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191 Cards in this Set
- Front
- Back
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Plan procurements is done during __________ process group.
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Planning
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Conduct Procurements occurs during ________ process group.
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Executing
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Administer procurements occurs during the _________ and _______ process group.
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monitoring and controlling
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Close procurements occurs during the __________ process group.
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Closing
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_________ is a formal process by which many organizations obtain goods and services.
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Procurement
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When a project is planned, the work is analyzed to determine if internal rescources can do everything or if any will be _______ (make or by decision).
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outsourced
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In addition to contracts, ouputs of the procurements management process includes the procurement management plan, procurement Statement of Work (SOW), procurement documents and:
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change requests, additional procurement documentation, and lessons learned.
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The _______ will facilitate creating a plan for how the procurement process will proceed (a procurement management plan) and will create a description of the work to be done by a seller (a procurement statement of work).
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project manager
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The most common procurement documents are:
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- Request for Proposal (RFP)
- Invitation for Bid (IFB) - Request for Quotation (RFQ) |
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The type of procurement document used is connected to the _________ type selected and the form of the procurment management statement of work.
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contract
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Once the _______ is signed, the procurement must be administered.
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contract
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During ______ __, final reports are submitted, lessons leared are documented, and final payment is made.
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procurement closure
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The company or the person who purchases the servces is called the "_____."
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buyer
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The company or person who provides services and good is called the "_______."
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seller
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According to PMBOK the seller is _________ to the project team.
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external
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If it is not in the _______, it can only be done if a formal change order to the contract is issued.
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contract
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All ____ and ______ ________ for the procurement should be specifically stated in the contract.
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product and project management
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Contracts should help diminish project ______.
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risk.
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Contractsare _______ _______, the seller has no choice but to perform as agreed in the contract.
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legally binding
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Changes must be submitted and approved in ______.
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writing.
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In a _____ contracting environment, there is one procurement department, and a procurement manager may handle procurements on many projects.
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centralized
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In a ______ contracting environment, a procurement manager is assigned to one project full-time and reports directly to the project manager.
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decentralized
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The advantages of ________ contracting environment include:
- Because they are part of a department that focuses on procurements, they are thought to result in procurement managers with higher levels of expertese - A procurement department will provide employees with continuous improvement, training, and shared lessons learned. - Standardized company practices allow efficiency and help improve understanding - individuals in the department have a clearly defined career path in the procurement profession. |
centralized
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The advantages of _________ contrating environment are:
- The project manager has easier access to contracting expertise because the procurement manager is a member of the team - the procurement manager has more loyalty to the project. |
decentralized
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Disadvantages of ________ contracting environment include:
- there is no home department for the procurement manager to return to after the project is completed - it is more difficult to maintain a high levelo of contracting expertise in the company, because there is no procurement department with a focus on improving expertise - there may be duplication of expertise and inefficient use of procurement resources in projects across the organization - there may not be a career path as a procurement manager in the company |
decentralized
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The disadvantages of _________ contracting environment are:
- one procurement manager may work on many projects, so this individual must divide his or her attention among many projects - it may be more difficult for the project manager to obtain contracting help when needed. |
centralized
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The four sequential procurement management processes are ____, _________, ______, _____ procurments.
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Plan
Conduct Administer Close |
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Inputs to the procurement management process include Enterprise environmental factors, organizatinal process assets, procurement manager, scope baseline, risk register, any procurement in place already, identification of resources not available within the performing organization, project schedule and ____ _______ for the project
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cost baseline
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_______ analysis of the project should be completed before contracts are signed.
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Risk
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The ______ _____ provides an understanding of the scope of the project.
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scope baseline
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The _______ ____ must manage the interface between multiple sellers and multiple procurements on one project.
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project manager
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The _____ ______ will help determine when the procurements are needed.
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project schedule
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The _______ ________ process answers the questions, "What goods and services do we need to buy for this project, how will we purchase them, and who are potential sellers to use?"
