FREE Certified Supply Chain Professional (CSCP) Supply Chain Risk Management Questions and Answers

Question 1

A company identifies that its primary supplier for a critical component is located in a region with high geopolitical instability.
To address this vulnerability, the company qualifies an alternative supplier in a different country and splits its orders between the two.
This action is an example of which risk response strategy?

Accepted Answer

Risk mitigation

Answer

Risk acceptance

Answer

Risk transference

Answer

Risk avoidance

Question 2

When conducting a supply chain risk assessment, a risk matrix is commonly used to prioritize threats. This tool visually plots risks to determine their significance and to focus resources on the most critical ones. What are the two primary dimensions used in a risk matrix?

Accepted Answer

Probability of occurrence and severity of impact

Answer

Cost of mitigation and time to recovery

Answer

Frequency of detection and cost of failure

Answer

Supplier lead time and inventory carrying cost

Question 3

Which of the following best defines supply chain resilience?

Accepted Answer

The ability to anticipate, resist, and recover from disruptions to return to an original or more desirable state.

Answer

The ability to achieve the lowest possible total cost for sourcing, production, and delivery.

Answer

The ability to rapidly adjust production and logistics to meet short-term changes in customer demand.

Answer

The ability to forecast demand with a high degree of accuracy to minimize inventory.

Question 4

A U.S.-based manufacturer imports key components from a supplier in Japan and pays in Japanese Yen (JPY). The company is concerned that the U.S. Dollar (USD) may weaken against the JPY over the next quarter, which would increase the cost of its imports. Which strategy would be most effective for managing this specific financial risk?

Accepted Answer

Executing a currency hedging contract

Answer

Increasing safety stock of the component

Answer

Implementing a vendor-managed inventory (VMI) program

Answer

Shifting to a domestic supplier

Question 5

A company is developing a formal plan to ensure that it can maintain critical operations, such as order fulfillment and customer service, during and after a major disruption like a fire at its main distribution center. This documented process of planning for recovery is best known as:

Accepted Answer

A Business Continuity Plan (BCP)

Answer

A Sales and Operations Plan (S&OP)

Answer

A Total Quality Management (TQM) program

Answer

A Strategic Sourcing Plan

Question 6

A supply chain manager is identifying potential risks to the company's operations. Which of the following is an example of an internal operational risk?

Accepted Answer

A critical piece of manufacturing equipment experiences an unexpected breakdown.

Answer

A key supplier suddenly declares bankruptcy.

Answer

A new international trade tariff is imposed on imported raw materials.

Answer

A major earthquake disrupts a primary shipping lane.