1) Supply chain efficiency is all about optimizing the following flows :

(a) Product flow-After sales Service flow-Cash flow

(b) Product flow-Cash flow-Return flow
(c) Product / Service flow-Information flow-Finance flow
(d) Product flow-Fund flow-Reverse flow of Products

Answer : (c)

2) Tier 1 to Tier N external suppliers, who supply the right materials to the right locations are
typically referred to be located on the side:

(a) Upstream
(b) Downstream
(c) In-bound logistics
(d) Procurement

Answer : (a)

3) For a retail supply chain serving millions of consumers, which is comparatively a more complex
one?
(a) Distribution network
(b) Transportation
(c) Procurement
(d) Vendor rating

Answer : (a)

4) The primary driver of any supply chain decisions should be :

(a) Aligning with the strategies of a channel partner
(b) Serving the end-user customer
(c) Serving the needs of the focus firm
(d) Aiming to become market leader

Answer : (b)

5) All of the following are appropriate supply chain strategies for functional products EXCEPT:

(a) Minimal inventory with high inventory turns

(b) Short lead time (consistent with low cost)
(c) Suppliers chosen for cost and quality
(d) Design of that product to ensure standardized manufacturability

Answer : (d)
6) “_______________” is the process of moving goods from the point of consumption to the point
of origin
(a) Out bound Logistics
(b) In bound Logistics
 (c) Reverse Logistics
(d) Salvage of goods

Answer : (c)

7) The common factors that cause product returns in FMCG products are :
(i)Forecast errors and demand variability
(ii)Product Lifecycle
(iii)Number of SKUs and safety stock policy
(iv)Logistics ‘trade off’
(v)Not meeting customer’s configuration of products
(a) (i),(iii) and (iv)
(b) (i) and (v)
(c) (iii)
(d) (i),(ii),(iii) and (iv).
Answer : (d)

8) Logistics is treated as ‘sub set’ of supply chain management for which of the following reasons:
(a) Supply chain concept assumes a holistic approach
(b) Supply chain leads to integration
(c) Logistics is seen as part of the work needed to fulfill customer requests
(d) All of the above

Answer : (d)

9) A two wheeler manufacturer assembles hundred and twenty bikes in one hour. The takt time for
this set up is
(a)120 UPH (Units per Hour)
(b)960
(c)2 minutes
(d)30 seconds.
Answer : (d)
10) All of the following about ‘Global Warming Potential (GWP)’are true, EXCEPT:
(a) GWP monitors and controls Global Warming not to exceed 2 degree Celcius
(b) GWP is used to convert emissions of non CO2 gases to CO2 equivalent
(c) All the non CO2 gases have GWP
(d) GWP values are internationally accepted and followed.
Answer : (a)
11) The cost of making and delivering a product to the customer is referred to as
(a) supply chain responsiveness.
(b) supply chain efficiency.
(c) cost-responsiveness efficient frontier.
(d) implied uncertainty.
Answer: (b)
12) A supply chain needs to achieve a balance between the ‘level of availability’ and ‘the cost of
inventory’ that
(a) maximizes supply chain revenues.
(b) minimizes supply chain costs.
 (c) maximizes supply chain profitability.
(d) maximizes supply chain availability.

Answer: (c)

13) When the demand is stable for a matured product, a supply chain manager has the scope to
(a) increase both overstocking and understocking.
(b) increase overstocking and reduce understocking.
(c) reduce overstocking and increase understocking.
(d) reduce both overstocking and understocking.
Answer: (d)

14) Supply chain Management is not ‘just’ about cost but it contributes to Economic Value Addition
by way of
(a) Increasing Sales revenues through increased On time and complete delivery
(b) Logistic assets management
(c) Ensuring with flow within and between
(d) Integrating functions
Answer : (a)

15) Following are the characteristics of a typical functional product like detergent EXCEPT:
(a) High forecast error
(b) Long life cycle
(c) Low profit margins
(d) Low variety
Answer : (a)

16) All members across Supply chain, share critical information such as Point of Sales data, real time
market dynamics, inventory levels etc., as a result of:
(a) Internal Integration
(b) Positive Coordination
(c) External Integration
(d) Functional realization
Answer : (c)

17) A performance measure normally is composed of a number and Unit of measure. The number
indicates __________ and unit gives the number a ____________
(a) Magnitude, meaning
(b) Meaning, magnitude
(c) Goal, target
(d) Goal, achieved
Answer : (a)

18) A warehouse is suffering from high attrition rate and absenteeism. A performance measure that
measures this aspect can be called as
(a) In-put measure
(b) Out-put measure
(c) Lagging measure
 (d) Behavioral measure
Answer (d)

19) If the average aggregate inventory value is Rs.100,000 and the cost of goods sold is Rs.450,000,
which of the following is inventory turnover?
(a) 19.23
(b) 4.5
(c) 0.8654
(d) 0.2222
Answer : (b)

20) Which of the following processes is part of the Supply-Chain Operations Reference (SCOR)
process model?
(a) Return
(b) Customer relationship management (CRM)
(c) Design
(d) Marketing
Answer : (a)

21) If a company has 25 days of accounts payables outstanding and 30 days invested in inventory
and accounts receivables is 75 days, what is its cash-to-cash cycle time
(a) 105 days
(b) 80 days
(c) 75 days
(d) 50 days
Answer : (b)

22) Which of the following is true regarding a supply chain?