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plan procurements
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The plan procurements process includes:
- performing a make-or-buy decision - creating a procurement management plan - creating a procurement statement of work for each procurement - selecting a contract type for each procurement and... |
- creating the procurement documents
- determining the source selection criteria |
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For the ______ or ______ decision, the cost savings of purchasing a product or service may be outweighed by the cost of managing the procurement.
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Make-or-Buy
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One of the main reasons to buy is to decrease _______ to the projects constraints.
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risk
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It is better to _____ if:
- if you have an idle plant or workforce - you want to retain control - the work involves proprietary information or procedures. |
make
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The _______ ______ needs to determine the scope of work to be done on each procurement.
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project manager
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The work to be done on each procurement is call the "_________ __________ __ ______." It must be as clear, complete, and concise as possible, and must describe all the work and activities the seller is required to complete.
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procurement statement of work
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If you are buying _____, your procurement statement of work will just include your functional and/or performance requirements.
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expertise
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The type of procurement statement of work will depend on:
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the nature of the work and the type of industry.
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A ________ procurement statement of work conveys what the final product should be able to accomplish, rather than how it should be built or what its design characterists should be.
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performance
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A ________ type of procurement statement of work conveys the end purpose or result, rather than specific procedures.
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functional
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A _______ type of procurement statement of work conveys precisely what work is to be done.
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design
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The three broad categories of contracts are fixed price (FP), time and material (T&M) and ___________.
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cost reimbursable (VR)
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A _________ contract is used for acquiring goods or services with well defined specifications or requirements and when there is enough competition to determine a fair and reasonable fixed price before the work begins.
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fixed price
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The ______ ______ is the most common type of contract.
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fixed price
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The ____ has the least cost risk in fixed priced (FP) contracts.
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buyer
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The ______ is most concerned with a fixex price contract.
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seller
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In a ________ ________ _______ _______ contract, profits (or financial incentives) can be adjusted on the seller meeting specified performance criteria.
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fixed price incentive fee
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In a ______ ______ ______ ________ contract, the buyer pays a fixed price (which includes fee) plus an award amount (a bonus) based on performance.
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Fixed Price Award Fee
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In a Fixed Price Award Fee the award paid is judged _____. Therefore, procedures must be in place in advance for giving out the award, and a board must be established to help make the decision fairly.
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subjectively
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If there are any questions about future economic conditions (future prices) for contracts that exist for a multi-year period a buyer may chose a ______ _____ ________ ________ _____ type of contract.
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Fixed Price Economical Price Adjustment (FPEPA).
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A ________ ______ is the simplest type of fixed price contract.
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Purchase Order
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Purchase orders become contracts when they are "_____" by performance.
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accepted
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In the ____ ______ _______ type of contract, the buyer pays on a per-hour or per-item basis.
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Time and Materials
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The Time and Materials type of contract is frequently used for service efforts in which the ________ __ _____ cannot be defined at the time the contract is awarded.
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level of effort
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In a Time and Materials type of contract, to make sure the costs do not become higher than budgeted, the buyer may put a "____ __ _______" clause in the contract and thus limit the total cost they are required to pay.
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"Not to Exceed"
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With a time and material contract, the buyer has ______ amount of cost risk compared with cost reimbursable and fixed price contracts.
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medium
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A ________ _________ contract is used when the exact scope of work is uncertain and, therefore, costs cannot be estimated accurately enough to effectively use a fixed price contract.
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Cost Reimbursable
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A ______ ______ contract requires the seller to have an accounting system that can track costs by project.
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Cost Reimbursable
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A _____ contract is one in which the seller reveives no fee (profit). It is appropriate for work performed by a nonprofit ortganization.
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Cost
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A ___ ____ _____ ______ contract provides for payment to the seller of actual costs plus a negotiated fee that is fixed before work begins.
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Cost Plus Fixed Fee
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In a _____ _______ ______ _____ contract, the buyer pays all costs and a base fee plus an award amount (bonus) based on performance.
