My study notes and reference materials 630-005

1. XXXX.com has a 10% profit margin before taxes and spends 50% of its sales dollar on materials. What percentage reduction in material costs for XXXX.com to achieve an increase of 5% in sales?

A. 1%

B. 2.5%

C. 5%

D. 7.5%

E. 10%

Answer: A

2. Which of the following statements regarding the process of reviewing supplier samples and/or demonstrations with user departments and functional departments such as quality, engineering, research, and administration, are FALSE?

A. It increases the amount of time involved in making a buying decision.

B. It is an example of purchasing's role as a service function within the organization.

C. It reduces purchased prices by allowing purchasing to make the final buying decision.

D. It leads to improved quality because the supplier will have a better understanding of user requirements.

Answer: C

3. In which of the following countries outside of the United States do U.S. patentees enjoy protection against infringement?

A. In countries that have full diplomatic relations with the United States.

B. In countries that are signatories to patent conventions only.

C. In European Union member counties only.

D. In GATT member countries only.

E. None of the above.

Answer: B