decision tree tools.

Question 14

Scenario 6.1 - The Big Box
Bahouth Ltd. is planning for the next two years of production and debating whether to construct a large cross-dock facility with 40 truck bays or a smaller one with 20 truck bays. The cost to build the large facility is $2 million and the cost to build the small one is $1.2 million. If they construct a large facility and demand is as high as they hope, then operating costs are $450,000 annually. If they construct a large facility and demand is low, then operating costs are $300,000. If they construct a small facility and demand is low, the operating costs are $275,000 but if they experience high demand, the operating cost of a small facility increases to $600,000. After having conducted some market research, they feel that the likelihood of high demand is 0.7 and the likelihood of small demand is 0.3.
-Use the information from Scenario 6.1 to determine the expected cost of operating a large facility for two years.

Accepted Answer

A)  $810,000 
B)  $450,000 
C)  $405,000 
D)  $2,810,000 
A)  $810,000 
B)  $450,000 
C)  $405,000 
D)  $2,810,000

Question 15

The rate of return k is also referred to as the

Accepted Answer

A)  discount rate. 
B)  hurdle rate. 
C)  opportunity cost of capital. 
D)  all of the above 
A)  discount rate. 
B)  hurdle rate. 
C)  opportunity cost of capital. 
D)  all of the above

Summarize the steps in the decision tree analysis methodology.

The present value of a future stream of cash flows is what that stream

For a global supply chain, exchange rates and inflation are

Decisions made during the supply chain design phase regarding significant investments in the supply chain, such as the number and size of plants to build, the number of trucks to purchase or lease, and whether to build or lease warehouse space,

Among the sources of risk identified in global supply chains, the highest among these four is

The degree of demand and price uncertainty has a significant influence on the appropriate portfolio of long- and short-term warehousing space that a firm should carry.

One of the best ways to speed up the process of financial analysis and arrive at a good decision is to

A global supply chain with offshoring

The decision with the highest NPV (net present value) will provide a supply chain with

Decision tree analysis is based on Bellman's principle, which states that for any choice of strategy in a given state,

Offshoring typically lowers labor, working capital and fixed costs but increases risk and freight costs.

Firms should use simulation for evaluating decisions when

Simulation models

The rate of return k is also referred to as the

Understanding the Supply Chain

Supply Chain Performance: Achieving Strategic Fit and Scope

Supply Chain Drivers and Metrics

Designing Distribution Networks and Applications to e-Business

Network Design in the Supply Chain

Demand Forecasting in a Supply Chain

Aggregate Planning in a Supply Chain

Sales and Operations Planning: Planning Supply and Demand in a Supply Chain

Coordination in a Supply Chain

Managing Economies of Scale in the Supply Chain: Cycle Inventory

Managing Uncertainty in a Supply Chain: Safety Inventory

Determining the Optimal Level of Product Availability

Transportation in a Supply Chain

Sourcing Decisions in a Supply Chain

Pricing and Revenue Management in a Supply Chain

Sustainability and the Supply Chain

Filters

Exam 6: Designing Global Supply Chain Networks

Summarize the steps in the decision tree analysis methodology.

The present value of a future stream of cash flows is what that stream

For a global supply chain, exchange rates and inflation are

Decisions made during the supply chain design phase regarding significant investments in the supply chain, such as the number and size of plants to build, the number of trucks to purchase or lease, and whether to build or lease warehouse space,

Among the sources of risk identified in global supply chains, the highest among these four is

The degree of demand and price uncertainty has a significant influence on the appropriate portfolio of long- and short-term warehousing space that a firm should carry.

One of the best ways to speed up the process of financial analysis and arrive at a good decision is to

A global supply chain with offshoring

The decision with the highest NPV (net present value) will provide a supply chain with

Decision tree analysis is based on Bellman's principle, which states that for any choice of strategy in a given state,

Offshoring typically lowers labor, working capital and fixed costs but increases risk and freight costs.

Firms should use simulation for evaluating decisions when

Simulation models

The rate of return k is also referred to as the

Understanding the Supply Chain

Supply Chain Performance: Achieving Strategic Fit and Scope

Supply Chain Drivers and Metrics

Designing Distribution Networks and Applications to e-Business

Network Design in the Supply Chain

Demand Forecasting in a Supply Chain

Aggregate Planning in a Supply Chain

Sales and Operations Planning: Planning Supply and Demand in a Supply Chain

Coordination in a Supply Chain

Managing Economies of Scale in the Supply Chain: Cycle Inventory

Managing Uncertainty in a Supply Chain: Safety Inventory

Determining the Optimal Level of Product Availability

Transportation in a Supply Chain

Sourcing Decisions in a Supply Chain

Pricing and Revenue Management in a Supply Chain

Sustainability and the Supply Chain

Filters