Question 1

Which of the following best describes the main purpose of contract management?

AInforming a member of your company's senior management team if something goes wrong with the supplier's performance of a contract

BAllowing a contract to take its course unless something goes wrong at which point you take action

CRequesting the expeditor to telephone the supplier regularly to obtain constant delivery updates

DEnsuring that a contract is performed to a standard that fully meets the objectives and expectations agreed between buyer and seller.

Answer : B

Question 2

Which one of the following most closely illustrates how the vast majority of disputes between buyers and sellers are resolved?

AMost disputes are resolved by litigation in a court of law

BMost disputes are resolved by amicable negotiation between the parties

CMost disputes are resolved by the appointment of an adjudicator

DMost disputes are resolved by the appointment of an arbitrator.

Answer : C

Question 3

Which of the following is one of the recognised safeguards that might help protect the buyer against problems associated with Cost Reimbursable Pricing?

AThe supplier presenting weekly or monthly reports of expenditure and performance

BThe supplier presenting copies of its balance sheet before the contract is awarded

CThe supplier presenting its profit and loss account for inspection by the buyer

DThe supplier presenting cash flow statements for inspection by the buyer.

Answer : B

Question 4

Which of the following best describes one of the most likely problems of fixed pricing for the buyer?

AMany sellers regard the commercial risks of fixed pricing for long-term contracts as being too great

BSellers might build high margins into the contract to cover unforeseen eventualities, leading to high prices being paid

CSellers need to be able to forecast price movements of labour and materials accurately over the life of the contract

DSellers may take advantage of the buyer if prices fall during the life of the contract.

Answer : D

Question 5

Which of the following best describes litigation as a means of settling disputes between buyer and seller?

AIt is often used in international contracts

BIt is an agreement between both parties resulting from amicable discussion

CIt is an adversarial action under rules established in a country's constitution

DIt is a form of expert determination using a third party.

Answer : B

Free A8 Questions for CIPS A8 Exam as PDF & Practice Test Software

Question 1

Question 2

Question 3

Question 4

Question 5