APICS CSCP Practice Test - Questions Answers, Page 29
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Question 281

A third-party logistics (3PL) provider most likely will add the greatest contributed value in the supply chain by:
Explanation:
Third-party logistics (3PL) providers offer outsourced logistics services which can include transportation, warehousing, and distribution. The greatest value they add is enabling companies to focus on their core competencies by managing complex logistics operations on their behalf. This specialization can lead to increased efficiency and effectiveness, allowing companies to direct their resources and attention to their primary business activities. While options B, C, and D can also be benefits, they are more specific outcomes rather than the broad strategic advantage of improved focus on core competencies.
Coyle, J. J., Langley, C. J., Novack, R. A., & Gibson, B. (2017). Supply Chain Management: A Logistics Perspective.
https://www.cscmp.org
Question 282

Sell-side e-commerce must include:
Explanation:
Sell-side e-commerce refers to online platforms where businesses sell products directly to consumers. Automated order entry and tracking are essential components of this process as they streamline the purchasing experience, ensuring orders are accurately captured and customers can monitor the status of their purchases. While automated returns processing, advance ship notice (ASN), and electronic data interchange (EDI) are important, they are not as universally mandatory for the basic functionality of sell-side e-commerce as automated order entry and tracking.
Laudon, K. C., & Traver, C. G. (2021). E-commerce 2021: Business, Technology, Society.
https://www.supplychaindive.com
Question 283

Kaizen is a process used in supply chain networks primarily to achieve:
Explanation:
Kaizen is a Japanese term meaning 'continuous improvement.' It is a philosophy that focuses on incremental improvements in processes, efficiency, and quality. In supply chain networks, Kaizen aims to enhance performance by systematically refining procedures, reducing waste, and increasing productivity. Unlike radical changes or focusing on profits, Kaizen emphasizes steady, consistent improvements over time which collectively lead to significant performance enhancements.
Imai, M. (1986). Kaizen: The Key to Japan's Competitive Success.
https://asq.org/quality-resources/kaizen
Question 284

Which of the following actions is most likely to improve the flow of funds between a group of supply chain partners?
Explanation:
Improving the flow of funds between supply chain partners can be significantly influenced by enhanced information sharing and collaboration. By increasing transparency and communication, partners can better coordinate their financial and logistical operations, reducing delays and inefficiencies. This cooperation can lead to more accurate forecasting, optimized inventory management, and smoother payment processes, ultimately improving the financial fluidity within the supply chain. Options B, C, and D address specific aspects of financial management but do not have as broad or fundamental an impact as improved information sharing and collaboration.
Simchi-Levi, D., Kaminsky, P., & Simchi-Levi, E. (2008). Designing and Managing the Supply Chain: Concepts, Strategies, and Case Studies.
https://www.supplychainquarterly.com
Question 285

A key assumption of the economic order quantity (EOQ) is that:
Explanation:
The Economic Order Quantity (EOQ) model is designed to determine the optimal order quantity that minimizes the total costs of inventory, including ordering and holding costs. A key assumption of the EOQ model is that the rate of demand is continuous and constant. This means that the demand for the product does not fluctuate significantly over time, allowing for a steady and predictable rate of consumption. This assumption simplifies the calculation by ensuring that order cycles are regular and inventory depletion occurs at a consistent rate. Options A, C, and D do not align with the fundamental assumptions of the EOQ model.
Chopra, S., & Meindl, P. (2015). Supply Chain Management: Strategy, Planning, and Operation.
https://www.investopedia.com
Question 286

A company is seeking to attract recent college graduates as customers. Which of the following market characteristics should the company use in order to segment its customers?
Explanation:
Demographic segmentation involves dividing a market into segments based on variables such as age, gender, income, education, and occupation. When a company is seeking to attract recent college graduates, demographic characteristics are most relevant. This group can be identified by their age range, educational attainment, and possibly their new entry into the workforce. Understanding these demographics helps the company tailor its marketing strategies to meet the specific needs, preferences, and behaviors of recent graduates. Options A, C, and D may also be relevant but are not as directly related to identifying recent college graduates.
Kotler, P., & Keller, K. L. (2016). Marketing Management.
https://www.marketing91.com
Question 287

A company with a fleet of trucks is considering using a third-party logistics (3PL) provider to distribute a new product. Which of the following benefits most likely will result?
Explanation:
Using a third-party logistics (3PL) provider can enhance a company's distribution capabilities, providing better market accessibility. 3PL providers often have extensive networks, advanced technology, and expertise in logistics management, allowing companies to reach markets more efficiently and effectively than they could on their own. This is especially beneficial when launching a new product, as it can ensure wider and faster market penetration. Options A, B, and C may provide some benefits, but they are secondary to the strategic advantage of improved market accessibility offered by 3PL providers.
Coyle, J. J., Langley, C. J., Novack, R. A., & Gibson, B. (2017). Supply Chain Management: A Logistics Perspective.
https://www.logisticsmgmt.com
Question 288

Which of the following cost elements typically would be included in the cost of carrying inventory?
Explanation:
The cost of carrying inventory includes several components, one of which is obsolescence. Obsolescence refers to the reduction in value of inventory over time as products become outdated or no longer useful. This is a critical cost element because it directly impacts the financial value of held inventory. Other carrying costs include storage costs, insurance, and capital costs. Options A, B, and C are costs associated with production or direct material expenses but do not fall under the typical carrying costs of inventory.
Waters, D. (2003). Inventory Control and Management.
https://www.supplychaindive.com
Question 289

Which of the following sustainability tools is most appropriate for managing environmental compliance with regulatory requirements?
Explanation:
ISO 14000 is a family of standards related to environmental management that helps organizations minimize their environmental impact and comply with applicable laws, regulations, and other environmentally oriented requirements. It provides a framework for developing an effective environmental management system (EMS) and ensures continuous improvement in environmental performance. While GRI, ISO 26000, and the United Nations Global Compact provide guidance on broader sustainability and social responsibility, ISO 14000 is specifically designed for managing environmental compliance and regulatory requirements.
ISO (International Organization for Standardization), ISO 14000 Family - Environmental Management.
https://www.iso.org/iso-14001-environmental-management.html
Question 290

The most cost-effective way to increase the velocity of goods in a supply chain is to:
Explanation:
Increasing the velocity of goods in a supply chain focuses on reducing delays and inefficiencies in the movement of products. Handling goods that are not in motion (e.g., those in storage, waiting for transportation, or during processing) efficiently can significantly enhance the flow and reduce bottlenecks. Techniques such as better inventory management, streamlined processes, and reduced handling times contribute to this improvement. While switching to a faster mode of transportation or using multiple 3PL providers can also increase velocity, these options are typically more costly compared to optimizing existing processes. Establishing warehouses near retail outlets can help but is not always practical or cost-effective.
Simchi-Levi, D., Kaminsky, P., & Simchi-Levi, E. (2008). Designing and Managing the Supply Chain: Concepts, Strategies, and Case Studies.
https://www.supplychainquarterly.com
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