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Cost Plus Incentive Fee (CPAF)
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The ______ amount in a Cost Plus Award Fee contract is determined in advance and apportioned out depending on performance.
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award
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The best contract type meets the needs of the ________ ______, results in reasonable seller risk, and provides the seller with the greatest incentive for efficient performance.
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particular procurement
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Think of an _______ as a bonus for the seller.
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incentive
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_______ are designed to motivate the seller's efforts toward things that might not have otherwise been empahsized and to discourage seller inefficiency and waste in the areas in which incentives are designated.
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Incentives
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Each ______ will state when payments are to be made to the seller.
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contract
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The priorities from least most important for the Cost Plus Fixed Fee contract are:
1. ? 2. time 3. performamce |
1. cost
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The priorities for Cost Plus Award Fee (CPAF) are:
1. cost 2. time 3. ? |
3. performance
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The priorities from least to most important for Cost Plus Incentive Fee (CPIF) contract are:
1. ? 2. performance 3. cost |
1. time
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The priorities from least to most important for Time and Materials contracts are:
1. performance 2. time 3. ? |
3. cost
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The priorities from least to most important for Fixed Price Incentive Fee (FPIF) contract are:
1. ? 2. performance 3. cost |
1. time
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The priorities from least to most important for Fixed Price (FP) contract are:
1. cost 2. time 3. ? |
3. performance
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Advantages of ________ _______ contract are:
1. This is less work for the buyer to manage. 2. The seller has a strong incentive to control costs. 3. Companies have experiance with this type of contract. 4. The buyer knows the total price before the work begins. |
Fixed Price
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Advantages of the _______ and _______ contract are:
1. Quick to create 2. Duration is brief 3. Good choice when hiring bodies or people to augment your staff. |
Time and Materials
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Advantages of the _______ _______ contract are:
1. Allows for simpler procurement 2. Less work to define scope than a Fixed Price contract 3. Lower cost than Fixed Price because the seller does not have to add as much for risk. |
Cost Reimbursable.
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Disadvantages of the ______ and _______ contract are:
1. There is profit for the seller in every hour billed. 2. Seller has no incentive to control costs. 3. Appropriate only for small projects. 4. Requires a great deal of day-to-day oversight from the buyer. |
Time and Materials
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Disadvantages of the __________ _______ contract are:
1. If seller under prices work they may try to make up profit on change orders. 2. Seller may try to not complete some of the procurement Statement of Work if they begin to lose money. 3. Requires more work for the buyer to write the procurement Statement of Work. May be more expensive than Cost Reimbursable if the procurement Statement of Work is incomplete and the seller needs to add to the price for the increased work. |
Fixed Price
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The disadvantages of the ________ _______ contract are:
1. Requires auditing the seller's invoice. 2. Requires more work for the buyer to manage. 3. Seller has only a moderate incentive to control costs. 4. Total price is unknown. |
Cost Reimbursable
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If you need work to begin right away, the best type of contract is?
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Time and Materials
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If you want to buy expertise in determining what needs to be done, best contract type is the?
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Cost Reimbursable
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If you are buying a programmer's services to augment your staff, the best type of contract is the?
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Time and Materials
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If you need work done, but you don't have time to audit invoices on this work, the best type of contract is?
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Fixed price
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If you need to rebuild a bridge as soon as possible after a storm, the best type of contract would be?
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Fixed Price Incentive Fee
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If the project requires a high level of expertise to complete, and you want to have the best performance possible in the finished product, you would want to use a?
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Cost Plus Incentive Fee (CPIF) or Cost Plus Award Fee (CPAF) contract
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If you need to hire a contractor to perform research and development, you should use which type of contract?
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Cost Reimbursable
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If the scope of work is complete, but the economy is currently unpredictable, you should use which contract type?
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Fixed Price Economic Price Adjustment (FPEPA) contract
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_______ is the amount of money the seller has left over after costs are paid.
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Profit
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_______ is the amount the seller charges the buyer.
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Price
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______ is how much an item costs the seller to create, develop, or purchase.
