Supply Chain Management: IIBM Exam paper Sem 2: contact us for answers

Examination Paper: Supply Chain Management

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IIBM Institute of Business Management

IIBM Institute of Business Management

Examination Paper MM.100

Supply Chain Management

Section A: Objective Type (30 marks)

· This section consists of Multiple Choice questions& Short Answer type questions.

· Answer all the questions.

· Part One questions carry 1 mark each & Part Two questions carry 2 marks each.

Part One:

Multiple Choices:

1. When demand is steady, the cycle inventory for a given lot size (Q) is given by:

a. Q/4

b. Q/8

c. Q/6

d. Q/2

2. There are two firms ‘x’ and ‘y’ located on a line of distance demand(0-1) at ‘a’ and ‘b’

respectively, the customers are uniformly located on the line, on keeping the fact of splitting of

market, the demand of firm ‘x’ will be given by:

a. (a+b)/2

b. a+(1-b-a)/2

c. (1+b-a)/2

d. a+(a-b)/2

3. Push process in supply chain analysis is also called:

a. Speculative process

b. Manufacturing process

c. Supplying process

d. Demand process

4. If the Throughput be ‘d’ and the flow time be ‘t’ then the Inventory ‘I’ is given by:

a. I *d=t

b. I=t+d

c. d=I*t

d. I =d*t

5. Forecasting method is:

a. Time series

b. causal

c. Qualitative

d. All the above

Examination Paper: Supply Chain Management

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IIBM Institute of Business Management

6. Component of order cost include:

a. Handling cost

b. Occupancy cost

c. Receiving costs

d. Miscellaneous costs

7. How many distinct types of MRO inventory are there?

a. One

b. Four

c. Three

d. Two

8. Supply chain driver is:

a. Inventory

b. Return ability

c. Fulfillment

d. All of above

9. SRM stands for:

a. Strategic Relationship Management

b. Supply Return ability Management

c. Supplier Relationship Management

d. None of the above

10. Discount factor equals to, where k is the rate of return.

a. 1/1+k

b. 2/1+k

c. 1/1-k

d. 1/2+k

Part Two:

1. Explain “zone of strategic fit”.

2. Explain “scope of strategic fit”.

3. What do you understand by “Stimulation Forecasting Method”?

4. Write a note on “Obsolescence (or spoilage) cost”.

5. Define “Square Law” in safety inventory of supply chain management.

6. What does the word “postponement” signifies in supply chain?

7. What do you understand by the term “tailored sourcing”?

8. Explain the term “Outsourcing”.

9. Write a note on “threshold contracts” for increasing agent efforts.

Examination Paper: Supply Chain Management

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IIBM Institute of Business Management

10. What is “dynamic pricing”?

END OF SECTION A

Section B: Caselets (40 marks)

· This section consists of Caselets.

· Answer all the questions.

· Each Caselet carries 20 marks.

· Detailed information should form the part of your answer (Word limit 150 to 200 words).

Caselet 1

Orion is a global co. That sells copiers. Orion currently sells 10 variants of a copier, with all inventory

kept in finished-goods form. The primary component that differentiates the copiers is the printing

subassembly. An idea being discussed is to introduce commonality in the printing subassembly so

that final assembly can be postponed and inventories kept in component form. Currently, each copier

costs $1,000 in terms of components. Introducing commonality in the print subassembly will increase

component cost to$1.025.One of the 10 variants represents 80 percent of the total demand. Weekly

demand for this variant is normally distributed ,with a mean of 1,000 and a standard deviation of

200.Each of the remaining nine variants has a weekly demand of 28 with a standard deviation of

20.Orion aims to provide a 95per level of services .Replacement lead time for components is four

weeks. Copier assembly can be implemented in a matter of hours. Orion manages all inventories

using a continuous review policy and uses a holding cost of 20 percent.

Questions:

1. How much safety inventory of each variant must Orion keep without component commonality?

What are the annual holding costs?

2. How much safety inventory must be kept in component form if Orion uses common components

for all variants? What is the annual holding cost? What is the increase in component cost using

commonality? Is commonality justified across all variants?

3. At what cost of commonality will complete commonality be justified.

4. At what cost of commonality will commonality across the low-volume variants be justified.

Caselet 2

An electronic manufacturer has outsourced production of its latest MP3 player to a contract

manufacturer in Asia. Demand for the players has exceeded all expectations whereas the contract

manufacturers sell three types of players- a 40-GB player, a 20-GB player, 6-GB player. For the

upcoming holiday season, the demand forecast for the 40-GB player is normally distributed, with a

mean of 20,000and a standard deviation Dard deviation of 11,000, and the demand forecast for the 6-

GB player has a mean of 80,000 and a standard deviation of 16,000. The 40-GB player has a sale

Examination Paper: Supply Chain Management

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IIBM Institute of Business Management

price of $200, a production cost of $100, and a salvage value of $80 .The 20-GB player has a price of

$150, a production cost of $70, and a salvage value of $50.

Questions:

1. How many units of each type of player should the electronics manufacturer order if there are no

capacity constraints?

2. How many times of each type of player should the electronics manufacturer order if the available

is 140,000? What is the expected profit?

END OF SECTION B

Section C: Applied Theory (30 marks)

· This section consists of Applied Theory Questions.

· Answer all the questions.

· Each question carries 15 marks.

· Detailed information should form the part of your answer (Word limit 200 to 250 words).

1. Consider two products with the same margin carried by a retail store. Any leftover units of one

product are worthless. Leftover units of the other product can be sold to outlet stores. Which

product should have a higher level of availability? Why?

2. McMaster-Carr sells maintenance, repair, and operations equipment from five warehouses in the

United States. W.W. Grainger sells products from more than 350 retail locations, supported by

several warehouses. In both cases, customers place orders using the Web or on the phone. Discuss

the pros and cons of the two strategies.

END OF SECTION C