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Full file at http://testbank360.eu/test-bank-project-management-for-informationtechnology-business-and-certification-1st-edition-kapur

Appendix 1 – Procurement Planning The key reasons for procurement of goods and services from an outside source are all of the following except: Focus internal resources on core business and use the external resources as needed. Increase speed to market by leveraging available expertise without taking the time to develop internal skills. Identify vendors who are willing to take the risk of reduced cost because of downturn in the economy. Identify cost-effective solutions by leveraging the economies of scale that are possible by specifically focused external sources. Answer: C Feedback: Option C is not a good reason to procure goods and services because if this is the decision driver and the economy improves, the vendor may not be a viable option. Regardless, trying to find a vendor in financial trouble is never a good idea. Related to the skills of procurement and contract negotiations, which of the following is generally most true? The vendor personnel are more qualified and experienced in contract negotiations than the buyer personnel. The buyer personnel are more qualified and experienced in contract negotiations than the vendor. The vendor and buyer personnel are equally qualified and experienced in contract negotiations. The buyer personnel are less qualified and experienced in contract negotiations than the vendor personnel. Answer: D Feedback: The vendor personnel negotiate more frequently than do a given buyer personnel, therefore option D is correct. Contracts between a vendor and a buyer can be classified as all of the following except: Fixed price. Cost plus fixed fee. Time and material. Time and sunk cost. Answer: D

PMBookTeacherExamAPP1 Š 2004 Center for Project Management Ž

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Full file at http://testbank360.eu/test-bank-project-management-for-informationtechnology-business-and-certification-1st-edition-kapur Feedback: Option D is a distracter. In the case of a fixed price contract, who carries the risk? Seller. Buyer. Both equally share the risk. The insurance company. Answer: A Feedback: Because the project cost is fixed, and if there are any possibilities of cost overruns, the seller will have to absorb them. In the case of a cost reimbursement contract, who carries the risk? Buyer. Seller. Both equally share the risk. The insurance company. Answer: A Feedback: The buyer carries the higher risk as any additional costs incurred by the seller will need to be reimbursed. The term RFQ as related to contracts stands for: Request for quality Request for quantity Request for quote Request for quitting Answer: C Feedback: RFQ stands for request for quote. The term RFP as related to contracts stands for: Request for PMBOK Request for proposal Request for personnel Request for papers Answer: B Feedback: RFP stands for request for proposal. PMBookTeacherExamAPP1 Š 2004 Center for Project Management Ž

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Full file at http://testbank360.eu/test-bank-project-management-for-informationtechnology-business-and-certification-1st-edition-kapur The term LOA as related to contracts stands for: Letter of authority. Letter of approval. Letter of agreement. Letter of assurance. Answer: C Feedback: LOA stands for letter of agreement. Typically, an LOA is typically signed: Instead of a contract. Before the contract is signed. After the contract is signed. When the contract is signed. Answer: B Feedback: Option B is the correct answer because when a proposed project needs to start at the earliest possible date, but the few finals contract negotiation steps are expected to take considerable time, the final (selected) bidder is asked to start work through a Letter of Agreement (LOA). Which of the following is not true regarding a letter of agreement (LOA)? The LOA needs to be signed by both the buyer and the vendor. It binds both parties until the final contract is signed. The vendor agrees to undertake a defined set of tasks, and the buyer commits to pay for those services. Often the payment arrangement is on a time-and-material basis even when the final contract may use some other payment consideration. A LOA always favors the buyer as the buyer can decide on the terms of the payments to the vendor. Answer: D Feedback: Because the LOA is issued before the contract negotiations are finalized, it carries some risk for both parties. Which type of contract provides the least amount of risk for the buyer? Cost plus incentive fee. Firm fixed price. Fixed price plus incentives. Cost plus fixed fee. PMBookTeacherExamAPP1 Š 2004 Center for Project Management Ž

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Full file at http://testbank360.eu/test-bank-project-management-for-informationtechnology-business-and-certification-1st-edition-kapur Answer: B Feedback: Also known as lump-sum contracts, firm fixed price contracts establish a fixed price for the services and/or products to be delivered. These contracts carry minimum risk for the buyer. The process of ensuring that a vendor performs according to the contractual requirements is known as: Contract review. Contract closeout. Contract administration. Contract performance. Answer: C Feedback: While the work by the approved vendor continues, the specific steps taken to ensue that the work is progressing according to the terms of the contract is known as contract administration. The term constructive change order as it relates to the lifespan of a contract means all of the below except (select all that apply): Any oral order by someone of apparent authority has the same effect as a written and authorized change order. Any written act by someone of apparent authority has the same effect as a written and authorized change order. Any oral order by someone of defined authority has the same effect as a written and authorized change order. Any written act by someone of defined authority has the same effect as a written and authorized change order. Answer: A, B Feedback: It is important to note that during the contract lifespan, oral or written acts by someone of apparent authority have the same effect as a written and authorized change order. The two key words are: oral and apparent. These two simple words can get you in very hot water when disagreements arise between the two parties. Which of the following statements are not true about a service level agreement (SLA)? It supplements a contract. It replaces a contract. Articulates the maximum level of service (operational performance) to be provided by the vendor. PMBookTeacherExamAPP1 Š 2004 Center for Project Management Ž

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Full file at http://testbank360.eu/test-bank-project-management-for-informationtechnology-business-and-certification-1st-edition-kapur Articulates the minimum level of service (operational performance) to be provided by the vendor. Answer: B, C Feedback: A SLA does not replace a contract and typically it articulates the minimum level of service that the vendor would provide (though some people prefer to include the maximum level as well).

PMBookTeacherExamAPP1 Š 2004 Center for Project Management Ž

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Test bank project management for information technology business and certification 1st edition kapur  

test bank project management for information technology business and certification 1st edition kapur. Full file at http://testbank360.e...

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