(a) Cash flows downstream while materials flow upstream.
(b) A component supplier for a manufacturer's plant is downstream from the manufacturer.
(c) Services may be part of a manufacturing supply chain but do not have a distinct supply
chain themselves.
(d) Information flows upstream, downstream, and between network members and external
entities.
Answer: (d)

23) Ram sells his paintings in his art gallery. Who is the tier two supplier to Ram?
(a) Stationery shop where from Ram bought his paint & brushes
(b) The pigment supplier to paint manufacturer
(c) Distributor who supplies paint to stationery shop
(d) There is no tier two in this supply chain
Answer: (C)

24) For a food and beverage supply chain, which of the following could be a key performance
indicator (KPI) for replenishment?
(a) Inventory turns
(b) Volume growth
(c) Introduction lead time
 (d) Order fill rate
Answer: (d)

25) A FMCG supply chain manager plans to increase the number and geographic locations of his
warehouses. Which of the following would be the most likely overall benefit to the supply chain
of this change?
(a) Reduction warehouse space required for a given inventory amount
(b) Reduction of delivery time to retail outlets
(c) Less variability in order size (bullwhip effect)
(d) Decrease in the overall amount of stored inventory
Answer: (b)

26) The Supply chain for a premium high priced fashion jewellery has to be
(a) Efficient one and focus on operations
(b) Effective and quick to accept changing demands
(c) Cost focused to minimize the supply chain costs
(d) Asset efficiency focused.
Answer : (b)

27) An organization sets a goal of increasing its fill rate from 92% to 94% because
another firm in its industry can offer 94%. This is an example of which of the
following?
(a) Competitive benchmarking
(b) Process benchmarking
(c ) Best-in-class benchmarking
(d) Internal benchmarking
Answer : (a)

28) Some amount of GHGs are absorbed by the natural systems such as oceans and plant bio-mass,
which are referred to as :
(a) Sinks of GHGs
(b) Planet cooling system
(c) Planet balancing
(d) Reverse Infra red radiation
Answer : (a)

29) A sporting goods store sells some items at a low margin and steady demand, such as tennis
balls, some items at a high margin and unpredictable demand, such as jogging outfits, and some
items only during certain seasons, such as Cricket kits. Which of the following would provide the
simplest and most effective supply chain solution for this company?
(a) One supply chain for seasonal goods and one for the remaining goods
(b) One supply chain for steady low-margin goods and one for exceptions
(c) One supply chain for all goods
(d) One supply chain for steady low-margin goods, one for unpredictable high-margin goods,
and one for seasonal goods.
Answer : (d)

30) The common and most serious challenge to collaborative planning is ?

 (a) common mode of communication
(b) standard protocols for exchanging data
(c) Willingness to share confidential information
(d) applications for forecasting and planning
Answer : (c)

31) A Supply chain manager of a production firm has identified following risks then calculated their
probability and loss as :
(i)Delayed delivery : 12 percent chance leading to a loss of Rs22000
(ii) Damaged products in consignment : 10 percent chance leading to a loss of Rs32000
(iii) Wrong products mixed up : 40 percent chance leading to a loss of Rs2000
How he can prioritize these risks ?
(a) (i), (ii), (iii)
(b) (ii), (i), (iii)
(c) (iii), (i), (ii)
(d) (ii),(iii),(i)
Answer : (b)

32) All of the following are true with regard to (ITO)Inventory Turn Over ratio EXCEPT :
(a) Higher ITO is better
(b) ITOs reflect efficient Inventory control
(c) ITOs focus on stock outs or shortages
(d) ITOs count how many times inventory cycles
Answer : (C)

33) A transporter who brings goods did not provide real time information about his whereabouts,
leading to poor visibility of pipe line inventory. This risk arising out of violation of agreed service
levels can be named as :
(a) External risk
(b) Environmental risk
(c) Supply risk
(d) Control Risk
Answer : (d)

34) The Just-in-Time philosophy can be best defined as:

(a) Delivering goods just before they are needed
(b) Fulfilling customer orders just as they are needed
(c) Manufacturing without inventory
(d) Elimination of waste
Answer : (d)

35) The annual cost of goods sold for a company is Rs40 million and the average inventory is Rs10
million. By how much would the inventory need to be reduced to have annual inventory turns
equal 20 turns?
(a) Rs2 million
(b) Rs8 million
(c) Rs6 million
(d) Rs4 million
 Answer : (b)

36) Fuel burnt for transporting raw material to the manufacturer through trucks is covered under
which scope :
(a) Scope 1
(b) Scope 2
(c) Scope 3
(d) Scope 1 & 2.
Answer : (c)

37) Following are the metrics to measure Collaboration with suppliers, EXCEPT :
(a) Decisions on availability level
(b) Decisions on optimal order quantity
(c) Development of Forecasts
(d) Total freight volumes in In-bound
Answer : (d)

38) Which of the following would be included in the cost of carrying inventory?

(I). Heating and lighting a warehouse

(II). Obsolete inventory
(III). Labor to move material
(IV). Damaged inventory

(a) I, II, and III

(b) II, III, and IV
(C) I, III, and IV
(d) I, II, III, and IV
Answer : (d)

39) Dell sells computers directly to customers via the Internet using an assemble-to-order process,
where customers choose the desired features of their computer. Delivery time is committed by
Dell and agreed by customer. In this arrangement, huge inventory need not be maintained in
show rooms. This results in:
(a) High Inventory Turns
(b) High stock outs
(c) Lesser customer service levels
(d) Over stocking
Answer : (a)

40) A home appliances company has four distribution centres (DC)in the country for distributing
their finished goods. They want to benchmark the operations of DCs through Inventory
accuracy, shipping accuracy & storage density. This kind of benchmarking can be called as:
(a) External benchmarking
(b) Internal benchmarking
(c) Competitive benchmarking
(d) Functional benchmarking
Answer : (b)
 41) Which one of the following does not fall under quantitative forecasting method?
a) Market research method
b) Moving average method
c) Weighted moving average method
d) Exponential smoothing method
Answer : (a)

42) The role of seasonality is

a) To indicate a consistent rate of growth or decline in demand for the next periods.
b) To capture the short-term patterns of demand that may not be repetitive in nature.
c) To capture the predictable seasonal fluctuations in demand.
d) To indicate the fluctuations in demand due to chance variations.
Answer : (C)

