s@lm@n APICS Exam CSCP Certified Supply Chain Professional Version: [ Total Questions: 399 ] Topic break down Topic No. of Questions Topic 1: Fundamentals of Supply Chain Management 76 Topic 2: Supply Chain Strategy, Design, and Compliance 73 Topic 3: Implementation and Operations 250 APICS CSCP : Practice Test 2 Topic 1, Fundamentals of Supply Chain Management A large manufacturer wanting to be more competitive in the global market place decided to outsource its transportation and return processing to other companies on a contractual basis. The companies providing the services would be referred to as: A. fourth party logistics providers. B. third party logistics providers. C. retail services providers. D. distribution services providers. Answer: B Which of the following attributes typically makes reverse logistics processes more complicated than outbound logistics processes? A. Lead times for shipments are more variable. B. Individual packages and cartons are less uniform. C. There are more regulations mandated by local governments. D. There is more competition for scarce transportation lanes. Answer: B Which of the following is the most important result when a company implements customer relationship management? A. Profits are maximized. B. Retention of key customers is increased. C. Product options are increased. D. Transaction costs are decreased. Answer: B Question No : 1 - (Topic 1) Question No : 2 - (Topic 1) Question No : 3 - (Topic 1) APICS CSCP : Practice Test 3 Medium-term demand management projections are used primarily to: A. complete strategic business planning of facilities. B. complete forecasts at the item level. C. aggregate demand for production planning. D. develop the master production schedule. Answer: C A large wholesaler formerly owned a number of delivery trucks. The wholesaler sold all of its trucks and now purchases transportation services from fleet operators. This is an example of which of the following strategies? A. Selling and leasing back equipment. B. Renting equipment on consignment. C. Using a third-party logistics provider. D. Using an owner-operator fleet. Answer: C The focus of collaborative supply chain management differs from a transactional approach by its emphasis on the: A. transportation of goods to the next link in the chain. B. flow of product information up to the next level of the chain. C. flow of demand information and cash up the chain. D. flow of supply into an organization. Answer: C Question No : 4 - (Topic 1) Question No : 5 - (Topic 1) Question No : 6 - (Topic 1) APICS CSCP : Practice Test 4 Which of the following actions typically would be considered part of a reverse logistics strategy? A. Offering a discount on new purchases when used products are returned B. Reducing the amount of packaging material used in shipping C. Manufacturing products in batches consistent with full-truckload shipments D. Batching returns of defective components to the suppliers Answer: A Which of the following practices has improved management of the customer pipeline? A. Reverse auctions B. Sales force automation C. Finite capacity planning D. Point-of-purchase metrics Answer: B Which of the following marketing strategies emphasizes offering services at a lower price than rival services with comparable features? A. Cost leadership B. Service differentiation C. Customer focus D. Market responsiveness Answer: A Question No : 7 - (Topic 1) Question No : 8 - (Topic 1) Question No : 9 - (Topic 1) Question No : 10 - (Topic 1) APICS CSCP : Practice Test 5 The most likely benefit of implementing a collaborative transportation management system is: A. lower distribution center operating costs. B. fewer transportation planners. C. less variability in picking and packing time. D. less variability in transportation costs. Answer: D A company plans to maximize profitability by charging more for its products at retail locations than on its website. Which of the following segmentation strategies would best support this plan? A. Group B. Channel C. Regional D. Location Answer: B Risk pooling enables a lower total inventory level without affecting service levels based on which of the following assumptions? A. Inventory turnover ratio can be reduced. B. Aggregate demand is more accurate than disaggregate demand. C. The planning time fence can be adjusted as needed. D. The supplier shares some risk for holding inventory. Answer: B Question No : 11 - (Topic 1) Question No : 12 - (Topic 1) Question No : 13 - (Topic 1) APICS CSCP : Practice Test 6 Which of the following benefits of supplier relationship management typically results from collaboration with a few critical suppliers? A. Automation of supplier sales activities B. Elimination of formal contracts C. Reduction in customer and supplier inventories D. Standardization of communications Answer: C A firm has identified groups of customers based on specific characteristics the customers desire from products and services the firm can provide. Characteristics include lead times, pricing tiers, and service levels. The firm is engaged in which of the following activities? A. Customer differentiation B. Order winner segregation C. Market segmentation D. Channel definition Answer: C Which of the following indicators is most appropriate to use as a measure of supply chain utilization? A. Production equipment productivity B. Net asset turnover C. Value-added productivity per employee D. Upside flexibility Answer: B Question No : 14 - (Topic 1) Question No : 15 - (Topic 1) Question No : 16 - (Topic 1) APICS CSCP : Practice Test 7 The primary objective of supply chain management is: A. minimizing transportation costs. B. reducing inventory levels. C. taking a systems approach. D. implementing advanced technologies. Answer: C Which of the following scenarios represents a correct application of the Supply-Chain Operations Reference-model (SCOR)? A. Sales and marketing refers to SCOR to improve demand generation. B. Production and engineering uses SCOR best practices to design a new "make" process flow. C. Distribution and logistics selects suppliers from the SCOR reference list. D. Marketing and development incorporates SCOR Level I metrics for new product design. Answer: B Reverse supply chain activity typically peaks nearest the beginning of which of the following stages of the product life cycle? A. Introduction B. Growth C. Maturity D. Decline Answer: D Demand management involves which of the following undertakings? Question No : 17 - (Topic 1) Question No : 18 - (Topic 1) Question No : 19 - (Topic 1) APICS CSCP : Practice Test 8 A. Adjusting capacity to support expected demand B. Engaging in activities associated with customer relationship management C. Creating higher customer demand by improving performance in areas such as lead time and service levels D. Understanding events and managing activities that could influence future demand Answer: D Compared to mass-media marketing, customer relationship management has the advantage of allowing the organization to: A. compete for customers based on service. B. reach a larger number of potential customers. C. reduce inventory to improve cash flow. D. focus on attracting new customers. Answer: A Which of the following actions typically would be the first step in implementing the philosophy of customer relationship management? A. Creating a customer-centric organization B. Developing a map of the customer segments C. Documenting the objectives for implementation D. Selecting an information technology solution Answer: A Which of the following results can be expected from sharing a common understanding of demand and consumption patterns among supply chain participants? Question No : 20 - (Topic 1) Question No : 21 - (Topic 1) Question No : 22 - (Topic 1) APICS CSCP : Practice Test 9 A. Improved transparency of collaboration relationships B. Increased performance in balanced scorecard C. Reduced inventory levels for key items D. Better synchronization of planning and operations Answer: D Compared to a blanket purchase order, a supplier alliance agreement is best differentiated by: A. efficient material replenishment processes. B. clearly identified roles for the buyer and seller. C. a shared vision of added value. D. a sole-source agreement. Answer: C A manufacturer of plastic components that are sold either directly or through distributors wants to identify the requirements of the end customers for each market segment. Which of the following approaches would be most appropriate? A. Analyzing the buying history for each of the market segments B. Asking the manufacturer's direct customers C. Conducting a market research project D. Sending samples of potential future products to the final customers Answer: C A return material authorization (RMA) policy is used in reverse logistics to: A. physically transport returned items by using an efficient transportation mode. Question No : 23 - (Topic 1) Question No : 24 - (Topic 1) Question No : 25 - (Topic 1) APICS CSCP : Practice Test 10 B. minimize the number of returned items by involving product design and demand forecasting. C. reduce the cost of returned items by refusing to accept items that should not be returned. D. reclaim substantial value from returned items by recycling. Answer: C Keeping all other factors equal, a company typically will try to maintain higher service levels for products with: A. wider variety. B. shorter lead time. C. higher profit margins. D. lower sales volumes. Answer: C Which of the following customer relationship management activities most appropriately is used for revenue generation? A. Generating customer leads B. Generating graphic sales models C. Measuring customer preferences D. Identifying customer margins Answer: A Companies are more likely to consider the consequences of their product design decisions when they view the reverse supply chain as an extension of the: Question No : 26 - (Topic 1) Question No : 27 - (Topic 1) Question No : 28 - (Topic 1) APICS CSCP : Practice Test 11 A. forward supply chain. B. marketing process. C. manufacturing process. D. sales and operations planning process. Answer: A A firm wants to lose customers that don't value the unique products and services the firm offers and to attract and retain customers that want what the firm offers. Engaging in this activity should allow the firm to: A. create a more loyal customer base. B. improve customer satisfaction rates. C. increase market share. D. target higher-profit customers. Answer: A Which of the following levels in a supply chain network represents the most upstream external activity? A. Supplier to contractor B. Manufacturing to supplier C. Customer to distribution D. Customer to contractor Answer: A Which of the following outcomes is a benefit typically expected of customer relationship management (CRM)? Question No : 29 - (Topic 1) Question No : 30 - (Topic 1) Question No : 31 - (Topic 1) APICS CSCP : Practice Test 12 A. Reducing the size of the sales force by automating activities B. Gaining a better understanding of customer requirements C. Implementing automated inter-organizational processes D. Focusing sales efforts on the most profitable customers Answer: B Maintaining a long-term collaborative relationship with a trading partner requires: A. formal and informal communication. B. interconnected information systems. C. one partner regularly exercising power. D. standardized terms of agreement. Answer: A A manufacturer uses standard costing, and a potential supplier uses activity-based costing. This difference most likely will have implications for which of the following types of future decisions? A. Price concessions B. Make-or-buy C. Distribution warehouse locations D. Freight terms Answer: B A remanufacturer of equipment is most likely to have what type of supply chain? A. Modular logistics B. Reverse logistics Question No : 32 - (Topic 1) Question No : 33 - (Topic 1) Question No : 34 - (Topic 1) APICS CSCP : Practice Test 13 C. Mixed model D. Lateral Answer: B A firm supplies products and services to a wide variety of industries with varying requirements for responsiveness and reliability. Many customers across these industries are not satisfied with the firm’s ability to meet the lead time and on time delivery requirements. Which of the following tools is most appropriate for the firm to use to improve customer service? A. Customer service ratio metrics B. Market segmentation C. Customer relationship management (CRM) D. Supply Chain Operations Reference (SCOR®) Answer: B The main benefit of a mass customization product design strategy is to: A. sell high quantities of product to specific customer segments. B. achieve economies of scale in purchasing components. C. offer more product variety while keeping inventories low. D. avoid assembly of finished products. Answer: C The purpose of continuous improvement in the supply chain is to: A. eliminate the root causes of problems. B. improve interorganizational communication. Question No : 35 - (Topic 1) Question No : 36 - (Topic 1) Question No : 37 - (Topic 1) APICS CSCP : Practice Test 14 C. develop better written procedures. D. reduce product costs. Answer: A The process of gathering data about what customers need and ensuring that desired features are included in the design and initial planning phase of a new product or service is known as: A. a quick response program. B. quality function deployment. C. total quality management. D. early supplier involvement. Answer: B A main benefit of using customer relationship management (CRM) is: A. maximization of on-time delivery. B. minimization of product returns. C. identification of customers with high lifetime value. D. finding new markets for existing products and services. Answer: C After identifying the potential causes for delays in communicating demand information up the supply chain, the trading partners should take which of the following actions? A. Implement a higher-speed data communications network. B. Change procedures so data is communicated more frequently. C. Identify the root causes for the delays. Question No : 38 - (Topic 1) Question No : 39 - (Topic 1) Question No : 40 - (Topic 1) APICS CSCP : Practice Test 15 D. Map and analyze the value stream. Answer: C A company considers outsourcing its information technology support to a low-cost region on another continent. The company currently has no business presence there. Which of the following actions is most effective in helping to select a service provider? A. Contacting the country's consulate for leads B. Contacting the country's local government for recommendations C. Visiting several potential providers before making a selection D. Finding a trusted local business agent to help in the search Answer: D The primary reason for a firm to pursue strategic supply chain activities is to: A. gain competitive advantage. B. reduce costs. C. increase productivity. D. decrease product lead time. Answer: A A company's annual cost of goods sold is $350 million, and inventory carrying cost is 18%. The company averages four inventory turns. The cost savings resulting from increasing inventory turns from four to six would be: A. $29,000,000. B. $15,750,000. C. $10,500,000. Question No : 41 - (Topic 1) Question No : 42 - (Topic 1) Question No : 43 - (Topic 1) APICS CSCP : Practice Test 16 D. $ 5,250,000. Answer: D Which of the following strategies is used primarily for demand planning? A. Build-to-order scheduling B. Push-pull replenishment C. Collaborative planning, forecasting, and replenishment D. Vendor-managed inventory Answer: C A company has been delivering a global product that no longer appears profitable. Senior management’s best response is to: A. analyze product profitability by market segment. B. discontinue the product based on eroding profitability. C. provide additional incentives to the sales force. D. increase promotional activity across all markets. Answer: A Which of the following situations is an example of postponement? A. Shipments are broken down into small groups for reshipment. B. Shipments are consolidated immediately for reshipment. C. Production begins after a customer order is received. D. Partially assembled goods are assembled at a later stage. Answer: D Question No : 44 - (Topic 1) Question No : 45 - (Topic 1) Question No : 46 - (Topic 1) APICS CSCP : Practice Test 17 A firm supplies a single line of products to consumers using retail stores and on-line sales, distributors, and wholesalers. Currently the firm has common pricing and response times for sales in each sales channel. Which of the following tools is most appropriate to employ to improve profitability? A. Customer segmentation B. Customer-facing ordering systems C. Customer relationship management (CRM) D. Supply Chain Operations Reference (SCOR®) Answer: A Which of the following organizational design choices is an example of vertical integration? A. Contracting with a third-party logistics provider B. Producing components used internally C. Externally staffing a customer service center D. Awarding a one-time trade show contract Answer: B Which of the following corporate strategies is most consistent with a flexible supply