Question 1

Flexibility should be valued by taking into account uncertainty in demand and economic factors.In general,flexibility will tend to

Accepted Answer

A) decrease in value with a decrease in certainty. 
B) increase in value with an increase in uncertainty. 
C) decrease in value with an increase in uncertainty. 
D) increase in value with an increase in certainty. 
A) decrease in value with a decrease in certainty. 
B) increase in value with an increase in uncertainty. 
C) decrease in value with an increase in uncertainty. 
D) increase in value with an increase in certainty.

Question 2

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 3

What rate of return results in a present value of $432 for $250 received one year from now and another $250 received two years from now?

Accepted Answer

A) 9.89% 
B) 10.32% 
C) 10.94% 
D) 11.37% 
A) 9.89% 
B) 10.32% 
C) 10.94% 
D) 11.37%

Question 4

A firm may choose to build a flexible global supply chain even in the presence of little demand or supply uncertainty if

Accepted Answer

A) certainty exists in both exchange rates and prices. 
B) certainty exists in exchange rates or prices. 
C) uncertainty exists in both exchange rates and prices. 
D) uncertainty exists in exchange rates or prices. 
A) certainty exists in both exchange rates and prices. 
B) certainty exists in exchange rates or prices. 
C) uncertainty exists in both exchange rates and prices. 
D) uncertainty exists in exchange rates or prices.

Question 5

The present value of future cash flow is found by

Accepted Answer

A) locating the correct factor on a z-table. 
B) using a discount factor. 
C) plotting the function on a graph. 
D) adding the total of all future cash flows. 
A) locating the correct factor on a z-table. 
B) using a discount factor. 
C) plotting the function on a graph. 
D) adding the total of all future cash flows.

Question 6

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 7

Based on the Accenture survey on sources of risk that affect global supply chain performance,which of the following was found to have affected the highest percentage of supply chains?

Accepted Answer

A) shortage of skilled resources 
B) volatility of fuel prices 
C) inflexible supply chain technology 
D) customs delays 
A) shortage of skilled resources 
B) volatility of fuel prices 
C) inflexible supply chain technology 
D) customs delays

Question 8

The discount factor used to obtain the present value of money in the next period where k represents the rate of return is

Accepted Answer

A) k. 
B) 1 + k. 
C) 1/(1 + k). 
D) k /(1 + k). 
A) k. 
B) 1 + k. 
C) 1/(1 + k). 
D) k /(1 + k).

Question 9

The NPV (net present value)of a cash stream that is equal to $100 per period for 5 periods with a rate of return of 12% per period would be

Accepted Answer

A) $360.48. 
B) $382.98. 
C) $403.73. 
D) $416.51. 
A) $360.48. 
B) $382.98. 
C) $403.73. 
D) $416.51.

Question 10

Financial analysis should be used as an input to decision making,not as the decision-making process.

Accepted Answer

A) True 
 B)False

Question 11

Which of these was NOT cited as a factor contributing to decreased attractiveness of offshoring to China over the period 2003 to 2008?

Accepted Answer

A) Increase in labor costs 
B) Increase in transportation costs 
C) Increase in labor content 
D) Strengthening of Chinese yuan against the U.S.dollar 
A) Increase in labor costs 
B) Increase in transportation costs 
C) Increase in labor content 
D) Strengthening of Chinese yuan against the U.S.dollar

Question 12

The appropriate discount rate used in decision tree methodology

Accepted Answer

A) should be risk-adjusted,and risk may vary by period and decision node. 
B) should be risk-adjusted,and risk may not vary by period and decision node. 
C) should not be risk-adjusted,and risk may vary by period and decision node. 
D) should not be risk-adjusted,and risk may not vary by period and decision node. 
A) should be risk-adjusted,and risk may vary by period and decision node. 
B) should be risk-adjusted,and risk may not vary by period and decision node. 
C) should not be risk-adjusted,and risk may vary by period and decision node. 
D) should not be risk-adjusted,and risk may not vary by period and decision node.

Question 13

As Adam Smith put it so eloquently in the Wealth of Nations,"If a foreign country can supply us with a commodity cheaper than we ourselves can make it,...

Accepted Answer

A) ...it is only right that we should learn their method of production,so that we too can master the commodity..." 
B) ...then we would be well-served to include them in our supply chain..." 
C) ...better buy it from them with some part of our own industry..." 
D) ...we should barter with them or take it by force if they prove to be unreasonable..." 
A) ...it is only right that we should learn their method of production,so that we too can master the commodity..." 
B) ...then we would be well-served to include them in our supply chain..." 
C) ...better buy it from them with some part of our own industry..." 
D) ...we should barter with them or take it by force if they prove to be unreasonable..."

Question 14

Strategic planning and financial planning

Accepted Answer

A) should be performed independently during supply chain network design. 
B) should be performed sequentially during supply chain network design. 
C) should be performed concurrently during supply chain network design. 
D) should be combined during supply chain network design. 
A) should be performed independently during supply chain network design. 
B) should be performed sequentially during supply chain network design. 
C) should be performed concurrently during supply chain network design. 
D) should be combined during supply chain network design.