43) Long-term forecasts are usually less accurate than short-term forecasts because
a) Short-term forecasts have almost same standard deviation of error relative to the
mean like long-term forecasts.
b) Short-term forecasts have more standard deviation of error relative to the mean
than long-term forecasts.
c) Long-term forecasts have a smaller standard deviation of error relative to the
mean than short-term forecasts.
d) Long-term forecasts have a larger standard deviation of error relative to the mean
than short-term forecasts.
Answer : (d)

44) Which one of the following statements is NOT true?

a) Forecasts are almost always true.
b) Long-term forecasts are usually less accurate than short-term forecasts.
c) In general, the farther up the supply chain a company is, the greater is the distortion
of information it receives.
d) Aggregate forecasts are usually more accurate than disaggregate forecasts.
 Answer : (a)

45) Which measure of forecasting error does consider the average of absolute difference
between actual demand and forecast values?
a) Mean error
b) Mean absolute deviation
c) Mean squared error
d) Mean absolute percentage error

Answer : (b)

46) The weekly demand of 200 gm Colgate toothpaste experienced by a supermarket for the
last six weeks happens to be 178, 196, 206, 185, 166 and 198.
Demand 198 is for the most recent month. What will be the forecast demand of 200 gm
Colgate toothpaste in the coming week if a 3-period moving average method is
employed?
a) 186
b) 193
c) 188
d) 183
Answer : (d)
47) The weekly demand of 200 gm Colgate toothpaste experienced by a supermarket for the
last six weeks happens to be 178, 196, 206, 185, 166 and 198.
Demand 198 is for the most recent month. If a 3-period weighted moving average method
is employed in the above data set and a weight of 0.25, 0.35 and 0.40 is progressively
attached to the said data from the first period to the latest period, what would be the
forecast demand in the 7th week in this case?
a) 184
b) 182
 c) 189
d) 187
Answer : (a)
48) Which of the following has the highest fixed cost of any means of transporting
petroleum?
a) Pipelines
b) Ships
C) Trains
d) Trucks
Answer : (a)
49) Which of the following components of demand is NOT to be forecasted?
a) Trend
b) Cycle
c) Random variation
d) Seasonality
Answer : (C)

50) If we add one more layer, say ‘Stockist’ in between wholesaler and distributor What
effect it will have on total inventory throughout the supply chain?
a) decreases inventory
b) no effect on inventory
c) increases inventory
d) increases it in the short term, then decreases it
Answer : (C)
51) Which of the following best describes the ABC approach to inventory control?
a) Maintain a high inventory of "A" parts.
b) Have sufficient "C" parts.
c) Keep the "B" parts to a minimum level.
d) Always keep plenty of inventory.
Answer : (b)
 52) The inventory held in case, demand exceeds expectation and to counter uncertainty is
called
a) cycle inventory.
b) safety inventory.
c) seasonal inventory.
d) sourcing.

Answer: (b)

53) Which of the following forecasting methods is very dependent on selection of the right
individuals who will judgmentally be used to actually generate the forecast?
a) Time series analysis
b) Simple moving average
C) Weighted moving average
d) Delphi method
Answer : (d)

54) A company wants to generate a forecast for unit demand for year 2013 using exponential
smoothing. The actual demand in year 2012 was 120. The forecast demand in year 2012
was 110. Using this data and a smoothing constant alpha of 0.1, which of the following is
the Forecast for 2013?
a) 100
b) 110
c) 111
d) 114
e) 120
Answer : (C)
55) The weekly demand of 200 gm Colgate toothpaste experienced by a supermarket for the
last six weeks happens to be 178, 196, 206, 185, 166 and 198.
Demand 198 is for the most recent month. If naïve forecast is utilized, what would be the
forecast sales of 200 gm toothpaste in the 7th week?
a) 206
b) 185
c) 166
d) 198
Answer : (d)
56) A company has actual unit demand for three consecutive years of 124, 126, and 135. The
respective forecasts for the same three years are 120, 120, and 130. Which of the
following is the resulting MAD value that can be computed from this data?
a) 1
b) 3
c) 5
d) 15
Answer : (C)

57) Which of the following statements is TRUE?

a) Naïve forecast could be treated as an extreme case of simple exponential smoothing.
b) Naïve forecast could be treated as an extreme case of trend-corrected exponential
smoothing.
c) Naïve forecast could be treated as an extreme case of seasonality-corrected exponential
smoothing.
d) Naïve forecast could be treated as an extreme case of trend and seasonality-corrected
exponential smoothing.
Answer : (a)

58) Which one of the following criteria is given highest importance by a Public-sector firm
while evaluating the performance of a supplier?
a) Quality
b) Price
c) Delivery schedule
d) After sales support
Answer : (b)
 59) In case there is change in the required quantity of an item by the User Department, which
Department does communicate this change to the supplier/s?
a) User Department
b) Stores Department
c) Purchase Department
d) Accounts Department
Answer : (C)

20. Heavy sales of umbrellas during a rain storm is an example of which of the following?
a) trend
b) causal relationship
c) statistical correlation
d) coincidence
Answer : (b)

60) Which one of the following is NOT TRUE about factor score?
a) It is computed taking into account both subjective as well as objective criteria into the
decision making problem.
b) Selection of a supplier/s is based on the maximum total factor score obtained by the
same.
c) It discriminates suppliers’ performancebased ontotal factor scores obtained in all sub-
criteria taken together but fails to discriminate their performance on the basis of factor
score secured on individual sub-criterion.
d) It can discriminate suppliers’ performance based on total factor scores obtained in all
sub-criteria taken together and it can also discriminate their performance on the basis of
factor score secured on individual sub-criterion.
Answer : (d)
61) A bill of material (BOM) contains:
 I. Components used to make one final product
II. Labor needed to build the product
III. Sub assemblies at various stages of production
IV. Safety stock by item

a) I and II
b) I and III
c) II and III
d) III and IV
Answer : (b)
62) Materials requirements planning involves all of the following, EXCEPT:
a) from whom to order
b) how much to order
c) what to order
d) when to order
e) when to schedule delivery
Answer: (a)

