CPIM Supply Planning & Procurement Processes 4

Question 1

A firm uses a min-max inventory system. The minimum is 100 units and the maximum is 400 units. Current stock is 85 units. How many units should be ordered?

Accepted Answer

315 units

Answer

When stock falls below the minimum, order up to the maximum: 400 − 85 = 315 units.

Question 2

Which of the following is a key output of a supplier scorecard review?

Accepted Answer

Objective performance data used to guide supplier development or sourcing decisions

Answer

Supplier scorecards aggregate KPIs (quality, delivery, cost) to identify improvement areas and inform sourcing strategies.

Question 3

In the context of procurement, what does the term 'make-or-buy analysis' evaluate?

Accepted Answer

Whether to produce a component internally or source it from a supplier

Answer

Make-or-buy analysis compares the costs and strategic implications of internal production versus external procurement.

Question 4

Which supply planning technique uses actual customer demand to pull replenishment through the supply chain rather than pushing based on forecasts?

Accepted Answer

Demand-driven MRP (DDMRP)

Answer

DDMRP uses strategically positioned buffers and actual demand signals to pull replenishment, reducing forecast-driven overproduction.

Question 5

A buyer issues an RFQ to five suppliers. Two respond with bids. What risk does this situation present?

Accepted Answer

Insufficient competition, potentially yielding non-competitive pricing

Answer

Low bid response rates reduce competitive tension, which may result in higher prices or less favorable terms for the buyer.

(CPIM) Certified in Planning and Inventory Management Practice Test

(CPIM) Certified in Planning and Inventory Management Practice Test

CPIM Supply Planning & Procurement Processes 4