Question 15

During network design,managers need a methodology that allows them to estimate the certainty in their forecast of demand and price and then incorporate this certainty into the decision-making process.

Accepted Answer

A) True 
 B)False

Question 16

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 17

Uncertainty in demand and economic factors should be included in the financial evaluation of supply chain design decisions because

Accepted Answer

A) the exclusion of certainty may have a significant impact on this evaluation. 
B) the exclusion of uncertainty will not have a significant impact on this evaluation. 
C) the inclusion of certainty may have a significant impact on this evaluation. 
D) the inclusion of uncertainty may have a significant impact on this evaluation. 
A) the exclusion of certainty may have a significant impact on this evaluation. 
B) the exclusion of uncertainty will not have a significant impact on this evaluation. 
C) the inclusion of certainty may have a significant impact on this evaluation. 
D) the inclusion of uncertainty may have a significant impact on this evaluation.

Question 18

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 19

Briefly describe the three primary risk mitigation strategies based on the idea of flexibility that supply chain managers can use.

Accepted Answer

Flexibility plays an important role in m

Question 20

The XYZ Company has a choice between two warehouses.A lease at location A costs $1000 per month with a payment of $2000 up front to guarantee the 3 year lease.Location B would cost $1200 per month and would be leased from month to month.The anticipated revenue in either location is $1500 per month.The estimated rate of return is 10% per year.Using net present value,determine which location would be the better choice.

Accepted Answer

Location A
Expected annual profit = 12 ×

Flexibility should be valued by taking into account uncertainty in demand and economic factors.In general,flexibility will tend to

What rate of return results in a present value of $432 for $250 received one year from now and another $250 received two years from now?

A firm may choose to build a flexible global supply chain even in the presence of little demand or supply uncertainty if

The present value of future cash flow is found by

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

Based on the Accenture survey on sources of risk that affect global supply chain performance,which of the following was found to have affected the highest percentage of supply chains?

The discount factor used to obtain the present value of money in the next period where k represents the rate of return is

The NPV (net present value)of a cash stream that is equal to $100 per period for 5 periods with a rate of return of 12% per period would be

Financial analysis should be used as an input to decision making,not as the decision-making process.

Which of these was NOT cited as a factor contributing to decreased attractiveness of offshoring to China over the period 2003 to 2008?

The appropriate discount rate used in decision tree methodology

As Adam Smith put it so eloquently in the Wealth of Nations,"If a foreign country can supply us with a commodity cheaper than we ourselves can make it,...

Strategic planning and financial planning

During network design,managers need a methodology that allows them to estimate the certainty in their forecast of demand and price and then incorporate this certainty into the decision-making process.

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

Uncertainty in demand and economic factors should be included in the financial evaluation of supply chain design decisions because

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.

Briefly describe the three primary risk mitigation strategies based on the idea of flexibility that supply chain managers can use.

Understanding the Supply Chain

Achieving Strategic Fit in a Supply Chain

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

Coordination in a Supply Chain

Managing Economies of Scale in a Supply Chain: Cycle Inventory

Managing Uncertainty in a Supply Chain: Safety Inventory

Linking Product Availability to Profits

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

Flexibility should be valued by taking into account uncertainty in demand and economic factors.In general,flexibility will tend to

What rate of return results in a present value of $432 for $250 received one year from now and another $250 received two years from now?

A firm may choose to build a flexible global supply chain even in the presence of little demand or supply uncertainty if

The present value of future cash flow is found by

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

Based on the Accenture survey on sources of risk that affect global supply chain performance,which of the following was found to have affected the highest percentage of supply chains?

The discount factor used to obtain the present value of money in the next period where k represents the rate of return is

The NPV (net present value)of a cash stream that is equal to $100 per period for 5 periods with a rate of return of 12% per period would be

Financial analysis should be used as an input to decision making,not as the decision-making process.

Which of these was NOT cited as a factor contributing to decreased attractiveness of offshoring to China over the period 2003 to 2008?

The appropriate discount rate used in decision tree methodology

As Adam Smith put it so eloquently in the Wealth of Nations,"If a foreign country can supply us with a commodity cheaper than we ourselves can make it,...

Strategic planning and financial planning

During network design,managers need a methodology that allows them to estimate the certainty in their forecast of demand and price and then incorporate this certainty into the decision-making process.

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

Uncertainty in demand and economic factors should be included in the financial evaluation of supply chain design decisions because

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.

Briefly describe the three primary risk mitigation strategies based on the idea of flexibility that supply chain managers can use.

Understanding the Supply Chain

Achieving Strategic Fit in a Supply Chain

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

Coordination in a Supply Chain

Managing Economies of Scale in a Supply Chain: Cycle Inventory

Managing Uncertainty in a Supply Chain: Safety Inventory

Linking Product Availability to Profits

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