63) Which of the following is NOT considered a motive for a firm to hold inventories?
a) To decouple or separate parts of the production process
b) To hold inventory in anticipation of customer demand
c) To take advantage of quantity discounts
d) To minimize holding costs
Answer : (d)

64) The objective of inventory management is :

a) To improve the operating efficiency of a firm by keeping a bare minimum inventory.
b) To provide excellent service to its customers by keeping a sufficiently highamount of
inventory.
c) To get rid of excess inventory at any level of a firm.
d) To achieve a satisfactory level of customer service while keeping inventory-related costs
 within reasonable limit.
Answer : (d)

65) Quantity of an item purchased by a firm in order to take advantage of economies of scale
is known as
a) Safety inventory
b) Cycle inventory
c) Pipeline inventory
d) Decoupling inventory
Answer : (b)

66) Which of the following would most likely be classified as a fixed cost for a carrier?
a) Purchase cost of a truck
b) Fuel costs
c) Maintenance costs
d) Drivers' wages
Answer : (a)

67) In the economic order quantity calculation, which one of the following statements most
accurately identifies the effect of increasing order sizes on inventory holding and order
costs?
a) Holding costs remain constant while setup costs rise steadily.
b) Total costs drop up to a point and then rise steadily.
c) Economies of scale lower all holding and ordering/setup costs equally and steadily.
d) Setup and order costs remain constant while holding costs drop steadily.
Answer : (b)

68) A retailer experiences an average weekly demand of 150 bottles of 200 ml. coke. The
retailer purchases the above coke for Rs. 10 per unit and the inventory carrying cost is
15% of the purchased price. The ordering cost for this retailer is estimated to be Rs.1000
 per order. The retailer keeps his store open for 50 weeks a year. Economic order quantity
is computed as : 3162 bottles.
What is the cycle stock?
a) 1575
b) 63
c) 1581
d) 3162
Answer : (c)

69) Which mode of transportation is the least expensive?

a) air
b) truck
c) rail
d) water
e) pipeline
Answer: ( d)
70) A retailer experiences an average weekly demand of 150 bottles of 200 ml. coke. The
retailer keeps his store open for 50 weeks a year. Economic order quantity is computed as
: 1500 bottles.
How many orders are to be placed by the retailer with its supplier in a year?
a) 2
b) 3
c) 4
d) 5
Answer : (d)

71) Which one of the following is NOT the determinant of safety stock?
a) Order up-to level
b) The extent of demand variability
c) The extent of lead time variability
 d) The degree of stock-out risk acceptable to the management
Answer : (a)

72) From the inventory manager's point of view, pilferage contributes to which of the
following costs?
a) Setup costs
b) Carrying costs
c) Logistics costs
d) Ordering costs
Answer : (b)

73) Which one of the following warehouse operations would take place at a manufacturer's
centralized warehouse to facilitate delivery of one product to many retailers?
a) Consolidation
b) Spot stocking
c) Break-bulk
d) Mixing
Answer : (C)

74) By ordering extra stock (safety stock), a purchasing manager might reasonably expect to
benefit the supply chain in all the following ways except
a) Reducing the likelihood of stock-outs.
b) Reducing overall supply chain costs.
c) Improving customer service.
d) Anticipating unpredicted demand spikes.
Answer : (b)

75) Daily demand of 200 gm pack colgate toothpaste in a retail store follows normal
distribution with an average daily demand of 45 units. It takes 3 days to supply the order
placed by the store. The store keeper follows a simple thumb rule for buffer stock, which
is equal to 50% lead time demand.
 What would be the ROP (Re order Point) in this problem?
a) 203
b) 68
c) 186
d) 216
Answer : (a)

76) For which of the following items demand should be calculated rather than forecast?
a) All Hyundai cars
b) All Hyundai Accent model cars
c) Steering wheels for Accent model cars
d) All replacement parts
Answer : (C)

77) What is the basis of classification of FSN analysis?

a) Annual consumption value of items
b) Frequency of consumption of items
c) Criticality of items
d) Availability of items
Answer : (b)
78) Which one of the following is NOT TRUE about VMI?
a) VMI tries to improve the stock-out situation faced by a retailer but does not take care of
excessive inventory carried by the retailer.
b) VMI tries to improve the stock-out situation faced by a retailer and also the excessive
inventory carried by the retailer.
c) It improves the forecast and better match manufacturer production with customer
demand.
d) It enables manufacturer to update its production plan.
Answer : (a)
79) Demand for a given item is said to be dependent if
a) It originates from the external customer
b) There is a deep bill of material
c) The finished products are mostly services (rather than goods)
d) There is a clearly identifiable parent
Answer : (d)

80) The ______ is (are) the MRP input detailing which end items are to be produced, when
they are needed, and in what quantities.
a) Master production schedule (MPS)
b) Gross requirements
c) Inventory records
d) Assembly time chart
Answer : (a)

41. A key to reducing “Cycle inventory” is

a) the reduction of holding cost.
b) the reduction of manufacturing cost.
c) the reduction of lot size.
d) the reduction of warehouse space.
e) all of the above
Answer: (C)

42. Which of the following would not be an example of a fixed ordering cost?
a) administrative cost incurred to place an order
b) trucking cost incurred to transport an order
c) labor cost incurred to receive an order
d) labor cost incurred to manufacture a part
e) none of the above
Answer: (d)

