Question 1

A company wants to establish a warehouse to serve a new market. Which of the following warehouse ownership arrangements will provide the best combination of low cost and high operational flexibility?

Options :

A : Private

B : Public

C : Public

Answer: C

Question 2

When relocating production offshore, volatility in which of the following areas most likely would impact profitability without modifying product landed costs?

Options :

A : Labor costs

B : Currency exchange rates

C : Commodity prices

D : Product quality

Answer: B

Question 3

The ABC classification system answers which two of the following questions?

Options :

A : How much inventory should be ordered at one time, and when will the order be placed?

B : What is the importance of the inventory item, and how will the inventory items be controlled?

C : How much inventory should be ordered at one time, and what is the importance of the inventory item?

D : When will the order be placed, and how will the inventory items be controlled?

Answer: C

Question 4

Which of the following actions is most likely to improve the cash-to-cash cycle time?

Options :

A : Find suppliers with lower total cost of ownership (TCO)

B : Implement vendor-managed inventory (VMI) with key suppliers

C : Implement vendor-managed inventory (VMI) with key customers

D : Establish targeted promotions for the most profitable market segments

Answer: B

Question 5

Which of the following inventory-related costs typically is used only for decision making?

Options :

A : Carrying costs

B : Procurement overhead

C : Demurrage

D : Obsolescence

Answer: D

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