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Sample Questions L4 Module 3

This document contains 10 sample exam questions for the CIPS Level 4 Diploma in Procurement and Supply Module 3 on commercial contracting. The questions cover a range of topics including contractual terms, output specifications, pricing mechanisms, negotiation timing, performance management, sourcing strategies, and contract formation principles. The correct answers to the objective response questions are identified. The sample exam questions are intended to help students prepare for assessment on key learning outcomes and assessment criteria related to commercial contracting.

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Chongo malombola
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Download as PDF, TXT or read online on Scribd
1K views

Sample Questions L4 Module 3

This document contains 10 sample exam questions for the CIPS Level 4 Diploma in Procurement and Supply Module 3 on commercial contracting. The questions cover a range of topics including contractual terms, output specifications, pricing mechanisms, negotiation timing, performance management, sourcing strategies, and contract formation principles. The correct answers to the objective response questions are identified. The sample exam questions are intended to help students prepare for assessment on key learning outcomes and assessment criteria related to commercial contracting.

Uploaded by

Chongo malombola
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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CIPS Level 4 – Diploma in Procurement and

Supply
Module 3 – Commercial Contracting

SAMPLE EXAM QUESTIONS


OBJECTIVE RESPONSE QUESTIONS AND ANSWERS

The correct answer will be identified as [key]

Leading global excellence in procurement and supply


L4M3 Sample Exam Questions Dec 2018
Q1. Which of the following is a provision in a contract under which one party commits to compensate the other for
any harm or loss arising out of the contract?

a. Indemnity

b. Intellectual property

c. Liquidated damages

d. Warranty

LO: 3

AC: 3.2

Q2. Which of the following are likely to feature within an output-specification?

1. Product functions

2. Technical inputs

3. Performance requirements

4. Conformance standards

a. 1 and 2 only

b. 2 and 3 only

c. 1 and 3 only

d. 2 and 4 only

LO: 1

AC: 1.1

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L4M3 Sample Exam Questions Dec 2018
Q3. A procurement manager has negotiated a firm fixed price throughout the contract duration of two years. Was
this the right thing to do?

a. No, because even with these contracts the pricing can change

b. No, because this is an unfair term and therefore is not legally binding

c. Yes, because this has provided certainty and so is an aid to budgeting

d. Yes, because this type of pricing will always be better than a spot price

LO: 3

AC: 3.3

Q4. Ace Group is seeking to encourage one of its key suppliers to improve its contract delivery performance. Ace
Group wants to encourage the supplier to identify cost savings and ways to enhance quality. Which of the following
would help?

a. Gainshare

b. Indexation

c. Liquidated damages

d. Service credits

LO: 3

AC: 3.3

Q5. When is the best time for the buyer's express terms to be provided to the supplier in a competitive bidding
process with negotiation?

a. At the contract kick off meeting

b. When the negotiation is nearing completion

c. With the contract award notification

d. As part of the invitation to tender

LO: 3

AC: 3.1

3
L4M3 Sample Exam Questions Dec 2018
Q6. Which of the following are often used in conjunction with service level agreements (SLAs) as part of the
performance management regime to encourage the supplier to meet the buyer's requirements?

a. Service guarantees

b. Service credits

c. Service warranties

d. Service penalties

LO: 2

AC: 2.2

Q7. A major public body maintain a large and diverse property estate comprising more than 100 buildings in multiple
locations around the country. To maintain this property estate, which of the following is likely to be the most
effective arrangement between the organisation and suppliers?

a. Framework agreements

b. One off purchases

c. Spot transactions

d. Purchase orders

LO: 1

AC: 1.3

Q8. A large manufacturing group is going through a period of investment under which a number of its facilities will
close on a short-term basis for re-fit and upgrade works to be undertaken. The CPO is concerned about the impact
on the organisation's ability to meet customer orders should any of the work carried out by suppliers overrun. In
respect of this particular concern, the CPO should consider using which of the following contractual terms with these
suppliers?

a. Insurance

b. Force majeure

c. Liquidated damages

d. Jurisdiction

LO: 3

AC: 3.2

4
L4M3 Sample Exam Questions Dec 2018
Q9. Which of the following will typically be included with the invitation to tender (ITT)? Select the THREE that apply?

a. Specification

b. Purchase order

c. Terms and conditions

d. Requisition

e. Performance measures

f.Mandate

LO: 1

AC: 1.1

Q10. Under general legal principles of contract formation, which of the following will always automatically result in
the termination of an offer? Select TWO that apply.

a. Acceptance

b. Negotiation

c. Variation

d. Non-disclosure

e. Revocation

LO: 1

AC: 1.2

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L4M3 Sample Exam Questions Dec 2018

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