Business Logistics
Exam Practice Tests
Course Introduction
Business Logistics focuses on the management and coordination of the movement, storage, and flow of goods, services, and information from the point of origin to the end consumer. This course examines key topics such as inventory management, transportation, warehousing, supply chain integration, order processing, and logistics technologies. Through case studies and practical applications, students will develop a thorough understanding of how effective logistics strategies improve organizational efficiency, customer satisfaction, and overall competitiveness in both domestic and global markets.
Recommended Textbook
Purchasing and Supply Chain Management 7th Edition by van Weele
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15 Chapters
909 Verified Questions
909 Flashcards
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Page 2
Chapter 1: The Role of Purchasing in the Value Chain
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Sample Questions
Q1) Which of the following situations explains 'ordering'?
A) Ordering refers to the placing of purchase orders at a supplier against previously arranged conditions.
B) Ordering is when orders are placed directly at the supplier, without questioning the supplier's conditions.
C) Ordering refers to the placing of purchase orders at a supplier without previously arranged conditions.
D) Ordering is when orders are placed directly at the supplier and there is questioning of the supplier's conditions.
Answer: A
Q2) Which term describes products which are not consumed immediately,but whose purchasing value is depreciated during its economic life cycle?
A) Just -in-Time supplies
B) Raw materials acquisition
C) Equipment
D) Investment goods
Answer: D
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Chapter 2: Industrial Buying Behavior: Decision-Making in Purchasing
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58 Verified Questions
58 Flashcards
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Sample Questions
Q1) Which of the following best explains the standard legal and commercial conditions that will apply to every purchase order issued by the buyer?
A) General terms of purchase.
B) Specified terms of purchase.
C) Non-negotiable contractual terms.
D) Guarantees
Answer: A
Q2) Which of the following best explains a 'Routine buy'?
A) A known product from a known supplier.
B) A known product from an unknown supplier.
C) A new product from a known supplier.
D) A new product from an unknown supplier.
Answer: A
Q3) Which of the following better explains 'Advance Payments'?
A) Payments made by a client after delivery of the contractor's work.
B) Payments made by a client on the delivery of the contractor's work.
C) Payments made to compensate for a failure to meet deadline.
D) Payments made by a client ahead of actual delivery of the contractor's work.
Answer: D
Page 4
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Chapter 3: The Purchasing Management Process
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Sample Questions
Q1) Which of the following is not part of communicating purchasing policy?
A) Internal communication.
B) Settling complaints.
C) Business values, integrity and ethics.
D) External communication.
Answer: B
Q2) Which of the following explains 'Audit Process'?
A) The process audit is a systematic investigation of the extent to which the (technical) processes are capable of meeting the established standards in a predictable way.
B) The process audit is a snap check on the extent to which the (technical) processes are capable of meeting the established standards in a predictable way.
C) The process audit is a systematic investigation of the extent to which the (technical) processes are capable of meeting the established standards.
D) The process audit is a systematic investigation of the extent to which the (technical) processes are capable of meeting the future standards in a predictable way.
Answer: A
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Chapter 4: Buying Business Services
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Sample Questions
Q1) Which of the following is a criterion in the purchasing portfolio approach (Kraljic Portfolio)?
A) Projected market share.
B) New product availability.
C) Supply risk.
D) Existing market share.
Q2) Which of the following characteristics is a quadrant in the purchasing portfolio approach (Kraljic Portfolio)?
A) New products.
B) Routine products.
C) Availability.
D) Old products.
Q3) Which of the following best explains the outcomes that will be expected as a consequence of the service provided?
A) The supplier processes needed to produce the service.
B) The performance of the supplier.
C) The resources and capabilities of the supplier.
D) The economic value generated by the service.
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6
Chapter 5: Contract Management for Complex Projects
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Sample Questions
Q1) Which of the following best describes the concept of bounded rationality in the context of contracts?
A) Complete information available to decision takers.
B) All options appraised.
C) Objectivity.
D) Different contractual perspectives due to incomplete information and self-interest.
Q2) Which of the following best explains 'reimbursable time and materials contracts'?
A) Contractor receives a fixed sum per annum.
B) Contractor receives a fixed sum per month.
