CAPM Procurement Management 2

Question 1

Which document formally authorizes a seller to begin work on a project?

Accepted Answer

Contract

Answer

A contract is the legally binding document that authorizes the seller to begin performing work for the buyer.

Question 2

In a Fixed-Price-Incentive-Fee (FPIF) contract, the fee is adjusted based on what factor?

Accepted Answer

The relationship between final costs and target costs

Answer

In FPIF contracts, the incentive fee is adjusted by comparing final negotiated costs to the target cost using a predetermined share ratio.

Question 3

What is the purpose of a procurement audit?

Accepted Answer

To review the procurement process for lessons learned

Answer

A procurement audit is a structured review of the procurement process to identify successes and failures for use in future projects.

Question 4

Which of the following is an example of a Time and Material (T&M) contract?

Accepted Answer

The seller is paid $75/hour plus materials at cost

Answer

T&M contracts combine a fixed rate per unit of time with reimbursement for actual material costs, making them hybrids of fixed-price and cost-reimbursable contracts.

Question 5

A project manager receives competing bids from multiple vendors. What process does evaluating these bids belong to?

Accepted Answer

Conduct Procurements

Answer

Conduct Procurements is the process where seller responses are received, sellers are selected, and contracts are awarded.

CAPM Practice Test

CAPM Practice Test

CAPM Procurement Management 2