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Cost
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________ _______ is a term often used to compare the end result with what was expected.
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Target price
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The _______ _______ is the highest price the seller will pay.
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ceiling price
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Point of total assumpation (TPA) only applies to ________ _________ __________ _________ contracts and refers to the amount above which the seller bears all the loss of a cost overrun.
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fixed price incentive fee (FPIF)
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What is the cost risk to the buyer for a Cost Reimbursable contract?
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high
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What is the cost risk to the buyer for a Time and Materials contract?
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medium
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What is the cost risk to the buyer for a Fixed Price contrat?
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low
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Generally, what is being purchased with Cost Reimbursable or Time and Materials contract?
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services
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Generally, what is being purchased with Fixed Price contract?
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goods
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Describe how the costs to the buyer might be stated in Cost Reimbursable contract?
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variable fixed fee
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Describe how the costs to the buyer might be stated in Time and Materials contract?
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hourly rate
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Describe how the costs to the buyer might be stated in a Fixed Price contract?
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as set currency amount
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How important is a detailed Statement of Work for a Cost Reimbursable contract?
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low
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How important is a detailed procurement Statement of Work in Time and Materials contract?
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low
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How important is a detailed procurement Statement of Work in the Fixed price contract?
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high
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How much auditing of the seller's cost will the buyer need to do for a Cost Reimbursable contract?
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high, all costs must be audited
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How much auditing of the seller's cost will the buyer need to do for a Time and Materials contract?
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none
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How much auditing of the seller's cost will the buyer need to do?
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low, contract costs are already fixed
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A ______ ______ _____ requests a detailed proposal on how the work will be accomplished, who will do it, resumes, company experiance, price, etc.
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Request For Proposal (RFP)
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________ _____ ______ usually just request a total price to do all the work.
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Invitation to Bid (ITB)
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_______ ____ __________ request a price quote per item, hour, meter, or othe unit of measure.
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Request for Quotation
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A Request for Proposal involves a ______ ______ contract and performance or functional Statement of Work
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Cost Reimbursable
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A Invitation for Bid involves a ______ ______ contract and requires a design Statement of Work.
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Fixed Price
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A Request for Quotation is used for ______ and ________ contract and can use any procurement Statement of Work
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Time and Materials
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Well designed _________ documents can have the following effects on the project:
1. Easier comparison of seller's responses 2. More complete responses 3. More accurate pricing 4. Decrease in the number of changes to the project |
procurement
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______ ________ ________ are included in the procurement documents to give the seller understanding of the buyer's needs and to help the seller decide whether to bid or make a proposal on the work.
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Source Selection Criteria
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When the buyer receives the seller's response during the ________ ______ process, source selection criteria become the basis by which the buyer evaluates the bids or proposals.
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Conduct Procurement
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If the buyer is purchasing a commodity like linear meters of wood, the source selection criteria may jos be the ______ _____.
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lowest price
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A ________ _______ is an agreement between the buyer and prospective sellers identifying the information or documents they will hold confidential and control, and who in the organization will gain access to the confidential information.
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Nondisclosure Agreement
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What is the benefit of a Nondisclosure agreement?
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the buyer can talk more openly about their needs without fear that one of the buyer's competitors will gain access to the shared information.
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The PMBOK Guide definition of a teaming agreement is closer to what should really be called a _________ ________ agreement or a retainer contract.
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master services
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When specific work is needed, the buyer and seller work to create the ________ __ ______ and then initiate a project under the existing terms of the master services agreement.
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scope of work
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________ is used to resolve disputes using private third parties to render a decision on the dispute.
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Arbitration
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Why do parties pay for and use arbitration?
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It is quicker and cheaper.
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_______ refers to the circumstances under which one party can assign it's rights or obligations under the contract to another.
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Assignment
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_______ are payments or performance _____ that may protet the buyer from claims of nonpayment by the seller.
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Bonds, bonds
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_______/________ occurs when any obligation of the contract is not met.
