(1). Which of the following is not a transactional relationship characteristic? (a). Long-term contr

Which of the following is not a transactional relationship
(a). Long-term contract,
(b). An absence of concern,
(c). One of a series of independent deals,
Costs, data and forecasts are not shared.

Which of the following is not one of the issues that affect a supplier’s
assessment of a buying

(a). Gifts & gratuities,
(b). Openness and Approachability,
(c). Availability,
(d). Professionalism.

Which of the following is a major element included in a “to buy†cost
(a). Delivered purchased material costs,
(b). Transportation costs,
(c). Direct
labor costs,
(d). Any follow-on costs stemming from quality and
related problems.

Which of the following is not one of the six categories of cost
presented in the textbook?
(a). Price of goods,
(b). Variable manufacturing costs,
(c). Fixed manufacturing costs,
(d). Semi Variable costs.

Which of the following is not a common source of prices for a price
(a). Catalog prices,
(b). Internet prices,
(c). The grapevine,
(d). Independent cost estimates.

Which of the following is not a category of discounts?
(a). Trade discounts,
(b). Quantity discounts,
(c). Credit card discounts,
(d). Seasonal discounts.

Which of the following is not considered a major element that affects a
supplier’s cost?
(a). Effectiveness of competitors,
(b). Capabilities of management,
(c). Efficiency of labor.
(d). Amount and quality of subcontracting.

Which of the following is not a common use of learning curve?
(a). Estimation of Target costs,
(b). Improving Make-or-Buy Analyses,
(c). Estimation Delivery Times,
Estimation of Material costs.

Several potential benefits exist when a buying firm pays for and takes
title to special tooling? Which is not
one of the potential benefits?
(a). The buying firm gains greater control,
(b). Insurance costs are lower,
(c). Analysis of production costs is easier,
(d). Labor learning curve effect is reduced.

Generally, compensation arrangements do not determine:
(a). Degree & timing of the cost
responsibility assumed by the suppliers,
(b). Amount of profit or fee available to the
(c). Capability of the supplier with respect to
(d). Motivational implications of the fee portion
of the compensation arrangements.

Which of the following statements is not true about incentive arrangements
in contracts?
(a). Used to motivate the supplier to control
(b). Used to encourage goods supplier performance,
(c). Contract price will usually be lower,
(d). Ceiling price is usually fixed during

Which of the following is not a cost type arrangement?
(a). Cost reimbursement,
(b). Cost plus hidden charges,
(c). Cost plus fixed fee,
(d). Cost plus award fee.

Which of the following is usually not one of the objectives of a
negotiation with a supplier?
(a). Quality,
(b). Fair & reasonable price,
(c). Cultural values,
(d). On-time performance.

Which of the following is not one of the major steps in the typical
negotiation process?
(a). Preparation,
(b). Establishment of objectives,
(c). Litigation prevention,
(d). Face to face discussions.

Which of the following is a traditional non-cost objective in a
(a). Liability for claims and damages,
(b). Quantity of labor,
(c). Wage rates,
(d). Quantity of materials.

Which of the following is not a powerful preparation activity or tool
for negotiation presented in

the textbook?
(a). Agenda.
(b). Murder Boards,
(c). Mock Negotiations,
(d). Historical Price Data Sheets.

Several changes in business have increased the need for better contract
management. Which of

the following is not of those changes?
(a). Collaboration is continuing to become more
(b). Large inventories are available,
(c). Quality is expected,
(d). Deliveries are expected to be on time, or
early or late.

What usually does not need to be specified at the pre-award conference?
(a). All items and conditions,
(b). Expected quality levels,
(c). Staffing and supervision,
(d). Site conditions, work rules, safety.

(19). Which of the following is not one of the four
categories of actions that exist to resolve a dispute?
(a). Negotiation,
(b). Mediation,
(c). Situation,
(d). Arbitration.

Which of the following is not true about pricing in institutions?
(a). Until recently, many suppliers granted
special prices to institutions,
(b). Today, most suppliers view the institutional
market as a less preferable market to private
(c). To obtain fair prices in such a market,
institutions much have supply managers that can
effectively with their highly competent sales counterparts,
(d). Institutions, as a group, continue to violate
one of the basic principles of good supply
management-that of not disclosing prices.

Which condition clearly indicates that negotiation is preferred over
competitive bidding?
(a). Dollar volume of the potential buy is very
(b). Product isn’t actually needed until five
months into the future,
(c). Each firm that is competing is a technical
giant in the field,
There will be substantial pre-production engineering and tooling required.

All of the following factors will strengthen the buying organization’s
position in a negotiation

(a). Unclear specifications,
(b). Strongly competitive field,
(c). Lack of urgency for a contract,
Thorough cost/price analysis.

Which of the following is the least likely source of relevant
information about a supplier when

planning a negotiation?
(a). External databases,
(b). Persons who previously negotiated with the
(c). Dun & Bradstreet reports,
(d). Supplier’s ranking among Fortune companies.

Which of the following types of costs change in direct proportion to
changes in the level of

operational activity?
(a). Fixed,
(b). Variable,
(c). Standard,
(d). Direct.

All of the following are elements considered in a cost analysis except:
(a). Direct Labor,
(b). Liability,
(c). Material,
(d). Profit.


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