CCT Procurement & Contract Management Flashcards

Which contract type transfers the most financial risk to the contractor?

Answer: Firm Fixed Price

A Firm Fixed Price contract places maximum financial risk on the contractor since payment does not change regardless of actual costs.

What is the primary purpose of a Request for Proposal (RFP) in the procurement process?

Answer: To solicit detailed proposals from vendors including pricing and methodology

An RFP solicits detailed proposals from potential vendors, covering technical approach, qualifications, and pricing for complex procurements.

In construction cost management, what does the term 'bid bond' refer to?

Answer: A surety bond ensuring the bidder will honor the bid and sign the contract if awarded

A bid bond is a surety instrument guaranteeing that a bidder will enter into the contract at the bid price if selected.

Which procurement method is most appropriate when price is the sole selection criterion and requirements are clearly defined?

Answer: Invitation for Bid (IFB)

An Invitation for Bid (IFB) is used when specifications are clear and the award goes to the lowest responsive, responsible bidder.

What is 'contract claims management' primarily concerned with?

Answer: Processing requests for additional compensation or time beyond the original contract terms

Contract claims management involves evaluating and resolving contractor requests for additional money or schedule time due to changed conditions or disputes.

A cost technician reviewing a subcontract notices the scope of work is ambiguous. What is the most appropriate action?

Answer: Request a contract modification to clarify scope before execution

Ambiguous scope in a contract should be clarified through a formal modification before execution to prevent future disputes and cost overruns.