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Free Access CIPS L4M3 New Release

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Total 190 questions

Commercial Contracting Questions and Answers

Question 21

Which of the following indicates the ratio between profit and costs?

Options:

A.

Gearing

B.

Margin

C.

Mark-up

D.

Liquidity

Question 22

XYZ Ltd is negotiating a long-term supply contract of important parts with a supplier. Dave, procurement manager teams up with Alla, legal manager to construct a service level agreement. Dave is concerned that poor performance of supplier may cause damages to the operations of the organisation. Which of the following can be used in conjunction with SLA to compensate the buying organisation in case of supplier's poor performance?

1. Warranties

2. Force majeure clauses

3. Penalty clauses

4. Service credits

Options:

A.

1 and 3 only

B.

3 and 4 only

C.

1 and 2 only

D.

4 and 2 only

Question 23

Under hire purchase agreement, when will the ownership of asset legally belong to the purchaser?

Options:

A.

When the final instalment is paid

B.

When the purchaser takes possession of the asset

C.

When the down payment is made

D.

When the agreement is signed

Question 24

A senior buyer is preparing specification for the next purchase. He intends to embed social and environmental criteria that align with his organisation's overarching strategy. Which of the following provides the social and environmental objectives that an organisation pursues?

Options:

A.

Economic performance

B.

Procurement Systems and Technology

C.

Economy of scale

D.

Organisation’s CSR policies

Page: 6 / 7
Total 190 questions