C) Contractor receives a variable sum based on work completed.
D) Contractor receives a fixed sum per unit of work completed.
Q3) Which of the following is a dimension of contract management?
A) Tendering.
B) Financial flow
C) Contracting
D) Evaluating.
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Chapter 6: Public Procurement
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Sample Questions
Q1) Which of the following best comes before the 'contract notice'?
A) The contract awards notice.
B) The notification of unsuccessful bidders.
C) The contract evaluation.
D) The prior information notice.
Q2) Which of the following best explains 'central purchasing bodies'?
A) Purchasing organizations based in central Europe.
B) Organizations instituted by member contracting authorities to obtain benefits from co-ordinated purchasing activities.
C) Organizations of suppliers to public bodies.
D) Organizations which audit public bodies' purchasing contracts.
Q3) How many European Public Procurement Directives are there?
A) One.
B) Two.
C) Three.
D) Four.
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Chapter 7: Purchasing and Business Strategy
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62 Flashcards
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Sample Questions
Q1) Which of the following are characteristics of 'routine products'?
A) They have a small value per item and there is only one supplier.
B) They have a high value per item and there are many suppliers.
C) They have a high value per item and there is only one supplier.
D) They have a small value per item and there are many suppliers.
Q2) Which of the following is a characteristic of the 'Exploitation segment' of the 'Dutch windmill'?
A) Buyer can easily switch from one supplier to another.
B) Supplier in a dominant position versus its customers.
C) Supplier in weak position needing to compete with other suppliers for orders.
D) Suitable for building long-term relationships.
Q3) Which of the following are characteristics of 'leverage products'?
A) Sourcing from one supplier at standard quality grades.
B) Sourcing from many suppliers at standard quality grades.
C) Sourcing from one supplier at variable quality grades.
D) Sourcing from many suppliers at variable quality grades.
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Chapter 8: Outsourcing and Risk Management
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Sample Questions
Q1) Which of the following should be a feature of an Outsourcing Service Level Agreement (SLA)?
A) It should never be updated.
B) It should reflect the overall business goals.
C) It should allow for the supplier to make changes to the SLA.
D) It should not contain details on actions if service levels are not achieved.
Q2) Which of the following best explains 'capacity-related outsourcing'?
A) The company has insufficient capacity to undertake the required activity.
B) The company does not have the expertise to perform the required activity.
C) The company cannot deliver the required <quality in the required activity.
D) The company does not have the money to carry out the required activity.
Q3) Which of the following is not a risk factor?
A) Unavailability of qualified staff.
B) Materials shortages.
C) Occurrence of unforeseen disputes.
D) Exchange rates.
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Chapter 9: Category Sourcing: Developing Effective
Sourcing
Strategies
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Sample Questions
Q1) Which of the following should be addressed by a contract strategy?
A) Price agreement versus performance agreement.
B) Outsourcing potential.
C) Competitor analysis.
D) Currency of transactions.
Q2) Which of the following is not an activity required when conducting a feasibility study?
A) Analysis of current suppliers and how they perform.
B) Carry out an overview of value chain.
C) Definition of future company requirements and needs.
D) Functional and technical specification of purchased products and future needs.
Q3) Which of the following is a time horizon for a design partner relationship?
A) Order to order.
B) 1 year.
C) 1-3 years.
D) 1-5 years.
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11
Chapter 10: Purchasing Innovation and Quality Management
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Sample Questions
Q1) Which of the following terms is a strategic management process?
A) Deciding on make-or-buy questions.
B) Screening and selection of project partners.
C) Evaluating supplier proposals and ways of working.
D) What contractual agreements to use in technological collaboration.
Q2) Which of the following best explains 'kaizen'?
A) Using business consultants as auditors.
B) The concept of continuous quality improvement.
C) Assessing the internal quality and control system of an organization using a systems approach.
D) The systematic investigation of the extent to which the technical processes are capable of meeting the established standards in a predictable way.
Q3) Which of the following is not an example of an internal error cost?
A) Losses due to product downgrading.
B) Costs of corrective measures.
C) Losses due to a reduced speed of production caused by quality deviations in materials or components.
D) Loss of 'goodwill'.