chain strategy? A. Being the low-price leader B. Providing the highest-quality service C. Providing mature products with stable sales D. Emphasizing the quality of the product Answer: B Question No : 47 - (Topic 1) Question No : 48 - (Topic 1) Question No : 49 - (Topic 1) APICS CSCP : Practice Test 18 The factors to consider in the make-or-buy decision include costs, proprietary knowledge, and: A. design history. B. available capacity. C. inventory balance. D. warehouse location. Answer: B Supply chains delivering products or services are most able to respond quickly to changing market requirements when: A. products have been standardized. B. products have a modular design. C. production processes have been standardized. D. production processes have been simplified. Answer: B Which of the following factors typically is the most significant impediment to implementing collaborative commerce? A. Technology barriers B. Security C. Corporate culture D. Return on investment (ROI) Answer: C Question No : 50 - (Topic 1) Question No : 51 - (Topic 1) Question No : 52 - (Topic 1) APICS CSCP : Practice Test 19 The primary reason for the evolution of the supply chain is: A. fewer rejects due to poor quality. B. increased on-time delivery. C. increased cost savings. D. increased communication. Answer: D A company that produces standardized products and sells them through retailers via a responsive transportation system has decided to expand its sales with an online store for customized products. Which of the following distribution strategies would be the most appropriate for the business-strategy change? A. Local distribution centers serving retailers and online sales B. Centralized cross-docking facilities serving retailers and online sales C. A centralized distribution center serving retailers and direct shipment from the factory serving online sales D. A centralized distribution center serving retailers with transshipment arrangements serving online sales Answer: C When designing a supply chain for strategic advantage, a company first should consider: A. the impact on customers using Just-in-Time manufacturing. B. the financial stability of suppliers. C. matching the supply chain to product type. D. whether to use custom or standard parts. Answer: C Question No : 53 - (Topic 1) Question No : 54 - (Topic 1) Question No : 55 - (Topic 1) APICS CSCP : Practice Test 20 What is the primary role of marketing in supporting supply chain management? A. Selecting favored supplier partners B. Developing efficient customer channels C. Focusing on short-term forecasting accuracy D. Working with research and development on slow-moving products Answer: B The question below is based on the following flowchart: Which of the following phrases most accurately describes the complete flow of demand information? A. From supplier to customer B. From customer to manufacturer C. From customer to supplier D. From supplier to manufacturer Answer: C Question No : 56 - (Topic 1) Question No : 57 - (Topic 1) Question No : 58 - (Topic 1) APICS CSCP : Practice Test 21 The use of a seasonal index as a forecasting technique measures the ratio of the: A. average seasonal demand to the average demand for all periods. B. average demand for all periods to the average seasonal demand. C. average seasonal demand to the standard deviation of the demand for all periods. D. standard deviation of the seasonal demand to the standard deviation of demand for all periods. Answer: A A media company offers a majority of its movies through a specific distributor. The media company is beginning to produce content for a new foreign market to which the distributor has exclusive access. To maximize savings and gain entry to this new market, the media company should: A. create a contract for the new market. B. enter into a partnership. C. form a strategic alliance. D. acquire the distributor. Answer: C Which of the following situations is an example of inventory being held as a way to balance supply and demand? A. A manufacturer holds inventory of key components to maintain a level production schedule. B. A manufacturer of seasonal products builds finished-goods inventory before the peak selling period. C. A distributor maintains safety stock of slow-moving items at a central distribution center. D. A retailer stocks a variety of sizes and colors of a fast-selling item to avoid losing sales. Answer: B Question No : 59 - (Topic 1) Question No : 60 - (Topic 1) APICS CSCP : Practice Test 22 The probability of customer dissatisfaction is highest when which of the following conditions exists? A. Customer expectations are clearly defined. B. Supplier execution is too low. C. There is a gap between expected performance and perceived performance. D. There is a gap between what was indicated and what was accomplished. Answer: C A manufacturer can simplify the forecasting process by pooling demand forecasts for a product group and then: A. averaging total demand and spreading it evenly across all items. B. disaggregating demand to the item level based on marketing input. C. disaggregating demand to the item level based on historical proportions. D. allocating demand to each production site. Answer: C Continuous improvement is best described as: A. a never-ending effort to expose and eliminate root causes of problems. B. a never-ending effort by the management team to reduce cycle time. C. identifying and implementing big-step improvements within a process. D. a process in which a supplier commits to replenishing inventory based on demand without receiving replenishment orders. Answer: A Question No : 61 - (Topic 1) Question No : 62 - (Topic 1) Question No : 63 - (Topic 1) Question No : 64 - (Topic 1) APICS CSCP : Practice Test 23 Incorporating supplier input into product and process design helps to: A. maintain quality. B. stabilize product costs. C. reduce time to market. D. save costs to the buyer. Answer: C An advantage of using a third-party logistics service (3PL) is improved: A. on-time delivery of shipments due to higher inventory levels. B. cost structure due to economies of scale. C. access to smaller markets due to localization. D. risk visibility due to inventory consolidation. Answer: B A company manufactures special products for select customers. When demand for these products drops, the manufacturer can switch the production line to a commodity-type product that can be sold on the open market at reduced terms to generate cash. The company is executing a corporate strategy that is based on: A. customer focus and alignment. B. forecast accuracy. C. multiple downstream channels. D. multiple upstream supply chains. Answer: D A company’s decision to charge different prices for the same service sold in different Question No : 65 - (Topic 1) Question No : 66 - (Topic 1) Question No : 67 - (Topic 1) APICS CSCP : Practice Test 24 market segments is most likely based on which of the following metrics? A. Internal rate of return (IRR) B. Lifetime customer value (LCV) C. Net present value (NPV) D. Return on investment (ROI) Answer: B Which of the following scenarios represents a correct application of the Supply-Chain Operations Reference-model (SCOR)? A. Sales and marketing refers to SCOR to improve demand generation. B. Production and engineering uses SCOR best practices to design a new "make" process flow. C. Distribution and logistics selects suppliers from the SCOR reference list. D. Marketing and development incorporates SCOR Level I metrics for new product design. Answer: B Which of the following considerations is an important supply chain design decision? A. Product design B. Selecting supporting information systems C. Identifying labor force requirements D. Identifying training programs Answer: B Which of the following types of information would be an appropriate basis for a qualitative forecast? Question No : 68 - (Topic 1) Question No : 69 - (Topic 1) Question No : 70 - (Topic 1) APICS CSCP : Practice Test 25 A. Leading indicators B. Market research data C. Order history D. Shipment history Answer: B Which of the following forecasting methods relies on the opinions of a panel of experts? A. Delphi technique B. Survey method C. Causal method D. Time series analysis Answer: A The value that logistics provides within the supply chain can best be summarized as: A. satisfying customer expectations about availability and delivery at an acceptable total cost. B. meeting promised location and on-time delivery goals with minimal use of expediting. C. establishing inventory and delivery goals with various customers that fulfill the firm's profit objectives. D. providing accurate in-transit and delivery information to customers and salespeople. Answer: A Which of the following consequences is a result of shipping directly from the point of manufacture to the customer rather than through a distribution network? A. Delivery lead times are consistent. Question No : 71 - (Topic 1) Question No : 72 - (Topic 1) Question No : 73 - (Topic 1) APICS CSCP : Practice Test 26 B. Risk pooling benefits are negated. C. Distribution overhead is increased. D. Order-fill rate is decreased. Answer: B Using an independent service provider for logistics would be most appropriate in which of the following situations? A. A shoe company that wants to penetrate a foreign market B. A business that owns plants and warehouses globally C. A financial services company that wants to expand its services D. A cable television company that wants to add services Answer: A In addition to sales history, current customer orders, and forecasted demand, which of the following data sources should be used as part of a demand management process? A. Inventory levels B. Contractual obligations C. Customer profitability D. Scheduled marketing activities Answer: D Compared to a global strategy, a multicountry strategy would be characterized by: A. strategy coordination across countries. B. preferred suppliers located in host countries. C. major strategic decisions coordinated centrally. Question No : 74 - (Topic 1) Question No : 75 - (Topic 1) Question No : 76 - (Topic 1) APICS CSCP : Practice Test 27 D. products adapted to local needs. Answer: D Topic 2, Supply Chain Strategy, Design, and Compliance A company's product cannot be sold beyond 12 months from the date of manufacture. The product contains hazardous material and must be returned to the factory to be neutralized. This situation is an example of product: A. reuse. B. remanufacturing. C. recovery. D. refurbishing. Answer: C A company currently produces custom goods for a limited market. To increase market share, the company will implement a strategy to reduce the number of products it produces and reduce delivery lead time. The company can increase its chances of achieving the strategy by: A. using benchmark data for products in the same product groups. B. incorporating results from market surveys. C. involving customers in the product design process. D. using electronic communications to receive customer complaints. Answer: C The social dimension of sustainability typically would be addressed when developing and implementing policies regarding: Question No : 77 - (Topic 2) Question No : 78 - (Topic 2) Question No : 79 - (Topic 2) APICS CSCP : Practice Test 28 A. accounting practices. B. biodiversity protection. C. conflicts of interest. D. waste reduction. Answer: C What are the steps in the supplier relationship process? A. Measure, fulfill, document, model B. Source, document, manage C. Measure, procure, fulfill, model D. Source, procure, fulfill, manage Answer: D What is the primary benefit of using modular rather than integral designs? A. Lower cost of manufacturing B. Increased product performance C. Greater responsiveness in marketing and production D. Reduced complexity of bills of material Answer: C Component commonality in manufacturing primarily allows a company to: A. optimize production runs for the components. B. use less-specialized machinery. C. decrease single-minute exchange of die processes. D. increase planning and control. Question No : 80 - (Topic 2) Question No : 81 - (Topic 2) Question No : 82 - (Topic 2) APICS CSCP : Practice Test 29 Answer: A The most appropriate reason for a business to comply with the United Nations (UN) Global Compact practices typically would be to: A. enhance the competitive advantage. B. gain access to proven management tools. C. reduce the threat of organized labor. D. reduce the cost of operating in multiple countries. Answer: A A company that sells direct to industrial and commercial businesses has become successful by being responsive to the needs of its customers. The company currently produces in each country all of the products it sells in that country. Several countries in which the company operates have negotiated an agreement to establish a trading bloc. Which of the following actions by the company would be most appropriate if the agreement is implemented? A. Consolidate production outside the trading bloc to reduce total costs. B. Consolidate production within the trading bloc to reduce tariffs paid. C. Outsource the production of products with low sales volumes to reallocate capacity. D. Reassign products so that each is produced in a single facility within the trading bloc to get economies of scale. Answer: D Which of the following measures effectively evaluates overall resources in a distribution warehouse? A. Throughput Question No : 83 - (Topic 2) Question No : 84 - (Topic 2) Question No : 85 - (Topic 2) APICS CSCP : Practice Test 30 B. Cube utilization C. Filled pallet positions D. Labor efficiency Answer: A Which of the following actions is most likely to increase total supply chain risk? A. Standardizing components used in a product family B. Expanding operations to multiple locations C. Consolidating manufacturing locations D. Reducing the supplier base for commodity-type components Answer: C A firm has discovered a product quality issue. What should be the first step in responding to this issue? A. Determine the root cause of the quality issue. B. Separate the non-conforming products. C. Trace the location of the faulty product in the supply chain. D. Replace faulty products when they are returned by the end user. Answer: C When a company undertakes a win-back strategy without considering the profitability of customer accounts, it is neglecting which of the following key elements? A. Loyalty B. Scoring C. Segmentation Question No : 86 - (Topic 2) Question No : 87 - (Topic 2) Question No : 88 - (Topic 2) APICS CSCP : Practice Test 31 D. Prospecting Answer: C It is most appropriate to measure spending per customer as a proportion of profitability during which of the following phases of a supplier/customer relationship? A. Customer acquisition B. Customer retention C. Customer dependency D. Strategic customer care Answer: B A manufacturer offers a trade-in allowance on a new machine when the customer returns the old machine. The manufacturer reconditions the returned machine locally and then sells it on the used market for a profit. This program is an example of a focus on: A. environmentally sensitive engineering. B. gray box design. C. green manufacturing. D. sustainability in operations. Answer: D A company originally based in Germany sets up companies in India, China, Vietnam, Mexico, and Brazil. It sources most of the raw materials locally and employs the local workforce to manage and produce finished goods. Most of the goods produced are consumed in the same country. The company can be classified as what type of enterprise? A. Globally integrated Question No : 89 - (Topic 2) Question No : 90 - (Topic 2) Question No : 91 - (Topic 2) APICS CSCP : Practice Test 32 B. Domestic C. Multinational D. Virtual Answer: C A company ships from its manufacturing facilities directly to its warehouses. If the number of warehouses increases, transportation costs between manufacturing facilities and warehouses most likely will: A. increase. B. decrease. C. not change. D. become less predictable. Answer: A Which of the following actions is in accordance with the Ten Principles in the United Nations (UN) Global Compact? A. Preventing a group of employees from forming a collective bargaining (union) group B. Paying different wages in different parts of the world for a given job classification C. Requiring an individual to pay a fee for consideration in hiring or promotion decisions D. Withholding certain employment opportunities from specific groups of people Answer: B Which of the following activities typically would be an appropriate application of the ISO 31000 Risk Management Principles and Guidelines? A. Calculating a risk index for each facility Question No : 92 - (Topic 2) Question No : 93 - (Topic 2) Question No : 94 - (Topic 2) APICS CSCP : Practice Test 33 B. Establishing external risk communications processes C. Projecting the ability of a facility to recover from an event D. Preparing for risk management accreditation Answer: B The strategy to implement supplier relationship management has been developed. The most appropriate next step is to: A. develop criteria for prospective partners. B. develop policies for alliances. C. select