CIPS A7 Exam Practice Test Instant Access

Question 1

Which of the following tools of analysis is most suited to establishing the targets for an internal cost reduction programme?

APareto analysis

BValue chain analysis

CPorters 'five forces' analysis

DAnsoffs analysis.

Answer : A

Question 2

Which of the following best describes a strategy of 'related diversification'?

AMarketing an existing product in an existing market

BMarketing a new product in an existing market

CMarketing a new product in a new market

DMarketing an existing product in a new market.

Answer : C

Question 3

Which of the following defines 'value' in the context of value analysis?

AValue = Function/Cost

BValue = Feature added to a product to secure a premium price

CValue = Selling price/Cost

DValue = Cost/Function.

Answer : B

Question 4

Which of the following is likely to be regarded as a support function in an organization?

ADistribution

BProduction

CFinance

DSales

Answer : B

Question 5

When using the supplier positioning model to help determine purchasing strategies, which of the following best describes strategic purchases?

ALow expenditure purchases where supply is plentiful and there is little risk for the buying organization

BHigh expenditure purchases which carry a significant degree of risk for the buying organization

CLow expenditure purchases where supply is limited and there is some degree of risk for the buying organization

DHigh expenditure purchases where there is a large number of suppliers in the marketplace.

Answer : B

Question 6

When conducting a supplier appraisal on a potential supplier of a strategic item, which of the following gives the best indication as to the continuity of supply?

AFinancial profitability

BFinancial liquidity

CTechnical and commercial innovation

DPersuasive selling techniques.

Answer : B

Question 7

Which of the following is regarded as a 'prevention cost' in relation to quality control.

AInspection staff and equipment

BWarranty claims

CLoss of customers

DStaff education and training.

Answer : C

CIPS An Introduction to Purchasing Strategy A7 Exam Practice Test