CPSM Diagnostic Practice Exam 1 With 100% Correct
Solutions.
A supply manager completes a category profile and identifies services
provided through multiple suppliers. A market and industry analysis
shows that the service provides are growing their businesses by
acquiring competitors, thus enabling them to provide a greater range of
services. Which of the following techniques will BEST enable the
supply manager to leverage market competition?
(A) Lotting strategy
(B) Market-basket model
(C) Market segmentation
(D) Sole sourcing - ANSWER -(A) Lotting strategy
A supply manager implements a system whereby the potential supplier
names are hidden until final contract awards are made. This example is
BEST described as ensuring
(A) confidential information is protected
(B) diversity initiatives are met
(C) total costs are minimized
(D) collusion will not occur - ANSWER -(A) confidential information is
protected
A supply manager for a privately held manufacturing company is
preparing an RFP for raw materials. None of
the RFP recipients is an incumbent, and the award resulting from the
RFP is expected to be of significant dollar value. The supply manager is
concerned that the lack of publicly available financial information could
,impact willingness of the prospective suppliers to submit proposals.
Which of the following will BEST address the concerns of the
prospective bidders?
(A) Escrow account
(B) Letter of credit
(C) Payment bond
(D) Surety bond - ANSWER -(B) Letter of credit
Which of the following is the LEAST critical element in a best
alternative to a negotiated agreement (BATNA)?
(A) Alternate products
(B) In-house capabilities
(C) Source options
(D) Supplier capabilities - ANSWER -(D) Supplier capabilities
A supply manager is negotiating with a critical supplier. The parties
have relatively equal bargaining power. Which of the following would
MOST likely occur in "win-win" negotiation between these parties?
(A) The supply manager and supplier conclude the negotiation by
splitting the difference between their respective positions.
(B) The supply manager and supplier each find concessions with equal
weight/value to provide a balanced outcome.
(C) The supply manager and supplier decide to share confidential
information.
(D) The supply manager and supplier establish an appropriate settlement
range for the continuation of
,negotiations. - ANSWER -(B) The supply manager and supplier each
find concessions with equal weight/value to provide a balanced
outcome.
An in-depth analysis of a supplier's proposal is useful because it is
important to understand the
(A) SOW throughout the evaluation process
(B) SOW throughout the proposal development process
(C) supplier's proposal throughout the negotiation process
(D) supplier's firm-fixed price - ANSWER -(C) supplier's proposal
throughout the negotiation process
Which of the following is LEAST appropriate as an objective for
negotiations?
(A) Meeting the minimum essential needs of the organization
(B) Maintaining control over contract performance
(C) Determining the negotiation site
(D) Ensuring the correct ratio of contract administrators to workers -
ANSWER -(D) Ensuring the correct ratio of contract administrators to
workers
Which of the following is likely to be the BEST use of social media
sites such as LinkedIn during the preparation for negotiations with a
potential supplier?
(A) Selecting the ideal negotiation sire
(B) Determining objectives for the negotiation
(C) Collecting information, reports and comments on the supplier
, (D) Defining the roles and responsibilities of the negotiating team -
ANSWER -(C) Collecting information, reports and comments on the
supplier.
A supply manager for XYZ Corp. is planning for negotiations with
Supplier A, a provider of software critical for use on XYZ's production
line. XYZ likes the software, but was recently alerted by Supplier A that
they are dropping support for the version that XYZ uses. The supply
manager learns that an upgrade is cost prohibitive for XYZ. Prior to
negotiations, the supply manager asks the IT department to detail its
requirements for support of the software, and to assign an IT employee
to attend the negotiations. The day before the negotiation, the IT
employee calls the supply manager and stares that he
is unable to attend due to a scheduling conflict. He further states that he
is confident the supply manager can represent the IT department's needs
in the negotiations.
Given this scenario, which of the following should the supply manager
do?
(A) Follow the advice of the IT employee and represent IT in the
negotiation - ANSWER -(B) Escalate the issue to the IT director,
ensuring that they send a representative
A supply manager is negotiating a contract with a supplier to purchase
one million components. To determine a pricing arrangement
satisfactory to both parties, which of the following is LEAST
appropriate?