43. Which one of the following is NOT TRUE about Bill of Materials (BOM)?
 a) BOM provides a clear idea about the composition of a product through product structure
tree.
b) Errors at one level of BOM tend to remain localized.
c) It shows the quantity of each item needed to complete one unit of an item upstream.
d) The list of items in BOM is hierarchical.
Answer : (b)

44. Planned order receipt indicates

a) Open orders scheduled to arrive from the vendors.
b) Expected amount of inventory that will be on hand at the beginning of each time period.
c) Quantity expected to be received at the beginning of each period.
d) Planned amount to order in each time period.
Answer : (C)

45. Which of the following is correct?

a) Average inventory = cycle inventory + safety inventory
b) Average inventory = cycle inventory - safety inventory
c) Average inventory = cycle inventory x safety inventory
d) Average inventory = cycle inventory / safety inventory
e) none of the above
Answer: (a)

46. The appropriate level of safety inventory is determined by

a) the uncertainty of both demand and supply.
b) the desired level of product availability.
c) the desired level of cycle inventory.
d) (a) and (b) only
Answer: (d)

47. Lead time is the gap between

a) When an order is placed and when it is received.
 b) When an order is received and when it is put away.
c) When an order is received and when it is used.
d) When an order is acknowledged and when it is received.
Answer: (a)
48. A company that checks inventory status at regular periodic intervals and places an order
to raise the inventory level up to a specified threshold is using
a) Continuous review.
b) Daily review.
c) Occasional review.
d) Periodic review.
Answer: (d)
49. Which one of the following is NOT a primary report of MRP?
a) Planned orders
b) Order releases
c) Changes
d) Performance-control reports
Answer: (d)

50. A Material Requirements Plan contains information with regard to all of the following
EXCEPT :
a) Quantities and required delivery dates of all subassemblies
b) Quantities and required delivery dates of final products
c) Capacity needed to provide the projected output rate
d) Inventory on hand for each final product
Answer : (C)
51. Each R requires 2 of component S and 1 of part T. The lead time for assembly of R is 3
days. The lead time for the manufacture of S is 5 days. The lead time for the manufacture
of T is 10 days. The cumulative lead time for R is _____ days.
a) 5
b) 8
c) 13
d) 18
Answer : (C)

52. The MPS calls for 50 units of Product A and 60 of B. There are currently 25 of Product B
on hand. Each A requires 2 of Part C; each B requires 5 of C. There are 160 units of C
available. The net requirements for C are
a) 115
b) 175
c) 240
d) 690
Answer : (a)

53. Which one of the following does come under outbound logistics?
a) Movement of raw materials, semi-finished goods and finished goods within a processing
centre.
b) Bringing materials, components etc. from the sources of supply to the processingcentre.
c) Movement of finished goods within a distribution centtre.
d) Movement of finished goods from the processing plant to the distribution centre.
Answer : (d)

54. Which transportation network design option has the elimination of intermediate
warehouses and its simplicity of operation and coordination as its major advantage?
a) Direct shipping network
b) Direct shipping with milk runs
c) All shipments via central DC
d) Shipping via DC using milk runs
e) Tailored network
Answer: (a)
55. Which element of logistics cost does account for maximum cost of logistics?
a) Inventory carrying cost
b) Facilities cost
c) Transportation cost
 d) Packaging and material handling cost
Answer : (C)

56. Which one of the following is TRUE regarding transportation cost?

a) With increasing distance, transportation cost per km decreases at an erratic rate
b) With increasing distance, transportation cost per km decreases at a diminishing rate
c) With increasing distance, transportation cost per km decreases at an increasing rate
d) With increasing distance, transportation cost per km remains the same.
Answer : (b)
57. What trade-offs do managers need to consider when making transportation decisions?
a) transportation cost versus inventory cost
b) transportation cost versus customer responsiveness
c) Product cost versus handling costs
d) (a) and (b)
Answer : (d)
58. Which mode of transportation will be suitable for shipping groceries from one location to
another?
a) Rail
b) Water
c) Air
d) Truck
Answer : (d)

59. Which particular distribution network is suitable for shipping goods when the volume of
demand is quite high and the uncertainty in demand is low?
a) Direct shipment network
b) Direct shipping with milk-run
c) Shipping via Distribution centre
d) Shipping via Distribution centre using milk-runs
Answer : (a)
 60. Which one of the following is TRUE about cross-docking?
a) Inbound and outbound trucks contain exactly the same product in same quantity.
b) It provides the benefit of economies of scale in inbound transportation but not in
outbound transportation.
c) It provides the benefit of economies of scale in outbound transportation but not in
inbound transportation.
d) It provides the benefit of economies of scale in both inbound and outbound
transportation.
Answer: (d)

61. Which of the following is NOT TRUE about Cross Docking ?

(a) Cross docking requires highest level of Demand and Supply coordination
(b) Cross docking will increase Warehouse stock turns
(c) Put away and Pick operations can be skipped
(d) Cross docking is suitable for milk run distributions only.
Answer : (d)
62. _______________ are fully motorized, computer-controlled, independently-rotating
aisles of Shelves.
(a) Carousels
(b) Articulated flow racks
(c) Robotic shelves
(d) Turret racks
Answer : (a)

