Project Procurement Management Flashcards
7 cards from real CAPM practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Project Procurement Management flashcards as text
In a Cost Plus Incentive Fee (CPIF) contract, what happens if the seller beats the target cost?
Answer: The seller and buyer share the savings according to a pre-agreed formula
In a CPIF contract, cost savings below the target are shared between buyer and seller according to a pre-set sharing ratio, incentivizing the seller to control costs.
Which tool or technique used in Conduct Procurements allows buyers to gather early information from the market before issuing formal procurement documents?
Answer: Market Research
Market research involves collecting information about industry capabilities, pricing trends, and potential sellers before issuing formal solicitation documents.
What is the purpose of a Bidder Conference in procurement?
Answer: To ensure all prospective sellers have a clear and equal understanding of the procurement requirements
Bidder conferences (also called contractor conferences) ensure all prospective sellers receive the same information and have equal opportunity to clarify requirements.
Which contract type is most appropriate for projects where the scope is well-defined and risks of cost overruns are low?
Answer: Firm Fixed Price (FFP)
FFP contracts work best when scope is well-defined and stable, allowing both parties to agree on a set price with minimal uncertainty.
What is a Teaming Agreement in the context of project procurement?
Answer: A legal agreement between two potential sellers to combine capabilities to bid on a contract
Teaming Agreements are legal agreements that allow two companies to combine their capabilities and bid together on a procurement opportunity.
The Control Procurements process is primarily concerned with:
Answer: Managing procurement relationships, monitoring contract performance, and making changes as needed
Control Procurements manages the ongoing relationship with sellers, monitors their performance against contract terms, and processes changes or corrections as needed.
What does the term 'Privity of Contract' mean in procurement management?
Answer: The direct legal relationship between two contracting parties
Privity of contract is the legal relationship that exists directly between contracting parties; third parties generally cannot enforce or be bound by the contract.