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CON 290 Quiz Question Pool – Week 1 (Instructor Solution – Quiz A)

CON 290 Quiz Question Pool – Week 1 (Instructor Solution – Quiz A) For use with printed tests: The print test version (A or B) of each printed test is identified in the upper left corner of the test. This is the solution for test version A. 1. Lesson 2: Acquisition Planning – Print Versions A & B TLO 3: For a given fact pattern, determine whether to contract without providing for full and open competition. ELO 3-3: Identify FAR Subpart 6.3 exceptions to full & open competition. Question: You are preparing to issue a competitive RFP for a development contract. Your customer has heard that two large contractors plan to form a joint venture to respond to the solicitation. Due to past issues with a joint venture, he has directed you to exclude joint ventures from submitting proposals. Does the FAR allow you to exclude joint ventures? a. Yes; the customer is authorized to direct restricted competition as long as it is in the Government’s best interest. b. No; FAR Part 6 does not provide any exclusion or exception that authorizes such action. c. No, unless excluding joint ventures would ensure lower prices. d. Yes, if your supervisor, the Small Business Administration, and the designated competition advocate approve the action. 2. Lesson 2: Acquisition Planning – Print Version A TLO 3: For a given fact pattern, determine whether to contract without providing for full and open competition. ELO 3-3: Identify FAR Subpart 6.3 exceptions to full & open competition. Question: Your customer has an urgent requirement that can only be filled by two potential sources. The requirements are met for using the exceptions at FAR 6.302-1, “Only one responsible source” and FAR 6.302-2 “Unusual and compelling urgency.” According to FAR Subpart 6.3, which exception must you apply? a. FAR 6.302-2 b. FAR 6.302-1, and you must solicit from only one source c. FAR 6.302-1, and you must solicit from both sources d. You may use either exception because FAR Subpart 6.3 gives no preference 3. Lesson 2: Acquisition Planning – Print Versions A & B TLO 5: Given an agency requirement, determine whether an undefinitized contract action (UCA) should be used to mitigate contract schedule risk. ELO 5-2: Identify the contract risks associated with using a UCA and the DFARS limitation imposed to mitigate each risk. Week 1 Quiz Question Pool January 2012 1Question: You are negotiating with Galaxia, Inc, to definitize a letter contract. Galaxia has already completed 50% of the contract work. According to the DFARS, what impact will this have on establishing your negotiation position for profit? a. None. To ensure objectivity, profit negotiations should be completely independent of any facts pertaining to the letter contract. b. You should consider Galaxia’s reduced contract risk in developing your negotiation position on profit. c. You should consider negotiating a higher profit to reward Galaxia’s outstanding performance in accomplishing 50% of the contract work prior to definitization. d. None. You should strictly apply the weighted guidelines. 4. Lesson 2: Acquisition Planning – Print Version A TLO 7: Given an agency requirement and supporting market research data, select a contract type & incentive structure that motivates contractor performance while mitigating contract risks. ELO 7-3: Recognize when and how the three types of contract incentives (cost, schedule and performance) are used to motivate contractor performance. Question: You are negotiating a firm-fixed price (FFP) contract with Grabball Corporation for a low-rate initial productioncontract. You are at an impasse on delivery schedule. Grabball suggests breaking the impasse by adding a delivery incentive to the contract. May you agree to this approach? a. Yes, but it becomes a fixed-price-incentive-firm (FPIF) contract in that case. b. Yes, as long as the incentive is based solely on factors other than cost. c. No, incentives may only be added to incentive-type contracts. d. No, unless Grabball agrees to change the contract type to a something other than FFP. 5. Lesson 2: Acquisition Planning – Print Versions A & B TLO 7: Given an agency requirement and supporting market research data, select a contract type & incentive structure that motivates contractor performance while mitigating contract risks. ELO 7-4: Determine which contract types will mitigate identified contract risks, including cost, schedule and performance risk. Question: Your customer has an urgent requirement for a