63. Forecasts are usually wrong but we continue to use them. They are necessary because:
a) Forecasters provide a service to the organization.
b) Forecasts are a prelude to business planning.
c) Master production schedule (MPS) needs one.
d) Materials requirements planning (MRP) cannot operate without one.
Answer : (b)
64. Transportation plays a key role in every supply chain because
a) Products are normally produced and consumed in the same location.
b) Products are rarely produced and consumed in the same location.
c) Cost of transportation is inconsequential and non value adding
d) Transportation is not a factor in determining profitability.
Answer: (b)
65. Inventory is used to decouple:
a) Production plans from master schedules.
b) Rough cut capacity from capacity plans.
c) Supplier orders from supplier deliveries.
d) Supply from the demand.
Answer : (d)
66. Total logistics costs are a sum of the
a) Inventory and facility costs.
b) Transportation and facility costs.
c) Inventory and transportation costs.
d) Inventory, transportation, and facility costs.
Answer: (d)
67. Which of the following is not an input to MRP?
a) Master Production Schedule
b) Inventory records
c) Bill of materials
d) Capacity planning
Answer : (d)
68. Total ordering and holding costs
a) Are relatively stable.
b) Are relatively stable around the economic order quantity.
c) Are relatively unstable around the economic order quantity.
d) Are unstable.
Answer: (b)
69. Which of the following would be normally included in demand management?
 I. Forecasted requirements
II. Service parts requirements
III. Branch warehouse requirements
IV. Inter-plant orders

a) I, II, and III

b) II, III, and IV
c) I, III, and IV
d) I, II, III, and IV
Answer : (d)
70. A forecast which is exhibiting a trend will have which of the following patterns?
a) A steady increase or decrease
b) A consistent fluctuating pattern based on the time of year
c) An inconsistent fluctuation in demand
d) A wavelike fluctuation over several years
Answer : (a)

81) Today’s successful companies at all levels have one thing in common. The common
theme can best be described as one where the companies are:

(a) Oriented around public service.

(b) Strongly customer centric and heavily committed to Customer satisfaction

(c) Moving toward globalization and socialization.

(d) More interested in governmental regulation and control than ever before.

Answer : (b)

82) Creating __________________ is at the very heart of modern Supply chain management and
practice.
(a) Profit maximization
(b) Increased stock value
(C ) Award winning products
(d) Customer value and satisfaction
Answer : (d)
83) When value can be added to a product or service?
( a) during the design phase

(b) prior to the start of manufacturing or providing the service

(c) anywhere in the supply chain

(d) depends on service offered after purchase

Answer : (C)

84) Which of the following defines the values of the new CRM/SRM culture?
( a) new business organization

(b) new job definitions

(c) new management structure

(d) new business vision and mission statement

Answer : (d)

85) What typically happens with respect to satisfying a lifetime customer as the relationship
develops?
( a) it becomes easier to satisfy a lifetime customer

(b) it becomes harder to satisfy a lifetime customer

(c) it requires about the same effort

(d) it is hard to tell

Answer : (a)

86) In which of the following manufacturing environments would consumer products, such as
camera, food/beverage etc. be classified?
(a) Assemble-to-order
(b) Engineer-to-order
(c) Make-to-order
(d) Make-to-stock
Answer : (d)
87) Which of the following manufacturing types would typically have the longest delivery time?
(a) Make-to-order
(b) Engineer-to-order
(C)Make-to-stock

(d)Assemble-to-order

Answer : (b)

88) A power generating boiler fabrication and manufacture, to suit specific operating conditions of a
customer can be classified as :
(a) Make-to-order
(b) Engineer-to-order

(C)Make-to-stock

(d)Assemble-to-order

Answer : (b)

89) Which of the following statements would be true regarding the delivery time in an engineer to
order company?

(a) Delivery time is shorter than a make-to-order company.

(b) It would be the same as a make-to-stock item.
(c) It would be longer than an assemble-to-order company.
(d) It would be shorter than an assemble-to-order company.
Answer is: ( C)

90) The key driver in a Total Quality Management (TQM) organization would be:
(a) lower costs.
(b) training employees.
(c) problem solving tools.
(d) customer needs identification.
Answer is: (d)

91) Customer is buying ‘value’. In this context, Value Chain, refers to the:
(a) total value generated by a company's activities.
(b) total revenue for all the products and services.
(c) supplier network for providing goods and services.
 (d) margin associated with the activities.
Answer is: (a)

92) Supplier relationship management (SRM) increases the visibility of the entire supply chain. This
benefits SRM participants in which of the following ways?
(a) Reduces customer service calls

(b) Lowers the number of required distributors

(c) Enables faster response and better contingency planning

(d) Simplifies market segmentation

Answer is: ( C)

93) When there is healthy competition in the market and the company can source its requirements
from two or more suppliers, the type of sourcing is
(a) Multiple Sourcing
(b) Single sourcing
(c) Standard sourcing
(d) Blanket sourcing
Answer : (a).

94) Dell builds computers to customer specifications from a stock of existing components. This type
of order fulfillment process is :
(a) Make To Stock
(b) Make To Order
(c) Engineer To Order
(d) Assemble To Order
Answer : (d)

95) Quality Cost Classification are:

(a) Prevention, Appraisal, Internal failure, External failure
(b) Performance, Warranty
(c) Sorting, salvaging costs, reworks
(d) Returns management costs, repair costs
Answer : (a)

96) The conventional approach to dealing with suppliers in a transactional

 Relationship had characteristics EXCEPT:

(a) “You supply, and I pay. End of story”

(b) Lowest bidder winning

(c) Buyer’s dominant position

(d) Win-Win approach

Answer : (d)

97) Strategic sourcing critically evaluates the following parameters, EXCEPT :

(a)Internal capability or out sourcing.

(b)Identification of Vendors and Vendor development.

(c)Co-ordination with other functions

(d) competitor’s relationship with vendors.

Answer : (d)

98) In Weighted Point Method of Supplier Evaluation, the weightage given to factors would
be : Quality 35%, Delivery 30%, Service 25%, Price 10%

(a) The weightage can vary based on organization’s priorities

(b) This weightage system is Universally followed

(c) Only this system evaluates the suppliers correctly

(d) This suits manufacturing environment only

Answer : (a)

99) Which of the following best describes the type of outsourced service provider that performs one
or more logistics services?
a) 3PLs

b) 4PLs

c) reverse logistics providers

d) Transporters
 Answer : (a)

100) Strategic Sourcing is applicable to which supply chain partners?

a) all of a business' suppliers

b) some of a business' suppliers

c) all of a business' customers

d) all of a business' customers and suppliers

Answer : (b)

101) “_______”links the needs of the customer (end user) with design, development,
engineering, manufacturing, and service functions.