(A) Evaluating the supplier's current cost data
(B) Establishing a cost goal
Solutions.
A supply manager completes a category profile and identifies services
provided through multiple suppliers. A market and industry analysis
shows that the service provides are growing their businesses by
acquiring competitors, thus enabling them to provide a greater range of
services. Which of the following techniques will BEST enable the
supply manager to leverage market competition?
(A) Lotting strategy
(B) Market-basket model
(C) Market segmentation
(D) Sole sourcing - ANSWER -(A) Lotting strategy
A supply manager implements a system whereby the potential supplier
names are hidden until final contract awards are made. This example is
BEST described as ensuring
(A) confidential information is protected
(B) diversity initiatives are met
(C) total costs are minimized
(D) collusion will not occur - ANSWER -(A) confidential information is
protected
A supply manager for a privately held manufacturing company is
preparing an RFP for raw materials. None of
the RFP recipients is an incumbent, and the award resulting from the
RFP is expected to be of significant dollar value. The supply manager is
concerned that the lack of publicly available financial information could
,impact willingness of the prospective suppliers to submit proposals.
Which of the following will BEST address the concerns of the
prospective bidders?
(A) Escrow account
(B) Letter of credit
(C) Payment bond
(D) Surety bond - ANSWER -(B) Letter of credit
Which of the following is the LEAST critical element in a best
alternative to a negotiated agreement (BATNA)?
(A) Alternate products
(B) In-house capabilities
(C) Source options
(D) Supplier capabilities - ANSWER -(D) Supplier capabilities
A supply manager is negotiating with a critical supplier. The parties
have relatively equal bargaining power. Which of the following would
MOST likely occur in "win-win" negotiation between these parties?
(A) The supply manager and supplier conclude the negotiation by
splitting the difference between their respective positions.
(B) The supply manager and supplier each find concessions with equal
weight/value to provide a balanced outcome.
(C) The supply manager and supplier decide to share confidential
information.
(D) The supply manager and supplier establish an appropriate settlement
range for the continuation of
,negotiations. - ANSWER -(B) The supply manager and supplier each
find concessions with equal weight/value to provide a balanced
outcome.
An in-depth analysis of a supplier's proposal is useful because it is
important to understand the
(A) SOW throughout the evaluation process
(B) SOW throughout the proposal development process
(C) supplier's proposal throughout the negotiation process
(D) supplier's firm-fixed price - ANSWER -(C) supplier's proposal
throughout the negotiation process
Which of the following is LEAST appropriate as an objective for
negotiations?
(A) Meeting the minimum essential needs of the organization
(B) Maintaining control over contract performance
(C) Determining the negotiation site
(D) Ensuring the correct ratio of contract administrators to workers -
ANSWER -(D) Ensuring the correct ratio of contract administrators to
workers
Which of the following is likely to be the BEST use of social media
sites such as LinkedIn during the preparation for negotiations with a
potential supplier?
(A) Selecting the ideal negotiation sire
(B) Determining objectives for the negotiation
(C) Collecting information, reports and comments on the supplier
, (D) Defining the roles and responsibilities of the negotiating team -
ANSWER -(C) Collecting information, reports and comments on the
supplier.
A supply manager for XYZ Corp. is planning for negotiations with
Supplier A, a provider of software critical for use on XYZ's production
line. XYZ likes the software, but was recently alerted by Supplier A that
they are dropping support for the version that XYZ uses. The supply
manager learns that an upgrade is cost prohibitive for XYZ. Prior to
negotiations, the supply manager asks the IT department to detail its
requirements for support of the software, and to assign an IT employee
to attend the negotiations. The day before the negotiation, the IT
employee calls the supply manager and stares that he
is unable to attend due to a scheduling conflict. He further states that he
is confident the supply manager can represent the IT department's needs
in the negotiations.
Given this scenario, which of the following should the supply manager
do?
(A) Follow the advice of the IT employee and represent IT in the
negotiation - ANSWER -(B) Escalate the issue to the IT director,
ensuring that they send a representative
A supply manager is negotiating a contract with a supplier to purchase
one million components. To determine a pricing arrangement
satisfactory to both parties, which of the following is LEAST
appropriate?
(A) Evaluating the supplier's current cost data
(B) Establishing a cost goal
