Question

True or False questions

1. Monetary risk can be minimized through the use of third-party providers, such as freight forwarders. True or False ?

2. The "maturity period" is the third stage in the product life cycle. True or False ?

3. Global sourcing of materials poses a much higher risk for loss of intellectual property compared to global outsourcing of manufacturing. True or False ?

4. The geographic location of a Plant can be a cost driver when it comes to outsourcing. True or False ?

5. "Vendor-managed inventory" has been unsuccessful as a strategy for developing beneficial supplier relationships. True ot False ?

6. Cost for reverse logistics generally includes training. True or False ?

7. Hedging and factoring inctease monetary risk. True or False ?

8. Natural disasters are an example of logistocal risk factors. True or False ?

9. " Average inventory value" represents the cost of holding the annual inventory investment. True or False ?

10. The first step in the strategic procurement is: conduct an internal needs analysis. True or False ?

Answer 1

1.

True, Monetary risk can be minimized through the use of third-party providers, such as freight forwarders. This is so because third party providers  are the individuals that organizes shipments for corporations to get commodities from the producer to a market, consumer or final destination of distribution. This reduces the risk of any fraud of payments by the organizations.

2. Yes, The "maturity period" is the third stage in the product life cycle. During the stage of maturity period, the profits and prices decline due to high competitive pressures. Weak firms in the industry are forced to leave the industry and growth rate becomes stable. The five stages in product life cycle theory are:

a) introduction

b) growth

c) maturity

d) decline

e) abondenment

3.

False, Global sourcing of materials does not poses a much higher risk for loss of intellectual property compared to global outsourcing of manufacturing. However, there is a protection risk,foran intellectual property if the components include proprietary design or require proprietary equipment.

4.

True,  the geographic location of a Plant can be a cost driver when it comes to outsourcing. This is so because before outsourcing we cna analyze and eliminate the hidden and associated costs in the process of outsourcing , industry could potentially discover millions of dollars in savings, depending on the characteristics, size, scope, and logistics of geography of their activities that are outsourced.