ISM Exam INTE Topic 1 Question 22 Discussion

Actual exam question for ISM's INTE exam

Question #: 22
Topic #: 1

[All INTE Questions]

GHI, Inc. is a U.S.-based company with an expanding product line. GHI widens its sourcing of components to global suppliers, including suppliers in countries which are not included in trading blocs or bilateral agreements with the United States. Compliance with which of the following will MOST likely reduce GHI's administrative burden of cargo inspections on materials imported from these sources?

AUnited Nations Convention on Contracts for the International Sale of Goods (CISG)

BForeign Corrupt Practices Act (FCPA)

CGlobal Environmental Management Initiative (GEMI)

DCustoms-Trade Partnership Against Terrorism (C-TPAT)

Show Suggested Answer

Suggested Answer: D

In a highly competitive market like office supplies, the most critical cost associated with shortag-es is typically lost sales. If PQR, Inc. experiences shipping delays and cannot maintain continuous inventory, customers are likely to turn to competitors to meet their needs. This can result in im-mediate lost sales and potentially long-term loss of customer loyalty. The cost of lost sales often outweighs other costs like idle workers or production downtime because it directly affects revenue and market share. Reference:

* Chopra, S., & Meindl, P. (2015). Supply Chain Management: Strategy, Planning, and Op-eration. Pearson.

* Christopher, M. (2016). Logistics & Supply Chain Management. Pearson UK.

by Chi at Feb 10, 2025, 06:02 PM

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25 days ago

I think the answer is D) Customs-Trade Partnership Against Terrorism (C-TPAT). It focuses on securing the international supply chain, which could help reduce cargo inspections.

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