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Breach/Default
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The response to a ____ must always be the issuing of a letter formally notifying the other party of the ________.
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breach, breach
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_______ ____ is a situation that can be considered an act of God, such as a fire or freak electrical storm, that is an allowable excuse for either party not meeting contract requirements.
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Force majeure
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A _________ breach is a breach so large it may not be possible to complete the work under the contract.
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material
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_______ is the amount of money, usually 5-10%, withheld from each payment. This money is paid when all the final work is complete.
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Retainage
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____ _ _____ allocates the risk between the parties to a contract in the event goods or services are lost or destroyed during the performance of a contract.
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Risk of loss
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_________ is stopping the work before it is complete.
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Termination
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________ is of the essence means delivery dates are strictly binding. The seller is on notice that time is very important and that any delay is a material breach.
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Time
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_________ are statements saying that rights under the contract may not be waived or modified other than by express agreemeng of the parties.
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Waivers
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A _________ __________ must realize that he or she can intentionally or unintentionally give up a right in the contract through conduct, inadvertent failure to enforce , or lack of __________.
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oversight.
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_______ ___ _____ means the work provided under the contract will be owned by the buyer.
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Work for hire
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___ __ _____ is a letter, without binding, that says the buyer intends to hire the seller.
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Letter of Intent
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_____ simply means a contractual relationship.
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Privy
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There is no reason that you must go through the whole procurement process unless the procurement is for a ________ and t here are laws requiring it or if the performing organization has rules regarding a bidding process for all procurements.
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government
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In ________ _______ noncompetitive procurement you contract directly with your preferred seller without going through procurement process.
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Single Source
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In ______ _______ noncompetitive procurement process there is only one seller. This might be a company that owns a patent.
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Sole Source
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A ________ _______ allows the buyer's evaluation committee to select a seller by weighting the source selection criteria according to the evaluation criteria.
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weighting system
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The _______ ____ generally lead the negotiations.
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procurement manager
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The __________ _______ is the only person with authority to change the contract.
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procurement manager or contract adminstrator
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Procurement are closed when a contract is completed and ...
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when a contract is terminated before the work is completed.
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_______ _____ involves checking to see if all the work was completed correctly and satisfactorily.
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Product verification
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________ ______ is the final settlement of all claims, invoices, and other issues may be handled through negotiation or dispute resolution process.
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Negotiated settlement
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____ ____ is making the final payments and completing cost records.
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Financial Closure
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_______ _____ is a structured review of only the procurement process.
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Procurement audit
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The _________ file could contain:
1. the contract 2. changes 3. submitalls from the seller 4. seller peformance reports 5. financial information 6. inspection results 7. lessons learned |
Procurement
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Once signed, a contract is legally binding unless:
A. One party is unable to perform B. One party is unable to finance its part of the work. C. It is in violation of applicable law. D. It is declared null and void by either party's legal counsel. |
C. It is in violation of applicable law.
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With a clear contract statement of work, a seller completes work as specified, but the buyer is not pleased with the results. The contract is considered to be:
A. Null and void B. Incomplete C. Complete D. Waived |
C. Complete
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All of the following statements concerning procurement documents are incorrect EXCEPT:
A. Well-designed procurement documents can simplify comparison of responses B. Procurement documents must be rigorous with no flexibility to allow consideration of seller suggestions. C. In general, bid documents should not include evaluation criteria. D. Well-designed procurement documents do not include a procurement statement of work. |
A. Well-designed procurement documents can simplify comparison of responses
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A project manager for the seller is told by her management that the project should do whatever possible to be awarded incentive money. The primary objective of incentive clauses in a contract is to:
A. Reduce costs for the buyer. B. Help the seller control costs. C. Synchronize objectives. D. Reduce risk for the seller by shifting risk to the buyer. |
