Materials Management
Pre-Test Questions
Course Introduction
Materials Management focuses on the efficient planning, organizing, and controlling of materials flow from suppliers through manufacturing to distribution. This course covers key concepts such as inventory control, procurement processes, materials requirement planning (MRP), warehouse management, supplier relationship management, and the integration of material systems with overall supply chain strategies. Emphasis is placed on cost containment, quality improvement, and the timely availability of materials to ensure operational efficiency and customer satisfaction in various industries.
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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Chapter 1: The Role of Purchasing in the Value Chain
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Sample Questions
Q1) Which of the following statements explains 'purchasing management'?
A) All activities necessary to manage supplier relationships in such a way that their activities are aligned with the company's overall business strategies and interests.
B) Relates to all activities necessary to manage customer relationships in such a way that their activities are aligned with the company's overall business strategies and interests.
C) Relates to all activities necessary to manage staff relationships in such a way that their activities are aligned with the company's overall business strategies and interests.
D) Relates to all activities necessary to manage financial relationships in such a way that their activities are aligned with the company's overall business strategies and interests.
Answer: A
Q2) Which of the following is an explanation of a 'category'?
A) A strategy.
B) A group of products which can be substituted for one another by a consumer.
C) A plan.
D) A procedure.
Answer: B
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Chapter 2: Industrial Buying Behavior: Decision-Making in Purchasing
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Sample Questions
Q1) Which of the following better explains 'Gatekeepers'?
A) Those who control the flow of information from the supplier towards the other members of the Decision Making Unit (DMU).
B) Those who control access to the organizations' property.
C) Those who can influence the media.
D) Those suppliers that meet the buyer's prequalification criteria and that will be requested to submit a first proposal.
Answer: A
Q2) Which of the following best explains a 'Purchase order confirmation'?
A) A document that is used by the buyer in which they agree to perform according to the order.
B) A document that is used by the supplier in which they agree to perform according to the buyer's purchase order.
C) A document that is used by the buyer in which they agree to perform according to the supplier's contract.
D) A document that is used by the supplier in which they agree to receive payment according to the buyer's purchase order.
Answer: B
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Chapter 3: The Purchasing Management Process
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Sample Questions
Q1) Which of the following is not a focus in the purchasing and supply model?
A) Reduce cost.
B) Social resistance
C) Supply chain optimization.
D) Serve the factory.
Answer: B
Q2) Which of the following explains 'Market Structure'?
A) The total set of conditions in which a company sells its products, with special attention to the number of parties in the market and the nature of the product being traded.
B) The number of suppliers.
C) The total set of conditions in which a company sells its products with special attention to the nature of the product being traded.
D) The total set of conditions in which a company sells its products with special attention to the number of parties in the market.
Answer: A
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5
Chapter 4: Buying Business Services
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Sample Questions
Q1) What of the following may be a consequence of a lack of alignment between the purchasing department and other departments?
A) Competence problems and friction between the parties may occur.
B) Profits decline.
C) Budgets are reduced.
D) Suppliers go elsewhere.
Q2) Which of the following internal activities,once outsourced,could result in service provider staff working within the purchaser organization?
A) Transport and logistics.
B) Sales.
C) Finance activities.
D) Market research.
Q3) Which of the following were traditionally the most purchased services?
A) Payroll.
B) Human Resources.
C) Transport.
D) Cleaning.
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Chapter 5: Contract Management for Complex Projects
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Sample Questions
Q1) Which of the following best explains 'co-operative system'?
A) Contractual relationship where parties pursue different objectives.
B) Contractual relationship where parties act rationally in the name of a common objective.
C) Contractual relationship where parties dispute the contract details.
D) Contractual relationship where one party fails to meet their contractual requirements.
Q2) Which of the following best explains 'outcome-oriented contract'?
A) How the contractor should deliver the work.
B) Specification of desired outcomes of contractor work.
C) Where the contractor should deliver the work.
D) Specification of required inputs.
Q3) Which of the following is an example of a large infrastructure project?
A) Highways.
B) An office redecoration.
C) A roof repair.
D) Re-surfacing the car park.
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Chapter 6: Public Procurement
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Sample Questions
Q1) Which of the following is an example of optional exclusion criteria?
A) Corruption.
B) Money laundering.
C) Not fulfilling obligations relating to the payment of social security contributions or taxes.
D) Participation in politics.
Q2) According to the EU Directives on public procurement threshold values,the total value of the lots which are separated from the total contract should not exceed which of the following percentages of the total contract value?
A) 5%.
B) 10%.
C) 15%.
D) 20%.
Q3) As a result of the general EU procurement procedures,contractors are not allowed to do which of the following?
A) Use brand or specific supplier specifications.
B) Use own suppliers.
C) Award contracts to non-EU companies
D) Avoid procurement procedures.
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Chapter 7: Purchasing and Business Strategy
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Sample Questions
Q1) Which of the following should be considered when assessing a company's competitive position?
A) Human resource management.
B) Economic conditions.
C) Political decisions.
D) Substitute products.
Q2) Which of the following best explains 'commodity strategies'?
A) A clear and detailed picture of a company's future purchasing spending.
B) A plan of action to reduce purchasing spending.
C) A plan of action to address past supplier difficulties.
D) A plan of action to reduce dependency on suppliers.
Q3) Which of the following is not a generic strategy to sustain profitability?
A) Cost leadership.
B) Product differentiation.
C) Focus.
D) Cost cutting.
