PCC PCC Contract Management & Procurement 1

Question 1

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

Accepted Answer

Cost-plus-fixed-fee

Answer

Cost-plus contracts reimburse all allowable costs, so the buyer bears the risk if costs exceed estimates.

Question 2

In project controls, a procurement baseline is used primarily to:

Accepted Answer

Track vendor performance against contracted deliverables and costs

Answer

The procurement baseline measures actual vendor cost and schedule performance against what was contractually agreed.

Question 3

What document formally authorizes a seller to begin work on a contract?

Accepted Answer

Notice to Proceed (NTP)

Answer

A Notice to Proceed (NTP) is the official authorization issued to a contractor to begin work under the contract.

Question 4

Which procurement document provides the most detailed technical and administrative requirements for a project?

Accepted Answer

Statement of Work (SOW)

Answer

The Statement of Work (SOW) defines in detail the work to be performed, deliverables, schedule, and technical requirements.

Question 5

A project controller reviewing contract terms notices the contract includes a liquidated damages clause. This clause is intended to:

Accepted Answer

Compensate the owner for losses if the contractor misses key milestones

Answer

Liquidated damages are pre-agreed financial penalties assessed against the contractor for schedule delays that cause owner losses.

(PCC) Project Controls Certification Practice Test