(a) QFD – Quality Function Deployment

(b) BPR – Business Process Re engineering
(c) ERP – Enterprise Resource Planning
(d) SFA – Sales Force Automation
Answer : (a)

102) Global IT majors such IBM, Accenture, and Microsoft having their operations in India is
an example of :
(a) Off shoring
(b) Out sourcing
(c) Job contracting
(d) Subsidizing
Answer : (a)

103) Which of the following are changes in today's business culture resulting from a greater
emphasis on relationships with customers and suppliers?
(I) Greater focus on customers

(II) Greater emphasis on integration both internally and externally

(III) Greater focus on mass marketing

(a) I only

(b) II only

(c) I and II
 (d) I and III

Answer : (C)

104) When the company develops the relationship with a lifetime customer, what typically
happens to revenue and profit opportunities?
(a) increases

(b) decreases

(c) remains constant

(d) it is hard to predict

Answer : (a)

105) Creating a customer-focused business includes all of the following steps EXCEPT:
(a) implement CRM program

(b) align business to customer focus

(c) redefine company mission

(d) create customer map

(e) identify customer needs

Answer : (C)

106) Passive information refers to information that is

a. Not current
b. Not useful
c. Obtained using passive sensors
d. That is obtained from systems that have reached steady-state
Answer : (a)
107) Relationships are revealed when
e. Data is processed
f. Information is taken to the next level
g. Insights are gathered
h. Patterns are known
Answer : (b)
108) Which of the following helps to understand the consequences of decisions
i. Knowledge
j. Insight
k. Sound experience
l. Vast data
Answer : (b)
109) Active Information that
m. relates to the activities of the people
n. Represents the different active states of a system
o. Is “hot” data
p. Is information that is current and obtained in real-time
Answer : (d)

110) VMI refers to

a. Velocity Materials Infrastructure
b. Vendor Maintenance Initiative
c. Vehicle Modification Information
d. Vendor Managed Inventory
Answer : (d)

111) Portal is
a. A large web site
b. Same as web site
c. A specialized web site
d. Different from web site
Answer : (d)

112) PDM refers to

a. Product information
b. Product data management
c. Process Development Methodology
d. Production, Distribution and Manufacturing
Answer : (b)

113) An example of information that partners in SCM should share is

a. Sales margin
b. Employee names
c. Raw material suppliers
d. Production plans
Answer : (d)

114) SCOR stands for

a. Supplier Customer Operations Rules
b. Supplier Consumer Operations Rules
c. Supplier Customer Operation Reference
d. Supply Chain Operations Reference
Answer : (d)

115) Egreetings is an example of

 a. Customization by the groups
b. Consumer preference model
c. Customer Choosing method
d. Mass customization
Answer : (d)

116) The fundamental law of supply chain design involves

a. Industry clock speed
b. Rate of production
c. Effectiveness of the chain
d. Optimal design of logistics
Answer : (a)

117) Pick-to-light is
a. same as wave picking
b. same as batch picking
c. Picking light items
d. None of the above
Answer : (d)

118) AMS stands for

a. Automatic Mechanized Storage
b. Automated and Mechanized Shipping
c. Alternate Machining Shop
d. Automated Manifest System
Answer : (d)

119) MAPINFO is an example of

a. GIS software
b. CAD software
c. GPS software
d. None of the above
Answer : (a)

120) All of the following are required elements of a transportation management system
(TMS) EXCEPT :
a. Tracking to ensure that the plan is being followed at the execution level.
b. Visibility of transportation across managers, sales, customers, and shipping personnel.
C. Distributed control over the planning of transportation.
d. Integration of transportation planning with order management and fulfillment.
Answer : (C)
121) Enterprise software
 a. Collects transaction data.
b. Collects and Analyzes transaction data to make decisions.
c. Executes decisions both within an enterprise and across its supply chain.
d. All of the above

Answer: (b)

122) A transportation management system (TMS) package must include all of the following
EXCEPT:
A. tracking safety stock at transfer points.
B. centralized control over shipment planning.
C. execution.
D. visibility.
Answer : (a)

123) Chinese Postman Problem involves finding the

a. Shortest walking distance for the postman
b. Amount of letters postman has to carry
c. Maximum distance the postman can cover in a shift
d. Maximum time needed to deliver letters
Answer : (a)

124) Berthing refers to

a. Allocation of berths for ships to dock
b. Assigning berths for sailors/drivers
c. Allocation of parking spots for trucks
d. Assigning laborers to a container
Answer : (a)

125) A hub can be

a. Distribution hub
b. Cross dock point
c. Pool pint
d. All of the above
Answer : (d)

126) In slotting, optimization software uses data about product’s

a. physical characteristics
b. velocity
c. Volatility
d. Cost
Answer : (a)

127) UCC refers to

a. Uniform Code Council
b. Universal Code Council
 c. Unique Character Count
d. Uniform Character Collection
Answer : (a)

128) DISH is a type of EDI used in

a. Telecommunication industry
b. Television industry
c. Shipping industry
d. Manufacture of utensils
Answer : (C)

129) In barcodes, density refers to

a. Number of characters packed per unit length, say inch
b. Number of characters packed per unit area, say square centimeters
c. Number of lines per centimeter
d. Thickness of lines
Answer : (a)

130) Code 39 is
a. An alphanumeric barcode
b. An Integer only bar code
c. Used in USA only
d. Used in European Union only
Answer : (a)

131) In near field communication, Peer-to-Peer involves

a. Link-level communication
b. Network layer communication
c. Application layer communication
d. Transport layer communication
Answer : (a)

132) In cloud computing , elasticity refers to

a. The ability to increase the amount of bandwidth
b. The ability to increase the cpu power
c. The ability to increase disk storage
d. All of the above
Answer : (d)

133) Cloud computing

a. Is same as SAAS
b. Involves availing resources to the extent needed
c. Provides clouds
d. Uses HTTP and FTP
 Answer : (b)

134) ERP uses

a. EAI
b. GPS
c. GPRS
d. TCP/IP
Answer : (a)

135) Paypal
a. Is an intermediary
b. Is an infomediary
c. Helps pay in real currency
d. None of the above
Answer : (a)
136) Customs duties are levied, on which of the following value of goods ?