initial partners. D. conduct a pilot implementation. Answer: A In an advanced planning system, which of the following modules feeds the master planning module? A. Purchasing planning B. Demand planning C. Distribution planning D. Fulfillment planning Answer: B A company that has consistently achieved a high level of on-time delivery performance has decided to reduce its inventory level significantly. Which of the following outcomes is the most likely effect of that decision on the company's on time delivery performance? A. There will be no effect. Question No : 95 - (Topic 2) Question No : 96 - (Topic 2) Question No : 97 - (Topic 2) APICS CSCP : Practice Test 34 B. It will decline and then stabilize at a lower level. C. It will improve and then stabilize at a higher level. D. It will decline until sales erode. Answer: B A corporation must consider which of the following factors when selecting its enterprise resources planning system? A. Uniqueness of operations B. Corporate profitability C. MRP and MRP II processing D. Industry benchmarks Answer: A The globalization of a supply chain typically increases uncertainty and: A. production lead time. B. local competition. C. documentation complexity. D. product standardization. Answer: C Which of the following actions would be most appropriate for an enterprise that has successfully integrated internal supply chain management systems and functions? A. Focusing on reducing setup times B. Implementing a firewall to limit access to supply and demand data C. Working with key suppliers to reduce costs and lead times Question No : 98 - (Topic 2) Question No : 99 - (Topic 2) Question No : 100 - (Topic 2) APICS CSCP : Practice Test 35 D. Working with trading partners to reduce channel redundancies Answer: C The customer who provides point-of-sale data remains the sole decision-maker regarding order quantities when what type of inventory strategy is used? A. Continuous replenishment B. Advanced continuous replenishment C. Vendor-managed replenishment D. Quick response Answer: D In the Supply Chain Operations Reference-model (SCOR®), the cash-to-cash cycle time for a manufacturing company is the number of days between which two of the following situations? A. Paying for raw materials and getting paid for the product B. Shipping the product from the warehouse and receiving it at the customer's location C. Paying for raw materials and sending an invoice to the customer D. Billing the customer and getting paid for the product Answer: A Distribution from which of the following types of sites enables goods to enter a country, undergo further modification, and then be exported without paying customs duties? A. Public warehouse B. Value-added territory C. Free trade zone Question No : 101 - (Topic 2) Question No : 102 - (Topic 2) Question No : 103 - (Topic 2) APICS CSCP : Practice Test 36 D. Customs clearing house Answer: C When doing international business, a company's total line-haul costs will vary with the: A. weight shipped. B. distance shipped. C. pallets shipped. D. volume shipped. Answer: B Benchmarking a firm's performance against industry competitors is most valuable because it can reveal: A. a competitor's manufacturing processes. B. a firm's leadership ranking relative to industry peers. C. which processes require improvement. D. that no further improvement is possible. Answer: C A company closely monitors supplier performance and notices recent late deliveries from one supplier. The supplier discloses flood damage at the plant. The company quickly shifts sourcing to a new supplier and has minimal loss of sales. Which of the following risk strategies reflects the company's actions? A. Achieving low cost through reaction B. Creating an adaptive supply chain community C. Reducing supply chain vulnerability Question No : 104 - (Topic 2) Question No : 105 - (Topic 2) Question No : 106 - (Topic 2) APICS CSCP : Practice Test 37 D. Investing in redundancy Answer: B The demand side of a traditional warehouse management system primarily is concerned with: A. receiving incoming goods. B. assigning storage locations. C. assembling outbound orders. D. forecasting product demand. Answer: C Allowing for organizational restructuring is an example of which of the following steps in creating successful strategic alliances among suppliers? A. Managing multifaceted relationships B. Negotiating a win-win deal C. Planning for change D. Conducting pulse checks Answer: C An effective procurement strategy for commodity products should focus on: A. driving down cost and reducing risk. B. spreading purchases equally across suppliers. C. selecting primary and alternate sources. D. selecting suppliers with value-added products. Question No : 107 - (Topic 2) Question No : 108 - (Topic 2) Question No : 109 - (Topic 2) APICS CSCP : Practice Test 38 Answer: A A company produces and distributes a family of soft drinks in a single country. It has developed and will introduce a new family of soft drinks for weight- and health-conscious individuals. There currently are no competitors with nationwide distribution for this category of soft drinks. Which of the following supply chain strategies would be most appropriate for the two product families? A. Produce both product families to forecast and push through the distribution system. B. Produce both product families only after receipt of a distributor order. C. Produce the current product family to forecast and the new product family to order. D. Produce the current product family to order and the new product family to forecast. Answer: C A manufacturer of consumer packaged goods with a single plant and nine regional distribution centers is considering reducing the number of distribution centers in its system. Reducing the number of distribution centers most likely will reduce fixed warehousing and the cost of: A. storing cycle inventory in the distribution centers. B. storing finished-goods inventory at the manufacturing plants. C. transportation from the distribution centers to the customer. D. transportation from the plant to the distribution centers. Answer: D When implementing e-commerce in the supply chain, a company's toughest challenge most likely will be: A. getting all vendors to computerize. Question No : 110 - (Topic 2) Question No : 111 - (Topic 2) Question No : 112 - (Topic 2) APICS CSCP : Practice Test 39 B. translating data into universal standards. C. convincing the information technology department of the value. D. explaining the reason for change to customers. Answer: B A manufacturer and the distributors of its products have decided to focus on price and product availability as strategic priorities. Which of the following values would be the most appropriate measure of customer service? A. Manufacturer's volume flexibility B. Order-fulfillment lead times C. Distributors' order-fill rates D. Supply chain inventory days of supply Answer: C Direct shipment distribution typically offers which of the following advantages? A. Risk pooling is facilitated. B. Demand variability is reduced. C. Service levels are increased. D. Lead times are reduced. Answer: D The most important challenge to consider when sourcing globally is: A. the identification of sources capable of producing the materials. B. the availability of low-cost labor and energy. C. complying with specific import/export issues. Question No : 113 - (Topic 2) Question No : 114 - (Topic 2) Question No : 115 - (Topic 2) APICS CSCP : Practice Test 40 D. balancing the difference between piece price and total cost. Answer: D A company's supply chain depends heavily on sourcing from international suppliers. Conditions increasingly threaten supply continuity. Which of the following actions is most appropriate? A. Source from domestic suppliers. B. Conduct a risk assessment. C. Carry additional safety stock. D. Spread logistics across multiple carriers. Answer: B Which of the following warehousing tools enables wireless scanning of products? A. Magnetic stripes B. Universal product codes C. Radio frequency devices D. Local area network Answer: C Which of the following processes would a company use to evaluate the risk profile for end- of-life planning for a product family? A. Distribution requirements planning B. Sales and operations planning C. Rough-cut capacity planning D. Production activity control Question No : 116 - (Topic 2) Question No : 117 - (Topic 2) Question No : 118 - (Topic 2) APICS CSCP : Practice Test 41 Answer: B Bar codes and radio frequency identification systems are key technologies in supply chain systems because they perform which of the following functions? A. Tracking truck locations on cross-country deliveries B. Facilitating timely and accurate data acquisition C. Providing paperless invoicing of goods D. Producing schedule broadcasts for suppliers Answer: B Which of the following strategies would increase overall supply chain risk? A. Single sourcing a product that makes the highest annual profit B. Outsourcing a product that is not well suited to your operations C. Identify multiple sources for a product that has a potential for supply chain disruption D. Internally manufacturing a product that has a high level of technical intellectual property Answer: A Customizing can be an effective warehousing strategy because it allows a company to: A. allocate available storage space to optimize handling costs. B. address trade-offs between space and material handling needs. C. effectively design its inbound and outbound dock areas. D. add value to the product through modification, labeling, and packaging. Answer: D Question No : 119 - (Topic 2) Question No : 120 - (Topic 2) Question No : 121 - (Topic 2) APICS CSCP : Practice Test 42 The transportation manager at a consumer goods manufacturer has decided to begin shipping full truckload rather than less-than-truckload quantities. Which of the following outcomes is likely following implementation of this decision? A. Inventory levels at the manufacturer will decrease. B. Lead times as seen by the customer will increase. C. Production efficiencies at the manufacturer will increase. D. Transportation costs as seen by the customer will increase. Answer: B A company is formally adhering to the principles of the UN Global Compact. After a review of their supply chain, they have found that a key supplier is in violation of the compact. The best action for the company to do first is: A. do nothing. The company is not responsible for compliance of suppliers. B. replace the supplier as soon as possible with a compliant supplier. C. notify the supplier of non-compliance. D. require the supplier to become compliant. Answer: C Which of the following outcomes occurs when direct shipping is used instead of a distribution network? A. Outbound transportation cost is reduced. B. Inventory velocity is reduced. C. Order-fill rates are reduced. D. Inventory obsolescence is reduced. Answer: D Question No : 122 - (Topic 2) Question No : 123 - (Topic 2) Question No : 124 - (Topic 2) APICS CSCP : Practice Test 43 A product design that can be produced to requirements even when conditions in the production process are unfavorable typically is known as what type of design? A. Universal B. Computer-aided C. Modular D. Robust Answer: D The best way to manage a business relationship is to measure performance to: A. cost of ownership metrics. B. quality targets. C. on-time delivery. D. agreed-upon metrics. Answer: D Inventory parameters established using analytic inventory techniques typically are based on balancing: A. supply and dependent demand. B. customer service and inventory costs. C. transportation and warehousing costs. D. inventory levels and decision-making costs. Answer: B Question No : 125 - (Topic 2) Question No : 126 - (Topic 2) Question No : 127 - (Topic 2) APICS CSCP : Practice Test 44 Which of the following ISO standards is used to assist organizations with sustainable development? A. ISO 31000 B. ISO 14001 C. ISO 26000 D. ISO 9001 Answer: C When an importer and manufacturer are operating in a free trade zone, payment of a customs duty is triggered when products are: A. returned. B. assembled. C. stored. D. distributed. Answer: D Which of the following distribution approaches for a low-volume, high-variety product line typically will result in the highest level of customer service and the lowest total distribution costs? A. Direct shipment from plant to customers B. Shipment from a central distribution warehouse C. Shipment through a multi-echelon distribution network D. Outsourcing the distribution function Answer: A Question No : 128 - (Topic 2) Question No : 129 - (Topic 2) Question No : 130 - (Topic 2) APICS CSCP : Practice Test 45 Potential customers of a company's new product have tight tolerance requirements. The company plans to purchase a critical component. To meet customer requirements, the company should first: A. implement statistical process control for the component. B. bring manufacturing of the critical component in-house. C. develop an alternate source of supply. D. certify the supplier of the component. Answer: D The United Nations Global Compact uses 10 guiding principles to: A. reduce uncertainty for multinational firms regarding legal, import/export, labor, and environmental standards across countries. B. set minimum levels of compliance across a broad range of transactional areas for businesses operating in multiple geographic regions. C. align the needs of businesses to increase profitability and the needs of individual countries to ensure their specific legal requirements are met. D. help ensure that markets, commerce, technology, and finance promote advancement of economies and societies everywhere. Answer: D Which of the following strategies can be used to help manage global risks? A. Direct shipment B. Cross-docking C. Mass customization D. Flexibility Answer: D Question No : 131 - (Topic 2) Question No : 132 - (Topic 2) Question No : 133 - (Topic 2) APICS CSCP : Practice Test 46 A company that sells engineered-to-order products is planning implementation of a supplier relationship management system (SRM) for direct materials. Which of the following factors is most likely to make the implementation difficult? A. Complexity of the purchasing process B. Cost of the application software upgrades C. Management of variable lead times D. Resistance of material suppliers Answer: A Which of the following factors typically is most important in successfully implementing sales and operations planning (S&OP)? A. Involvement of specialists from all functional groups within an organization B. Creation of a dedicated S&OP organizational unit C. Involvement and accountability at senior management level D. Focus on 3 months to 18 months in the future Answer: C Implementation of supply chain applications based on which of the following technologies is most likely to have the lowest fixed costs? A. Best of breed packages B. One integrated package C. Service-oriented architecture D. Software-as-a-service Answer: D Question No : 134 - (Topic 2) Question No : 135 - (Topic 2) Question No : 136 - (Topic 2) Question No : 137 - (Topic 2) APICS CSCP : Practice Test 47 A company that is focused on customer relationship management is most likely to take which of the following actions for customers who have been profitable over time? A. Reduce the cost of serving them. B. Target them for higher margin services. C. Target them for greater attention. D. Charge them for administrative services used. Answer: C Which of the following statements about the use of bar code labels for product identification in the supply chain is true? A. They have been replaced by radio frequency identification tags. B. They can be read by devices 1 to 3 meters from the item. C. They facilitate the capture of information about the location of items. D. Each of the trading partners must apply a unique label. Answer: C A business is changing from a business to business model to a business to consumer model. Which of the following statements about this supply chain change is true? A. Returns from customers will decrease. B. Number of supplier orders will increase. C. Number of customer orders will increase. D. Average supplier order size will increase. Answer: C A toy company decides to buy more products from an overseas company to reduce costs. Question No : 138 - (Topic 2) Question No : 139 - (Topic 2) Question No : 140 - (Topic 2) APICS CSCP : Practice Test 48 To make sure that goods clear customs more quickly, the company most likely would engage a: A. consolidator. B. overseas carrier. C. shipping association. D. freight forwarder. Answer: D A company most likely would consider moving a portion of its manufacturing to a second location to: A. improve competitive advantage through cost control. B. avoid manufacturing downtime due to material shortages. C. maximize security for customer shipments. D. minimize the impact of natural disasters. Answer: D What is the primary benefit of using a central storage warehouse for all components rather than using point-of-use storage? A. Reduced need for bar codes and radio frequency identification technology B. Reduced material handling costs