PROJECT PROCUREMENT MANAGEMENT Flashcards
Which of the following is not an output of the Conduct Procurements process?
a. Selected sellers
b. Agreements
c. Resource calendars
d. Source selection criteria
D
The best answer choice is D. Source selection criteria is an output of the Plan Procurement Management process.
Donna is in the process of meeting with the contractors she has selected to provide work for her project. At the same time she is monitoring their contract performance. Which of the following describes this process?
a. Manage stakeholder engagement
b. Conduct procurements
c. Plan procurement management
d. Control procurements
D
The best answer choice is D because control procurements defines the process Donna is conducting.
In contracting, the buyer assumes the most amount of risk with what type of contract?
a. CPFF
b. CPIF
c. FPIF
d. FFP
A
A Cost Plus Fixed Fee contract reimburses the seller for expenses; the fee does not change based on performance.
Which of the following statements best describes contract enforcement?
a. A contract is valid as long as one party agrees to the terms.
b. A contract cannot be called an agreement.
c. A contract legally binds both the seller and the buyer.
d. A contract is valid only if it is presented in writing.
C
A contract is a mutually binding agreement that obligates the seller to provide the specified product, service, or result and obligates the buyer to pay for it.
Which of the following may influence a firm to buy something instead of making it (procurement)?
a. Lack of expertise within the project organization
b. Unreliable suppliers
c. Quantity too small to interest a supplier
d. Control of lead time, transportation, and warehousing costs
A
If the performing organization doesn’t have the correct capacity or expertise, it’s usually easier to go out and hire that capability. Otherwise, it’ll take time for a resource to learn the necessary skills.
Which of the following is a dynamic, structured, interactive process whereby a neutral third party assists disputing parties in resolving conflict through the use of specialized communication and negotiation
techniques?
a. Active Disputes Resolution
b. Litigation
c. Informal resolution
d. Mediation
D
Mediation is a method used to informally settle claims and disputes. An independent party aids in settling the claim or dispute between the parties.
Which of the following processes involves managing procurement relationships, monitoring contract
performance, making changes and corrections as appropriate, and closing out contracts?
a. Plan Procurement Management
b. Conduct Procurements
c. Control Procurements
d. Contract Fulfillment
C
By the PMBOK® Guide definition, the process of Control Procurements involves managing procurement relationships, monitoring contract performance, making changes and corrections as appropriate, and closing out contracts.
A request, demand, or assertion of rights by a seller against a buyer, or vice versa, for consideration,
compensation, or payment under the terms of a legally binding contract, such as for a disputed change, is formally called:
a. A claim
b. A change request
c. A contract amendment
d. A waiver
A
A claim is a request, demand, or assertion of rights by a seller against a buyer, or vice versa, for consideration, compensation, or payment under the terms of a legally binding contract, such as for a disputed change.
You’re closing out a project to repair a road that’s been washed out by a mudslide. You’ve been incentivized with a CPIF contract in order to complete the project cost effectively. The target cost is $200,000, with a 10% target profit. The final cost was $180,000. The incentive split is 80/20. How much is the total contract price?
a. $184,000
b. $116,000
c. $200,000
d. $204,000
D
The final cost is $180,000. The target cost is $200,000 with a 10% target fee, or $20,000. The 20%
share ratio is ($200,000 – $180,000) × 20% = $4,000. Therefore, the final price is $180,000 + $20,000 + $4,000 = $204,000.
From the processes listed below, select the one that would be most likely to involve legal documents.
a. Conduct Procurements
b. Develop Project Charter
c. Perform Integrated Change Control
d. Determine Budget
A
The best answer choice is A because procurement typically involves legal agreements and contracts.
A point on the cost line of the profit-cost curve determined by the contract elements associated with a fixed price plus incentive fee (FPIF) contract above which the seller effectively bears all the costs of a cost overrun is called:
a. The refund point
b. The point of total assumption
c. The point of absorption
d. The fee assumption point
B
The point of total assumption is where the seller starts to return some of the fee.
From the following choices, select the one that is not an input to the Control Procurements process.
a. Approved change requests
b. Work performance information
c. Work performance data
d. Project management plan
B
The best answer choice is B because work performance information is an output of this process.
Charles is a new project manager for an IT company. He has been given a project that requires procurement of circuit boards from an outside vendor. During his time on the project, Charles has been monitoring the vendor’s performance, and the results of the performance monitoring have been very positive. The project is ahead of schedule and under budget. The client is reconsidering the final product and has asked Charles to modify the product to include two more features. Which of the following terms can be used to describe this scenario?
a. Control scope
b. Plan scope management
c. Manage stakeholder engagement
d. Scope creep
D
The best answer choice is D. Charles is involved in the Control Procurements process because he is monitoring and controlling the vendor’s performance and managing the procurement relationship.
Thomas is managing a project for a financial client interested in creating a new website for its online banking services. Because high security is a critical requirement, Thomas engaged a vendor to develop a multilevel security system for the site. When he reviewed the vendor’s performance on the project, Thomas notices a violation of contractual terms, and he feels this violation may compromise the security of the website. Thomas would like to initiate a corrective action in order to make the vendor’s performance align with the security requirements in the procurement statement of work. Which of the following are outputs of Thomas’s effort?
a. Procurement documents and approved change request
b. Change request and seller performance evaluation
c. Approved change request and performance reports
d. Project statement of work and work performance reports
B
The best answer choice is B. When contractual terms are not met, corrective action must be initiated. This typically results in project management plan updates, organizational process assets updates, procurement documentation, and change requests.
Which of the following is documents provides a narrative description of products, services, or results to be delivered by the project?
a. A procurement management plan
b. A Statement of Work (SOW)
c. Contract terms and conditions
d. The scope statement
B
The procurement Statement of Work (SOW) has a narrative description of the work that needs to
be done.
