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

CPPC gives the seller no incentive to control costs since their fee increases as costs rise, placing maximum risk on the buyer.

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

A change order formalizes the adjustment to scope or requirements to align the deliverable with intent while keeping the contract valid.

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

Bidders' conferences give all prospective sellers the same information simultaneously to ensure fair and equal understanding of requirements.

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

A Notice to Proceed (NTP) is the formal authorization that instructs the seller to begin work on the contract.

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

Unidentified material cost increases represent a risk event that was not adequately identified and planned for in risk management.

PMP - Project Management Professional Practice Test

PMP - Project Management Professional Practice Test

PMP Procurement Management 2