CPCM STUDY GUIDE EXAM QUESTIONS
WITH COMPLETE SOLUTIONS
Contractor purchasing system review (CPSR) - Answer-evaluation of the efficiency &
effectiveness with which the prime spends government funds and complies with
government policy when subcontracting.
break even analysis - Answer-determines the point at which total revenues are exactly
equal to the total fixed variable costs
modular contracting - Answer-intended to reduce program risk and to incentive
contractor performance while meeting the government's need for timely access to
rapidly changing technology
liabilities - Answer-the various claims against a firm, including accounts payable, notes
payable, obligations under capital leases, and long-term debts.
substantial performance - Answer-performance that deviates only in minor respects
from contract requirements. cannot be terminated for default
performance based acquisition - Answer-intended to ensure that required outcome
quality levels are achieved and that total payment is related to the degree that outcomes
achieved meet contract standards.
cost estimating relationship (CER) - Answer-secondary comparison used in performing
price analysis. used to adjust comparisons by establishing a common denominator
between different items.
free trade agreement - Answer-treaty between two or more countries that do not impose
tariffs for commerce conducted across their borders.
operating activities - Answer-company's cash flow from net income or loss
constructive change - Answer-verbal or written act or omission by an authorized
government official that has the same affect as a written change order.
four corners doctrine - Answer-theory that the contract itself should include all of the
terms and conditions that the parties wish to be a part of the agreement.
government special tooling - Answer-must be used only for the manufacturing of
specialty items
design specification - Answer-establishes precise measurements, tolerances, materials
in process and finished product tests, quality control, and inspection requirements.
,forward pricing rate agreement (FPRA) - Answer-written agreement to make certain
rates available during a specified period for pricing contracts or mods.
marketing channel - Answer-set of institutions necessary to transfer the title of goods
and services and to move goods from the point of origin to the point of consumption.
simplified acquisition - Answer-less rigorous method for entering into a relatively low
dollar threshold contract. used to reduce admin costs and remove burden on potential
suppliers. Also used to provide socioeconomic favored groups a chance to do business
with a buyer in a less structured way.
basic research - Answer-to study and research on pure science that is meant to
increase our scientific knowledge base. does not seek to solve or treat a problem.
offset agreement - Answer-industrial or commercial compensation practice required by
foreign government's for the purchase of defense articles in government to government
or direct commercial sales. Negotiating resides with the U.S. firm .
color of money - Answer-term used to describe the type of procurement money used for
a particular item.
current liabilities - Answer-likely to be paid within a year and often are due by a specific
date.
configuration - Answer-a collection of an item's descriptive and governing characteristics
that can be expressed in functional and physical terms.
tactical planning - Answer-focuses on short-term goals and involves evaluating
economic and environmental issues such as competition and requirements planning to
meet the strategic plan's goal
government real property - Answer-property used in production, maintenance, research,
development or testing.
latent defect - Answer-defects that existed at the time of acceptance but were not
discoverable by a reasonable inspection
hub and spoke - Answer-distribution model where stock is held at the hub location and
then is sent out to the spoke location when needed. allows for reduced inventory.
observation - Answer-tool used by the buyer's staff to validate information received from
other sources
environmental impact statement (EIS) - Answer-document prepared to describe the
effects for proposed activities on the environment.
, Miller Act - Answer-requires performance and payment bonds for any construction
contract exceeding 150K except that this requirement may be waived for international
performance.
inherently governmental function - Answer-function that is so intimately related to the
public interest that it mandates performance by a government personnel. it requires the
exercise of substantial discretion.
organizing - Answer-allocating resources to meet goals identified during the planning
process
herzberg's theory - Answer-behavioral science theory that addresses situations in which
people feel good and bad about their job.
government r&d - Answer-primary purpose is to advance scientific and technical
knowledge and to apply that knowledge to achieve agency and national goals.
copyright - Answer-royalty free, non-exclusive, and irrevocable license to reproduce,
translate, publish, use, and dispose of written or recorded material and to authorize
others to do so. Good for the life of the person + 70 years.
operational planning - Answer-looks at near term goals and identifies how the
organization will meet its tactical goals.
cooperative purchasing - Answer-process whereby 2 or more communities, countries, or
other governmental jurisdiction voluntarily agree to coordinate their purchases of one or
more commodities to obtain the best unit price through volume buying.
quality control - Answer-process of measuring quality performance, comparing it with
the standard and acting on the difference
GWAC - Answer-contract available to multiple buyers that provides for an indefinite
quantity, within stated limits, of supplies or services during a fixed period. the quantity
must be stated as a number of units of as a dollar value
operating profit - Answer-amount of gross profit earned from the normal operations of
the company. the amount of sales in excess of the total operating expenses.
contingency planning - Answer-proactive management that deals with events
considered unlikely to occur.
eligible offer - Answer-a foreign offer where the combined proposed price of the eligible
products and the domestic end products exceeds 50% of the total proposed price of the
group.
