Test Bank and Solutions For Principles of Supply Chain Management A Balanced Approach 6th Edition By Joel Wisner Chapter 2—Purchasing Management TRUE/FALSE 1. Purchasing can be broadly classified into two categories: merchants and industrial buyers. ANS: T PTS: 1 BUSPROG: Analytic LO: 2-1 Bloom’s: Knowledge Difficulty: Easy 2. Merchants primary task is to purchase raw materials for conversion purposes. ANS: F PTS: 1 BUSPROG: Analytic LO: 2-1 Bloom’s: Knowledge Difficulty: Easy 3. A low ROA suggests that management is capable of generating large profits with relativiely small investments. ANS: F PTS: 1 BUSPROG: Analytic LO: 2-1 Bloom’s: Comprehension Difficulty: Easy 4. The procedures for public procurement differ from the private sector. ANS: T PTS: 1 BUSPROG: Analytic LO: 2-2 Bloom’s: Comprehension Difficulty: Easy 5. Cost savings is an advantage of using an e-procurement system. ANS: T PTS: 1 BUSPROG: Analytic LO: 2-2 Bloom’s: Knowledge Difficulty: Easy 6. The goal of a good purchasing system is to ensure efficient information transitions between the materials users, the purchasing personnel, and the suppliers. ANS: T PTS: 1 BUSPROG: Analytic LO: 2-2 Bloom’s: Knowledge Difficulty: Easy 7. The purchase order is NOTa legally binding contract until it is accepted by the supplier. ANS: T PTS: 1 BUSPROG: Analytic LO: 2-2 Bloom’s: Knowledge Difficulty: Easy 8. A material requisition and a purchase requisition are the same thing. ANS: T PTS: 1 BUSPROG: Analytic LO: 2-2 Bloom’s: Knowledge Difficulty: Easy 9. A follow-up is considered a reactive approach to speed up an overdue shipment. ANS: F PTS: 1 BUSPROG: Analytic LO: 2-2 Bloom’s: Knowledge Difficulty: Easy

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