Project Procurement Management Flashcards

Which document formally authorizes a project and identifies the project manager?

Answer: Project Charter

The Project Charter formally authorizes the project and grants the project manager authority to apply resources.

What is the primary purpose of a Procurement Statement of Work (SOW)?

Answer: To describe the work to be done and deliverables expected from a seller

A Procurement SOW defines the portion of project scope to be delivered by a seller, providing enough detail for prospective sellers to determine if they can provide it.

Which contract type places the most financial risk on the buyer?

Answer: Cost Plus Percentage of Cost (CPPC)

In a Cost Plus Percentage of Cost contract, the seller's profit increases as costs increase, giving the seller no incentive to control costs and placing maximum risk on the buyer.

What is a Firm Fixed Price (FFP) contract?

Answer: A contract where the seller is paid a set price regardless of costs incurred

An FFP contract sets a fixed price that does not change regardless of the seller's actual costs, placing cost risk on the seller.

Which process involves obtaining seller responses, selecting a seller, and awarding a contract?

Answer: Conduct Procurements

Conduct Procurements is the process of obtaining seller responses, selecting a seller, and awarding a contract.

What document does a buyer send to potential sellers when the work can be quantified precisely and sellers compete primarily on price?

Answer: Request for Quotation (RFQ)

A Request for Quotation (RFQ) is used when price is the primary selection factor and the work is well-defined and quantifiable.

What is the primary output of the Plan Procurement Management process?

Answer: Procurement Management Plan

The Procurement Management Plan is the primary output of Plan Procurement Management, documenting how procurement will be conducted throughout the project.