A buyer for DEF, Inc. has been exceeding spending authority on agreements with several new suppliers.
Which of the following Is an accurate statement regarding DEF's liability in this situation?

• A.DEF is only liable for an amount equal to the buyer's actual authority level.
• B.DEF is fully liable for the agreements, as the buyer is an employee of the company.
• C.DEF is responsible for the agreements if the buyer exceeded actual authority, but the suppliers perceived the spend to be within apparent authority.
• D.DEF is responsible for the agreement if the buyer exceeded actual and apparent authority levels, but only for a value equal to the apparent authority amount.

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Which of the following is the BEST reason to develop relationships with a small number of suppliers?

• A.To identify innovation opportunities
• B.To Improve sourcing opportunities
• C.To decrease internal cultural barriers
• D.To obtain pricing improvements

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A firm wants to leverage supply contracts by making maintenance, repair, and operations (MRO) supplies available to all of its subsidiaries. Which of the following is the MOST efficient and cost-effective way to provide product details to potential users?

• A.Require suppliers to provide secure ordering portals tailored to specific contracts
• B.Conduct train-the-trainer sessions for supply management staff at the subsidiaries
• C.Create internal online catalogs with ordering instructions and links to suppliers' sites
• D.Email a list of suppliers' websites to contacts at each subsidiary

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After a new report concludes that airplane exhaust has a negative impact on the environment, a government regulation is introduced which reduces the number of flights airlines can make in a day by 10 percent. To comply with this regulation, a certain airline halves the frequency of flights on several of its routes but maintains its original fleet of airplanes. What happens to the costs for the airline?

• A.Average cost per flight will increase.
• B.Cost for each additional flight will increase.
• C.Total costs will fall by 10 percent.
• D.Total costs for the airline will increase.

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Two years ago, the purchasing manager at a company spent $25,000 on a new machine that would improve production efficiency at the company. The manufacturers of the machine release an updated model that costs $35,000 and that promises to further improve production efficiency. Under what conditions should the purchasing manager upgrade to the new model?

• A.If the savings from the additional efficiency improvements are large enough to offset the $60,000 spent on machines
• B.If the savings from the additional efficiency improvements are large enough to offset the $10,000 difference in price between the machines
• C.If the efficiency improvements from the old machine did not result in enough savings to offset the $25,000 purchase price
• D.If the savings from the additional efficiency improvements are large enough to offset the $35,000 cost of the new machine

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