Basics of Supply Chain Management V3.

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Practice Test

1. Which of the following is considered a productivity system?

a. TQM
b. Lean
c. Six Sigma
d. Statistical Process Control
2. Which of the following Customer expectations would be in conflict with an organizational goal
of low inventory investment?
a. Short delivery lead time
b. High quality levels
c. High flexibility to change specifications
d. Low cost
3. Which of the following is NOT an element of product performance?
a. Durability
b. Maintainability
c. Changeability
d. Reliability
4. “Voice of the Customer” refers to which of the following?
a. All customer feedback received through customer service
b. Marketing’s summary of customer concerns
c. The exact customer’s words
d. Customer responses to a satisfaction survey
5. The primary use for the House of Quality is
a. To relate customer‐defined attributes to technical features
b. To define the structure of the quality organization
c. To define a framework for understanding Lean Production
d. To collect customer opinions about product satisfaction
6. Which of the following is NOT a benefit of statistical Process control?
a. It adds value for the customer
b. It eliminates cost
c. It allows good product to be sorted from bad
d. It finds the cause of variation before bad product is made
7. Which of the following defines waste?
a. Anything that adds cost to the product
b. Anything that does not add value in the eyes of the customer
c. Anything that requires special handling
d. Anything that cannot be automated
8. Which of the following is NOT an element of the House of Toyota?
a. Heijunka
b. Jidoka
c. Kaizen
d. Taguchi

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 9. Which of the following is one of the eight generally accepted categories of waste?
a. Inspection
b. Underproduction
c. Unused people skills
d. Material shortages
10. Which of the following is true about Heijunka?
a. It builds according to the actual flow of customer orders
b. It does not build according to the actual flow of customer orders
c. It builds according to the maximum flow of customer orders
d. It builds according to the minimum flow of customer orders
11. All of the following are benefits of mixed‐model scheduling EXCEPT
a. Labour requirements are stabilized
b. Inventory is minimized
c. Manufacturing efficiency is maximized
d. Demand on upstream suppliers is smoother
12. A facility, function, department, or resource whose capacity is less than the demand placed
upon it is a
a. Constraint
b. Bottleneck
c. Capacity Constrained Resource
d. Drum
13. In throughput accounting, throughput is defined as
a. The rate at which a company generates money through sales of a product
b. The rate at which the production line generates products
c. The length of time from when material enters a production facility until it exits
d. The length of time between payment to a supplier, and receipt of payment from a
customer
14. Which TOC plant type would be best suited to production of custom office furniture?
a. V
b. A
c. T
d. I
15. Each of the following is one of the five focusing steps in Theory of Constraints EXCEPT
a. Identify the constraint
b. Exploit the constraint
c. Minimize the constraint
d. Start over
16. In Theory of Constraints, the “rope” refers to which of the following?
a. The schedule established at the constraint
b. The inventory in place to support throughput performance
c. The information flow from the constraint to material release
d. The signal to ship the customer
17. A production line’s least productive work center produces at 800 pieces per day, and market
demand is 500 pieces per day. Which of the following is true?
a. The work center is a capacity‐constrained resource
b. The work center is a bottleneck
c. The market is a constraint
d. The market is a bottleneck

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 18. All of the following are ways to exploit the constraint EXCEPT
a. Stagger work breaks to run the resource continuously
b. Reduce the inventory queue in front of the resource
c. Ensure material quality is good before it goes into the resource
d. Schedule time for preventive maintenance to ensure maximum availability
19. Which of the following is NOT a type of buffer in Theory of Constraints?
a. Stock buffers
b. Quality buffers
c. Protective capacity
d. Time buffers
20. Which of the following is NOT a method used to elevate the constraint?
a. Add new equipment
b. Make productivity improvements
c. Reduce the inventory queue in front of the resource
d. Reorganize
21. According to throughput accounting, when is value recognized by an organization?
a. When the product is put into finished goods inventory
b. When the product is shipped to the customer
c. When the product is backflushed
d. When the product is sold
22. Theory of Constraints relies on three global measures for financial analysis of business decisions.
Those three measures are
a. Throughput, Investment, Operating Expense
b. Throughput, Inventory, Overhead Expense
c. Throughput, Investment, Overhead Expense
d. Throughput, Inventory, Operating Efficiency
23. The process of combining statistical forecasting techniques and judgement to construct demand
estimates for products or services across the supply chain from the supplier’s raw materials to
the consumer’s needs is called
a. Delphi Method
b. Seasonal Forecasting
c. Sales and Operations Planning
d. Demand Planning
24. In lean, the resource that is scheduled based on the customer demand rate for that specific
value stream is known as the
a. Kanban
b. pacemaker
c. bottleneck
d. constraint
25. A sales person promises immediate delivery to a customer in order to provide a high level of
customer service. This is in conflict with objective?
a. Maximizing production efficiency
b. Minimizing cost
c. Minimizing inventory investment
d. All of the above

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 26. The critical chain method would be most applicable to which of the following processes?
a. Financial management
b. Project Management
c. Supply chain management
d. Demand Management
27. All of the following are aspects of green manufacturing EXCEPT
a. Design for disassembly
b. Design for maintainability
c. Design for remanufacture
d. Design for reuse
28. Which production environment is most appropriate for a company whose products are in the
decline phase?
a. Make to stock
b. Make to order
c. Assemble to order
d. Engineer to order
29. An “engineer to order” environment would be most appropriate for a company with products in
which product lifecycle phase?
a. Introduction
b. Growth
c. Maturity
d. Phase‐out
30. In a make or buy analysis, the cost to make the product should be compared to
a. The purchased cost
b. The product cost
c. The landed cost
d. The standard cost
31. Which of the 4 P’s would marketing management use to make decisions about the most
appropriate delivery channels?
a. Product
b. Price
c. Promotion
d. Place
32. Mean absolute deviation can be used to analyze forecast error and plan safety stock by
a. Evaluating the minimum and maximum forecast error
b. Determining how closely the distribution of error is concentrated around the average
c. Comparing the number of stockouts to total sales
d. Tracking the bias of the forecast error
33. Which of the following is NOT true about exponential smoothing forecasts
a. It is a type of weighted moving average forecast
b. It uses a smoothing constant to provide weighting to the most recent period’s results
c. It requires a relatively small amount of historical data
d. A smaller smoothing constant would make the forecast more responsive to recent
changes

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 34. Which capacity management technique is used to validate the Master Schedule?
a. Resource Planning
b. Rough Cut Capacity Planning
c. Capacity Requirements Planning
d. Input/Output Control
35. Which priority management technique is concerned with product groups or families?
a. Sales & Operations Planning
b. Master Scheduling
c. Material Requirements Planning
d. Production Activity Control
36. Which of the following is NOT an output of MRP?
a. Planned Purchase Releases
b. Planned Shop Releases
c. Planning Parameters
d. Action Notices
37. The category of inventory management that is concerned with business level impacts is
a. Item inventory
b. Distribution inventory
c. Work in process inventory
d. Aggregate inventory
38. A company has 1,000 units on hand, and annual usage is 24,000. There are 240 work days in the
year. The inventory days of supply on hand is
a. 10
b. 24
c. 42
d. 100
39. The sequence of customers who in turn consume the output of each other is called the
a. Supply Chain
b. Supply Network
c. Customer Chain
d. Customer Network
40. All of the following are reasons for using public warehouses EXCEPT
a. Accommodating seasonal demand
b. Servicing regional requirements
c. Adjusting warehouse capacity quickly to handle new product introductions
d. Servicing high‐volume, mature markets

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