sensor that will detect the presence of mephitite, a highly toxic substance being used by terrorists to fashion new chemical weapons. According to market research, there is no existing sensor that meets this requirement. A new sensor could be developed, but such a novel development project will most likely take from 18 months to 2 years after contract award (ARO) to accomplish. Your customer needs the sensor as soon as possible, preferably within 12 months ARO. What contract structure should you include in your solicitation to most effectively meet your customer’s requirements? Week 1 Quiz Question Pool January 2012 2a. Time-and-materials with a delivery date of 12 months ARO b. Fixed-price-award-fee with a delivery date of 2 years ARO c. Cost-plus-incentive-fee with a delivery date of 18 months ARO with delivery incentives for earlier delivery d. Firm-fixed-price with a delivery date of 12 months ARO 6. Lesson 3: Solicitation Review (Reference: FAR 16.301-1, FAR 16.302, FAR 31.201-2) – Print Version A TLO 10: Identify the major elements and components of a given solicitation. ELO 10-2: Recognize the properties of a CPFF completion contract type, including statutory fee limitations. Question: Under a CPFF contract, the final amount that will be paid is: a. Actual cost incurred plus profit b. Allowable cost incurred plus a fixed fee c. Your negotiated cost plus fixed fee d. Total allowable cost plus the negotiated fee percentage 7. Lesson 3: Solicitation Review (Reference FAR 16.302, FAR 15.404-4(c)(4)(i)(C)) – Print Version A TLO 10: Identify the major elements and components of a given solicitation. ELO 10-2: Recognize the properties of a CPFF completion contract type, including statutory fee limitations. Question: What is the statutory limitation on the amount of fee that a contracting officer can negotiate for a CPFF contract to deliver a production lot of SSR transponders? a. 10% b. 6% c. 15% d. There is no statutory limitation on profit. 8. Lesson 3: Solicitation Review (Reference: FAR 52.245- 1(e)(3)) – Print Versions A & B TLO 10: Identify the major elements and components of a given solicitation. ELO10-4: Identify conditions under which the Government acquires title to property acquired under a Government contract. Question: Under a cost reimbursement contract, if the contractor proposes six pieces of specialized equipment that would need to be purchased in order to complete a particular Government project, what happens if the Government agrees to the contractors’ strategy to purchase these items as a direct charge to the contract? Week 1 Quiz Question Pool January 2012 3a. The contractor would assume ownership of these items since they physically made the purchase for them and have privity with the equipment vendors. b. The contractor assumes ownership since they actually purchased the equipment. c. The equipment could be sold for fair market value and the Government and contractor would split the proceeds and share them equally. d. The Government would acquire title since appropriated funds assigned to this contract were expended to pay for them. 9. Lesson 3 : Solicitation Review – Print Versions A & B TLO 10: Identify the major elements and components of a given solicitation. ELO 10-2: Recognize the properties of a CPFF completion contract type, including statutory fee limitations. Question: You are administering a cost-plus-fixed-fee (CPFF) completion contract with Cooper Corporation to develop a new sensor. The fixed fee in the contract is $100,000, which was based upon 10% of the $1 million estimated cost. At the end of the contract, Cooper has delivered the new sensor in accordance with the contract requirements. Cooper has incurred $1,050,000 of cost. How much fee has Cooper earned? a. $105,000, if all costs are allowable. b. $100,000, if Cooper justifies the cost overrun. c. $95,000, to reflect fee adjustment for the cost overrun. d. $100,000, because Cooper delivered the new sensor in accordance with the contract requirements. 10. Lesson 3: Solicitation Review – Print Version A TLO 10: Identify the major elements and components of a given solicitation. ELO 10-3: Recognize when certified cost and pricing data is required. Question: You have just received a proposal from Dodds, Inc. that fails to provide certified cost or pricing data although your solicitation required it. When questioned, Dodds argued that it should not be required to provide certified cost or pricing data. Should certified cost or pricing data have been required? a. Yes, if the acquisition is under the simplified acquisition threshold. b. Yes, if the contract prices were set by law. c. No, if there was adequate price competition. d. No, if Dodds is a small business. 