APICS Certified Supply Chain Professional (CSCP) — Question 260

A company evaluating supply chain options compares the lower costs associated with moving to a geographically distant area to the increased costs associated with achieving smooth, consistent, and timely flow of material. The company is determining:

Answer options

• A. total cost of ownership (TCO).
• B. direct and indirect cost alignment.
• C. complete cost considerations.
• D. full-cost evaluation.

Correct answer: A

Explanation

The correct answer is A, total cost of ownership (TCO), as it encompasses all costs associated with acquiring and using a product, including both direct and indirect costs. Options B and D focus on specific aspects of cost alignment and evaluation without considering the comprehensive nature of TCO, while C does not specifically highlight the ownership aspect.