WITH COMPLETE SOLUTIONS
Contractor purchasing system review (CPSR) - Answer-evaluation of the efficiency &
effectiveness with which the prime spends government funds and complies with
government policy when subcontracting.
break even analysis - Answer-determines the point at which total revenues are exactly
equal to the total fixed variable costs
modular contracting - Answer-intended to reduce program risk and to incentive
contractor performance while meeting the government's need for timely access to
rapidly changing technology
liabilities - Answer-the various claims against a firm, including accounts payable, notes
payable, obligations under capital leases, and long-term debts.
substantial performance - Answer-performance that deviates only in minor respects
from contract requirements. cannot be terminated for default
performance based acquisition - Answer-intended to ensure that required outcome
quality levels are achieved and that total payment is related to the degree that outcomes
achieved meet contract standards.
cost estimating relationship (CER) - Answer-secondary comparison used in performing
price analysis. used to adjust comparisons by establishing a common denominator
between different items.
free trade agreement - Answer-treaty between two or more countries that do not impose
tariffs for commerce conducted across their borders.
operating activities - Answer-company's cash flow from net income or loss
constructive change - Answer-verbal or written act or omission by an authorized
government official that has the same affect as a written change order.
four corners doctrine - Answer-theory that the contract itself should include all of the
terms and conditions that the parties wish to be a part of the agreement.
government special tooling - Answer-must be used only for the manufacturing of
specialty items
design specification - Answer-establishes precise measurements, tolerances, materials
in process and finished product tests, quality control, and inspection requirements.
,forward pricing rate agreement (FPRA) - Answer-written agreement to make certain
rates available during a specified period for pricing contracts or mods.
marketing channel - Answer-set of institutions necessary to transfer the title of goods
and services and to move goods from the point of origin to the point of consumption.
simplified acquisition - Answer-less rigorous method for entering into a relatively low
dollar threshold contract. used to reduce admin costs and remove burden on potential
suppliers. Also used to provide socioeconomic favored groups a chance to do business
with a buyer in a less structured way.
basic research - Answer-to study and research on pure science that is meant to
increase our scientific knowledge base. does not seek to solve or treat a problem.
offset agreement - Answer-industrial or commercial compensation practice required by
foreign government's for the purchase of defense articles in government to government
or direct commercial sales. Negotiating resides with the U.S. firm .
color of money - Answer-term used to describe the type of procurement money used for
a particular item.
current liabilities - Answer-likely to be paid within a year and often are due by a specific
date.
configuration - Answer-a collection of an item's descriptive and governing characteristics
that can be expressed in functional and physical terms.
tactical planning - Answer-focuses on short-term goals and involves evaluating
economic and environmental issues such as competition and requirements planning to
meet the strategic plan's goal
government real property - Answer-property used in production, maintenance, research,
development or testing.
latent defect - Answer-defects that existed at the time of acceptance but were not
discoverable by a reasonable inspection
hub and spoke - Answer-distribution model where stock is held at the hub location and
then is sent out to the spoke location when needed. allows for reduced inventory.
observation - Answer-tool used by the buyer's staff to validate information received from
other sources
environmental impact statement (EIS) - Answer-document prepared to describe the
effects for proposed activities on the environment.
, Miller Act - Answer-requires performance and payment bonds for any construction
contract exceeding 150K except that this requirement may be waived for international
performance.
inherently governmental function - Answer-function that is so intimately related to the
public interest that it mandates performance by a government personnel. it requires the
exercise of substantial discretion.
organizing - Answer-allocating resources to meet goals identified during the planning
process
herzberg's theory - Answer-behavioral science theory that addresses situations in which
people feel good and bad about their job.
government r&d - Answer-primary purpose is to advance scientific and technical
knowledge and to apply that knowledge to achieve agency and national goals.
copyright - Answer-royalty free, non-exclusive, and irrevocable license to reproduce,
translate, publish, use, and dispose of written or recorded material and to authorize
others to do so. Good for the life of the person + 70 years.
operational planning - Answer-looks at near term goals and identifies how the
organization will meet its tactical goals.
cooperative purchasing - Answer-process whereby 2 or more communities, countries, or
other governmental jurisdiction voluntarily agree to coordinate their purchases of one or
more commodities to obtain the best unit price through volume buying.
quality control - Answer-process of measuring quality performance, comparing it with
the standard and acting on the difference
GWAC - Answer-contract available to multiple buyers that provides for an indefinite
quantity, within stated limits, of supplies or services during a fixed period. the quantity
must be stated as a number of units of as a dollar value
operating profit - Answer-amount of gross profit earned from the normal operations of
the company. the amount of sales in excess of the total operating expenses.
contingency planning - Answer-proactive management that deals with events
considered unlikely to occur.
eligible offer - Answer-a foreign offer where the combined proposed price of the eligible
products and the domestic end products exceeds 50% of the total proposed price of the
group.
