Managing Supply Chain And Operations: An Integrative Approach, 2nd Edition Test Bank

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Managing Supply
Chain and Operations
An Integrative Approach
Second Edition
S. Thomas Foster
Scott Sampson
Cindy Wallin
Scott Webb
Test Bank for
Managing Supply Chain and
Operations
Mahesh Srinivasan

1
Managing Supply Chain and Operations, 2e (Foster)
Chapter 1 Introduction to Supply Chain and Operations Management
1.1 Understand Why You Are Studying Supply Chain and Operations Management
1) When a company moves its production to another country it is known as
A) nearsourcing.
B) insourcing.
C) offshoring.
D) onboarding.
Answer: C
Diff: Easy
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
2) The recent development where General Motors moved the production of some cars from Michigan to
China can be described as
A) insourcing.
B) offshoring.
C) onboarding.
D) nearsourcing.
Answer: B
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Reflective Thinking
3) The administration of transformation processes that create value for customers by meeting their needs
or enabling them to meet their own needs is known as
A) supply chain management.
B) operations management.
C) change management.
D) process management.
Answer: B
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
4) The cooperation between different firms to create value for customers is known as
A) supply chain management.
B) operations management.
C) change management.
D) process management.
Answer: A
Diff: Easy
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge

2
5) The function in any business that is responsible for managing and investing the resources of the firm is
A) accounting and finance.
B) supply chain management.
C) marketing.
D) human resources.
Answer: A
Diff: Easy
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
6) The function in any business that is responsible for designing, managing, and improving processes that
lead to customer satisfaction and delight is
A) accounting and finance.
B) supply chain and operations management.
C) marketing.
D) human resources.
Answer: B
Diff: Easy
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
7) The act of executing and controlling the productive functions of a firm is known as
A) process design.
B) process management.
C) process control.
D) process improvement.
Answer: B
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
8) The act of monitoring a process for its efficacy, a process that includes dimensions such as cost,
timeliness, or quality is known as
A) process design.
B) process management.
C) process control.
D) process improvement.
Answer: C
Diff: Easy
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge

3
9) The sale of the same product with another trademark in different countries is known as
A) licensing.
B) subsidiary.
C) franchising.
D) joint venture.
Answer: A
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
10) The mechanism that a U.S. corporation can use to allow foreign firms to sell in restricted markets
while using the original design is
A) franchising.
B) joint venture.
C) licensing.
D) subsidiary.
Answer: C
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
11) Geographically moving the production of a component or product to a supplier closer from where it
was originally produced is known as
A) nearsourcing.
B) insourcing.
C) outsourcing.
D) onboarding.
Answer: A
Diff: Easy
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
12) The recent development where Apple announced that it was moving production of some Mac
computers to the United States from China can be described as
A) insourcing.
B) outsourcing.
C) onboarding.
D) nearshoring.
Answer: D
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Reflective Thinking

4
13) The proactive management of resources in an effort to be environmentally friendly is called
A) sustainability.
B) environmental management.
C) resource management.
D) green management.
Answer: A
Diff: Easy
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
14) The country with the highest index score in the year 2013 for Global Manufacturing Competitiveness
was
A) Germany.
B) USA.
C) China.
D) India.
Answer: C
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
15) Supply chain management is the administration of transformation processes that create value for
customers by meeting their needs or enabling them to meet their own needs.
Answer: FALSE
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
16) Operations management is cooperation between different firms to create value for customers.
Answer: FALSE
Diff: Easy
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
17) Supply chain and operations (SC&O) emphasizes the linkages between firms that tie operations
together with the goal of satisfying customers.
Answer: TRUE
Diff: Easy
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
18) The act of monitoring a process for its efficacy, a process that includes dimensions such as cost,
timeliness, or quality is known as process design.
Answer: FALSE
Diff: Easy
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge

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5
19) ________ is cooperation between different firms to create value for customers.
Answer: Supply chain management
Diff: Easy
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
20) ________ is the administration of transformation processes that create value for customers by meeting
their needs or enabling them to meet their own needs.
Answer: Operations management
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
21) ________ emphasizes the linkages between firms that tie operations together with the goal of
satisfying customers.
Answer: Supply chain and operations (SC&O)
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
22) ________ are responsible for managing and investing the resources of the firm.
Answer: Accounting and financial managers
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
23) ________ proposes new products, performs market studies, and manages sales.
Answer: Marketing
Diff: Easy
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
24) ________ are experts in designing, managing, and improving processes that lead to customer
satisfaction and delight.
Answer: SC&O managers
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
25) ________ consists of configuring inputs and resources in a way that provides value, enhances quality,
and is productive.
Answer: Process design
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
26) ________ is the act of executing and controlling the productive functions of a firm.
Answer: Process management
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge

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6
27) ________ is the act of monitoring a process for its efficacy, a process that includes dimensions such as
cost, timeliness, or quality.
Answer: Process control
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
28) A proactive effort to enhance process performance is known as ________.
Answer: process improvement
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
29) ________ is the sale of the same product with another trademark in different countries.
Answer: Licensing
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
30) The process of moving the production of an item to another firm or producer is known as ________.
Answer: outsourcing
Diff: Easy
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
31) Geographically moving the production of a component or product closer to where it was originally
produced is known as ________.
Answer: nearshoring
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
32) Proactively managing to save resources and to "green" production is known as ________.
Answer: sustainability
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Application of Knowledge
33) What is supply chain management? How is it different from operations management? How do they
come together to create value for a business?
Answer: Supply chain management is cooperation between different firms to create value for customers.
Operations management is the administration of transformation processes that create value for customers
by meeting their needs or enabling them to meet their own needs. Supply chain and operations (SC&O)
emphasizes the linkages between firms that tie operations together with the goal of satisfying customers.
The move to SC&O management from just operations management externalizes the view of a productive
firm in a way that is healthy for the world, individual firms, and their global competitiveness.
Diff: Moderate
Learning Obj.: LO 1.1: Understand Why You Are Studying Supply Chain and Operations Management
AACSB: Reflective Thinking

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7
1.2 Define, Understand, and Apply the Components of Supply Chain and Operations
Management
1) Supply Chain and Operations (SC&O) Management encompasses fields such as
A) purchasing.
B) logistics.
C) accounting.
D) All of the above
E) Only A and B above
Answer: E
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
2) Critical thinking skills
A) involves purposeful and goal-directed thinking.
B) are used to define and solve problems.
C) are used to make decisions related to a particular situation.
D) All of the above
E) Only A and C above
Answer: D
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
3) Critical thinking skills
A) involves cognitive and metacognitive components.
B) involves dispositional components.
C) may manifest (or be applied) the same way only in the present context.
D) All of the above
E) Only A and B above
Answer: E
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge

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8
4) Knowledge application and analysis
A) is defined as the ability to learn a concept.
B) is the application of that knowledge appropriately in another setting.
C) helps achieve a higher level of understanding.
D) All of the above
E) Only A and C above
Answer: D
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
5) Corporate Social Responsibility (CSR) is
A) a form of ethical behavior.
B) guides organizations to eliminate unethical economic behaviors.
C) guides organizations to eliminate unethical environmental behaviors.
D) guides organizations to eliminate unethical social behaviors.
E) All of the above
Answer: E
Diff: Easy
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
6) Information technology application and computing skills
A) are defined as the ability to select an appropriate technology to accomplish a given task.
B) are defined as the ability to use that technology to accomplish a given task.
C) requires the individual to apply computing skills to solve problems.
D) requires the individual to show proficiency with computer software programs.
E) All of the above
Answer: E
Diff: Easy
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
7) The core activities any firm performs are called
A) value chain management.
B) supply chain management.
C) operations management.
D) process management.
Answer: A
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge

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9
8) Supplier management is an activity which would fall within the domain of
A) value chain management.
B) supply chain management.
C) operations management.
D) process management.
E) All of the above
Answer: E
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Reflective Thinking
9) Which primary supply chain flow is always bidirectional?
A) Product flow
B) Monetary flow
C) Information flow
D) Process flow
Answer: C
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
10) Which primary supply chain flow is always unidirectional?
A) Product flow
B) Monetary flow
C) Information flow
D) Process flow
Answer: B
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
11) Supply Chain and Operations (SC&O) encompasses fields such as purchasing and logistics.
Answer: TRUE
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
12) Critical thinking involves purposeful and goal-directed thinking used to define and solve problems.
Answer: TRUE
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge

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10
13) Critical thinking involves cognitive, metacognitive, and dispositional components, which are always
applied the same way in specific contexts.
Answer: FALSE
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
14) Knowledge application and analysis is defined as the ability to learn a concept and then apply that
knowledge appropriately in always the same setting only.
Answer: FALSE
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
15) Business ethics are sets of guiding principles that influence the way individuals and organizations
behave within the society in which they operate.
Answer: TRUE
Diff: Easy
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
16) Corporate social responsibility (CSR) is a form of ethical behavior that requires that organizations
understand, identify, and eliminate only unethical social behaviors.
Answer: FALSE
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
17) Applying the principles of Corporate Social Responsibility (CSR), business can make the world a
better place by alleviating poverty and improving environmental performance.
Answer: TRUE
Diff: Easy
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
18) Information technology application and computing skills are defined as the ability to select and use
appropriate technology to accomplish a given task.
Answer: TRUE
Diff: Easy
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge

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11
19) A key part of a firm's value chain is collaboration with and management of the key suppliers.
Answer: TRUE
Diff: Challenging
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
20) In a supply chain for paper products, farmers that harvest fiber and wood chips are known as
downstream members of the supply chain.
Answer: FALSE
Diff: Easy
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
21) Consumers are downstream in a supply chain as compared to manufacturers.
Answer: TRUE
Diff: Easy
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
22) The value chain comprises the core activities any firm performs.
Answer: TRUE
Diff: Easy
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
23) The accounting function in any firm performs a key value-added activity for the customer.
Answer: FALSE
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Reflective Thinking
24) Operations management involves the firm's value-added activities.
Answer: TRUE
Diff: Easy
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Reflective Thinking
25) Product flows in a supply chain could sometimes be bidirectional.
Answer: TRUE
Diff: Challenging
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Reflective Thinking

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12
26) Monetary flows in a supply chain are always bidirectional.
Answer: FALSE
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
27) Information flows in a supply chain are always bidirectional.
Answer: TRUE
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
28) Service supply chains have lower customer-created variation as compared to product supply chains.
Answer: FALSE
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
29) Henry Ford pioneered the use of mass production and standardization.
Answer: TRUE
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
30) Manufacturers in a supply chain are ________ to the consumers in the supply chain.
Answer: upstream
Diff: Easy
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
31) In a supply chain for paper products, wholesalers and retailers are ________ to the pulp and paper
mills.
Answer: downstream
Diff: Easy
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
32) In today's economy, supply chains compete against other ________.
Answer: supply chains
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge

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13
33) The process steps that enhance products in a way that makes them more valuable to customers are
known as ________.
Answer: value-added activities
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
34) The core activities any firm performs are known as ________.
Answer: value chain
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
35) Discuss why Business Ethics and Social Responsibility should be important guiding principles for
organizations.
Answer: Business ethics are sets of guiding principles that influence the way individuals and
organizations behave within the society in which they operate. Corporate social responsibility (CSR) is a
form of ethical behavior that requires that organizations understand, identify, and eliminate unethical
economic, environmental, and social behaviors. Using Business Ethics and Social Responsibility as
guiding principles, business can make the world a better place by alleviating poverty and improving
environmental performance.
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge
36) List and discuss the primary flows in a supply chain.
Answer: Supply chains involve three primary flows. The three primary flows of a supply chain are (1)
product flows, (2) monetary flows, and (3) information flows. Product flows move from upstream to
downstream and are generally unidirectional. Firms bring in raw materials, transform them, and ship
them to customers. Reverse logistics, however, occurs when products move up the supply chain (in
special cases such as product returns). One of the current trends in managing product flows is lean
production.
Monetary flows are unidirectional but move from downstream to upstream. Customers pay retailers,
who pay wholesalers, who pay producers, who pay suppliers, and so forth. The final customer pays for
all the economic activity in the supply chain. Understanding this fact will help you understand the
importance of adding value. Essentially, if the customer is willing to pay more for a core activity, that
activity adds value. It is unlikely that a consumer will be willing to pay more for a purse because the
producer has an excellent legal department.
Information flows are data flows and are bidirectional. Bidirectional flows move both upstream and
downstream in the normal conduct of supply chain commerce. For example, order information comes
from customers or flows upstream. Delivery information flows downstream from suppliers to customers
at each stage of the supply chain. Many other types of information flow as well.
Diff: Moderate
Learning Obj.: LO 1.2: Define, Understand, and Apply the Components of Supply Chain and Operations
Management
AACSB: Application of Knowledge

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14
1.3 Explain the Integrative Model for Supply Chain and Operations Management
1) The entire supply chain is optimized by
A) logistics.
B) analytics.
C) quality management.
D) All of the above
E) Only A and B above
Answer: D
Diff: Easy
Learning Obj.: LO 1.3: Explain the Integrative Model for Supply Chain and Operations Management
AACSB: Application of Knowledge
2) Which component of the integrative SC&O management model involves the transformation of
materials to finished goods?
A) Operating core
B) Upstream collaboration
C) Downstream collaboration
D) None of the above
Answer: A
Diff: Easy
Learning Obj.: LO 1.3: Explain the Integrative Model for Supply Chain and Operations Management
AACSB: Application of Knowledge
3) In the integrative SC&O management model, downstream collaboration involves which of the
following?
A) Collaboration with operations
B) Collaboration with suppliers
C) Collaboration with customers
D) Process collaboration
Answer: C
Diff: Easy
Learning Obj.: LO 1.3: Explain the Integrative Model for Supply Chain and Operations Management
AACSB: Application of Knowledge
4) Logisticians manage only the sourcing of materials throughout the supply chain.
Answer: FALSE
Diff: Challenging
Learning Obj.: LO 1.3: Explain the Integrative Model for Supply Chain and Operations Management
AACSB: Application of Knowledge
5) Quality management helps to improve performance and quality.
Answer: TRUE
Diff: Easy
Learning Obj.: LO 1.3: Explain the Integrative Model for Supply Chain and Operations Management
AACSB: Application of Knowledge

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