C. Synchronize objectives.
Incentives are meant to bring the objectives of the seller in line with those of the the buyer. That way both are progressing toward the same objective. |
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All the following statements about change control are incorrect Except:
A. A fixed price contract will minimize the need for change control. B. Changes seldom provide real benefits to the project. C. Contracts should include procedures to accomodate changes. D. More detailed specifications eliminate the cause of changes. |
C. Contracts should include procedures to accomodate changes.
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A routine audit of a cost reimbursable (CR) contract determines that overcharges are being made. if the contract does not specify corrective action, the buyer should:
A. Continue to make project payments B. Halt payments until the problem is corrected. C. Void the contract and start legal action to recover overpayments. D. Change the contract to require more frequent audits. |
A. Continue to make project payments
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The primary objective of contract negotiations is to:
A. Get the most from the other side. B. Protect the relationship. C. Get the highest monetary return. D. Define objectives and stick to them. |
B. Protect the relationship.
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A seller is working on a cost reimbursable (CR) contract when the buyer decides he wold like to expand the scope of services and change to a fixed price (FP) contract. All of the following are the seller's options EXCEPT:
A. Completing the original work on a cost reimbursable basis and then negotiating a fixed price for the additional work. B. Completing the original work and rejecting the additional work. C. Negotiating a Fixed price contract that includes all the work. D. Starting over with a new contract. |
D. Starting over with a new contract. The seller does not have the choice to start over. The contract that exists is binding. Both parties could agree to start over, but this is a drastic step.
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Bidder conferences are part of:
A. Plan procurements B. Adminster procurements C. Conduct procurements D. Communications management |
C. Conduct procurements
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All of the following MUST be present to have a contract EXCEPT:
A. Procurment Statement of Work B. Acceptance C. Address of the seller D. Buyer's signatures |
C. Address of the seller
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Which of the following best describes the project manager's role during the procurement process?
A. The project manager has only minor involvement B. The project manager should be the negotiator C. The project manager should supply an understanding of the risks to the project. D. The project manager should tell the contract manager how the contracting process should be handeled? |
C. The project manager should supply an understanding of the risks to the project.
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What is one of the KEY objectives during contract negotiations?
A. Obtain a fair and reasonable price. B. Negotiate a price under the seller's estimate. C. Ensure that all project risks are thoroughly delineated. D. Ensure that an effective communications management plan is established. |
A. Obtain a fair and reasonable price.
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Which of the following activities occurs during the Plan Procurements process?
A. Make-or-buy decisions. B. Answering seller's questions about the bid documents. C. Advertising. D. Proposal evaluation. |
A. Make-or-buy decisions.
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Which of the following is the BEST thing for a project manager to do in the Conduct Procurements process of procurement management?
A. Evaluate risks. B. Select a contract type. C. Update the project schedule D. Answer seller's questions about bid documents. |
D. Answer seller's questions about bid documents. During the Conduct Procurements process, you normally answer questions submitted by the sellers.
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The sponsor is worried about the sellere deriving extra profit on the cost plus fixed fee (CPFF) contract. Each month he requires the project manager to submit CPI calculations and an analysis of the cost to complete. The project manager explains to the sponsor that extra profits should NOT be a worry on this project because:
A. The team is making sure the seller does not cut scope. B. All costs invoiced are being audited. C. There can only be a maximum of 10% increase if there is an unexpected cost overrun. D. The fee is only received by the seller when the project is complete. |
B. All costs invoiced are being audited.
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In a Fixed Price (FP) contract, the fee or profit is:
A. Unknown B. Part of the negotiation involved in paying every invoice. C. Applied as a line item to every invoice. D. Determined with the other party at the end of the project. |
A. Unknown - To the seller, it is known, but this question is from the buyer's perspective. You do not know what profit the seller included in the contract.
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A project performed under a cost reimbursable contract has finally entered the Close Procurements process. What MUST the buyer remember to do?
