Free CIPS L4M7 Exam Questions

Question 1

A warehouse manager is evaluating the use of Automated Guided Vehicles (AGVs) within a repetitive taskenvironment. After reviewing their use and price, the manager decided to invest in several AGVs. Were theycorrect in doing this?

A : Yes, as it will reduce the costs of employing labour

B : No, as it reduces the flexibility of the warehouse operations

C : Yes, organisations must use high-tech solutions where possible

D : No, as they are only suitable for use in non-repetitive task environments

Answer: A

Question 2

The managing director requires action to be taken to improve the organization’s profitability and has asked for suggestions to enable this to be achieved. The procurement manager has said that a just-in-time (JIT) system should be introduced. Would such a system improve profitability?

A : Yes, because it would reduce stock holding costs

B : No, because it would increase buffer stock

C : No, because it would increase stock holding costs

D : Yes, because it would reduce stock turn rates

Answer: A

Question 3

A warehouse manager is evaluating the use of Automated Guided Vehicles (AGVs) within a repetitive taskenvironment. After reviewing their use and price, the manager decided to invest in several AGVs. Were theycorrect in doing this?

A : Yes, as it will reduce the costs of employing labour

B : No, as it reduces the flexibility of the warehouse operations

C : Yes, organisations must use high-tech solutions where possible

D : No, as they are only suitable for use in non-repetitive task environments

Answer: A

Question 4

A restaurant needs to buy a new freezer. The owner applies total cost of ownership model to calculate the life-time cost of the freezer. This equipment has a price tag of $1,000, the supplier can offer free delivery if the restaurant pays off immediately. Estimated electricity consumption of the freezer is $200 in 5 years. The supplier ascertains that the freezer is very durable, buyer doesn't need to care about maintenance costs. However, if the restaurant needs better protection from breakdowns, the warranty is free for the first 12 months after the purchase. This warranty package can be extended once for another 24-month period with the cost of $75. After 5 years, the buyer will be able to resell this freezer for $250. What would be the estimated total cost of ownership of this freezer if the restaurant owner buys the extended warranty package?

A : $1,525

B : $1,025

C : $1,200

D : $1,275

Answer: B

Question 5

Which of the following are critical factors that must be considered when evaluating warehouse or storage locations? The cost of the proposed locationWho owns the storage location or warehouse Access to transport networks The number of windows in the building

A : 1 and 3 only

B : 2 and 3 only

C : 2 and 4 only

D : 1 and 4 only

Answer: A