C. Ease of control and count accuracy D. Maintain a cleaner shop floor Answer: C A company wants to implement a system for managing environmental compliance with Question No : 141 - (Topic 2) Question No : 142 - (Topic 2) Question No : 143 - (Topic 2) APICS CSCP : Practice Test 49 legislative and regulatory requirements. Which of the following sustainability tools is most appropriate? A. ISO 14000 B. Global Reporting Initiative (GRI) C. ISO 26000 D. UN Global Compact Answer: A A manufacturer is the leader of a group of trading partners that are collaborating to improve customer service levels and profitability. Which of the following methodologies would be most appropriate for synchronizing supply and demand across the supply chain? A. Sales and operations planning B. Distribution requirements planning C. Supply Chain Operations Reference-model D. Supply chain event management Answer: A Managing supply chain risks includes which of the following activities? A. Developing alternatives to key suppliers B. Setting aside funds for disruption-recovery efforts C. Charging each supply chain partner a portion of risk cost D. Creating extra inventory to cover disruptions in the supply chain Answer: A The process used to determine the impact of promotions, price discounts, and rebates on Question No : 144 - (Topic 2) Question No : 145 - (Topic 2) Question No : 146 - (Topic 2) APICS CSCP : Practice Test 50 demand forecasts commonly is referred to as demand: A. planning. B. forecasting. C. aggregating. D. shaping. Answer: D An increase in the inventory turnover rate for a supply chain typically would indicate that there has been a reduction in: A. prices to the end user. B. supply chain cost of sales. C. the manufacturer's inventory. D. the total supply chain inventory. Answer: D The mission of the global reporting initiative (GRI) is to provide a: A. comparison of key metrics for companies in the same industries across the globe. B. feasible business plan that can be shown to global potential investors. C. trusted and credible framework for reports regarding sustainability practices. D. transparent collaboration between non-profit organizations and governments. Answer: C A firm is undertaking a revision of its financial metrics to make them more comprehensive and has decided to use metrics such as return on investment (ROI), return on assets (ROA), and economic value added (EVA). This is an example of utilizing which of the Question No : 147 - (Topic 2) Question No : 148 - (Topic 2) Question No : 149 - (Topic 2) APICS CSCP : Practice Test 51 following types of metrics? A. Activity based B. Stakeholder focused C. Financial sustainability D. Value chain Answer: C Topic 3, Implementation and Operations Use of consistent performance measures among trading partners is a best practice to: A. share data among information systems faster. B. manage collaboration and continuous improvement. C. reduce the time to introduce new products. D. increase the flexibility to collaborate with customers. Answer: B A manufacturer of consumer goods has purchased one of its distributors. The distributor's inventory system is archaic and will not integrate into the manufacturer's enterprise resources planning (ERP) system. Which of the following approaches is the most appropriate long-term solution for the manufacturer? A. Buy a complete ERP system that includes seamlessly integrated distribution. B. Buy a warehouse management system that integrates into the ERP system. C. Run the existing warehouse inventory system and update the ERP system manually. D. Hire a software contractor to write an interface with batch update to the ERP system. Answer: B Question No : 150 - (Topic 3) Question No : 151 - (Topic 3) Question No : 152 - (Topic 3) APICS CSCP : Practice Test 52 What benefit does Radio Frequency Identification (RFID) technology provide for a high- volume, low-cost manufacturer? A. Reduces store thefts B. Eliminates the effects of bullwhip C. Eliminates stock out at store level D. Reduces number of touch points in pallet handling Answer: D Which of the following actions by a group of trading partners is most likely to improve the flow of funds among them? A. Increasing the level of information sharing and collaboration B. Negotiating a single set of terms for the trading partners C. Reducing the time allowed for the timely payment discount D. Implementing links among their information systems Answer: A Which of the following strategies typically will require the lowest inventory investment and deliver the shortest lead time? A. Producing finished goods to forecast and shipping directly to customers B. Producing finished goods to forecast and distributing through a multi-echelon network C. Producing subassemblies to forecast and doing final assembly and shipping from the factory D. Producing subassemblies to forecast and doing final assembly and shipping from regional centers Answer: D Question No : 153 - (Topic 3) Question No : 154 - (Topic 3) Question No : 155 - (Topic 3) APICS CSCP : Practice Test 53 The employees at a convenience store are trained to ask customers purchasing snack foods whether they also would like to purchase a beverage. This situation is an example of: A. cross-selling. B. customer service. C. product marketing. D. selling an upgrade. Answer: A Which of the following measures typically would be considered an aspect of the environmental impact of a supply chain? A. Amount of funds invested in infrastructure improvements B. Hours of employee education about environmental stewardship C. Weight and volume of packaging materials used D. Total number of people making a living wage Answer: C Implementation of supplier relationship management is most successful when a company emphasizes which of the following two factors? A. Cost reduction and product design B. Quality and partnerships C. Technology and productivity D. Capital investments and global expansion Answer: B A firm has identified key benefits for developing a strategic alliance and has selected Question No : 156 - (Topic 3) Question No : 157 - (Topic 3) Question No : 158 - (Topic 3) APICS CSCP : Practice Test 54 appropriate supply chain partners. Which of the following actions should the firm take to build a successful alliance with a supplier who is also a competitor? A. Establish an internal committee to limit shared information. B. Negotiate contracts that maximize the firm's profits. C. Instruct employees to ignore the competitive aspect of the relationship. D. Encourage employees to cooperate with the supplier. Answer: D A supplier disputes a low rating generated by a company's enterprise resources planning (ERP) system. Which of the following actions by the purchasing agent is most appropriate? A. Advise the ERP information technology manager that there is a flaw in the rating system. B. Scrap the vendor rating system until the company can figure out what is wrong. C. Compare the vendor and company detail records, and interview company employees who handled the data. D. Tell the supplier that, regardless of the disputed claims, the supplier must improve performance. Answer: C E-business allows a firm to capitalize on the use of systems that: A. speed the receipt of e-mails between companies. B. permit real-time use of supply chain data. C. permit the use of batch-processed data. D. ensure security of proprietary data. Answer: B Question No : 159 - (Topic 3) Question No : 160 - (Topic 3) Question No : 161 - (Topic 3) APICS CSCP : Practice Test 55 The primary contribution from an enterprise resources planning system in building supply chain capability is: A. real-time manufacturing planning. B. improved decision making. C. ease of implementation. D. timely order tracking. Answer: B A project team has received 30 improvement ideas from subject matter experts in the business. Which of the following continuous improvement tools would be most appropriate to use to sequence implementation timing based on an agreed-upon weighted criteria? A. Affinity diagram B. Matrix diagram C. Prioritization matrix D. Interrelationship digraph Answer: C Which of the following export documents is used as the basis for the valuation of goods for insurance purposes and for assessment of duties? A. Export license B. Export declaration C. Bill of lading D. Commercial invoice Answer: D Question No : 162 - (Topic 3) Question No : 163 - (Topic 3) Question No : 164 - (Topic 3) APICS CSCP : Practice Test 56 The production scheduler for a bottleneck resource should: A. schedule additional preventive maintenance for the resource. B. ensure a constant queue of work waiting to be processed. C. increase production lot sizes to increase utilization of resources. D. implement pull signals for production of the bottleneck resource. Answer: B An information technology system that couples enterprise resources planning and an advanced planning system would be most appropriate for which of the following types of business operations? A. Multiple plants in multiple industries B. Multiple plants in the same supply chain C. Multiple supply chains of different products D. Multiple supply chains of the same product Answer: B In an assemble-to-order manufacturing environment, the master production schedule is typically the schedule of: A. resources. B. customer orders. C. components and subassemblies. D. the final assembly. Answer: C A supervisor knows that employees have good ideas for improving department operations Question No : 165 - (Topic 3) Question No : 166 - (Topic 3) Question No : 167 - (Topic 3) APICS CSCP : Practice Test 57 but are hesitant to share them. Which of the following tools would be most appropriate for encouraging the employees to participate in identifying opportunities? A. Tree diagram B. Pareto chart C. Process map D. Affinity diagram Answer: D A juice manufacturer wants to determine the time required to convert a dollar spent on materials into a dollar received in sales. Which of the following metrics would be most appropriate to make this determination? A. Activity-based costing B. Inventory carrying cost C. Cash-to-cash cycle time D. Average financial turnover Answer: C Which of the following processes ensures that functional plans are consistent? A. Strategic planning B. Sales and operations planning C. Project planning D. Master scheduling Answer: B Which of the following performance indicators can be used to measure the effectiveness of Question No : 168 - (Topic 3) Question No : 169 - (Topic 3) Question No : 170 - (Topic 3) APICS CSCP : Practice Test 58 a vendor-managed inventory program? A. Number of inventory receipts B. Inventory usage C. Inventory returns D. In-stock rate Answer: D An office furniture manufacturer observed that customers preferred to configure desks based on their available office space. To keep product costs to a minimum, yet satisfy customer needs, the company should choose which of the following design strategies? A. Modularity B. Component commonality C. Mass customization D. Standardization Answer: A A company exports products to emerging markets. Which of the following approaches would be used to enhance compliance, minimize risks, and connect supply chain activities? A. Logistics network planning B. Distribution requirements planning C. Supply chain event management D. Global trade management Answer: D Which of the following issues recently has caused companies to rethink implementation or Question No : 171 - (Topic 3) Question No : 172 - (Topic 3) Question No : 173 - (Topic 3) APICS CSCP : Practice Test 59 continued use of a Just-in-Time system? A. The upward trend in inventory carrying costs B. The reduced number of potential suppliers C. The elimination of billing documents D. Higher transportation costs Answer: D A common benefit of including an automatic identification system (AIS) at the point of sale (POS) in retail stores is improved: A. shipment traceability. B. unit inventory precision. C. sales revenue tracking. D. information integrity of freight bills. Answer: B The most common method for coping with demand variability in the manufacture of products with a lengthy cycle time is to have: A. higher raw material inventory. B. higher finished-goods inventory. C. lower finished-goods inventory. D. lower raw material inventory. Answer: B The theory of constraints (TOC) works best in an environment where the: Question No : 174 - (Topic 3) Question No : 175 - (Topic 3) Question No : 176 - (Topic 3) APICS CSCP : Practice Test 60 A. product mix for the operation changes daily. B. constraint cannot be easily managed. C. constraint cannot be easily identified. D. constraint persists long enough to be managed effectively. Answer: D Which of the following circumstances best describes a roadblock to implementing customer relationship management and supplier relationship management? A. Concern about conflicts of interest with partners in the supply chain B. Lack of defined industry standards C. Deterioration of customer service levels D. Increased access to information for supply chain partners Answer: A Use of a private warehouse is most appropriate when a firm needs to: A. adjust warehouse capacity easily for seasonal products. B. perform a limited number of specialized activities for customers. C. control operating policies and hours to respond to changes in market demand. D. take advantage of economies of scale and scope to increase profitability. Answer: C A company is aggressively pursuing improvements in the financial performance of its supply chain. The company should first focus its efforts on which of the following metrics? A. Process takt time B. Cycle count accuracy Question No : 177 - (Topic 3) Question No : 178 - (Topic 3) Question No : 179 - (Topic 3) APICS CSCP : Practice Test 61 C. Number of inventory turns D. Number of first-tier suppliers Answer: C Which of the following costs is an example of ordering cost? A. Inspection labor B. Obsolesence C. Cost of capital invested D. Insurance Answer: A A manufacturer experiences frequent changes in product technology and market preferences, resulting in new product introductions each year. Which of the following sourcing strategies would be most appropriate? A. Sole sourcing B. Multiple sourcing C. Long-term contracting D. Strategic partnering Answer: D A firm decides to move from a mass production to a mass customization model. This will result in a change in focus from: A. special to general purpose facilities. B. lower to higher operational cost. C. efficiency to effectiveness measures. Question No : 180 - (Topic 3) Question No : 181 - (Topic 3) Question No : 182 - (Topic 3) APICS CSCP : Practice Test 62 D. high to low flexibility workforce. Answer: A Variation in upstream requirements can be reduced by increasing: A. demand visibility. B. production capacity. C. product features. D. safety stock. Answer: A Which of the following actions typically is most important when building a collaborative supply chain? A. Investing sufficient capital B. Building mutual trust C. Integrating information systems D. Developing a common culture Answer: B During the sales and operations planning (S&OP) horizon, planned inventory can best be used to: A. implement a time-phased stock replenishment plan. B. allow for consistent production lot sizing. C. buffer the company against unknown fluctuations in demand. D. minimize storage and transportation costs. Question No : 183 - (Topic 3) Question No : 184 - (Topic 3) Question No : 185 - (Topic 3) APICS CSCP : Practice Test 63 Answer: C A company regularly issues sustainability reports in accordance with the Global Reporting Initiative (GRI) framework and uses the reports to track continuous improvement. Which of the following topics could be found in the sustainability reports? A. Labor practices B. Product specifications C. Raw material costs D. Currency exchange rates Answer: A A retailer sets service-level targets intended to maximize total profit. The retailer's service level target should be highest for items with a high profit margin and: A. low variability of demand. B. made to stock. C. small replenishment lot size. D. made to order. Answer: A Which of the following types of supply chains is characterized by difficulty in responding to rapidly changing demand patterns? A. Push-based B. Pull-based C. Innovative D. Collaborative Question No : 186 - (Topic 3) Question No : 187 - (Topic 3) Question No : 188 - (Topic 3) APICS CSCP : Practice Test 64 Answer: A Which of the following factors should be considered when establishing an inventory policy? A. Customer demand B. Selling price history C. Historical service levels D. Number of customers Answer: A Which of the following activities is forbidden in a foreign trade zone? A. Remarking or repackaging imports to avoid fines B. Breaking up large shipments to reduce import duties C. Reexporting goods without paying duties D. Conducting retail trade Answer: D Which of the following technologies directly enables pulling products through the supply chain? A. Automatic identification system (AIS) B. Point of sale (POS) system C. Customer relationship management (CRM) D. Supply chain event management (SCEM) Answer: B Question No : 189 - (Topic 