A. Decrease the risk rating of the project. B. Audit the seller's cost submitals. C. Evaluate the fee he is paying. D. Make sure that the seller is not adding resources. |
B. Audit the seller's cost submitals.
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The sponsor and the project manager are discussing what type of contract the project manager plans to use on the project. The buyer points out that the performing organization spent a lot of money hiring a design team to come up with a the design. The project manager is concerned that the risk for the buyer be as small as possible. An advantage of a fixed price contract for the buyer is:
A. Cost risk is lower. B. Cost risk is higher. C. There is little risk. D. Risks is shared by all parties. |
A. Cost risk is lower.
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As part of the records management system, you are trying to make sure that all records from the procurement are documented and indexed. Which of the following do you NOT have to worry about?
A. Proposal. B. Procurement statement of work. C. Terms and conditions D. Negotiation process |
D. Negotiation process - the negotiations process is not a document.
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You are in the middle of a complex negotiation when the other party says, "We need to finish in one hour because I have to catch my plane." That person is using which of the following negotiation strategies?
A. Good guy, bad guy B. Delay C. Deadline D. Extreme Demands |
C. Deadline - putting a time limit on a negotiation is an example of a deadline
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Which of the following is an advantage of centralized contracting?
A. Increased expertise B. Easier access C. No home D. More loyalty to the project. |
A. Increased expertise
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Which type of contract is the seller MOST concerned about project scope?
A. Fixed Price B. Cost Plus Fixed Fee C. Time and Materials D. Purchase Order |
A. Fixed Price - In a fixed price contract, the seller has t he cost risk and therefore wants to completely understand scope definition.
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Your company has an emergency and needs work done as soon as possible. Under thse circumstances, which of the following would be the MOST helpful to add to the contract?
A. A clear procurement statement of work B. Requirements as to which subcontractors can be used C. Incentives D. A force majeure clause |
C. Incentives
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During what part of the procurement process does procurement negotiation occur?
A. Plan procurements B. Close procurements C. Administer procurements D. Conduct procurements |
D. Conduct procurements
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The project team is arguing about the prospective sellers who have submitted proposals. One team member argues for a certain seller while another team member wants the project awarded to a different seller. What part of the procurement process is the team in?
A. Conduct procurements B. Administer procurements C. Negotiate contract D. Conduct procurements |
D. Conduct procurements - Select sellers are an output of the Conduct Procurements process
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The project team seams to like to argue; they have argued about everything. Luckily the project manager has set in place a reward system and team-building sessions that will help encourage the team to cooperate more. The latest thing they are arguing about is whether they should complete a work package themselves or outsource the work to someone else. What part of the procurement process must they be in?
A. Conduct Procurements B. Plan Procurements C. Administer Procurements D. Claims Administration |
B. Plan Procurements
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The project manager is in the middle of creating a request for proposal (RFP). What part of the procurement process is she in?
A. Conduct procurements B. Plan procurements C. Administer procurements D. Make-or-Buy Analysis |
B. Plan procurements - In the Plan Procurements process, we create the procurements documents. The RFP is one of those documents.
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Your program manager has come to you, the project manager, for help with a bid for her newest project. You want to protect your company from financial risk. You have limited scope definition. What is the BEST type of contract to choose.
A. Fixed Price (FP) B. Cost Plus Percentage of Cost (CPPC) C. Time and Materials (T&M) |
D. Cost Plus Fixed Fee (CPFF) - Of the options given, only the CPFF limits fees for large projects with limited scope definition.
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Negotiations between two parties are becoming complex, so party A makes some notes that both parties sign. However, when the work is being done, party B claims that they are not required to provide an item the both agreed to during negotiations, because it was not included in the subsequent contract. In this case, party B is:
A. Incorrect, because both parties must commply with what they agreed upon. B. Correct, because there was an offer. C. Generally correct, because both parties are only required to perform what is in the contract. D. Generally incorrect, because all agreements must be upheld. |
C. Generally correct, because both parties are only required to perform what is in the contract.
Party B is only required to deliver what is defined in the contract. |
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Your project has just been fast tracked and you are looking to quickly bring in a subcontractor to complete networking. There is no time to issue a request for proposal (RFP), so you choose to use a company you have used many times before for software development. A PRIMARY concern in this situation is:
A. Collusion between subcontractors B. The subcontractor's qualifications C. The subcontractor's evaluation criteria. D. Holding a bidding conference. |
B. The subcontractor's qualifications - Although you have used this contractor before, how can you be sure the company is qualified to do the new work, since it is not exactly like the previous work. this is the risk you are taking.
