Supply Chain Management A Logistics Perspective 10th Edition By Coyle – Test Bank

Supply Chain Management A Logistics Perspective 10th Edition By Coyle – Test Bank

CHAPTER 3 TEST QUESTIONS

True-False

1. The utility created through basic marketing activities is known as place utility.

ANSWER:  False

2. Transportation is the physical movement or flow of goods.

ANSWER:  True

3. As a firm spends more on transportation services, the cost of lost sales increases.

ANSWER:  False

4. A logistics channel is a supply chain of network organizations engaged in transfer, storage, handling, communication, and other functions that contribute to the efficient flow of goods.

ANSWER:  True

5. As the dollar value of a product decreases, its inventory value decreases.

ANSWER:  True

6. In a logistics system, warehousing should be optimized at the expense of related logistics activities, such as transportation and procurement.

ANSWER:  False

7. The mathematical calculation of the point of equality between systems under analysis is used for short-run/static analysis.

ANSWER:  False

8. To hold down distribution costs, the lowest-cost carrier should always be used.

ANSWER:  False

9. The inverse relationship that exists between the cost of lost sales and inventory costs is the inventory effect.

ANSWER: True

Multiple-Choice

10. As the dollar value of a product increases, packaging costs will:

1. Increase
2. Decrease
3. Stay the same
4. Can’t be determined

ANSWER: a

1. As the weight density of a product decreases, transportation cost per pound will:

1. Increase
2. Decrease
3. Stay the same
4. Can’t be determined

ANSWER: a

1. As a firm spends more on transportation services, the cost of lost sales:

1. Increase
2. Decrease
3. Stay the same
4. Can’t be determined

ANSWER: b

1. The value that is added to goods through a manufacturing or assembly process is:

1. Form utility
2. Place utility
3. Time utility
4. Possession utility

ANSWER: a

1. Which of the answers below is an example of the creation of form utility by a logistics activity?

1. When lumber is cut and made into a chair
2. When a firm’s finance manager approves customer purchases on a credit basis
3. When Dell combines components with software to produce a computer to a customer’s specifications
4. The breaking bulk and repackaging at a distribution center

ANSWER: d

15. The utility that is created by moving goods from production points to market points where demand exists is referred to as:

1. Form
2. Place
3. Time
4. Possession

ANSWER: b

16. Logistics creates which utility through production forecasting, production scheduling and inventory control?

1. Form utility
2. Quantity utility
3. Time utility
4. Possession utility

ANSWER: b