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ISM Supply Management Core Exam Sample Questions (Q213-Q218):

NEW QUESTION # 213
The owner of a t-shirt store on a beach sells 200 shirts per month in the summer for a price of $15.00. During the winter months, the owner reduces the price to $9.00 and sells 100
shirts per month. The store must be leased in one-year increments at $400 per month in rent. The cost of labor, materials, and utilities are an additional $600 a month. Should the store remain open during the winter months?

A. No, the store should shut down during the winter months.
B. Yes, the store should remain open during the winter months.
C. No, the store should shut down completely.
D. Yes, the store should remain open but should lower prices to $6.00 during the winter months.

Answer: B

NEW QUESTION # 214
Which of the following refers to a stakeholder want as opposed to a stakeholder need?

A. Requiring thata supplierprovideaccommodations for the company's representatives duringvisits
B. Requiring thata supplierprovidethe purchased component at or below the target cost
C. Requiring thata supplierprovidedetailed specifications for review for the supplied item
D. Requiring thata supplierprovidedelivery schedules that meet the requirements specified inthe contract

Answer: A

NEW QUESTION # 215
Supplier X provides software critical to production at EFG Corporation. Supplier X informs EFG that the software version it currently uses will no longer be supported and recommends an upgrade to a newer version.
However, EFG is very pleased with the performance of the current version, and the costs for upgrading are prohibitive at this time. EFG wants to find incentives for Supplier X to continue supporting EFG's needs. In this situation, which of the following would be the BEST course of action for EFG to take?

A. Request Information on the newer software version to persuade top management of its value
B. Identify additional business opportunities for Supplier X at EFG, as part of their ongoing relationship
C. Contact EFG's legal department to review the liquidated damages clause in the contract with Supplier X
D. Stress that failure to offer support will result in negative references for Supplier X

Answer: B

NEW QUESTION # 216
An international company is conducting its annual review of its supply management processes to confirm compliance to corporate legal requirements. An external audit team plans to visit each location. Which of the following is the MOST important activity each supply management professional should perform in order to prepare for the audit?

A. Review the ISM Principles and Standards of Ethical Supply Management Conduct
B. Review the order, receipt, and payment process with the accounting department
C. Review supply management activities to verify adherence to policies and procedures
D. Review company supply management policies with strategic suppliers

Answer: C

Explanation:
To prepare for an external audit focused on compliance with corporate legal requirements, it is essential to ensure that all supply management activities adhere to the company's policies and procedures. This involves a thorough review and verification process, which helps identify and address any discrepancies or non-compliance issues before the audit, ensuring a smooth and successful audit outcome.
References
* Guidelines on preparing for external audits in supply chain management.
* ISM Principles and Standards of Ethical Supply Management Conduct.

NEW QUESTION # 217
An exploration firm's supply manager meets with the fleet operations team to plan for the acquisition of vehicles to be used in company operations on a remote Pacific island. As removing the old vehicles from the island has proven to be a significant problem, the team requests the inclusion of a "take-back" requirement in the contract. Which of the following is the BEST way for the supply manager to respond to this request?

A. The supply manager should oppose the idea, as the sourcing process should be focused on acquisitions.
B. The supply manager should oppose the idea, as a take-back program from a remote island would be cost prohibitive.
C. The supply manager should refer the issue to the environmental quality manager.
D. The supply manager should include this requirement in the firm's upcoming procurement.

Answer: D

NEW QUESTION # 218
......

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