FAR 2026/2027 Exam Prep: 120 Multiple-
Choice Questions & Answers | FAR Parts
1-53, Contract Types, SAP, Ethics &
DFARS PGI
Description:
Master FAR 2026/2027 with 120 exam-style Q&As. Covers contract types, SAP, ethics,
protests & DFARS.
Download the complete 2026/2027 FAR exam blueprint today—master your contracting career
before your next test.
, FAR Exam Prep 2026: 120 Practice Questions
Section 1: Acquisition Planning & Market Research (Questions 1-3)
1. During which phase of the acquisition lifecycle is market research formally conducted?
A. Only during the solicitation phase
B. Only during the post-award phase
C. All phases of the acquisition
D. Only during the pre-solicitation phase
Answer: C
Explanation: Market research is not a one-time event. It is a continuous process applied
throughout all phases of an acquisition—from initial planning and requirements development
through solicitation, evaluation, and even post-award to identify improved practices or emerging
technologies.
2. A program manager is developing a new requirement that has not been purchased by the
agency in over five years. Which part of the Federal Acquisition Regulation (FAR) provides the
foundational policies and procedures for conducting market research?
A. FAR Part 7
B. FAR Part 12
C. FAR Part 10
D. FAR Part 15
Answer: C
Explanation: FAR Part 10 is specifically titled "Market Research" and establishes the policy for
conducting market research to determine whether commercial or non-developmental items are
available to meet agency needs.
3. According to current FAR policy, what is the primary purpose of conducting market research?
A. To justify a sole-source award
B. To determine if sources exist that can satisfy the agency's requirements
,C. To drive down the price of the contract
D. To eliminate all small business participation
Answer: B
Explanation: FAR 10.001 states the primary purpose is to identify if sources capable of
satisfying the agency's requirements exist, which directly informs acquisition strategy, make-or-
buy decisions, and the type of contract to use.
Section 2: Contract Types & Pricing Arrangements (Questions 4-7)
4. Which of the following contract types is explicitly prohibited for use in government
contracting under all circumstances?
A. Cost-plus-incentive-fee contract
B. Cost-plus-a-percentage-of-cost contract
C. Firm-fixed-price contract
D. Time-and-materials contract
Answer: B
Explanation: FAR 16.102(c) strictly prohibits the use of cost-plus-a-percentage-of-cost
contracts because they provide no incentive for the contractor to control costs; the profit
increases as costs increase.
5. A contracting officer is acquiring a commercial item and must select the appropriate contract
type. Which of the following is permitted?
A. Cost-reimbursement contracts only
B. Only firm-fixed-price or fixed-price with economic price adjustment
C. Any contract type authorized in FAR Part 16
D. Time-and-materials contracts without limitation
Answer: B
Explanation: FAR 12.207 explicitly states that when acquiring commercial items, contracting
officers must use firm-fixed-price contracts or fixed-price contracts with economic price
adjustment. Other contract types require exceptional approval.
, 6. When can a time-and-materials (T&M) contract lawfully be used in government acquisition?
A. For any commercial service acquisition
B. When the contracting officer prefers flexibility over cost certainty
C. Only when it is impossible to estimate the extent or duration of the work or to anticipate costs
accurately at the time of contracting
D. Whenever the estimated value is below the simplified acquisition threshold
Answer: C
Explanation: FAR 16.601(c) imposes a strict condition for T&M contracts: they may only be
used when no other contract type is suitable and it is not possible to estimate the work's extent,
duration, or costs accurately at the time of placement.
7. A contracting officer is preparing a solicitation using an Invitation for Bids (IFB). Which
contract types are permissible under this method?
A. Cost-reimbursement or incentive contracts
B. Any contract type approved by the head of the contracting activity
C. Only firm-fixed-price or fixed-price contracts with economic price adjustment
D. Time-and-materials or labor-hour contracts
Answer: C
Explanation: FAR 14.102(a) requires that IFBs be used when the government will award a firm-
fixed-price contract or a fixed-price contract with economic price adjustment, as the sealed bid
process requires a clear, complete, and unambiguous pricing structure.
Section 3: Solicitation Provisions & Contract Clauses (Questions 8-10)
8. A contracting officer named Joan is selecting solicitation provisions for a pending
procurement. What does this action indicate about the status of the contract?