11. Lesson 3 : Solicitation Review – Print Versions A & B TLO 10: Identify the major elements and components of a given solicitation. ELO10-5: Identify the Gov't responsibilities when providing government-furnished property (GFP). Week 1 Quiz Question Pool January 2012 4Question: You are in the process of negotiating a CPFF completion type contract for a new gun turret. You intend to provide Government-furnished property (GFP) for some of the required test equipment. The contractor objects, stating that reliance on GFP could affect its ability to deliver a working turret within the contract schedule. How should you respond? a. Negotiate either a higher fixed fee to compensate the contractor for its increased risk or an extended contract schedule to mitigate potential GFP issues. b. Point out that the contractor will get its full fixed fee as long as it delivers the hours required by the contract and exerts its best effort. c. Point out that FAR 52.245-1, “Government Property” allows the contractor to request equitable adjustment for cost or schedule impacts caused by Government provision of GFP. d. Direct the contractor to purchase the test equipment out of its profit rather than provide the equipment as GFP. 12. Lesson 3 : Solicitation Review – Print Versions A & B TLO 10: Identify the major elements and components of a given solicitation. ELO 10-7: Recognize a potential organizational conflict of interest. Question: You are preparing to issue a competitive RFP for a contract to produce a new sensor using a design recently developed under Government contract by Big Country Sensors (BCS). A potential contractor objects that BCS must be excluded from the competition in accordance with FAR Subpart 9.5 because it developed the design. How should you respond? a. Exclude BCS because, as the development contractor, they have an unfair competitive advantage. b. Permit BCS to participate because, even though they have a competitive advantage, it is an unavoidable one that is not considered unfair. c. Permit BCS to participate because FAR Part 6 requires full and open competition in all Federal procurements.. d. Exclude BCS in order to avoid a future protest. 13. Lesson 4: Data Rights – Print Version A TLO 11: Given a fact pattern, select the appropriate DFARS data rights license. ELO 11-2: Identify the four DFARS data rights licenses and their properties. Question: You are preparing to negotiate a contract with Cannaday Continental Corporation (3C) to produce a new sensor for the Protectorate program office. The sensor will include a proprietary battery pack developed entirely by 3C but you need to negotiate greater rights than those to which the Government would be entitled under the “follow the funds” rule. What data rights license will give the Government the greatest level of data rights? a. Government Purpose Rights b. Unlimited Rights Week 1 Quiz Question Pool January 2012 5c. Specifically Negotiated License Rights d. Limited Rights 14. Lesson 5: Pricing Refresher (Reference: FAR 15.402) – Print Version A TLO 12: For a given scenario, use cost analysis to evaluate the reasonableness of a contractor's proposal. ELO 12-1: Recognize the Government policy on pricing. Question: Which of the following would best describe the Government’s policy on pricing? a. To purchase supplies and services from responsible sources at fair and reasonable prices. b. To ensure we provide opportunities to streamline and expedite the acquisition. c. To make best value decisions when acquiring supplies and services. d. To perform cost analysis on each proposal to affirm fair pricing. 15. Lesson 5: Pricing Refresher – Print Version A TLO 12: For a given scenario, use cost analysis to evaluate the reasonableness of a contractor's proposal. ELO 12-5: For a given pool and base, calculate an overhead rate. Question: You are analyzing a proposal from Durrett Designs for a cost-plus-incentive-fee (CPIF) contract. For its manufacturing overhead (Mfg) rate, Durrett has proposed a base of $70 million. For the pool, your regression analysis resulted in the following values: $170 million, $185 million, and $200 million. Select the estimated pool value that will result in the lowest Mfg rate. a. $170 million b. $185 million c. $200 million d. More information is needed to determine the answer. 