Free Ethical and Responsible Sourcing Exam L4M4 Exam Practice Test

When conducting an ABC analysis- what category of items and type of suppliers would you typically find in the A category?

• low value items, transactional suppliers
• low value items, strategic suppliers
• high value items, strategic suppliers
• high value items, transactional suppliers

A balance sheet will show a company's assets, liabilities and shareholder equity. What is share- holder equity?

• the profit from sales once tax has been deducted
• the amount of money held in the company's bank account
• the owners' residual claim once all debt has been paid
• the amount of money from retained earnings

In which type of market would you be most likely to find a 'perfect competition'?

• monopoly
• oligopoly
• commodity
• monopolistic competition

Khalid is a procurement manager in the UK who is looking to source exotic fruit for a retailer. As this type of fruit doesn't grow naturally in the UK Khalid is looking at international suppliers, but is worried about variations in exchange rates. He is considering asking the suppliers to provide quotes in their local currencies. Will this reduce the risk posed to Khalid?

• yes- suppliers should quote in their own currencies so there is no risk to the importing company
• yes- when suppliers quote in local currencies you are more likely to get better prices
• no- quoting the prices in GBP / £ will provide Khalid with better security against cur-rency fluctuations
• no- prices should be quoted in GBP / £ as this will reduce the cost of imports

Which of the following would you use to work out a company's gearing ratio? Select TWO. 0current liabilities

• net profit
• shareholder equity
• long term debt
• gross sales

Which of the following is a regulatory body which protects the rights of workers?

• ISO
• ILO
• FairTrade
• WWF

The procurement team at Grape Juice Limited often use a weighted point system when ap-praising potential suppliers. What is a disadvantage of using a weighted point system?

• it allows transparency
• it is time-consuming to create
• it is easy to manipulate
• it is hard to be objective

Dylan is looking to appoint a new supplier of paint to his manufacturing business. The paint will be used to paint buses and taxis and therefore needs to be high quality and durable. Which of the following should Dylan look for in terms of quality management when appraising the suppliers?

• ISO9001
• Carter's 10 Cs
• ESG
• conformance specification

FTSE100 and Sensex are examples of what?

• stock markets
• commodity indices
• financial reports
• public sector organisations

Henry is importing cheese from South East Asia into the UK. He is doing some research on the costs and risks of this and has discovered that the product may be considered of 'non-preferential origin'. What implications would this mean for Henry?

• he will require insurance
• the goods are subject to tariff quotas
• there are no duty charges or limitations
• the goods are banned in the UK