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Chapter 8: Outsourcing and Risk Management
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Sample Questions
Q1) Which of the following are contained in a 'risk assessment matrix'?
A) Financial impact and likelihood of occurrence.
B) Financial impact and profitability.
C) Likelihood of occurrence and timescales.
D) Likelihood of occurrence and location.
Q2) Which of the following is not a core value of an outsourcing relationship?
A) Shared goals and objectives.
B) Mutual dependence.
C) Trust.
D) Independent evaluation.
Q3) Which of the following is not an element in the project execution stage of outsourcing?
A) Contract negotiation.
B) Order issue.
C) Confidentiality agreement.
D) Kick-off meeting.
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Chapter 9: Category Sourcing: Developing Effective
Sourcing
Strategies
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Sample Questions
Q1) Which of the following would not be contained in the 'bid package'?
A) Buyer's purchasing requirements.
B) Recent financial projections.
C) A draft contract.
D) Bid submission instructions.
Q2) Which of the following is an example of a customer relationship tactic?
A) Personal gifts and presents to decision-takers.
B) Supplier evaluations.
C) Competitive tendering.
D) Buy one get one free offer.
Q3) Which of the following term best describes the contractual relationship characteristic of a preferred supplier?
A) Quality agreement.
B) Annual agreement (1 year).
C) Design contract.
D) Order to order.
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11
Chapter 10: Purchasing Innovation and Quality Management
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Sample Questions
Q1) Which of the following best explains 'regular production stage'?
A) Production requirements are taken into account.
B) The product design is translated into a number of prototypes or laboratory models.
C) The conceptual design is translated into a technical design.
D) Production commences and market introduction follows.
Q2) Which of the following is not an element in a quality approach towards suppliers?
A) Preparation of the purchase order specification.
B) Sample inspection procedure.
C) Using consults to audit systems.
D) Periodic verification
Q3) Which of the following terms is a collaboration process?
A) Pre-selection of potential future technology partners.
B) How to work with suppliers in new product development.
C) Screening and selection of project partners.
D) Evaluating supplier development capabilities and performance.
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Page 12
Chapter 11: Purchasing Logistics and Supply Chain Management
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Sample Questions
Q1) Which of the following is a characteristic of 'monopolistic competition'?
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 best explains 'optimal batch size'?
A) The optimal batch size is achieved when the sum of the inventory costs and set up costs per unit produced is lowest.
B) The optimal batch size is achieved when the sum of price and the inventory costs is highest.
C) The optimal batch size is achieved when the set up costs per unit produced is lowest.
D) The optimal batch size is achieved when the inventory costs per unit produced is lowest.
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Chapter 12: Purchasing Organization
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Sample Questions
Q1) Which of the following best explains the 'fully integrated logistics structure'?
A) Purchasing reports directly to the engineering manager at the same level as production planning and physical distribution.
B) Purchasing reports directly to the logistics manager at a more senior level than production planning and physical distribution.
C) Purchasing reports indirectly to the logistics manager via the finance manager.
D) Purchasing reports directly to the logistics manager at the same level as production planning and physical distribution.
Q2) Which of the following is not an operational level purchasing decision?
A) The ordering process.
B) Major investment decisions.
C) All expediting activities related to released orders.
D) The monitoring and evaluation of supplier performance.
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14
Chapter 13: Performance Measurement and Governance in Purchasing
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Sample Questions
Q1) Which of the following best explains 'purchasing's strategic contribution'?
A) The extent to which, by choosing a certain course of action, a previously established goal or standard is met.
B) This refers to the relationship between planned and actual costs.
C) The savings made against budget allocation.
D) The building of superior relationships with best-in-class suppliers across the company's value chain.
Q2) Which of the following is not a problem making it difficult to evaluate purchasing performance?
A) The difference in the scope of purchasing both within and between companies.
B) The lack of formal objectives and performance standards.
C) The time it takes to evaluate purchasing performance.
D) The time it takes to evaluate purchasing performance
E) The accuracy with which purchasing performance actually can be measured.
Q3) Which of the following is not a sub-plan of the purchasing plan?
A) The purchased materials budget.
B) The purchased budget indirect materials.
C) The investment budget.
D) The consumables budget.
Page 15
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Chapter 14: Cost Approaches and Techniques
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Sample Questions
Q1) Which of the following best explains 'supplier satisfaction survey'?
A) Periodically, the buyer invites suppliers through interviews to suggest ideas which may improve business relationships.
B) Periodically, the buyer invites other suppliers through a standardized survey to suggest ideas which may improve business relationships.
C) Periodically, the buyer invites other buyers through a standardized survey to suggest ideas which may improve business relationships.
D) Periodically, the buyer invites suppliers through a standardized survey to suggest ideas which may improve business relationships.
Q2) Which of the following is not an example of a facility cost driver?
A) Facility scale.
B) Degree of vertical integration.
C) Use of automation.
D) Transportation costs to customer.
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16
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 'Health and safety'?
A) Freely chosen employment.
B) Industrial hygiene.
C) Machine safeguarding.
D) Emergency preparedness.
Q2) Which of the following best explains 'circular sourcing'?
A) Circular sourcing is aimed at buying products and components that are made up of high contents of recycled materials.
B) Circular sourcing is aimed at buying products and components that are made up of high contents of non-recycled materials.
C) Circular sourcing is aimed at selling products and components that are made up of high contents of recycled materials
D) Circular sourcing is aimed at selling products and components that are made up of non-recycled materials.
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