16. Lesson 5: Pricing Refresher – Print Versions A & B TLO 12: For a given scenario, use cost analysis to evaluate the reasonableness of a contractor's proposal. ELO 12-6: Use regression analysis to evaluate a contractor's proposed indirect rates. Question: If the independent variable used to predict Nanotech’s G&A rate was $6,278,947; the prediction interval for the dependent variable would be as a follows: Low Estimate High $4,119,792 $4,376,905 $4,636,018 Week 1 Quiz Question Pool January 2012 6Given this information, what would be the Government’s pessimistic, or less desirable, position for this indirect rate? a. 65.61% b. 69.71% c. 73.83% d. 88.92% 17. Lesson 5: Pricing Refresher (Reference: DFARS 215.404-71-2) – Print Version A TLO 12: For a given scenario, use cost analysis to evaluate the reasonableness of a contractor's proposal. ELO 12-7: Use DFARS weighted guidelines to evaluate contractor proposed profit. Question: Given the criteria in the DFARS and the Nanotech R&D Case, when using the weighted guidelines (WGL) to develop your profit/fee objective, which of the following is best justified? a. The technology incentive b. A contract type risk factor of 4.0% c. The working capital adjustment d. The cost efficiency factor 18. Lesson 5: Pricing Refresher – Print Versions A & B TLO 12: For a given scenario, use cost analysis to evaluate the reasonableness of a contractor's proposal. ELO 12-8: Evaluate a contractor's proposed cost of money. Question: Recall the Nanotech proposal of record as follows: Material 559,200 Labor 565,760 ODC (includes 3.9% misc ODC) 1,912,704 Subtotal 3,037,664 G&A 73.5% 2,232,683 Subtotal Cost 5,270,347 Fee 20.0% 1,054,069 FCCOM 15,674 Total 6,340,090 Week 1 Quiz Question Pool January 2012 7The allocation base the contractor should have used to calculate the Facilities Capital Cost of Money (FCCOM) amount for G&A was: a. $1,054,070 b. $2,232,683 c. $3,037,664 d. $5,270,348 19. Lesson 6: Negotiation Overview – Print Version A TLO 13: Identify basic negotiation techniques recommended for negotiating Government contracts. ELO 13-3: Recognize the basic negotiation techniques recommended by Stanford University’s “Sluggers Come Home” negotiation video. Question: You are negotiating the cost of materials with the Contractor’s representative. During the course of the negotiations, you raise concerns and offer valid data supporting your concerns that the Contractor’s proposed costs are unrealistically low. Even so, the Contractor continues to argue their position, ignore your negotiation points, and avoids discussing your different and convergent interests. The Contractor is engaging in what type of negotiation strategy? a. Interest Based Negotiations b. BATNA c. Position Based Negotiations d. Win-win 20. Lesson 7: R&D Case (Reference: DFARS 215.404-71-2) – Print Versions A & B TLO 14: For a given contractor CPFF completion proposal and related Government audit and technical evaluation documentation, establish a Government pre-negotiation objective and document in a pre-negotiation memorandum (pre-PNM). ELO 14-2: For each given cost element, perform cost analysis on the contractor's proposed costs. Question: Recall the Nanotech proposal of record as follows: Material 559,200 Labor 565,760 ODC (includes 3.9% misc ODC) 1,912,704 Subtotal 3,037,664 G&A 73.5% 2,232,683 Subtotal Cost 5,270,347 Fee 20.0% 1,054,069 FCCOM 15,674 Total 6,340,090 Week 1 Quiz Question Pool January 2012 8Nanotech’s proposal included a 3.9% Miscellaneous ODC factor applied to all ODC costs. The PDI license fee of $1,000,000 was also included as an ODC. If the Government negotiates a license with PDI directly and provides the sensor technical data package as GFP to NanoTech, by how much would NanoTech’s total proposal decrease? (NOTE: Since you do not have the tools to recalculate FCCOM, keep FCCOM at $15,674 for your calculation.) a. $1,000,000 b. $1,802,665 c. $1,039,000 d. $2,163,198 Instructor solution: Before After Material 559,200 559,200 Labor 565,760 565,760 ODC (includes 3.9% misc ODC factor) 1,912,704 873,704 < Delete $1,039,000* Subtotal 3,037,664 1,998,664 G&A 73.5% 2,232,683 1,469,018 Subtotal Cost 5,270,347 3,467,682 Fee 20.0% 1,054,069 693,536 FCCOM 15,674 15,674 Total 6,340,090 4,176,892 < Delta is 2,163,198 *$1,000,000 license fee plus 3.9% misc ODC factor 21. Lesson 7 : R&D Case Study (FAR 52.215-23)– Print Versions A & B TLO 14: For a given contractor CPFF completion proposal and related Government audit and technical evaluation documentation, establish a Government pre-negotiation objective and document in a pre-negotiation memorandum (pre-PNM). ELO 14-5: Evaluate whether excessive pass-through exists. Question: You are analyzing a proposal from