3) Question No : 190 - (Topic 3) Question No : 191 - (Topic 3) APICS CSCP : Practice Test 65 Which of the following processes is included in reverse logistics? A. Designing a new product out of recycled material B. Restoring a worn-out product to like-new condition C. Reducing the amount of packaging material in a product D. Eliminating toxic materials in a product Answer: B A company handling sale of product discarded by consumers is what type of provider? A. Third party logistics (3PL) B. Reverse logistics C. Fourth party logistics (4PL) D. Warehousing Answer: B The benefit most likely to result from a collaborative forecasting process is: A. improvement in forecast accuracy. B. improvement in forecast responsiveness. C. reduction of the coefficient of variation. D. reduction of forecasting effort. Answer: A Question No : 192 - (Topic 3) Question No : 193 - (Topic 3) Question No : 194 - (Topic 3) Question No : 195 - (Topic 3) APICS CSCP : Practice Test 66 A company operates under a make-to-order policy, and its supplier operates under a make- to-stock policy. Which of the following risks poses the greatest threat? A. Inventory risk for the company B. Inventory risk for the supplier C. Debt leverage risk for the company D. Debt leverage risk for the supplier Answer: B The profit margin for a product that is currently made in the company's facility has decreased during the past 2 years. Which of the following factors should be considered when deciding whether to make or buy the product? A. Production capabilities B. Transportation capabilities C. Distribution channels D. Landed cost Answer: D Horizontal and vertical exchanges of secure data among supply chain partners are facilitated best by: A. the intranet. B. a portal. C. a Web site. D. e-mail. Answer: B Question No : 196 - (Topic 3) Question No : 197 - (Topic 3) Question No : 198 - (Topic 3) APICS CSCP : Practice Test 67 Effective sales and operation planning (S&OP) is most likely to result in which of the following benefits? A. Better customer service B. Better product quality C. Lower product cost D. Lower work-in-process (WIP) inventory Answer: A Which of the following factors are fundamental to transportation performance? A. Full truck loads, maintenance, discounts B. Quality, Just-in-Time, invoicing C. Contract performance, order tracking, flexibility D. Cost, speed, delivery consistency Answer: D A firm decides to reduce the number of distribution centers it uses. Which of the following outcomes is the most likely result of this change? A. Order-fill rate will increase. B. Total safety stock will increase. C. Delivery lead time will decrease. D. Outbound transportation cost will decrease. Answer: A Supplier certification procedures verify that a supplier: Question No : 199 - (Topic 3) Question No : 200 - (Topic 3) Question No : 201 - (Topic 3) APICS CSCP : Practice Test 68 A. is ISO certified. B. implements, documents, and improves procedures related to customer requirements. C. tracks manufacturing processes, including bills of material and routings to support the processes. D. manufactures products to the specifications shown on engineering documents and bills of material. Answer: B A manufacturer's inventory levels are growing and service levels are dropping. Which of the following supply chain strategies is most appropriate to reduce inventory and improve service? A. Increase the safety stockon all items. B. Reduce the setup time. C. Optimize the total cost. D. Implement batch operations. Answer: B Effective sales and operations planning (S&OP) can contribute most to which of the following objectives? A. Increasing product quality B. Increasing the number of new customers C. Reducing unexpected customer requests D. Reducing excess inventory Answer: D What is the appropriate supply chain strategy for a product with low demand uncertainty and high economies of scale? Question No : 202 - (Topic 3) Question No : 203 - (Topic 3) Question No : 204 - (Topic 3) APICS CSCP : Practice Test 69 A. Pull B. Push C. Push-pull D. Postponement Answer: B A company discovers that several high-volume customers have very erratic ordering patterns. Which of the following actions is most likely to reduce variability? A. Checking the demand status multiple times daily B. Establishing Internet-enabled collaborative relationships C. Implementing electronic data interchange transactions D. Increasing safety-stock levels for items these customers order Answer: B Which of the following steps is first in developing a product differentiation strategy? A. Study customer needs B. Define customer segments C. Determine design modifications D. Establish competitive priorities Answer: A Which of the following characteristics is typical of a highly complex product when compared with a simple commodity product? A. Lower product cost B. Longer cycle time Question No : 205 - (Topic 3) Question No : 206 - (Topic 3) Question No : 207 - (Topic 3) APICS CSCP : Practice Test 70 C. Increased ability to change D. Lower profitability Answer: B A company has revenues of $100,000, which includes 10% supply chain expense and 80% other expenses. Which of the following actions will result in the largest increase in gross profit? A. Increase sales by 25%. B. Increase sales by 10% and reduce supply chain expense to 8%. C. Increase sales by 15% and reduce supply chain expense to 9%. D. Reduce supply chain expense to 5%. Answer: D Customer demand is 120 units per week. The company works on a 9-hour shift per day, 5- day per week basis. Each shift has a ½-hour lunch break and two 15-minute coffee breaks. The cycle time is 12 minutes. To meet demand, production must occur at the rate of one unit every: A. 12 minutes. B. 20 minutes. C. minutes. D. 28 minutes. Answer: B In order to optimize delivery routing and load planning as well as to provide advanced shipment notifications (ASN's), which of the following technology platforms should be implemented to plan and manage the above operations? Question No : 208 - (Topic 3) Question No : 209 - (Topic 3) Question No : 210 - (Topic 3) APICS CSCP : Practice Test 71 A. Electronic Date Interchange (EDI) B. Enterprise Resource Planning (ERP) C. Event Management System (EMS) D. Transportation Management System (TMS) Answer: D Some firms that have licensed other companies to manufacture their products run the risk of: A. losing market share. B. the other companies becoming competitors. C. the products becoming a commodity. D. the products being overpriced. Answer: B Which of the following characteristics typically is a feature of supplier relationship management? A. Supplier employees are located at the firm's facilities. B. Inventory is verified before the supplier ships the goods. C. Performance of both firms is measured and reported regularly. D. The supplier is the sole source for the goods. Answer: C A company develops annual forecasts for key products and enters into annual contracts with key suppliers based on the forecasts. Which of the following benefits would the company most likely receive from this approach? Question No : 211 - (Topic 3) Question No : 212 - (Topic 3) Question No : 213 - (Topic 3) APICS CSCP : Practice Test 72 A. Shorter delivery lead times B. Lower prices C. Improved service D. Higher-quality products Answer: B How does a mass customization product design strategy relate to component commonality, modular design, and product universality? A. Modular design is necessary for mass customization. B. Component commonality does not support mass customization. C. Universality is a prerequisite for mass customization strategy. D. Both universality and modular design are required for mass customization. Answer: A One operation in a four-stage process has been producing more than required and is causing elevated levels of work in process. Which of the following approaches would be most appropriate to address the situation? A. Kano B. Kanban C. Kaizen D. Keiretsu Answer: B The most appropriate approach to balance supply and demand over the medium term is: A. Enterprise resource planning (ERP) Question No : 214 - (Topic 3) Question No : 215 - (Topic 3) Question No : 216 - (Topic 3) APICS CSCP : Practice Test 73 B. Business planning C. Strategic planning D. Sales and operations planning (S&OP) Answer: D Which of the following outcomes most likely is the primary reason for outsourcing production of a new product? A. Increase control of the supply chain B. Increase flexibility of the supply chain C. Reduce required capital investment D. Reduce the need for skilled workers Answer: C A company uses cash-to-cash cycle time to assess how long it takes from: A. receiving inventory from the supplier to paying the invoice from the supplier. B. receiving inventory from the supplier to invoicing the customer. C. paying the supplier for inventory received to receiving payment from the customer. D. invoicing a customer to receiving payment from the customer. Answer: C The purpose of capacity requirements planning is to determine: A. the number of overtime hours required to complete a job. B. when equipment and labor are needed. C. what materials are needed. D. what materials require expediting. Question No : 217 - (Topic 3) Question No : 218 - (Topic 3) Question No : 219 - (Topic 3) APICS CSCP : Practice Test 74 Answer: B Which of the following tools is most appropriate to use to determine projects that will achieve the greatest net benefits? A. Pareto diagram B. Fishbone diagram C. Process flow diagram D. Operation process chart Answer: A A company is considering relocating production to a lower-wage country. Volatility in which of the following areas most likely would impact profitability without modifying product landed costs? A. Labor costs B. Currency exchange rates C. Commodity prices D. Product quality Answer: B Explanation: NEW QUESTIONS A manufacturer has direct relationships with its tier 1 suppliers. Which of the following supplier capabilities is a benefit to the manufacturer establishing a direct relationship with lower-tier suppliers? Question No : 220 - (Topic 3) Question No : 221 - (Topic 3) Question No : 222 - (Topic 3) APICS CSCP : Practice Test 75 A. Provides smaller lot sizes B. Provides components with short lead times C. Provides Just in Time deliveries D. Provides information about impending shifts in the economy Answer: D Which of the following outcomes is the primary benefit to an organization that develops a supplier certification program? A. Supplier capability is documented. B. Inspection costs are reduced. C. Delivery time is improved. D. Negotiating power is strengthened for the certifying organization. Answer: B The most significant reason for altering supply chain management practices in an organization would be a change in its: A. executive management. B. corporate strategy. C. profitability of operations. D. financial position. Answer: B A company has an asset turnover ratio of , inventory of $3,000, a 20% profit margin, and $5,000 in total assets. What is the total sales volume for the company? A. $ 5,400 Question No : 223 - (Topic 3) Question No : 224 - (Topic 3) Question No : 225 - (Topic 3) APICS CSCP : Practice Test 76 B. $ 9,000 C. $15,000 D. $25,000 Answer: B Electronic data interchange reduces costs primarily through: A. standardization of trading document formats. B. adaptability across hardware platforms. C. simplified software development. D. replacement of proprietary systems. Answer: A Which of the following reverse logistics activities involves reusing refurbished products? A. Return management B. Disposal and reclamation C. Decomposing and recycling D. Remanufacturing and repair Answer: D Which of the following situations is a consequence of global operations? A. Decreased logistic cost B. Increased logistic complexity C. Reduced product variety D. Longer lead times Question No : 226 - (Topic 3) Question No : 227 - (Topic 3) Question No : 228 - (Topic 3) APICS CSCP : Practice Test 77 Answer: B Which of the following actions best exemplifies an appropriate demand management strategy? A. Reducing costs in the procurement of goods B. Prioritizing demand when supply is constrained C. Maximizing sales orders from customers D. Updating the sales and operations planning (S&OP) to changes in production capacity Answer: B Which of the following approaches most likely will help a company reduce its cost of sales while increasing customer loyalty? A. Business process design B. Business development mapping C. Customer relationship management D. Sales contact management Answer: C A manufacturer is the sole supplier of a product family. It sells to regional distributors that sell to retailers. The manufacturer uses batch production processes that have long setup times. All nodes in the supply chain have agreed to pursue a quick response to changes in the level of demand as a competitive priority. Which of the following factors is most likely to hinder their pursuit of this competitive priority? A. Information technology standards B. Information sharing practices C. Contractual terms and conditions Question No : 229 - (Topic 3) Question No : 230 - (Topic 3) Question No : 231 - (Topic 3) APICS CSCP : Practice Test 78 D. Manufacturing lot sizes Answer: D On-time delivery performance in the supply chain can best be improved by aligning required capacity with what type of capacity? A. Demonstrated B. Rated C. Budgeted D. Theoretical Answer: A Which of the following activities is the most appropriate use of an advanced planning and scheduling system? A. Selecting the target market for a product B. Optimizing transportation routes C. Creating a daily demand forecast D. Identifying constraints within a facility Answer: D Continuous process improvement is characterized by which two of the following key steps? A. Quality circles and benchmarking B. Process review and supplier audits C. Analysis and assessment D. Observation and selection Question No : 232 - (Topic 3) Question No : 233 - (Topic 3) Question No : 234 - (Topic 3) APICS CSCP : Practice Test 79 Answer: C A car manufacturer has 40000 cars in inventory, of which 5000 are electric. The manufacturer expects to sell 5000 cars per day, of which 4000 are estimated to be gasoline cars. The days of supply for electric cars is: A. 40 days. B. 10 days. C. 8 days. D. 5 days. Answer: D Which of the following metrics would be most appropriate for a group of trading partners that is trying to gain competitive advantage through supply chain reliability? A. Cash-to-cash cycle time B. Supply chain response time C. Order-fill rate performance D. Value-added productivity per employee Answer: C The primary benefit a company is likely to achieve when setting time fences is: A. reducing lead time. B. providing a steady schedule for suppliers. C. interpreting forecast properly. D. maintaining a stable flow. Answer: D Question No : 235 - (Topic 3) Question No : 236 - (Topic 3) Question No : 237 - (Topic 3) APICS CSCP : Practice Test 80 Use of a centralized distribution center rather than a decentralized distribution network typically results in which of the following consequences? A. Distribution system overhead is higher. B. Customer delivery time is shorter. C. Total transportation costs are lower. D. Safety stock levels are lower. Answer: D Which of the following manufacturing strategies would run the greatest risk of increasing obsolete inventory costs? A. Make-to-stock B. Assemble-to-order C. Make-to-order D. Engineer-to-order Answer: A Which of the following metrics is the most appropriate measure of supply chain responsiveness? A. Order fulfillment lead times B. Percentage of orders delivered on time C. Retail inventory days of supply D. Upside production flexibility Answer: D Question No : 238 - (Topic 3) Question No : 239 - (Topic 3) Question No : 240 - (Topic 3) APICS CSCP : Practice Test 81 A consumer goods manufacturer has introduced a new frozen product and encountered problems applying package labels consistently. Which of the following methodologies would be most appropriate to use to identify the root cause of the problem? A. Six sigma B. Statistical process control C. Lean production D. Theory of constraints Answer: A Which of the following activities is an important phase of product life-cycle management? A. Developing supplier relationships B. Implementing performance measurements C. Designing supply chain logistics D. Incorporating key design elements Answer: D Which of the following activities is critical to successful synchronization of supply and demand throughout a supply chain? A. Sharing demand information B. Placing large orders to obtain lower prices C. Reducing the number of deliveries D. Maintaining increased inventories Answer: A Question No : 241 - (Topic 3) Question No : 242 - (Topic 3) Question No : 243 - (Topic 3) Question No : 244 - (Topic 3) APICS CSCP : Practice Test 82 A manufacturer is evaluating outsourcing production of high-volume components. Outsourcing production will likely require an increase in total supply chain inventory for the components due to an increase in: A. demand. B. lead time. C. quality. D. suppliers. Answer: B ABC Corporation is implementing a website that connects