SCMN 3730 LATEST 2026 TEST PAPER QUESTIONS AND
SOLUTIONS SCORED A+
✔✔The _____ clause in a contract ensures that all information, technology, and so on
shared between the parties remains confidential and is not shared with other customers
or suppliers.
a.
assignment and contracting
b.
liability
c.
third-party rights
d.
confidentiality
e.
intellectual property - ✔✔D
✔✔The _____ clause in a contract provides guidelines regarding what type of reporting
statistics and measures the supplier must provide to the buyer on a regular basis,
defined clearly.
a.
statistics
b.
notices
c.
most favored customer
d.
confidentiality
e.
third-party rights - ✔✔A
✔✔The _____ clause in a contract provides specific details on how the supplier's
performance will be measured and if any compensation will be awarded by the supplier
to the buyer if these certain defined levels of performance are not maintained.
a.
key performance indicators and compensation
b.
liability
c.
notices
d.
third-party rights
e.
assignment and contracting - ✔✔A
,✔✔The _____ clause in a contract establishes where bills, invoices, notices, and other
documents should be sent, as well as the key contact person at the buying and
supplying companies to whom all questions and issues concerning the relationship.
a.
severability
b.
notices
c.
governing law
d.
supply and delivery
e.
intellectual property - ✔✔B
✔✔The _____ clause in a contract describes how an issue will be addressed if a portion
of the agreement is void or unenforceable, and which court of law will resolve the
difference.
a.
force majeure
b.
severability
c.
notices
d.
intellectual property
e.
supply and delivery - ✔✔B
✔✔The _____ clause in a contract stipulates that any benefits attributed to a third party
(other than the buyer or supplier) identified in the contract must be enforced.
a.
governing law
b.
severability
c.
most favored customer
d.
assignment and contracting
e.
third-party rights - ✔✔E
✔✔The _____ clause of a contract identifies any free trade issues and benefits, and
how to share the benefits.
a.
assignment and contracting
,b.
free trade areas
c.
key performance indicators and compensation
d.
payment
e.
scope of agreement - ✔✔B
✔✔The _____ clause of a contract stipulates the court of law where any disputes will be
settled.
a.
third-party rights
b.
notices
c.
assignment and contracting
d.
governing law
e.
liability - ✔✔D
✔✔The most basic contractual pricing mechanism is called a/an _____ contract.
a.
fixed price with escalation
b.
cost plus incentive fee
c.
firm fixed price
d.
cost-sharing
e.
fixed price with redetermination - ✔✔C
✔✔In a firm fixed price contract, if market prices for a purchased good or service _____
the stated contract price, the _____ bears the brunt of the financial loss.
a.
rise above....purchaser
b.
rise above....seller
c.
fall below....seller
d.
stay the same....seller
e.
, None of the above. - ✔✔B
✔✔In a firm fixed price contract, if market prices _____ the stated contract price
because of outside factors such as competition, changes in technology, or raw material
prices, the _____ assumes the risk or financial loss.
a.
rise above....purchaser
b.
stay the same....seller
c.
stay the same....purchaser
d.
fall below....purchaser
e.
None of the above. - ✔✔D
✔✔A _____ contract should be used in cases where the parties cannot accurately
predict labor or materials costs and quantities to be used prior to the execution of the
purchase agreement.
a.
fixed-price with escalation
b.
firm fixed price
c.
cost sharing
d.
cost-based
e.
fixed-price with redetermination - ✔✔E
✔✔In the _____ contract, if the supplier can demonstrate actual cost savings through
production efficiencies or substitution of materials, the resulting savings from the initial
price targets are shared between the supplier and the purchaser at a predetermined
rate.
a.
time and materials
b.
cost plus fixed fee
c.
fixed-price with incentives
d.
firm fixed price
e.
fixed-price with escalation - ✔✔C
SOLUTIONS SCORED A+
✔✔The _____ clause in a contract ensures that all information, technology, and so on
shared between the parties remains confidential and is not shared with other customers
or suppliers.
a.
assignment and contracting
b.
liability
c.
third-party rights
d.
confidentiality
e.
intellectual property - ✔✔D
✔✔The _____ clause in a contract provides guidelines regarding what type of reporting
statistics and measures the supplier must provide to the buyer on a regular basis,
defined clearly.
a.
statistics
b.
notices
c.
most favored customer
d.
confidentiality
e.
third-party rights - ✔✔A
✔✔The _____ clause in a contract provides specific details on how the supplier's
performance will be measured and if any compensation will be awarded by the supplier
to the buyer if these certain defined levels of performance are not maintained.
a.
key performance indicators and compensation
b.
liability
c.
notices
d.
third-party rights
e.
assignment and contracting - ✔✔A
,✔✔The _____ clause in a contract establishes where bills, invoices, notices, and other
documents should be sent, as well as the key contact person at the buying and
supplying companies to whom all questions and issues concerning the relationship.
a.
severability
b.
notices
c.
governing law
d.
supply and delivery
e.
intellectual property - ✔✔B
✔✔The _____ clause in a contract describes how an issue will be addressed if a portion
of the agreement is void or unenforceable, and which court of law will resolve the
difference.
a.
force majeure
b.
severability
c.
notices
d.
intellectual property
e.
supply and delivery - ✔✔B
✔✔The _____ clause in a contract stipulates that any benefits attributed to a third party
(other than the buyer or supplier) identified in the contract must be enforced.
a.
governing law
b.
severability
c.
most favored customer
d.
assignment and contracting
e.
third-party rights - ✔✔E
✔✔The _____ clause of a contract identifies any free trade issues and benefits, and
how to share the benefits.
a.
assignment and contracting
,b.
free trade areas
c.
key performance indicators and compensation
d.
payment
e.
scope of agreement - ✔✔B
✔✔The _____ clause of a contract stipulates the court of law where any disputes will be
settled.
a.
third-party rights
b.
notices
c.
assignment and contracting
d.
governing law
e.
liability - ✔✔D
✔✔The most basic contractual pricing mechanism is called a/an _____ contract.
a.
fixed price with escalation
b.
cost plus incentive fee
c.
firm fixed price
d.
cost-sharing
e.
fixed price with redetermination - ✔✔C
✔✔In a firm fixed price contract, if market prices for a purchased good or service _____
the stated contract price, the _____ bears the brunt of the financial loss.
a.
rise above....purchaser
b.
rise above....seller
c.
fall below....seller
d.
stay the same....seller
e.
, None of the above. - ✔✔B
✔✔In a firm fixed price contract, if market prices _____ the stated contract price
because of outside factors such as competition, changes in technology, or raw material
prices, the _____ assumes the risk or financial loss.
a.
rise above....purchaser
b.
stay the same....seller
c.
stay the same....purchaser
d.
fall below....purchaser
e.
None of the above. - ✔✔D
✔✔A _____ contract should be used in cases where the parties cannot accurately
predict labor or materials costs and quantities to be used prior to the execution of the
purchase agreement.
a.
fixed-price with escalation
b.
firm fixed price
c.
cost sharing
d.
cost-based
e.
fixed-price with redetermination - ✔✔E
✔✔In the _____ contract, if the supplier can demonstrate actual cost savings through
production efficiencies or substitution of materials, the resulting savings from the initial
price targets are shared between the supplier and the purchaser at a predetermined
rate.
a.
time and materials
b.
cost plus fixed fee
c.
fixed-price with incentives
d.
firm fixed price
e.
fixed-price with escalation - ✔✔C