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Chapter 11: Purchasing Logistics and Supply Chain Management
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60 Flashcards
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Sample Questions
Q1) Which of the following is a characteristic of 'oligopoly'?
A) Neither the supplier nor the buyer can influence the price of the product because there are a large number of buyers and sellers.
B) There is a high degree of product differentiation.
C) A limited number of suppliers and a limited product differentiation.
D) The supplier cannot influence the price of the product because there are a large number of buyers.
Q2) Which of the following describe the focus of demand-chain management?
A) Physical distribution.
B) Purchasing.
C) Material management.
D) Suppliers.
Q3) Which of the following is not a characteristic of 'Materials Requirements Planning (MRP-I)'?
A) Releasing manufacturing orders.
B) Releasing purchasing requisitions.
C) Managing manufacturing orders and purchasing requisitions.
D) Controls relevant materials flows and production capacity.
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Chapter 12: Purchasing Organization
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Sample Questions
Q1) Which of the following key factors determine the way in which corporations should leverage their purchasing and supplier strategies?
A) Savings potential.
B) Purchasing maturity.
C) Price fluctuations.
D) Customer demands.
Q2) Which of the following best explains 'decentralized purchasing structure'?
A) All managers can make purchasing decisions.
B) All business unit managers can request purchasing orders.
C) All business unit managers can authorise invoices to be paid for purchases.
D) All business unit managers are responsible for their own financial results and therefore are responsible for all of its purchasing activities.
Q3) Which of the following best explains NPR buyer?
A) Buyers responsible for buying non-product related goods and services.
B) Buyers responsible for buying non-product related services.
C) Buyers responsible for buying product related goods.
D) Buyers responsible for buying all goods and services.
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Chapter 13: Performance Measurement and Governance in Purchasing
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Sample Questions
Q1) Which of the following is not a level of aggregation for measuring and evaluating the five dimensions of purchasing performance?
A) Per individual supplier level.
B) Per individual buyer.
C) Per line-item level.
D) Customer satisfaction.
Q2) Which of the following best explains the concept of 'purchasing effectiveness'?
A) Purchasing within budget.
B) An assessment of costs and outputs achieved.
C) The extent to which, by choosing a certain course of action, a previously established goal standard is being pursued.
D) The extent to which, by choosing a certain course of action, a previously established goal standard is being met.
Q3) Which of the following best explains 'cost avoidance'?
A) The variance between the historical and the actual purchase price paid per unit.
B) The reduction on costs against planned costs.
C) The total purchasing budget savings.
D) The purchasing savings budget for each item.
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Chapter 14: Cost Approaches and Techniques
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Sample Questions
Q1) Which of the following is not a question that should be asked of suppliers?
A) How much corporate tax do you pay?
B) Are you a best-in-class company?
C) Do you experience learning curve effects in your production or service operational processes?
D) What are the costs of non-quality for this particular product?
Q2) Which of the following best explains 'the customer's specification'?
A) The buyer knows precisely the cost of the material to be purchased.
B) The buyer can only obtain a rough indication of the product's cost by means of supply market research.
C) The buyer can only obtain a rough indication of the product's cost by means of demand market research.
D) The buyer knows precisely the profit margin on the material to be purchased.
Q3) Which of the following is not a question that should be asked of suppliers?
A) Are you a best-in-class company?
B) What is your ratio of direct to indirect costs?
C) What is your cost breakdown in terms of overheads, energy, labour and materials?
D) How much corporate tax do you pay?
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Chapter 15: Purchasing, Corporate Social Responsibility and Integrity
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Sample Questions
Q1) Which of the following is not an element in Philips supplier sustainability audit in relation to 'Management systems'?
A) Legal and customer requirements.
B) Training.
C) Waste water and solid waste.
D) Performance objectives.
Q2) Which of the following is a reason why corporate social responsibility (CSR) has increased in importance in recent times?
A) Raw materials have become scarcer.
B) Social media.
C) Outsourcing.
D) Legislation.
Q3) Which of the following is not an approach to Corporate Social Responsibility (CSR)?
A) Passive.
B) Reactive.
C) Proactive.
D) Historical.
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Page 17