clothing distributors and retailers with many different garment manufacturers from whom they can buy finished goods. This website would be an example of: A. virtual auction site. B. intranet commerce. C. a vertical exchange. D. an Internet storefront. Answer: C Turning the request-for-quotes process into a real-time auction setting most likely will: A. improve product quality. B. increase process costs. C. reduce cycle time. D. reduce bid cost. Answer: C Question No : 245 - (Topic 3) Question No : 246 - (Topic 3) Question No : 247 - (Topic 3) APICS CSCP : Practice Test 83 Which of the following factors is most likely to slow the adoption of collaborative planning, forecasting, and replenishment (CPFR)? A. The reluctance to share detailed information B. The cost of electronic data interchange services C. The risk that changed processes will disrupt operations D. The risk of security breaches Answer: A A pattern of increased shipments from manufacturing plants to a central warehouse at month-end and quarter-end typically would cause which of the following situations in a central warehouse? A. Fluctuation in required labor resources B. Decreased use of storage capacity C. Decreased transportation costs D. Increased outbound shipments Answer: A Which of the following statements best identifies the value of using a supplier rating system? A. It provides an objective means for a company to determine outstanding suppliers. B. It allows customers to post chargebacks to suppliers. C. It offers a company an effective way to control suppliers' delivery processes. D. It ensures that all suppliers are using the same quality standards to manufacture products. Answer: A Question No : 248 - (Topic 3) Question No : 249 - (Topic 3) Question No : 250 - (Topic 3) APICS CSCP : Practice Test 84 Variability in product design can best be reduced by: A. initiating 100% product inspection. B. outsourcing the design process. C. broadening design specifications. D. applying Six Sigma principles. Answer: D The most appropriate frequency for the sales and operations planning process typically is: A. weekly. B. monthly. C. quarterly. D. annually. Answer: B A distributor has a network consisting of a central distribution center serving five regional distribution centers that ships to multiple retailers. The distributor wants to reduce inventory while maintaining product availability. Which of the following actions is most likely to produce the desired outcome? A. Centralizing inventory for slow-moving items B. Reducing the quoted price for slow-moving items C. Implementing cross-docking at the central distribution center D. Implementing continuous replenishment at the regional centers Answer: A Which of the following activities typically is included in a warehouse management system? Question No : 251 - (Topic 3) Question No : 252 - (Topic 3) Question No : 253 - (Topic 3) APICS CSCP : Practice Test 85 A. Invoicing B. Freight-bill auditing C. Order processing D. Vehicle routing Answer: C A company has limited visibility of global customer sales. Which of the following methods is the most appropriate way to sense and respond to customer demand? A. Point of sale B. Sales and operations planning C. Demand-driven supply network D. Customer relationship management Answer: C Which of the following tradeoffs should be considered when selecting logistics options? A. Safety stock levels and customer service levels B. Inventory levels and scheduling operations C. Transportation cost and speed of delivery D. Centralized and decentralized distribution network Answer: C In determining warehouse velocity, the average inventory level is calculated by dividing the annual sales through the warehouse by the: A. total square footage of the warehouse. B. inventory turnover rates for the warehouse. Question No : 254 - (Topic 3) Question No : 255 - (Topic 3) Question No : 256 - (Topic 3) APICS CSCP : Practice Test 86 C. annual weight through the warehouse. D. annual cube through the warehouse. Answer: B A key assumption of the economic order quantity (EOQ) is that: A. future demand cannot be projected. B. the rate of demand is continuous and constant. C. reorder frequency is fixed. D. as the lot size decreases, the setup cost per unit decreases. Answer: B The lowest-cost supply network design requires balancing inventory costs and which of the following types of costs? A. Administrative B. Manufacturing C. Transportation D. Sales and marketing Answer: C Which of the following attributes is an example of both supply and operational risk? A. Quality B. Order quantities C. Robust processes D. Product mix Question No : 257 - (Topic 3) Question No : 258 - (Topic 3) Question No : 259 - (Topic 3) APICS CSCP : Practice Test 87 Answer: A The purchasing manager of a company wants to minimize stock-outs as well as obsolete inventory. Which of the following tools needs to be implemented? A. Blanket purchase order B. Advanced planning and scheduling (APS) C. Buy-back contracts D. Business-to-business integration software Answer: C In the supplier rationalization step of the supplier relationship management process, the supplier base is treated like: A. a rival competitor in a tight market. B. an extension of the enterprise. C. a subcontractor with the lowest bid. D. an end customer with 50% of the demand. Answer: B A company has recently implemented a vendor-managed inventory (VMI) program with several key suppliers but quality issues are disrupting production. Which of the following actions would be more effective in dealing with these issues? A. Tighten the quality tolerances B. Implement a supplier certification program C. Implement quality inspection at the receiving dock D. Charge back to the supplier the rework and scrap costs Question No : 260 - (Topic 3) Question No : 261 - (Topic 3) Question No : 262 - (Topic 3) APICS CSCP : Practice Test 88 Answer: B Which of the following supply chain attributes is most appropriate for products with wide variety and highly variable demand? A. Efficient B. Responsive C. Short D. Virtual Answer: B The primary risk that must be considered when lean practices are applied to a supply chain network is: A. decreased operations flexibility. B. decreased inventory availability. C. increased total ordering costs. D. increased customer returns. Answer: B The most useful inventory costing method which enables purchase price variance analysis is: A. average costing. B. standard costing. C. last in first out (LIFO) costing. D. first in first out (FIFO) costing. Answer: B Question No : 263 - (Topic 3) Question No : 264 - (Topic 3) Question No : 265 - (Topic 3) APICS CSCP : Practice Test 89 The use of kanban for item replenishment by external suppliers requires: A. accurate long-term forecasts. B. returnable plastic containers. C. close communication about component usage. D. a process for the reverse supply chain. Answer: C Which of the following principles is a core value of the UN Global Compact? A. Anti-Corruption B. Profitability C. Discrimination D. Employment Answer: A Purchased component standardization generates savings primarily by reducing: A. assembly costs through economies of scale. B. engineering costs due to lower testing requirements. C. inventory control costs due to smaller shelf space requirements. D. inventory transportation costs by using economical modes. Answer: A Question No : 266 - (Topic 3) Question No : 267 - (Topic 3) Question No : 268 - (Topic 3) Question No : 269 - (Topic 3) APICS CSCP : Practice Test 90 Which of the following statements is true when a contract manufacturing agreement is implemented? A. There is no longer a need for material requirements planning. B. The total cost of acquiring products will decrease. C. Communications and project management are key factors for success. D. Assets on the contract manufacturer's balance sheet typically will decrease. Answer: C Which of the following factors is the most important driver of supply chain change? A. Health and safety concerns B. Competitor actions C. Government regulations D. Customer perceptions of value Answer: D A procurement manager wants to reduce costs on commodity items. Which of the following actions is likely to result in the greatest savings? A. Conducting a supplier review and recertification B. Renegotiating contracts with commodity suppliers C. Standardizing and eliminating redundant items D. Leveraging group purchasing power Answer: D A firm has captured the following information for a product family: Question No : 270 - (Topic 3) Question No : 271 - (Topic 3) Question No : 272 - (Topic 3) APICS CSCP : Practice Test 91 The cash-to-cash cycle time is how many days? A. 41 B. 44 C. 62 D. 74 Answer: C A supply chain visibility application helps an organization by: A. planning raw material requirements. B. removing outliers from independent demand forecasts. C. providing flexibility in customer delivery locations. D. providing comprehensive information from any point of contact. Answer: D Companies interested in developing programs to pinpoint customer loyalty rely on customer relationship management tools that produce which of the following outputs? Question No : 273 - (Topic 3) Question No : 274 - (Topic 3) APICS CSCP : Practice Test 92 A. Transaction management B. Forecast, process, and information sharing C. Churn analysis and prediction D. Event and service management Answer: C A company that locates manufacturing facilities in different countries so that an economic downturn in one country most likely will be offset by business in another country is employing what type of strategy? A. Speculative B. Hedge C. Flexible D. Forecast Answer: B Point-of-sale information fails to measure actual demand most likely because: A. holidays interrupt typical sales patterns. B. inventory levels are inaccurate. C. there is lag time in the system. D. data about lost sales cannot be captured. Answer: D Before discontinuing a product based on activity-based cost calculations, one should primarily consider the effects upon: A. activity-based cost calculations of other products. Question No : 275 - (Topic 3) Question No : 276 - (Topic 3) Question No : 277 - (Topic 3) APICS CSCP : Practice Test 93 B. value stream mapping of complementary products. C. research and development (R&D) costs of new products. D. overhead absorption rates across product lines. Answer: A Which of the following techniques allows users to automate the notification of appropriate parties when exceptions to specific business rules occur? A. Enterprise resources planning B. Supply chain event management C. Advanced planning and scheduling D. Automatic identification and data capture Answer: B Which of the following factors is the most appropriate measure of delivery performance for finished goods? A. Perfect order fulfillment B. On-time delivery C. Load efficiency D. Available-to-promise Answer: A A company recently implemented a new supplier rating system. Data was collected from the enterprise resources planning system about each vendor's rating for cost, quality, and delivery over 12 months. A cutoff point was established for poor performers. The responsible purchasing agent then scheduled meetings with each supplier. Which of the following actions is most appropriate to take with suppliers whose ratings were below the cutoff point? Question No : 278 - (Topic 3) Question No : 279 - (Topic 3) Question No : 280 - (Topic 3) APICS CSCP : Practice Test 94 A. Discuss ways to raise the ratings for the next review period. B. Tell the suppliers they are on probation for 3 months. C. Immediately cancel outstanding contracts with those suppliers. D. Ask the suppliers to explain the poor performance. Answer: A Which of the following supplier performance factors typically is most critical for organizations that outsource production? A. Speed B. Reliability C. Flexibility D. Malfunction recovery Answer: B Which of the following supply chain strategies should be chosen if the lead-time for a product is long and the demand is not predictable? A. Inventory positioning B. Pull replenishment C. Continuous replenishment D. Push system Answer: A A company uses multiple ingredients to make a product that is sold in multiple countries. Each country requires country-specific labels. A third-party supplier provides the country- specific labels. The most appropriate push-pull interface is: Question No : 281 - (Topic 3) Question No : 282 - (Topic 3) Question No : 283 - (Topic 3) APICS CSCP : Practice Test 95 A. raw materials to product. B. product to labels. C. finished product with labels. D. customer to finished product. Answer: B Which of the following methodologies is most appropriate to use to drive continuous improvement? A. Define-measure-analyze-improve-control process B. Kanban C. Poka-yoke D. Pareto analysis Answer: A A company has outsourced a high volume of assembly work to top-tier suppliers, thereby reducing the overall number of suppliers they directly manage. Which of the following actions must the company perform to mitigate risk? A. Monitor lead times at sub-tier suppliers B. Maintain direct relationships with sub-tier suppliers C. Execute all terms of contracts at sub-tier suppliers D. Purchase all critical components for assembly at the company Answer: B Prioritizing customer needs is best accomplished by: A. sharing information with key customers. Question No : 284 - (Topic 3) Question No : 285 - (Topic 3) Question No : 286 - (Topic 3) APICS CSCP : Practice Test 96 B. installing a new enterprise resources planning system. C. responding to customer requests in the order they are received. D. establishing policies and procedures for honoring customer requests. Answer: D Outsourcing is most appropriate when a product is: A. modular and independent of knowledge and capacity. B. modular and dependent on knowledge and capacity. C. integral and independent of knowledge and capacity. D. integral and dependent on knowledge and capacity. Answer: A Designing a supply chain to maximize responsiveness and flexibility is most appropriate for which of the following types of organizations? A. Public utility provider B. Configurable products manufacturer C. Commodity goods supplier D. Luxury goods manufacturer Answer: B A firm has increased finished-goods inventories for several products to compensate for increased variability in demand. The firm analyzed shipment data and determined that the variability was due to a few customers placing large orders for single shipments to obtain discounts. Which of the following actions is the firm most likely to take to maintain sales and reduce variability in demand? Question No : 287 - (Topic 3) Question No : 288 - (Topic 3) Question No : 289 - (Topic 3) APICS CSCP : Practice Test 97 A. Reducing discounts for large orders B. Encouraging high-volume customers to place blanket orders C. Implementing extrinsic forecasting methods D. Increasing the level of safety stock on high-volume products Answer: B A disadvantage of capable-to-promise (CTP) when compared to available-to-promise (ATP) is: A. the loss of potential sales based on earlier allocations. B. it does not include inventory levels. C. it requires the purchase of additional equipment. D. it requires more complex calculations. Answer: D If a firm has 35 days of accounts payable outstanding and 55 days invested in inventory, and its cash-to-cash cycle time is 90 days, what is the number of days of accounts receivable? A. 70 B. 90 C. 110 D. 180 Answer: A Market segmentation is important within the logistics function because it: A. leads to profitable exchanges with the customer and creates intrinsic customer value Question No : 290 - (Topic 3) Question No : 291 - (Topic 3) Question No : 292 - (Topic 3) APICS CSCP : Practice Test 98 B. supports transactional marketing priorities for successful commodity exchanges to customers globally C. enables companies to position their products throughout the distributor network based on customer need D. creates perception in the mind of the customer as available products and services are exchanged Answer: C Which of the following actions is most appropriate when implementing a strategy to create customer-affordable value? A. Use a more rapid transportation mode. B. Increase safety stock. C. Extend product warranty. D. Employ lean principles. Answer: D Which of the following conditions are most indicative of a company that is effectively managing its cash? A. Low accounts receivable, low inventory, high accounts payable B. High accounts receivable, low inventory, high accounts payable C. Low accounts receivable , high inventory, low accounts payable D. High accounts receivable, high inventory, low accounts payable Answer: A Qualitative forecasting methods are most appropriate for projecting demand for: Question No : 293 - (Topic 3) Question No : 294 - (Topic 3) Question No : 295 - (Topic 3) APICS CSCP : Practice Test 99 A. commodity products. B. families of products. C. breakthrough products. D. raw materials. Answer: C A firm expands distribution of its products into additional countries. Some customers initiate order batching, which could lead to which of the following outcomes? A. Bullwhip effect