1. A contract is a unilateral document that obligates the seller to provide specified products and services under terms agreeable to the buyer. A. False
2. A description of the procurement item in sufficient detail to allow prospective sellers to determine if they are capable of providing the products, services or results is known as A. the procurement statement of work
3. A project organization can serve as either the buyer or the seller in a project related contract. A. True
4. All of the following accurately describe the features and characteristics of a contract EXCEPT: A. The project organization is always a buyer in a contract arrangement
5. All of the following entities are typically included in the supply chain EXCEPT A. public relations
6. All of the following factors are commonly used to assess potential suppliers pursuant to a source selection decision EXCEPT: A. personal relationships with senior management
7. All of the following items are generally considered when selecting the right type of contract EXCEPT: A. project organization’s accounting system
8. All of the following statements accurately describe supply chain management EXCEPT: A. It is a closed-loop system solely within the project organization’s boundaries
9. All of these are factors that could lead to a decision to buy or outsource rather than make or perform in-house, EXCEPT: A. more control over quality and time
10. Among the disadvantages associated with outsourcing is the gradual loss of special skills for doing some specific activities that have been outsourced. A. True
11. Buying from an outside supplier to meet project needs is a practice that is rarely used, because it invariably proves to be more expensive than obtaining materials and services internally. A. False
12. Contract incentives are often used when the buyer wants to maximize some aspect of performance, such as finishing the project early or providing a higher level of quality. A. True
13. During procurement planning, the project team determines which needs can best be met by acquiring products and services from an outside provider, and which can be accomplished by the team. A. True
14. Effective project partnerships generally require shared responsibilities, shared resources, shared information, shared rights and shared risks between suppliers and customers. A. True
15. Evaluations of prospective suppliers by project teams often involve all of the following approaches EXCEPT: A. prototyping
16. Extensive supplier evaluation approaches such as surveys, facility visits and financial analysis should be applied to first-tier suppliers only. A. False
17. Fixed price contracts provide low risk for the seller, since the buyer will pay a fixed price, regardless of how much the project actually costs the seller. A. False
18. In many cases, the proposal prepared by the vendor becomes a part of the final contract. A. True
19. Information is a key ingredient at each stage of the project supply chain, as well as within each phase of supply chain decision making. A. True
20. Logistics is the work required to move and position inventory throughout a supply chain. A. True
21. Often a project team will start the selection process by establishing a list of potential suppliers. All of the following information sources are frequently used to identify these potential suppliers EXCEPT: A. stakeholder register
22. On complex projects, despite the importance of factors such as technical capability, managerial capability and previous experience; the selection decision is made mostly or entirely on price. A. False
23. One of the important factors that should influence the selection of contract type is the degree of risk for the seller and the buyer that each contract type contains. A. True
24. Outputs of Plan Procurement Management include the procurement management plan and procurement statement of work. A. True
25. Project partnerships can be advantageous to both the client and the vendor, in terms of improved project execution, flexibility, and reduced bid administration. A. True
26. Project partnerships offer all of the following advantages to vendors EXCEPT: A. the buyer gains at the vendor’s expense
27. Project partnerships offer which of the following advantages to both clients and vendors? A. shared motivation
28. Supply chain management focuses exclusively upon the parties directly involved in providing supplies to the project team. A. False
29. Supply chain operations require managerial processes that span across functional areas within individual organizations, and link trading partners and customers across organizational boundaries. A. True
30. Supply chains use a combination of modes of transportation including: air, rail, water, pipeline and truck. A. True
31. The evaluation criteria developed during procurement planning should guide the vendor evaluation and selection. A. True
32. The PMBOK process of documenting project procurement decisions, specifying the approach and identifying potential sellers is known as: A. Plan procurement management.
33. The procurement management plan: A. describes how a project team will acquire goods and services from outside the performing organization.
34. Traditional project procurement was characterized by win / lose adversarial relations between owner and contractor, whereas contemporary project partnering fosters a relationship of trust and collaboration. A. True
35. Which of the following contract types is most appropriate when costs are NOT well known and the buyer absorbs all of the cost risk? A. Cost-Plus-Fixed-Fee (CPFF)
36. Which of the following factors should be considered when a project team evaluates a “make or buy” decision to procure services? A. advantages and disadvantages of outsourcing in terms of time, cost and performance control
37. Which of the following is one of the PMBOK Guide’s four project procurement management processes? A. Conduct procurements
38. Which of the following terms describes a method for transforming contractual arrangements into a cohesive, collaborative project team with a single set of goals and established dispute resolution procedures? A. partnering
39. Which of the following types of contracts involves payment to the seller for the seller’s actual costs plus a fee typically representing the seller’s profit? A. cost-reimbursable contract
40. Which party to a contract absorbs the preponderance of cost risk when a Firm-Fixed-Price (FFP) contract is used? A. the seller
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