A. The contract has been awarded and is in post-award administration
B. The contract has not yet been awarded
C. The contract is being terminated
D. The contract is in the claims process
Choice Questions & Answers | FAR Parts
1-53, Contract Types, SAP, Ethics &
DFARS PGI
Description:
Master FAR 2026/2027 with 120 exam-style Q&As. Covers contract types, SAP, ethics,
protests & DFARS.
Download the complete 2026/2027 FAR exam blueprint today—master your contracting career
before your next test.
, FAR Exam Prep 2026: 120 Practice Questions
Section 1: Acquisition Planning & Market Research (Questions 1-3)
1. During which phase of the acquisition lifecycle is market research formally conducted?
A. Only during the solicitation phase
B. Only during the post-award phase
C. All phases of the acquisition
D. Only during the pre-solicitation phase
Answer: C
Explanation: Market research is not a one-time event. It is a continuous process applied
throughout all phases of an acquisition—from initial planning and requirements development
through solicitation, evaluation, and even post-award to identify improved practices or emerging
technologies.
2. A program manager is developing a new requirement that has not been purchased by the
agency in over five years. Which part of the Federal Acquisition Regulation (FAR) provides the
foundational policies and procedures for conducting market research?
A. FAR Part 7
B. FAR Part 12
C. FAR Part 10
D. FAR Part 15
Answer: C
Explanation: FAR Part 10 is specifically titled "Market Research" and establishes the policy for
conducting market research to determine whether commercial or non-developmental items are
available to meet agency needs.
3. According to current FAR policy, what is the primary purpose of conducting market research?
A. To justify a sole-source award
B. To determine if sources exist that can satisfy the agency's requirements
,C. To drive down the price of the contract
D. To eliminate all small business participation
Answer: B
Explanation: FAR 10.001 states the primary purpose is to identify if sources capable of
satisfying the agency's requirements exist, which directly informs acquisition strategy, make-or-
buy decisions, and the type of contract to use.
Section 2: Contract Types & Pricing Arrangements (Questions 4-7)
4. Which of the following contract types is explicitly prohibited for use in government
contracting under all circumstances?
A. Cost-plus-incentive-fee contract
B. Cost-plus-a-percentage-of-cost contract
C. Firm-fixed-price contract
D. Time-and-materials contract
Answer: B
Explanation: FAR 16.102(c) strictly prohibits the use of cost-plus-a-percentage-of-cost
contracts because they provide no incentive for the contractor to control costs; the profit
increases as costs increase.
5. A contracting officer is acquiring a commercial item and must select the appropriate contract
type. Which of the following is permitted?
A. Cost-reimbursement contracts only
B. Only firm-fixed-price or fixed-price with economic price adjustment
C. Any contract type authorized in FAR Part 16
D. Time-and-materials contracts without limitation
Answer: B
Explanation: FAR 12.207 explicitly states that when acquiring commercial items, contracting
officers must use firm-fixed-price contracts or fixed-price contracts with economic price
adjustment. Other contract types require exceptional approval.
, 6. When can a time-and-materials (T&M) contract lawfully be used in government acquisition?
A. For any commercial service acquisition
B. When the contracting officer prefers flexibility over cost certainty
C. Only when it is impossible to estimate the extent or duration of the work or to anticipate costs
accurately at the time of contracting
D. Whenever the estimated value is below the simplified acquisition threshold
Answer: C
Explanation: FAR 16.601(c) imposes a strict condition for T&M contracts: they may only be
used when no other contract type is suitable and it is not possible to estimate the work's extent,
duration, or costs accurately at the time of placement.
7. A contracting officer is preparing a solicitation using an Invitation for Bids (IFB). Which
contract types are permissible under this method?
A. Cost-reimbursement or incentive contracts
B. Any contract type approved by the head of the contracting activity
C. Only firm-fixed-price or fixed-price contracts with economic price adjustment
D. Time-and-materials or labor-hour contracts
Answer: C
Explanation: FAR 14.102(a) requires that IFBs be used when the government will award a firm-
fixed-price contract or a fixed-price contract with economic price adjustment, as the sealed bid
process requires a clear, complete, and unambiguous pricing structure.
Section 3: Solicitation Provisions & Contract Clauses (Questions 8-10)
8. A contracting officer named Joan is selecting solicitation provisions for a pending
procurement. What does this action indicate about the status of the contract?
A. The contract has been awarded and is in post-award administration
B. The contract has not yet been awarded
C. The contract is being terminated
D. The contract is in the claims process
