CIPS L6M10 Exam Practice Test Instant Access

Question 1

ABC global firm has been primarily using a centralized organizational structure for decades. However, due to increasing competition and the need to adapt to local markets, the firm is considering restructuring. What organizational change might align better with its current challenges?

AMaintain the existing centralized structure to preserve stability.

BFurther centralize its operations to achieve economies of scale.

CDiversify its product offerings to address global demands.

DEstablish virtual teams for information management and customer service.

Answer : D

A virtual team approach allows firms to maintain coordination while adapting to local conditions, leveraging information and communication technologies. [P-104]

Question 2

What does the consideration of "health and safety for the movement of hazardous material" and "security where a product is of high value and low weight" fall under in the selection of a suitable mode of transport?

AOperational factors

BTransport mode characteristics

CCost and service requirements

DConsignment factors

Answer : D

Consignment factors include considerations such as safety, security, and handling requirements for different types of goods. [P-25]

Question 3

What is one approach Sarah, an experienced exporter, can take to minimize the risk of disputes over the interpretation of an international sales contract?

ARely solely on Incoterms without any variations or additions.

BExplicitly specify variations or additions to Incoterms relevant to the trade.

CAvoid specifying any terms in the contract to keep it flexible.

DMake small changes to Incoterms without notifying the buyer.

Answer : B

To minimize disputes, Sarah should explicitly specify variations or additions to Incoterms in her contract to ensure clarity. [P-123]

Question 4

GreenTech considers returns services due to competitor actions. What factor motivates this?

ASupplier expectations

BPressure groups

CCustomer demand and competition

DGovernment fines

Answer : C

Competitive pressure and customer expectations push companies to adopt returns services. [P-175]

Question 5

In the context of managing an extended transportation pipeline, what is the primary concern associated with implementing a "just in time" (JIT) inventory system?

AMinimizing the reliance on warehousing and storage

BReducing the cost of inventory holding

CIncreasing the risk of disruptions if material flow or labor is interrupted

DReducing transportation costs through last-minute logistics planning

Answer : C

JIT inventory systems reduce storage costs but increase vulnerability to supply chain disruptions due to material flow or labor interruptions. [P-13]

Question 6

ABC company operates in the global supply chain and wants to manage price and currency fluctuations effectively. Which surcharge could help them account for difficulties in navigating poor infrastructure, backlogs, and delays in transportation?

APeak season surcharge

BBunker adjustment factor

CWar risk surcharge

DCurrency adjustment factor

Answer : A

Peak season surcharge accounts for transportation challenges such as backlogs, delays, and infrastructure limitations during high-demand periods. [P-22]

Question 7

Which of the following is considered an external factor influencing an organization's reverse logistics activities?

AEmployee satisfaction

BTechnological advancements

CGovernment regulations

DInternal audit procedures

Answer : C

External factors influencing reverse logistics include government regulations, which are external forces like government regulators. [P-173]

CIPS Global Logistics Strategy L6M10 Exam Practice Test