SensorSmart, Inc. for a cost-plus-incentive-fee (CPIF) R&D contract to develop a new sensor. The $5 million dollar proposal includes $1 million dollars in subcontract costs for the lease of a special test facility. Should you allow SensorSmart to add G&A and profit to the $1 million of subcontract costs? a. No, if SensorSmart cannot demonstrate “added value.” b. Yes, if SensorSmart will not agree to remove the added G&A and profit from its proposal. c. No, G&A and profit rates should be negotiated and applied on an item-by-item basis to avoid overpayment by the Government. Using this method, lower rates should be applied to all high-dollar line items. Week 1 Quiz Question Pool January 2012 9d. Yes, if the G&A rate is deemed excessive. 22. Lesson 8 : Fact Finding – Print Version A TLO15: For a given negotiation, conduct fact-finding necessary to prepare for the negotiation scenario. ELO 15-2: Develop appropriate fact-finding questions. Question: In preparation for negotiations with John Bryans Unlimited (JBU) for a contract to develop a new sensor, you are conducting a fact-finding session. During the session, JBU asks, “Due to the complexity of the development effort, JBU believes a longer contract schedule is warranted. Does the Government agree?” Is this an appropriate fact-finding question? a. No, because only the Government can ask questions during fact-finding. b. Yes, because this gives you the opportunity to go ahead and negotiate lower profit as consideration for a longer schedule. c. Yes, because changing the schedule will enable you to get the contract awarded more quickly. You should go ahead and start negotiations since JBU appears ready. d. No, because it is asking you to negotiate and the parties are not prepared to negotiate during fact-finding. 23. Lesson 10: Production Contract Review – Print Version A TLO 19: Calculate the point of total assumption (PTA) for a given fixed-price incentive firm (FPIF) contract. ELO 19-1: Recognize the characteristics of an FPIF contract type. Question: The underrun share ratio specified in the FPIF production contract awarded to Proto Design Inc. is listed as “60/40”? What does this mean? a When the contractor reaches 60% of target cost, it will reach PTA. b. When the contractor reaches 60% of target cost, it will receive a 40% performance bonus. c. The contractor keeps 60% of all cost underruns. d. The Government keeps 60% of all cost underruns. 24. Lesson 10: Production Contract Review – Print Versions A & B TLO 20: For a given fact scenario, determine whether a contractor's request for performancebased payments should be made. ELO 20-1: Identify the types of financing available for use in Federal contracts and their characteristics. Question: You are preparing an RFP for a CPIF contract and are considering offering contract financing in the form of either performance-based payments or progress payments based on cost. Which form of financing may you offer? Week 1 Quiz Question Pool January 2012 10a. Either form may be offered, regardless of contract type, but performance-based payments are preferred. b. Performance-based payments must always be offered over progress payments. c. Neither form may be offered, if this will be a cost-reimbursement contract type. d. Contract financing may not be offered in the solicitation. If the selected contractor specifically requests financing, performance-based payments may be offered. 25. Lesson 10: Production Contract Review – Print Versions A & B TLO 20: For a given fact scenario, determine whether a contractor's request for performancebased payments should be made. ELO 20-3: For a given fact scenario, determine whether a contractor's request for performancebased payments should be made based on FAR conditions for approving performance-based payments. Question : You are administering a contract with Sensoria for low-rate initial production of a new sensor. The contract includes a provision for performance-based payments, with three cumulative and two severable events. The contractor has submitted a request for payment for Events 2 and 3. Event 3 is cumulative to Event. 2. Sensoria has completed 95% of the event criteria for Event 2 and 100% of the event criteria for Event 3. May you approve the payment request? a. No for both events. b. No for Event 2 but yes for Event 3. c. Yes for both events, if Sensoria promises in writing to complete Event 1 prior to the due date for Event 4. d. Yes for both events, but only Sensoria is a small business. Week 1 Quiz Question Pool January 2012 11

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