B. Price fluctuations C. Rationing D. Better forecasting Answer: A Which of the following changes often leads to higher levels of inventory? A. Decrease in customer service level B. Decrease in vendor lead times C. Increase in economies of scale D. Increase in warehouse holding costs Answer: C A company has adequate average available capacity but does not maintain surge capacity. With a distribution route to manage, which of the following actions will provide the most capacity relief? A. Increasing order-fulfillment lead times Question No : 296 - (Topic 3) Question No : 297 - (Topic 3) Question No : 298 - (Topic 3) APICS CSCP : Practice Test 100 B. Implementing allocation C. Increasing prices with a 30-day effective date D. Increasing product queue times Answer: A If a company successfully implements a sales and operations planning process, which of the following measures would be expected to increase? A. Percentage of on-time deliveries B. Cash-to-cash cycle time C. Forecast variation D. Cost of goods sold Answer: A An operations manager wants to measure variability in the delivery time of insurance policies to clients. Which of the following quality tools most appropriately would show the level of variability? A. Pareto chart B. Histogram C. Scatterplot D. Check sheet Answer: B Top management typically plans an organization's long-term future by isolating new opportunities and threats and identifying growth objectives during the process known as: A. resource planning. Question No : 299 - (Topic 3) Question No : 300 - (Topic 3) Question No : 301 - (Topic 3) APICS CSCP : Practice Test 101 B. sales and operations planning. C. corporate strategizing. D. financial planning. Answer: C A retailer wants to partner with its suppliers to implement automatic replenishment of inventories and joint sales forecasts. Which of the following supply chain management technologies most likely would support the retailer's strategy? A. Advanced planning and scheduling B. Collaborative planning, forecasting, and replenishment C. Supplier relationship management applications D. Radio frequency identification (RFID) tags Answer: B A distribution requirements planning system is implemented primarily to monitor or manage: A. supplier capacity. B. customer demand. C. inventory replenishment. D. demand variation. Answer: C Which of the following outcomes is an advantage of automating the request-for-quote process? A. Reducing cycle time Question No : 302 - (Topic 3) Question No : 303 - (Topic 3) Question No : 304 - (Topic 3) APICS CSCP : Practice Test 102 B. Disposing of excess inventories C. Centralization of product service content D. Enabling contract management Answer: A The logistics value proposition involves matching: A. identification of appropriate sourcing partners with service reliability metrics. B. activity-based costing practices with supply chain financial strategy. C. cost minimization practices with balanced scoreboard performance. D. operating competency and commitment with key customer requirements. Answer: D Which of the following objectives is the primary driver in the design and implementation of lean process management? A. Reducing the level of inventory B. Decreasing the cash-to-cash cycle C. Integrating processes between departments D. Satisfying customer requirements Answer: D Which of the following actions by trading partners is most likely to reduce the goods that will be processed by the reverse supply chain? A. Contracting with a third party to process returned goods B. Designing products that are easy to disassemble C. Working to delay regulations that require accepting returns Question No : 305 - (Topic 3) Question No : 306 - (Topic 3) Question No : 307 - (Topic 3) APICS CSCP : Practice Test 103 D. Providing support and service that meet customer needs Answer: D One of the first steps in devising an effective supply chain strategy within a company is to analyze a product's: A. nature of demand. B. backlog position. C. forecast bias. D. sales performance. Answer: A Which of the following actions is key to identifying potential problems in lean supply chain development? A. Implement vendor managed inventory B. Install a supply chain solution C. Reduce customer order size D. Reduce inventory levels Answer: D The relative speed at which all transactions within the supply chain process occur is known as: A. the cycle time. B. velocity. C. latency. D. throughput. Question No : 308 - (Topic 3) Question No : 309 - (Topic 3) Question No : 310 - (Topic 3) APICS CSCP : Practice Test 104 Answer: B Which of the following strategies is most appropriate for managing unknown risks in a global supply chain? A. Vertical integration B. Technology integration with suppliers C. Investing in redundancy D. Strengthening supplier relationships Answer: C A company that manufactures complex mechanical assemblies to customer order and ships them directly to the customer is implementing manufacturing cells. The benefit most likely to result from this effort is a reduction in the: A. number of component shortages. B. production planning horizon. C. time to fill customer orders. D. response time to a request for quote. Answer: C A company is having trouble with raw material deliveries and decides to develop a supplier certification program. The certification process most appropriately would start with which of the following suppliers? A. Suppliers of "A" classified items B. Suppliers recently ISO 9000-certified C. Suppliers with the worst performance records D. Competitors of suppliers with the worst performance records Question No : 311 - (Topic 3) Question No : 312 - (Topic 3) Question No : 313 - (Topic 3) APICS CSCP : Practice Test 105 Answer: A A company may reduce its amount of safety stock by: A. substituting information for inventory. B. increasing the number of retailers. C. increasing the number of producers. D. changing to a push system. Answer: A What are the three principle categories of forecasting methods? A. Seasonal, trend, and promotional events B. Moving average, exponential smoothing, and Holt-Winters C. Qualitative, extrinsic, and intrinsic D. Annual, monthly, and daily requirements Answer: C Value stream mapping provides the most benefit when: A. analyzing customer requirements. B. identifying nonvalue-added activities. C. planning kaizen events. D. implementing an information technology strategy. Answer: B Question No : 314 - (Topic 3) Question No : 315 - (Topic 3) Question No : 316 - (Topic 3) APICS CSCP : Practice Test 106 Which of the following types of raw materials would be most appropriate to source via an Internet-based trading exchange? A. Expensive material that is critical to the finished good B. Expensive material for which there are several substitutes C. Inexpensive material that is critical to the finished good D. Inexpensive material for which there are many sources Answer: D The make-to-stock model is an effective inventory strategy when the product: A. has a long manufacturing lead time. B. has a limited set of features. C. is designed by the customer. D. is frequently out of stock. Answer: B A company plans to benchmark its shipping reliability compared to other companies in the industry. Which measurement is most appropriate to benchmark in this case? A. Perfect order fulfillment B. Upside supply chain flexibility C. Order fulfillment cycle time D. Total inventory days of supply Answer: A Question No : 317 - (Topic 3) Question No : 318 - (Topic 3) Question No : 319 - (Topic 3) Question No : 320 - (Topic 3) APICS CSCP : Practice Test 107 A typical advantage of a production outsourcing strategy for a company focusing on agility as a competitive priority is that: A. monitoring costs are decreased. B. production lead time is increased. C. product quality is increased. D. product introduction time is decreased. Answer: D Which of the following approaches typically would be most effective in increasing inventory velocity in a supply chain? A. Using faster modes of transportation B. Using third-party logistics firms C. Reducing the inventory idle time D. Adding capacity at bottlenecks Answer: C A firm has determined its cash-to-cash cycle time to be 60 days. The number of days' payables outstanding is 25, and number of days' sales outstanding is 35. If the firm reduces its inventory by 20%, the new cash-to-cash cycle time, in days, will be approximately: A. 48. B. 50. C. 60. D. 88. Answer: B Question No : 321 - (Topic 3) Question No : 322 - (Topic 3) Question No : 323 - (Topic 3) APICS CSCP : Practice Test 108 Which of the following continuous improvement methodologies focuses on reduction of defects by reducing process variation? A. Just-in-Time (JIT) B. Kaizen C. Six Sigma D. Theory of constraints Answer: C A firm may use which of the following technologies to track the flow of inventory across its entire supply chain? A. Distribution requirements planning B. Radio frequency identification C. Transportation management system D. Warehouse management system Answer: B A company understates current revenue forecasts and delays the delivery of orders to meet the forecast. The most likely result of this practice is that shipments will peak: A. at the beginning of reporting periods. B. randomly throughout reporting periods. C. at both the beginning and end of reporting periods. D. at the end of reporting periods. Answer: A Which of the following actions is an initial step in a continuous process improvement Question No : 324 - (Topic 3) Question No : 325 - (Topic 3) Question No : 326 - (Topic 3) APICS CSCP : Practice Test 109 model? A. Creating a flowchart to map the process B. Benchmarking against another company C. Setting specific performance goals D. Developing a realistic project plan Answer: A Functional products require which of the following types of supply chain process? A. Restrictive B. Innovative C. Efficient D. Integrated Answer: C A supplier has decided to improve its forecast accuracy by reducing the information lead time from the retailer. Which of the following actions would be most appropriate to achieve the desired result? A. Eliminating sales and promotions B. Decentralizing demand information C. Reducing its quoted lead time D. Utilizing electronic data interchange Answer: D Incorporating information technology into its supply chain allows a company to efficiently: Question No : 327 - (Topic 3) Question No : 328 - (Topic 3) Question No : 329 - (Topic 3) APICS CSCP : Practice Test 110 A. collect, store, encode, process, analyze, transmit, receive, and print data. B. manage order entry, scheduling, warehousing, and order tracking. C. incorporate elements of Six Sigma into supplier relationships. D. upgrade enterprise resources planning revisions in a timely and secure manner. Answer: A An advanced planning system differs primarily from enterprise resources planning by: A. optimizing operations scheduling. B. translating plans into action. C. concentrating on production. D. linking to the transportation management system. Answer: A The recovery element of a reverse logistics supply chain strategy is best illustrated by: A. the use of refillable containers by a water supply company. B. the use of rechargeable batteries by an individual. C. a grower selling fresh-produce scrap to other farmers. D. the reduction of energy consumption by a manufacturer. Answer: A Which of the following factors is most important to consider when deciding on offshore outsourcing of manufacturing to a supplier? A. Size of the supplier organization B. Total cost of ownership C. Supplier performance history Question No : 330 - (Topic 3) Question No : 331 - (Topic 3) Question No : 332 - (Topic 3) APICS CSCP : Practice Test 111 D. Supplier certification Answer: B A manufacturing company with limited competence in logistics plans to expand into an international market. The most appropriate initial action the company should take is to: A. buy a distribution company. B. build a distribution network. C. engage a third-party logistics company. D. gain logistics experience. Answer: C A company produces to stock and sells its products to distributors. The factor that most likely will contribute to the risk of loss in inventory investment is the: A. accuracy of demand forecasts. B. replenishment lead time. C. level of product quality. D. variability in supply. Answer: A Which of the following outcomes is most likely a result of allocating excess capacity to a supply chain facility? A. Lower utilization which leads to higher cost B. Higher utilization which leads to higher cost C. Higher utilization which leads to lower cost D. Lower utilization which leads to lower cost Question No : 333 - (Topic 3) Question No : 334 - (Topic 3) Question No : 335 - (Topic 3) APICS CSCP : Practice Test 112 Answer: A A new sales and marketing director who wants to transform a company into a customer driven organization most likely would consider: A. allowing customers to use their preferred channels to interact with the company. B. implementing an independent system to capture customer data. C. minimizing the number of customer contacts. D. focusing product design on manufacturing strengths. Answer: A Which of the following constraints is most important to consider when adapting a vertical integration strategy? A. Location of suppliers B. Location of customers C. Capital requirements D. Size of existing manufacturing plant Answer: C Which of the following constituents typically must provide information first to effectively improve supply chain design? A. Supplier B. Distribution system C. Manufacturing D. Customer Answer: D Question No : 336 - (Topic 3) Question No : 337 - (Topic 3) Question No : 338 - (Topic 3) APICS CSCP : Practice Test 113 Which of the following actions by trading partners would be most appropriate to protect against variability in supply and demand? A. Improve product quality. B. Increase inventory levels. C. Increase information sharing. D. Reduce product complexity. Answer: C Which of the following actions is most likely to improve the cash-to-cash cycle time? 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 When profit impact is high and supply risk is low for an item, which of the following procurement strategies is most likely to be effective and successful? A. Leveraging purchasing power B. Forming a long-term partnership C. Automating the procurement process D. Ensuring continuous supply Answer: A Question No : 339 - (Topic 3) Question No : 340 - (Topic 3) Question No : 341 - (Topic 3) APICS CSCP : Practice Test 114 Managing risk should be a strategic part of supply chain management because: A. the occurrence of unanticipated risks essentially can be eliminated. B. not all members of the supply chain consider and respond to the same types of risks. C. substantial financial penalties can be assessed if legal requirements are not met. D. it helps to reduce the occurrence and consequences of unplanned negative events. Answer: D The most appropriate strategy for a firm that makes and sells a wide range of items typically would be to domestically source items that have which of the following characteristics? A. Short product life cycle and many variations B. Short product life cycle and few variations C. High labor value and low transport uncertainty D. High labor value and high transport uncertainty domestically Answer: A Lean supply chains strive to achieve their objectives by using which of the following approaches? A. Inventory optimization B. Cost reduction C. Waste reduction D. Quality function deployment (QFD) Answer: C Question No : 342 - (Topic 3) Question No : 343 - (Topic 3) Question No : 344 - (Topic 3) APICS CSCP : Practice Test 115 Standardization of supply chain processes is most likely to facilitate achievement of which of the following activities? A. Reducing the total cost of ownership B. Tracking the effects of improvement initiatives C. Creating project consensus D. Understanding of operational metrics Answer: B Which of the following types of lead times is related most closely to a supplier performance measure? A. Fulfillment B. Replenishment C. Overall D. Process Answer: B A company used Global Reporting Initiative guidelines to complete a self-assessment. Which of the following actions would be the most appropriate next step? A. Share information with all stakeholders B. Obtain top management support C. Identify action items D. Conduct gap analysis Answer: D Question No : 345 - (Topic 3) Question No : 346 - (Topic 3) Question No : 347 - (Topic 3) Question No : 348 - (Topic 3) APICS CSCP : Practice Test 116 Measurement of service to the customer should consider which of the following strategic priorities? A. Cash flow B. Responsiveness C. Order cycle time D. Forecast accuracy Answer: B A company is beginning the process of defining market segments for its products and services. The most appropriate objective for this undertaking would be to identify groups of customers with similar: A. geographical locations. B. buying power. C. revenue potential. D. service requirements. Answer: D The primary reason to establish a customer-dedicated warehouse is to: A. integrate and consolidate an assortment of inventory. B. position