A Valuable Method of Assessing Supplier Performance Is to Use

question 41

Multiple Choice

A valuable method of assessing supplier performance is to use a supplier performance index.This index is calculated by:

• A) total purchase price ÷ total supplier costs
• B) total supplier costs ÷ total purchase price
• C) average purchase price ÷ average supplier costs
• D) average supplier costs ÷ average purchase price

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Definitions:

Interest Rate

The percentage rate that is paid by a bank on money that is in some accounts.

Monthly Payment

A specified amount of money paid at regular monthly intervals, typically associated with loans or installment purchases.

Quoted Interest Rate

The interest rate that a lender offers to a borrower for a loan, not accounting for compounding or additional fees.

Buy Down

The process of paying additional points to a lender at closing to reduce the interest rate on a loan.