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The project manager and project sponsor are discussing the project costs and whether it is better to have their own company do part of the project or hire another company to do the work. if they asked for your opinion, you might say it would be better to do the work yourself if:
A. There is a lot of proprietary data. B. You have the expertise but you do not have the available manpower. C. You do not need control over the work D. Your company resources are limited. |
A. There is a lot of proprietary data.
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After much exitement and hard work, the procurement statement of work for the project is completed. Even after gaining agreement that the procurement statement of work is complete, the project manager is still concerned whether it actually addressess all the buyer's needs. The project manager is about to attend the bidder conference. He asks for your advice on what to do during the session. Which of the following is the BEST advice you can give?
A. You do not need to attend this session. The contract manager will hold it. B. Make sure you negotiate project scope. C. Make sure you give all the sellers enough time to ask questions. They may not want to ask questions while their competitors are in the room. D. Let the project sponsor handle the meeting so you can be the good guy in the negotiation session. |
C. Make sure you give all the sellers enough time to ask questions. They may not want to ask questions while their competitors are in the room.
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A seller is awarded a contract to build a pipeline. The contract terms and conditions require that a work plan be issued forthe buyer's approval prior to commencing work, but the seller fails to provide one. Which of the following is the BEST thing for the buyer's project manager to do?
A. File a letter of intent B. Develop the work plan and issue it to the seller to move things along. D. Issue a stop work order to the seller until a work plan is prepared. |
C. Issue a default letter - Any time the seller does not perform according to the contract, the project manager must take action. The preferred choice might be to contact the seller and ask what is going on, but that choice is not available here. Therefore, the best choice is to let him know he is in default.
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Close procurements is different from Close Project or Phase in that Close Procurements:
A. Occurs before project closure B. is the only one to involve the customer C. Includes the return of property D. May be done more than once for each contract |
A. Occurs before project closure
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You have just started administering a contract when management decides to terminate the contract. What should you do FIRST?
A. Go back tothe Plan Procurements process B. Go back to the Conduct Procurements process C. Finish the Admister Procurement process D. Go to the Close procurement process |
D. Go to the Close procurement process
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The project team is arguing about the prospective sellers who have submitted proposals. one team member argues for a certain seller while another team member wants the project to be awarded to a different seller. The BEST thing the project manager should remind the team to focus on in order to make a selection is the"
A. Procurement documents B. Procurement audits C. Evaluation criteria D. Procurement management plan |
C. Evaluation criteria
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The performing organization is trying to decide whether to split the contract department and assign procurement responsibilities to departments directly responsible for the projects. A procurement professional might not want this split to occure because they would lose __________ in a decentralized environment.
A. Standardized company project management practices B. Loyalty to the projects C. Experiance D. Access to others with similar experiance |
D. Access to others with similar experiance
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During project executing, your project team member delivers a project deliverable to the buyer. However, the buyer refuses the deliverable, stating that it does not meet the requirement on page 300 of the technical specifications. You review the document and find that you agree. What is the BEST thing to do?
A. Explain that the contract is wrong and should be changed. B. Issue a change order C. Review the requiremetns and meet with the responsible team members to review the WBS dictionary. D. Call a meeting of the team to review the requirements on page 300. |
C. Review the requiremetns and meet with the responsible team members to review the WBS dictionary.
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What type of of contract do you NOT want to use if you do not have enough labor to audit invoices?
A. Cost plus fixed fee (CPFF) B. Time and Materials (T&M) C. Fixed Price (FP) D. Fixed Price Incentive Fee (FPIF |
A. Cost plus fixed fee (CPFF) - requires auditing all invoices.
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