Important CIPS L6M9 Exam Questions

Answer: C, D, E

Explanation:

Investment appraisal techniques help assess whether an investment, such as purchasing new machinery, is financially viable. Return on investment, cash flow impact, and payback period are all investment appraisal methods. Liquidity and gearing assess financial health but do not determine whether to make an investment. (See p.160)

Answer: D

Explanation:

Backward vertical integration occurs when a company acquires a supplier or producer that is further upstream in the supply chain. In contrast, forward vertical integration happens when a company buys a retailer or distributor further downstream.

Note: Forward horizontal and backward horizontal integration do not exist---these are trick options. (See LO 1.2, p.42)

Answer: A, C, E, F

Explanation:

The Value Net consists of suppliers, customers, competitors, and complementors. Unlike a supply chain, which focuses on material and information flow, the Value Net is about creating business value.

Supplier: Provides goods/services

Customer: Purchases goods/services

Competitor: Competes in the same market

Complementor: A business that enhances your product/service offering

Buyer and distributor are not primary players in the Value Net. (See LO 1.2, p.31)

Answer: A

Explanation:

A Proprietary Network is a privately owned and controlled group.

Option B refers to a Social Network

Option C describes a Bureaucratic Network

Option D refers to an Asymmetric Network

Tip: Learn these definitions well, as they frequently appear in exam questions! (See LO 1.1)

Answer: D

Explanation:

Loading refers to allocating work to a person or machine---essentially 'loading' them with tasks. It helps determine workload distribution for maximum efficiency. (See p.180)