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ISM Supply Management Core Exam Sample Questions (Q74-Q79):
NEW QUESTION # 74
A recent recession greatly reduced income for many people. Which of the following goods likely saw the greatest reduction in willingness to pay (WTP)? (Select all that apply.)
Answer: B,C
NEW QUESTION # 75
A supply management department is asked to obtain lower prices from suppliers. Through its efforts, the department manages to achieve a 5% reduction in indirect spend categories. However, some stakeholders request more items, keeping total expenditures about the same despite lower per-item costs.
Which of the following will be the BEST long-term approach for supply management to improve upon this situation?
Answer: D
NEW QUESTION # 76
What denominator amounts does an analyst use to calculate the common size balance sheet and income statement?
Answer: B
NEW QUESTION # 77
A buying company concludes the request for proposal (RFP) process and signs a contract for its primary logistics provider. Company policy requires that the supply manager notify and debriefall unsuccessful bidders. During these debriefings, one of the bidders-Supplier X- states that it will offer a price discount lower than that of the successful bidder. Supplier X's proposal is very strong, and the firm has a track record of success with the buying company. Given this situation, which of the following is the BEST course of action for the supply manager to take?
Answer: A
Explanation:
Rejecting Supplier X's offer (Option C) is the best course of action. Once a contract has been awarded through a formal RFP process, reopening or renegotiating after the award undermines the integrity of the procurement process and can lead to legal and ethical issues. Escalating to executive management (Option A) or withdrawing the award (Option D) could disrupt established procurement protocols and fairness. Reopening the RFP (Option B) would compromise the transparency and fairness of the initial process.
References:
* Ethical Guidelines in Supply Management
* RFP Process Best Practices
NEW QUESTION # 78
A supply manager works with engineering on an aerospace project. A request for quotation (RFQ) Is distributed to five potential suppliers, three of whom respond that they are not interested In the project. The two remaining suppliers say they are interested, but a high level of risk involving tight tolerances will force them to raise prices significantly, and neither will accept a firm fixed price contract. The supply manager arranges a conference with engineering and both suppliers. During this conference, it is determined that only three of the tolerances are truly critical. Based on this conference, a revised RFQ is issued.
This scenario is an example of which of the following aspects of supply management?
Answer: A
Explanation:
* Scenario Overview: The supply manager issued an RFQ to five suppliers; three declined, and the remaining two raised concerns about risk and pricing.
* Conference Outcome: A conference revealed that only three tolerances were critical, leading to a revised RFQ.
* Value Engineering: This process involves evaluating a project to reduce costs while maintaining quality by identifying essential versus non-essential specifications.
* Supply Manager's Role: By facilitating this discussion, the supply manager helped reduce project costs and risks, demonstrating the principles of value engineering.
References
* CIPS. (n.d.). Value Engineering in Procurement.
* ISM. (n.d.). Cost Management and Value Engineering.
NEW QUESTION # 79
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