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Chapter5NetworkDesignintheSupplyChainTrue/False1.Supplychainnetworkdesigndecisionsincludethelocationofmanufacturing,storage,ortransportation-relatedfacilitiesandtheallocationofcapacityandrolestoeachfacility.Answer:TrueDifficulty:Moderate2.Decisionsconcerningtheroleofeachfacilityaresignificantbecausetheydeterminetheamountofflexibilitythesupplychainhasinchangingthewayitmeetsdemand.Answer:TrueDifficulty:Moderate3.Decisionsconcerningtheroleofeachfacilityaresignificantbecausetheydeterminetheamountofrigiditythesupplychainhasinchangingthewayitmeetsdemand.Answer:FalseDifficulty:Moderate4.Facilitylocationdecisionshavealong-termimpactonasupplychain’sperformancebecauseitiscosteffectivetoshutdownafacilityormoveittoadifferentlocation.Answer:FalseDifficulty:Easy5.Capacityallocationdecisionshaveasignificantimpactonsupplychainperformancebecausetheytendtostayinplaceforseveralyears.Answer:TrueDifficulty:Moderate6.Theallocationofsupplysourcesandmarketstofacilitieshasasignificantimpactonperformancebecauseitaffectstotalproduction,inventory,andtransportationcostsincurredbythesupplychaintosatisfycustomerdemand.Answer:TrueDifficulty:Easy7.Theallocationofsupplysourcesandmarketstofacilitiesdoesnotneedtobereconsideredonaregularbasissothattheallocationcanbechangedasmarketconditionsorplantcapacitieschange.Answer:TrueDifficulty:Moderate8.Networkdesigndecisionshaveasignificantimpactonperformancebecausetheydeterminethesupplychainconfigurationandsetconstraintswithinwhichinventory,transportation,andinformationcanbeusedtoeitherdecreasesupplychaincostorincreaseresponsiveness.Answer:TrueDifficulty:Moderate9.Networkdesigndecisionshaveasignificantimpactonperformancebecausetheydeterminethesupplychainconflagrationandsetconstraintswithinwhichinventory,transportation,andinformationcanbeusedtoeitherincreasesupplychaincostorreduceresponsiveness.Answer:FalseDifficulty:Easy10.Firmsfocusingoncostleadershiptendtofindthelowestcostlocationfortheirmanufacturingfacilities,butonlyifthatmeanslocatingveryfarfromthemarketstheyserve.Answer:FalseDifficulty:Easy11.Firmsfocusingonresponsivenesstendtolocatefacilitiesclosertothemarketandmayselectahigh-costlocationifthischoiceallowsthefirmtoquicklyreacttochangingmarketneeds.Answer:TrueDifficulty:Moderate12.Ifproductiontechnologydisplayssignificanteconomiesofscale,manylocallocationsarethemosteffective.Answer:FalseDifficulty:Moderate13.Iffacilitieshavelowerfixedcosts,manylocalfacilitiesarepreferredbecausethishelpslowertransportationcosts.Answer:TrueDifficulty:Moderate14.Iftheproductiontechnologyisveryinflexibleandproductrequirementsvaryfromonecountrytoanother,afirmhastosetuplocalfacilitiestoservethemarketineachcountry.Answer:TrueDifficulty:Hard15.Ifthetechnologyisflexible,itbecomesmoredifficulttoconsolidatemanufacturinginafewlargefacilities.Answer:FalseDifficulty:Hard16.Tariffshaveaminorinfluenceonlocationdecisionswithinasupplychain.Answer:FalseDifficulty:Easy17.Hightariffsleadtomoreproductionlocationswithinasupplychainnetwork,witheachlocationhavingalowerallocatedcapacity.Answer:TrueDifficulty:Hard18.Whendesigningsupplychainnetworks,companiesmustbuildappropriateflexibilitytohelpcounterfluctuationsinexchangeratesanddemandacrossdifferentcountries.Answer:TrueDifficulty:Moderate19.Inventoryandfacilitycostsincreaseasthenumberoffacilitiesinasupplychainincrease.Answer:TrueDifficulty:Moderate20.Transportationcostsincreaseasthenumberoffacilitiesisincreased.Answer:FalseDifficulty:Moderate21.Afirmmayincreasethenumberoffacilitiesbeyondthepointthatminimizestotallogisticscosttoimprovetheresponsetimetoitscustomers.Answer:TrueDifficulty:Easy22.Whenfacedwithanetworkdesigndecision,thegoalofamanageristodesignanetworkthatminimizesthefirm’scostswhilesatisfyingcustomerneedsintermsofdemandandresponsiveness.Answer:FalseDifficulty:Hard23.Thesupplychainnetworkisdesignedtomaximizetotalprofits,takingintoaccounttheexpectedmarginanddemandineachmarket,variouslogisticsandfacilitycosts,andthetaxesandtariffsateachlocation.Answer:TrueDifficulty:EasyMultipleChoice1.Supplychainnetworkdesigndecisionsincludea.onlythelocationofmanufacturing,storage,ortransportation-relatedfacilities.b.onlytheallocationofcapacityandrolestoeachfacility.c.boththelocationofmanufacturing,storage,ortransportation-relatedfacilitiesandtheallocationofcapacityandrolestoeachfacility.d.neitherthelocationofmanufacturing,storage,ortransportation-relatedfacilitiesnortheallocationofcapacityandrolestoeachfacility.e.noneoftheaboveAnswer:cDifficulty:Easy2.Supplychainnetworkdesigndecisionsclassifiedasfacilityroleareconcernedwitha.whatprocessesareperformedateachfacility.b.wherefacilitiesshouldbelocated.c.howmuchcapacityshouldbeallocatedtoeachfacility.d.whatmarketseachfacilityshouldserveandwhichsupplysourcesshouldfeedeachfacility.e.noneoftheaboveAnswer:aDifficulty:Moderate3.Supplychainnetworkdesigndecisionsclassifiedasfacilitylocationareconcernedwitha.whatprocessesareperformedateachfacility.b.wherefacilitiesshouldbelocated.c.howmuchcapacityshouldbeallocatedtoeachfacility.d.whatmarketseachfacilitysho