inventory to improve response time. C. balance inventory with consumption. D. equalize inbound and outbound logistics costs. Answer: B In the analysis of costs, fixed costs are those that are: Question No : 349 - (Topic 3) Question No : 350 - (Topic 3) Question No : 351 - (Topic 3) APICS CSCP : Practice Test 117 A. independent of the volume of output. B. dependent on the utilization of the asset. C. inversely proportionate to the volume of output. D. constant through the useful life of the asset. Answer: A Which of the following fill rates is the most rigorous measure of a firm's availability performance? A. Line B. Item C. Order D. Value Answer: C A service company has decided to create a customer-focused business and has identified the following steps in the process: {exhibit 3860} Which of the following sequences of steps is correct for implementing the company's decision? A. 2, 1, 4, 3, 5 B. 4, 2, 1, 5, 3 C. 3, 5, 2, 4, 1 D. 4, 2, 5, 1, 3 Answer: B Question No : 352 - (Topic 3) Question No : 353 - (Topic 3) Question No : 354 - (Topic 3) APICS CSCP : Practice Test 118 A master production schedule serves a company best by functioning as a: A. dispatch list. B. forecast system buffer. C. priority planning tool. D. supplier scheduling system. Answer: C Organizations that change from a traditional purchasing perspective to a supply chain perspective most likely will adopt techniques related to: A. product pricing. B. value stream analysis. C. centralized decision making. D. sourcing multiple suppliers. Answer: B A company that desires to implement a strategy for inventory management must define which of the following factors? A. Reliability and maintainability requirements B. Variability in the customer demand C. Overall item effectiveness D. Inventory carrying costs Answer: B Which of the following benefits should a supplier expect to receive by becoming a certified supplier? Question No : 355 - (Topic 3) Question No : 356 - (Topic 3) Question No : 357 - (Topic 3) APICS CSCP : Practice Test 119 A. Reduction in redundant processes with buyer B. Increase in price of items sold C. Increase in access to competitive information D. Reduction in number of items utilizing vendor-managed inventory Answer: A When evaluating several possible supply chain options, a firm considering the minimal total cost should: A. ensure that the inventory levels are as low as possible to minimize holding costs while still providing adequate customer service. B. account for the combined costs of holding buffer inventory and incurring inventory shortages. C. consider the costs of acquiring, holding, and transporting inventory, and of servicing customers. D. place buffer inventory in the lowest cost locations that meet lead time and service level requirements from customers. Answer: C A firm experiences a supply chain interruption from a second-tier supplier. Which of the following actions is the firm likely to take to minimize future interruptions? A. Require the supplier to submit weekly cycle count reports. B. Require the supplier to implement a sales and operations planning process. C. Map the supplier's supply chain to identify risks and opportunities. D. Conduct an ISO 14001 audit of the supplier. Answer: C When establishing third-party and fourth-party logistics relationships, a firm should avoid Question No : 358 - (Topic 3) Question No : 359 - (Topic 3) Question No : 360 - (Topic 3) APICS CSCP : Practice Test 120 providers who: A. use a proprietary information system. B. constantly update their information technology and equipment. C. provide extensive reporting on each customer interaction. D. meet customer requirements through regional warehousing. Answer: A Which of the following conditions is most likely to occur shortly after the introduction of an innovative product family? A. Forecast errors will be low. B. Production lead time will increase. C. An inventory buffer will be required. D. Demand will be stable. Answer: C Short order cycles to facilitate rapid replenishment will result in: A. minimal in-process inventory. B. fewer inventory moves. C. improved communications to customers. D. increased supplier collaboration. Answer: A Marketing affects supply chain management decisions primarily by its involvement in: A. analyzing economic indicators. Question No : 361 - (Topic 3) Question No : 362 - (Topic 3) Question No : 363 - (Topic 3) APICS CSCP : Practice Test 121 B. pricing, placing, and promoting products. C. determining product requirements. D. determining forecast error. Answer: B The practice of purchasing items in large quantities and requesting that shipments be delivered directly to customers is referred to as: A. drop shipping. B. cross-docking. C. breaking bulk. D. freight equalization. Answer: A Compared to the traditional enterprise resources planning (ERP) system, an electronic business system (EBS) is preferred for today's e-business solution because EBS: A. is more flexible and functional. B. is the backbone of outsourcing services. C. has converged with Web-based applications to form a grouping of business software functions. D. encompasses e-procurement as a traditional purchasing function. Answer: C Which of the following statements describes a continuous replenishment strategy in a retail environment? A. Retailers make replenishment decisions. Question No : 364 - (Topic 3) Question No : 365 - (Topic 3) Question No : 366 - (Topic 3) APICS CSCP : Practice Test 122 B. Retailers prepare individual orders and share sales data with vendors to improve customer service. C. Vendors use sales data and prepare shipments to maintain the desired level of inventory. D. Vendors take full control of inventory policy. Answer: C A company most likely would implement a supplier certification program to: A. improve the supplier's procurement process. B. abide by ISO standards. C. validate the supplier's compliance with requirements. D. implement point-of-sale (POS) terminals. Answer: C To ensure a successful relationship, trading partners must adapt their organizations to leverage advantages found in cross-supply-chain collaboration because: A. customers and suppliers are not interactive. B. cross-functional support can be offered only by the central source. C. all entities are collectively responsible for growth of revenue and profits. D. risks in supplier/customer negotiations are reduced. Answer: C A large bicycle company has outsourced manufacturing and needs to respond immediately to any logistics problems in the supply chain. The best technological solution to meet this need is: Question No : 367 - (Topic 3) Question No : 368 - (Topic 3) Question No : 369 - (Topic 3) APICS CSCP : Practice Test 123 A. enterprise resources planning. B. supply chain event management. C. supplier relationship management. D. a transportation management system. Answer: B Pull strategy typically would be the most appropriate strategy when customer demand uncertainty is: A. high, and supplier lead time is long. B. high, and supplier lead time is short. C. low, and supplier lead time is long. D. low, and supplier lead time is short. Answer: B The implementation of major enterprise-wide changes to eliminate or significantly reduce waste is related to which of the following concepts? A. Kaizen B. Kanban C. Six Sigma D. Lean Answer: D When trying to decide whether to outsource its customer relationship management function, a company primarily should consider which of the following factors? A. Location of the service provider Question No : 370 - (Topic 3) Question No : 371 - (Topic 3) Question No : 372 - (Topic 3) APICS CSCP : Practice Test 124 B. Internal controls of the company C. Compatibility of computer hardware D. Transaction costs Answer: B Explanation: A grocery store found that ground beef sales increased when buns were a featured sales item. This customer relationship management technique is called: A. data mining. B. data tracking. C. contact management. D. order entry. Answer: A An organization is partnering with a supplier. The most appropriate tool to ensure that the supplier has the necessary capabilities is: A. a supplier-input-process-output-customer diagram. B. supplier certification. C. supplier relationship management. D. supplier performance evaluation. Answer: B Which two of the following tools should be used with an enterprise resources planning system to build realistic supply chain models and to plan the most profitable flow of goods across the chain? A. An advanced planning and scheduling system and simulators B. An inventory planning and management system and simulators C. A vendor managed inventory system and customer relationship management D. Customer activity planning and logistics management Question No : 373 - (Topic 3) Question No : 374 - (Topic 3) APICS CSCP : Practice Test 125 Answer: A Which of the following approaches reduces lead times from supplier to customer using point of sale data? A. Advanced shipping notice (ASN) B. Continuous quality improvement (CQI) C. Vendor-managed inventory (VMI) D. Efficient consumer response (ECR) Answer: D A primary reason for enhancing supply chain security is to: A. meet government requirements. B. reduce insurance costs. C. improve lead time. D. protect brand image. Answer: D A primary objective of customer relationship management is to: A. implement market segmentation. B. create a data warehouse with critical customer information. C. identify customer needs for a greater level of satisfaction. D. target product promotions to customer segments. Answer: C Question No : 375 - (Topic 3) Question No : 376 - (Topic 3) Question No : 377 - (Topic 3) APICS CSCP : Practice Test 126 A manufacturer of fast-moving consumer goods wants to implement a process improvement method to increase flexibility and decrease the risk of obsolete inventory. Which of the following approaches is most likely to help reach these goals? A. Lean manufacturing B. Advanced planning and scheduling C. Six sigma D. Total quality management Answer: A Which of the following outcomes is an expected benefit of effectively implementing supply chain event management software? A. Inventory data are captured in real time. B. Files are transferred from one corporation to another. C. Notifications of variances from plans are triggered. D. Communication protocols between companies are standardized. Answer: C Which of the following manufacturing strategies typically generates the lowest supply chain inventory? A. Make to Stock B. Assemble to Order C. Make to Order D. Engineer to Order Answer: D Question No : 378 - (Topic 3) Question No : 379 - (Topic 3) Question No : 380 - (Topic 3) APICS CSCP : Practice Test 127 Which of the following variables is the most appropriate customer-facing goal used to determine the target inventory level? A. Inventory turns B. Level of service C. Total delivery cost D. Delivery lead time Answer: B Which of the following activities occurs as part of the sales and operations planning process? A. Time fences are matched to master production schedule horizons. B. The next quarter's forecasts are presented by sales staff to finance and operations personnel at the final meeting. C. Strategic plans are adjusted based on changing operating situations. D. Plans are converted to financial projections and capacity requirements. Answer: D Value stream mapping is a useful tool primarily because it: A. redefines supply chain relationships. B. is completed in 1 or 2 days. C. is used to improve efficiency in a specific area. D. looks at the entire supply chain rather than an isolated process. Answer: D Question No : 381 - (Topic 3) Question No : 382 - (Topic 3) Question No : 383 - (Topic 3) Question No : 384 - (Topic 3) APICS CSCP : Practice Test 128 The primary focus of lean manufacturing is: A. eliminating activities that do not add value. B. reducing inventory levels. C. optimizing production activities. D. maximizing the output of constraints. Answer: A Which of the following types of strategies minimizes inventory throughout the supply chain to avoid obsolescence? A. Delayed differentiation B. Low costs C. Location D. Response Answer: A Which of the following tools is most important in developing strategic sourcing? A. Price break analysis B. Network analysis C. Blanket purchase order D. Spend analysis Answer: D Which of the following procurement strategies is most appropriate for a high-risk, high- value item? Question No : 385 - (Topic 3) Question No : 386 - (Topic 3) Question No : 387 - (Topic 3) APICS CSCP : Practice Test 129 A. Procuring in bulk to take advantage of volume pricing B. Using an electronic trading platform to source items securely C. Entering into vendor managed inventory (VMI) agreement D. Creating a close collaborative relationship with the supplier Answer: D A company recently faced an increase in backorders. The company’s marketing department recently ran a sales promotion. The purchasing and planning departments were not aware of the promotional activity. Which of the following processes will help to solve this type of problem in the future? A. Sales and operations planning (S&OP) B. Advanced planning and scheduling (APS) C. Supplier relationship management (SRM) D. Customer relationship management (CRM) Answer: A A company that is having difficulties prioritizing resources against a long list of improvement projects should use which of the following processes? A. Control chart B. Competitive benchmarking C. Pareto analysis D. Six Sigma Answer: C The ABC classification system answers which two of the following inventory-related questions? Question No : 388 - (Topic 3) Question No : 389 - (Topic 3) Question No : 390 - (Topic 3) APICS CSCP : Practice Test 130 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: B When multiple warehouses are combined into one centralized warehouse, the requirement for safety stock is reduced because: A. there is less in-transit inventory. B. the total variability of demand is reduced. C. average cycle stock is reduced. D. safety stock becomes available-to-promise. Answer: B A large retailer has negotiated buyback contracts with several suppliers. The suppliers typically will need which of the following systems to effectively implement the contracts? A. Point-of-sale tracking B. Well-developed reverse logistics C. Monitoring the retailer's revenue D. Sales incentives to reward the retailer Answer: B A manufacturer with operations in an area prone to natural disasters is reviewing its sustainability strategy. Which of the following production strategies should the company implement to reduce the risk of supply interruptions? Question No : 391 - (Topic 3) Question No : 392 - (Topic 3) Question No : 393 - (Topic 3) APICS CSCP : Practice Test 131 A. Centralized B. Decentralized C. Make-to-order D. Engineer-to-order Answer: B Which of the following actions is most likely to improve customer perceptions about delivery performance provided by a firm? A. Shipping orders early whenever possible B. Increasing the order-fill rate C. Increasing inventory velocity for key products D. Implementing a pull inventory replenishment system Answer: B A large, global third party logistics provider (3PL) is contemplating the switch to the use of ethanol-based fuel in its truck fleet and wants to identify the impact of this change on food prices. Which of the following attributes of the triple bottom line (TBL) are part of this trade off decision? A. Organizational, financial and social B. Social, financial and environmental C. Social, environmental and organizational D. Organizational, financial and environmental Answer: B Which of the following factors typically is most critical to effective change management? Question No : 394 - (Topic 3) Question No : 395 - (Topic 3) Question No : 396 - (Topic 3) APICS CSCP : Practice Test 132 A. Early involvement of key stakeholders B. Extensive stakeholder education C. Analysis of the root causes of problems D. Quantification of potential benefits of the change Answer: A Which of the following elements is critical to successfully using a sales and operations planning process? A. Focusing on performance of the past 12 to 18 months B. Implementing a unified cross-functional plan and process C. Implementing bottom-up decision making D. Aligning the forecast to the annual budget Answer: B Which of the following statements indicates an attribute of international commercial terms (Incoterms)? A. They are required contract terms for international trade. B. Each term implies the responsibilities of the buyer and seller. C. Discounts and surcharges are identified by the terms. D. The terms are reviewed annually by the International Chamber of Commerce. Answer: B Which of the following behaviors is appropriate for a progressive company that is responding to changes in its supply chain? A. Pursuing cost reduction continuously Question No : 397 - (Topic 3) Question No : 398 - (Topic 3) Question No : 399 - (Topic 3) APICS CSCP : Practice Test 133 B. Developing multiple supply chains for different product lines C. Ensuring demand before committing to a change in the supply chain D. Designing products for maximum lifetime Answer: B APICS CSCP : Practice Test 134