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How did the relationship between purchasers and suppliers work in the past?
AIt was competitive, with each side seeking terms at the other's expense
BIt was collaborative, with joint design of every new product
CIt was regulated, with prices fixed by an industry body
DIt was informal, with no purchase orders ever issued
Answer & Solution
Correct answer: A. It was competitive, with each side seeking terms at the other's expense
1. In the past the relationship between purchasers and suppliers was often competitive and antagonistic.
2. Businesses used many suppliers and switched among them frequently.
3. During contract negotiations each side tried to get better terms at the expense of the other.
4. Communication was often limited to purchase orders and billing statements, so option D is wrong to say no orders were issued.
_Source: OpenStax Introduction to Business (CC BY 4.0), Ch 10 "Achieving World-Class Operations Management", section Keeping the Goods Flowing: Supply-Chain Management_
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