Exam 2 Practice Questions.ppt

Exam 2 Practice Questions.ppt - Question 8 If the expected...

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Question 8 If the expected annual requirements (R) for a part are less than the break even point, then it is more cost effective to: A. Buy the item B. Make the item C. Costs are the same to make or buy the item D. Cannot be determined
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Question 3 The total cost to make an item is = 40,000 + 7Q The total cost to buy the item is = 1000 + 10Q Given this, if my expected volume for a part is 10,000 units, I should: A. Buy the item B. Make the item C. I’m indifferent D. Cannot be determined
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Question 1 The goals of purchasing include: A. Ensuring uninterrupted supply B. Lowering total cost C. Improving quality and customer satisfaction D. All the above
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Question 2 ESI – Early Supplier Involvement – is defined as including your suppliers early in the design of your products, and this can have the benefits of improving the product’s quality and reducing it manufacturing costs. A. True B. False
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Question 4 After receiving a materials requisition, purchasing will typically A. Send out a PO B. Send out an RFQ C. Pay the invoice D. Receive the product E. Send out a pack slip (delivery order)
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question Price only should be considered when making a purchasing decision A. True B. False
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question 1 How do you interpret the following payment terms 1% 10 Net 75 A. The buyer must pay in full in 10 days B. The buyer must pay in full in 75 days C. The buyer gets a 1% discount for paying in 75 days D. The buyer can either pay in 75 days or get a 1% discount if he/she pays in 10 days.
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Question 4
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