(a) Assessable value (b) CIF value

(b) FOB value (d) Unit value

Answer : (a)

137) Customs Educational Cess is computed on

(a) BCD (b) CVD+ education cess

(b) BCD+CVD (d) BCD+CVD+ education cess

Answer : (d)

138) EXIM Policy of India runs concurrent to

(a) The Five-Year Plan

(b) The term of the Government

(c) The term of the Prime Minister

(d) The term of the Finance Minister

Answer : (a)

139) The Marine insurance is based on :

(a) High freight charges involved in international transportation

(b) Risks involved in international transportation

(c) Risks involved in receiving payment from overseas Buyers

(d) To overcome poor visibility

Answer : (b)

140) CVD is equivalent to

(a) Safeguard Duty (b) Excise Duty

(c) Sales Tax (d) Commercial Tax

Answer : (b)

141) Letter of Credit is a :

(a) Non-negotiable document

(b) Contract

(c) Demand Draft

(d) Credit Note

Answer : (d)

142) The purpose of A.R.E.1 Form is

(a) to claim Duty Drawback

(b) to claim Excise Duty credit

(c) to claim Customs Duty refund

(d) to claim Excise Duty payment

Answer : (b)

143) Pro-forma Invoice is equivalent to

(a) Purchase Order (b) Commercial Invoice

(c) Bill of Exchange (d) Letter of Credit

Answer : (a)

144) Customs Invoice is also known as

 (a) Certificate of Origin

(b) Certificate of Value

(c) Certificate of Analysis

(d) Certificate of Inspection

Answer : (b)

145) Which of the following is not related to Exports

(a) Bill of Entry (b) Shipping Bill

(c) Shipping Advice (d) Bill of Lading

Answer : (a)

146) The basic condition for an EOU is that

(a)They should be located in an EPZ

(b)They should import all the raw material

(c)100% of their products are to be exported

(d) All the raw material should be indigenized

Answer : (C)

147) The Policy divides the import items into 3 categories:

(i) Free

(ii) Restricted

(iii) Prohibited

(iv) Special

(a) (i),(ii),(iii)

(b) (i),(iii),(iv)

(c) (i),(ii),(iv)

(d) (ii),(iii),(iv)

Answer : (a)
148) Groupage operations are facilitated at

(a) Ports

(b) ICD/CFS

(c) Transit ports

Answer : (b)

149) NVOCC stands for:

(a) Non-Vessel Operating Common Carrier

(b) National Voyage Organizing Core Committee

(c) Naval Vessel on Crucial Cruise

Answer : (a)

150) Exchange Rate risks are overcome by

(a) Forward Exchange contracts

(b) Insurance Policy from ECGC

(c) Export loans

(d) Advances

Answer : (a)

151) Natural disasters in insurance are described as

(a) Transportation risks

(b) Extraneous risks

(c) Acts of God

Answer (C)

152) Marine Insurance is a

(a) Financial protection against loss

(b) Replacement of goods lost

(c) Replacement of freight charges in lost goods

 Answer : (a)

153) Foreign Exchange involves

(a) Exchange of goods between two countries

(b) Exchange of currency between two countries

(c) Exchange of people between two countries

(d) Based on trade agreements

Answer : (b)

154) Rate of exchange between currencies depends on

(a) The size of population of a country

(b) GDP rate prevailing

(c) Socio-political and economic factors

(d) Nature of trade agreements between countries

Answer : (C)

155) A MTO’s functions include

(a) organising various modes of transport and accepting liability for safety of cargo

(b) ensuring timely arrival and delivery of cargo

(c) consolidating all shipments in one FCL

Answer : (a)

156) Payments from importers to exporters is subject to risk due to

(a) Bank problems

(b) Exchange rate fluctuations

(c) Delays in mail

Answer : (b)

157) The safest mode of payment for both exporter and importer is
 (a) Advance payment

(b) Letter of credit

(c) Documents against payment

(d) Payment on receipt of goods

Answer : (b)

158) Importer opens a Letter of Credit through

(a) An Issuing Bank

(b) A Receiving Bank

(c) An Advising Bank

(d) Any overseas bank

Answer : (b)

159) An Irrevocable Letter of Credit is a

(a) Back-to-back credit

(b) Confirmed Letter of Credit

(c) Transferable Letter of Credit

Answer : (a)

160) Document of Carriage, being a contract, contains primarily

(a) Description of Goods

(b) Destination of Goods

(c) Terms of Transport

(d) Ownership transfers

Answer : (C)

161) Orientation Labels are used in order to

 (a) Provide handling instructions

(b) Make packing more attractive

(c) Add strength to the packing material

Answer : (a)

162) Hazard Labels

(a) Describe the volume of cargo

(b) Describe chemical composition of the cargo

(c) Describe the potential damage that will be posed by the cargo

Answer : (C)

163) Flat-rack Containers are used for loading

(a) Bulk cargo

(b) Odd-sized cargo

(c) cartons/boxes

(d) Live stock

Answer : (b)

164) Grains and minerals are stuffed into

(a) Bulk Containers

(b) Reefer Containers

(c) Standard Containers

(d) Tank container

Answer: (a)

165) Reefer Containers keep perishable cargo intact

(a) because of refrigeration equipment attached to it

(b) because of inner insulation

(c) because of refrigeration equipment on ships

Answer: (a)