PMP Procurement Management 2

Question 1

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

Accepted Answer

Cost Plus Percentage of Cost (CPPC)

Answer

Fixed-Price Incentive Fee (FPIF)

Answer

Cost Plus Fixed Fee (CPFF)

Answer

Time and Material (T&M)

Question 2

A seller delivers work that technically meets contract requirements but misses the project's intent. What should the project manager do FIRST?

Accepted Answer

Issue a change order to redefine requirements

Answer

Accept the deliverable and close the contract

Answer

Escalate to senior management immediately

Answer

Review the contract with legal counsel before acting

Question 3

What is the PRIMARY purpose of a bid conference (also called a bidders' conference)?

Accepted Answer

To ensure all prospective sellers have equal understanding of procurement requirements

Answer

To negotiate final contract terms with the preferred vendor

Answer

To evaluate vendor financial stability

Answer

To announce the winner of the procurement award

Question 4

Which document serves as the formal authorization from the buyer to the seller to begin work?

Accepted Answer

Notice to Proceed (NTP)

Answer

Request for Proposal (RFP)

Answer

Letter of Intent

Answer

Statement of Work (SOW)

Question 5

During contract negotiations, the seller insists on a higher price due to material cost increases. The buyer wants to maintain the original price. This is BEST described as:

Accepted Answer

A risk event that was not identified

Answer

A scope change requiring change control

Answer

A contractual dispute requiring mediation

Answer

A claims administration situation

Question 6

A project manager is evaluating make-or-buy decisions. Which factor would MOST favor outsourcing to a vendor?

Accepted Answer

The work requires specialized expertise not available internally

Answer

The work aligns with the organization's core competency

Answer

The organization has excess capacity and resources

Answer

The project timeline allows for internal skill development

Question 7

In a Fixed-Price Incentive Fee contract, what happens if the final cost exceeds the Point of Total Assumption (PTA)?

Accepted Answer

The seller absorbs all additional costs above the PTA

Answer

The buyer absorbs all additional costs above the PTA

Answer

Costs are shared equally between buyer and seller

Answer

The contract is automatically terminated