1.Supply chain management develop many supply contracts to optimize the supply c

Question

1.Supply chain management develop many supply contracts to optimize the supply chain network. What supply contract type allows buyers to return product for a full refund? (Points : 6)

a.Cost Sharing

b.Sales Rebate

c.Quantity – Flexibility

d.All of the above

2.Procurement strategies for commodity products such as electrical, steel, oil and grains need to reduce the following risks except: (Points : 6)

a.Price risk due to volatile market prices

b.Inventory risk due to uncertainty in demand

c.Shortages and component availability

d.None of the above

.3. Supply chain management has several ways to ensure that their supply chain business functions are completed correctly. Which process provides long-term goals and risk sharing with business partners? (Points : 6)

a.Arm’s Length Transactions

b.Acquisitions

c.Strategic alliances

d.All of the above

Explanation / Answer

1.Supply chain management develop many supply contracts to optimize the supply chain network. What supply contract type allows buyers to return product for a full refund? (Points : 6)

Ans: c. Quantity-Flexibility contracts.

Reason: Under Quantity-Flexibility contracts. supplier provides full refund of returned items only if the quantity of return is less certain quantity specified.

2.Procurement strategies for commodity products such as electrical, steel, oil and grains need to reduce the following risks except: (Points : 6)

Ans: c.Shortages and component availability

Reason: In addition to a and b, the strategy requires to reduce the shortage rick due to limited component availibity.

3. Supply chain management has several ways to ensure that their supply chain business functions are completed correctly. Which process provides long-term goals and risk sharing with business partners?

Ans: c. strategic alliances

Reason: Through strategic alliance the business partners can achieve mutual goals through commitment of many more resources, this leads to risk sharing between partners.

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