PCC PCC Contract Management & Procurement 2 — Questions and Answers
Question 1: Which contract type best incentivizes the contractor to control costs while sharing savings with the owner?
- Firm-fixed-price
- Cost-plus-award-fee
- Cost-plus-incentive-fee (Correct answer)
- Time-and-materials
Correct answer: Cost-plus-incentive-fee
Cost-plus-incentive-fee contracts include a formula that shares cost savings or overruns between buyer and seller, aligning their interests.
Question 2: During procurement planning, a make-or-buy analysis helps the project team determine:
- Which vendors offer the lowest prices
- Whether to produce goods internally or purchase them externally (Correct answer)
- The best contract type for a given requirement
- How to evaluate vendor proposals
Correct answer: Whether to produce goods internally or purchase them externally
A make-or-buy analysis weighs the cost and feasibility of in-house production against outsourcing to an external vendor.
Question 3: A contractor submitting a claim for additional compensation due to unforeseen site conditions is exercising rights under which contract provision?
- Force majeure clause
- Differing site conditions clause (Correct answer)
- Liquidated damages clause
- Termination for convenience clause
Correct answer: Differing site conditions clause
A differing site conditions clause entitles the contractor to seek additional compensation when subsurface or concealed conditions differ materially from those indicated in the contract.
Question 4: In the source selection process, which evaluation method uses a weighted scoring matrix to compare vendor proposals?
- Lowest-price technically acceptable (LPTA)
- Best value trade-off (Correct answer)
- Sole-source selection
- Sealed bidding
Correct answer: Best value trade-off
Best value trade-off uses weighted criteria to compare price, technical approach, and past performance, allowing a higher-cost proposal to win if it offers superior value.
Question 5: A project controls specialist tracks contract burn rate. This metric primarily measures:
- How quickly the project is using budgeted contract funds over time (Correct answer)
- The contractor's quality defect rate
- The number of change orders submitted
- Vendor on-time delivery performance
Correct answer: How quickly the project is using budgeted contract funds over time
Contract burn rate tracks the rate at which contracted funds are being spent, helping forecast if the contract budget will be exhausted before completion.
Question 6: Which document establishes the rules, responsibilities, and procedures governing how a contract will be administered throughout its lifecycle?
- Contract management plan (Correct answer)
- Procurement statement of work
- Vendor qualification list
- Performance work statement
Correct answer: Contract management plan
The contract management plan defines roles, processes, reporting requirements, and controls for managing the contract from award through closeout.
PCC PCC Contract Management & Procurement 2
Which contract type best incentivizes the contractor to control costs while sharing savings with the owner?