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L4M3 Commercial Contracting is now Stable and With Pass Result | Test Your Knowledge for Free

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L4M3 Practice Questions

Commercial Contracting

Last Update 3 days ago
Total Questions : 233

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Our free CIPS Level 4 Diploma in Procurement and Supply practice questions crafted to reflect the domains and difficulty of the actual exam. The detailed rationales explain the 'why' behind each answer, reinforcing key concepts about L4M3. Use this test to pinpoint which areas you need to focus your study on.

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Question # 21

Maximum Score: 1

Which of the following would be considered as advantages of an industry model form contract?

    It provides greater flexibility for negotiation

    It reduces the cost of contract development

    It is usually designed to be fair to both parties

    It removes the need for the buyer to understand it

Options:

A.  

1 and 2 only

B.  

2 and 3 only

C.  

1 and 3 only

D.  

2 and 4 only

Discussion 0
Question # 22

Which of the following should be specially noticed in market dialogue with suppliers in specification development?

Options:

A.  

Both parties must respect confidentiality

B.  

The buying organisation must avoid social media at all cost

C.  

Market dialogue is banned in the public sector

D.  

Market dialogue should only be conducted with well-known supplier

Discussion 0
Question # 23

In order to reduce the internal cost of administration from the raising of high-volume, low-value orders such as office stationery, a procurement manager implements the use of call-off orders for such circumstances. Is this an acceptable thing to do?

Options:

A.  

No, the procurement manager fears that they will lose staff and prefers to keep the administration costs high

B.  

No, as the role of the administration staff is to keep a check on the items being ordered and they would lose this ability

C.  

Yes, as the procurement manager will be able to track more easily the volume of small orders and where the spend is occurring

D.  

Yes, the use of a blanket order cuts the staff administration time and paperwork that would be involved in numerous small orders

Discussion 0
Question # 24

The nature of the "Battle of the forms" is when both buyer and supplier are attempting to ...

Options:

A.  

secure their own terms and conditions

B.  

create a collaborative relationship

C.  

create a performance specification

D.  

form a joint contract

Discussion 0
Question # 25

Which of the following are always included within a framework agreement? Select TWO that apply:

Options:

A.  

Exact quantity to be purchased

B.  

Call-off procedure

C.  

Exact price to be paid

D.  

Duration

E.  

Insurance

Discussion 0
Question # 26

Maximum Score 1

When a company has decided to outsource part of its operation, the contract will need to include a number of key contract terms to minimise risk. Which of the following should be included?

    A confidentiality clause designed to protect either party

    A clause stating how long the service is to be outsourced

    A clause stating how long the employees can take for holiday

    A contract variation and price adjustment clause

Options:

A.  

1 and 4 only

B.  

1 and 2 only

C.  

3 and 4 only

D.  

2 and 4 only

Discussion 0
Question # 27

Which of the following is the best definition of consideration in contract law?

Options:

A.  

Full statement about something to provide

B.  

The act of thinking carefully about one thing

C.  

One thing given in exchange

D.  

Formal discussion between people who are trying to reach an agreement

Discussion 0
Question # 28

Sally places a purchase order to the supplier for some components that her company requires. The supplier delivers the goods as she asks, but the quality assurance team finds that these components are defective and unfit for the company's operations. Which document is the ground to decide whether the goods received are fit for purpose?

Options:

A.  

CSR policies

B.  

Pre-qualification questionnaire

C.  

Code of conduct

D.  

Specification

Discussion 0
Question # 29

Which of the following is set down in statute as a liability that exists without any need to prove fault?

Options:

A.  

Strict liability

B.  

Current liability

C.  

Contingent liability

D.  

Non-current liability

Discussion 0
Question # 30

Which of the following are most likely to be substantive elements of the specification of a truck? Select TWO that apply:

Options:

A.  

Guarantee

B.  

Foreword

C.  

Expected lifespan

D.  

Ethics

E.  

Abbreviation

Discussion 0
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