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ISM Supply Management Core Exam Sample Questions (Q214-Q219):

NEW QUESTION # 214
BCD Inc. is in the early stages of selecting a new procure to pay (P2P) system, which is expected to add efficiencies and reduce transaction costs. Which of the following is the BEST way for supply management to participate in the selection of this system?

  • A. Conduct a survey to learn what transactions are regarded as cumbersome
  • B. Consult with key suppliers to learn their requirements for integration
  • C. Ensure that BCD's IT department understands the top suppliers' requirements for integration
  • D. Construct a detailed list of transaction types and estimated processing times

Answer: D

Explanation:
The selection of a new procure-to-pay (P2P) system requires a clear understanding of the specific needs and processes within the organization. By constructing a detailed list of transaction types and estimated processing times, supply management can ensure that the chosen P2P system is capable of handling the organization's workload efficiently and effectively. This step provides a concrete basis for evaluating potential systems and ensures that the selected system will meet the organization's specific requirements. References:
* "Procurement Systems: A Guide to Best Practice in Construction" by Gillian Fawcett and Les Ruddock
* "Procurement and Supply Chain Management" by Kenneth Lysons and Brian Farrington


NEW QUESTION # 215
---
A manager at a large gold mining company is trying to determine how a series of recent events will affect the future of his industry.
The following events occur simultaneously:
Flooding damages several gold mines in a region.
The price of platinum, a substitute for gold, increases.
A new government policy mandates an increased wage rate for mine workers.
What should the manager expect regarding the new equilibrium price and quantity for gold?

  • A. The effect on price is unknown, and the equilibrium quantity increases.
  • B. The equilibrium price increases and equilibrium quantity increases.
  • C. The equilibrium price increases and the effect on quantity is unknown.
  • D. The equilibrium price increases and equilibrium quantity decreases.

Answer: C


NEW QUESTION # 216
A government agency is interested in developing the most accurate forecast for the poverty rate in the United States and decides to perform regression analyses using a combination of the following independent variables: the percent of women in the labor force and the percent of the population that is uninsured. The agency collects data from all 50 U.S. states but is unsure whether both variables should be in the model. The agency runs three regressions:
Regression A. Poverty Rate = a + b1*(Percent of women in the labor force) + b2*(Percent uninsured)
Regression B. Poverty Rate = a + b*(Percent of women in the labor force)
Regression C. Poverty Rate = a + b*(Percent uninsured)

The regression statistics for all three regressions are given below. Based on these statistics, which model should the agency use to obtain the MOST accurate forecast?

  • A. Regressions A and B provide equally accurate forecasts
  • B. Regression B
  • C. Regression C
  • D. Regression A

Answer: B


NEW QUESTION # 217
During negotiations, each side adopts a point of view, and then both parties work to close the gap by exchanging concessions. Which of the following tactics is being used?

  • A. Positional bargaining
  • B. Logical reasoning
  • C. Relational persuasion
  • D. Power and influence

Answer: A

Explanation:
Positional bargaining is a negotiation strategy where each side adopts a fixed position and then negotiates to close the gap through concessions and compromise. This approach focuses on maintaining specific demands and making adjustments to reach a mutually acceptable agreement. It contrasts with interest-based bargaining, which focuses on underlying interests rather than fixed positions.
References
* Getting to Yes: Negotiating Agreement Without Giving In by Roger Fisher and William Ury
* Harvard Business Review articles on negotiation tactics


NEW QUESTION # 218
A company believes a "low-cost" strategy would help increase revenues. The company lowers the price of its product but actually sees a decrease in revenues. What information could explain this result?

  • A. The demand for the product is relatively inelastic.
  • B. The market is in an economic boom.
  • C. The company's product is not perceived as a necessity.
  • D. The company failed to cut costs significantly.

Answer: A


NEW QUESTION # 219
......

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