Question 1

Once the sales team enters an order, the MRP system refers to current stock levels and calculates how many of each product needs to be manufactured.

Options :

A : TRUE

B : FALSE

Answer: A

Question 2

The buyer does not need to look at global sources to fully understand their own country’s domestic importation regulations.

Options :

A : TRUE

B : FALSE

Answer: B

Question 3

Who devised the INCOTERMS?

Options :

A : International Chamber of Civil Engineers

B : International Chamber of Commerce

C : International Cubical of Civil Engineers

D : International Cubical of Commerce

Answer: B

Question 4

Which of the following is true for Just in time – JIT. Select all that apply?

Options :

A : Aims to bring inventory levels down to minimal levels or, in its purest form, have no inventory.

B : Any disruption in a Just-in-time system, such as supplies arriving late, will have a knock-on effect which can bring the whole process to a standstill.

C :

Buyers should adopt JIT with ALL suppliers

D : Can be used as an inventory control system to mitigate over-supply.

E :

Just in time, or JIT, is an operations management or inventory control system that aims to reduce wasted resources by minimising inventory. It coordinates demand and supply by purchasing, transporting and processing materials ‘just in time’ for when they are needed in the manufacturing process.

JIT should NOT be adopted with all suppliers as this is not practical. It should be adopted when appropriate because any disruption in a JIT system, such as supplies arriving late, will have a knock-on effect which can bring the whole process to a standstill.

Answer: A,B,D

Question 5

Which of the following is a definition of the economic order quantity – EOQ?

Options :

A : Formula that buyers use to calculate the most economically viable quantity in which to order additional stock

B :

Formula that buyers use to calculate the most economically viable price in which to order additional stock

C : Formula that buyers use to calculate the most economically viable place in which to order additional stock

D : Formula that buyers use to calculate the most economically viable quantity in which to order additional stock

Answer: A

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