CPPB Prep Course Practice Test with Correct Answers: Procurement Fundamentals, Exams of Nursing

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The purchasing officer of the governmental agency has expressed serious concerns about the number of repetitive requisitions, solicitations and POs that are being processed to purchase gasoline for the organization. Every time a new order is placed, another requisition is created and the prices paid by each dept. are not consistent; sometimes more and sometimes less depending on competition and timing. The buyer advises that the solution would be to use what type of contract? - Verified Answer FIXED-PRICE WITH ESCALATION/DE-ESCALATION A Govt agency with a centralized purchasing dept. has a threshold for small purchases of $1000 and three quotes are required above that figure. There has been a steady increase in the number of requisitions along with recent complaints from internal customers about it taking too long to buy what they need. Which of the following action is most likely to have the biggest impact on reducing costs and saving time in the long run? - Verified Answer INSTITUTING A PURCHASING CARD PROGRAM A Govt agency has been having problems with a supplier's performance and may terminate their contract with the supplier. Which of the following would be the best first step in addressing the issue with the supplier? - Verified Answer ADDRESS W/ ON-SITE SUPVSR/CONTRACTOR An agency uses a budget in which appropriations are approved for different classes of expenditures. Each class is broken into subclasses against which funding for svcs and commodities can be applied. This budget approach maximizes control & ensures financial accountability. What type of budget is this? - Verified Answer LINE ITEM BUDGET The procurement dept. is considering the acquisition of 10 high volume multi-function printers at a unit cost of $20,000. The printers have an estimated useful life of 8 yrs and require the following annual costs per printer: Consumable Supplies $350; Electricity $150; and Maintenance $350. What is the total cost of ownership of the printers? A) $264,000, B) $268,000, C) $256,000, D) $260,000 - Verified Answer B) $268,

The supplier of a performance based contract that has a initial 3 yr term w/ two one-yr extensions upon satisfactory performance, has failed to perform in accordance w/ specified delivery schedules. They also do not respond to quality issues in a timely manner. The supplier has not been given formal notice of the problems. The internal user does not want the contract extended for the remaining two one-yr periods, and wants to terminate the contract immediately for cause. What should the contract administrator do?

• Verified Answer USE THE "CURE NOTICE" PROCEDURES AND GIVE NOTICE OF THE FAILURES TO THE SUPPLIER The members of the team are getting to know one another and learning about the knowledge and skills that each brings to the team. At what phase of development is this team? A) Performing, B) Norming, C) Storming, D) Forming - Verified Answer D) FORMING A supplier has completed the work identified in the specifications, but the govt agency has determined that addtl work is required to complete the project. What should the buyer do to get this work done? A) Inspect and reject the work, B) Issue a change order under the existing contract, C) Let the contractor perform the additional work and then determine a fair & reasonable price for that work, D) Withhold final acceptance of the project until the supplier completes the additional work. - Verified Answer B) ISSUE A CHANGE ORDER UNDER THE EXISTING CONTRACT A procurement dept is diligent to ensure that a solicitation does not have to be cancelled and re-completed. This activity achieves what organizational goal? A) Value Analysis, B) Cost Reduction, C) Efficiency, D) Cost Avoidance - Verified Answer D) COST AVOIDANCE Which of the following is a benefit of an automated procurement system? A) Reduces communication entering the system from outside of the organization, B) Prevents incorrect information being shared among stakeholders, C) Provides a common repository for data, D) Ensures purchasing controls all information and decisions. - Verified Answer C) PROVIDES A COMMON REPOSITORY FOR DATA The agency would like to "piggyback" its purchases with other agencies that are participating in cooperative purchasing. When using a "piggyback" method, what would the arrangement be called? A) Cooperative

Solicitation, B) Cooperative Contract, C) Cooperative Organization, D) Piggyback RFP - Verified Answer B) COOPERATIVE CONTRACT On the team Susan writes down key points on a flip chart pad. What team role is Susan playing? A) Leader, B) Recorder, C) Facilitator, D) Time Keeper - Verified Answer B) RECORDER A govt agency processed a purchase requisition for the purchase of 250 street lights with new LED light fixtures. Which fund should a purchasing agent check to confirm that the money was available for this purchase? A) Fiduciary Fund, B) Capital Fund, C) Operating Fund, D) Debt Service Fund

• Verified Answer B) CAPITAL FUND A building contract to do certain work, contains within itself an unwritten customer expectation that the work shall be done in a professional manner is representative of which of the following: A) Full Warranty, B) Express Warranty, C) Implied Warranty, D) Implied Authority - Verified Answer C) IMPLIED WARRANTY Upon receipt of a Purchase Requisition for a small buy commodity, what is the first step the buyer should take? A) Issue a solicitation, as appropriate to the dollar threshold established by the entity, B) Determine if the item is available in surplus stock, C) Determine if there are other rqmts within the ITB that could be combined for a larger quantity, D) Solicit at least three quotes from valid sources - Verified Answer B) DETERMINE IF THE ITEM IS AVAILABLE IN SURPLUS STOCK The county garage manager is responsible for maintaining stock of often- used commodities such as air filters, engine oil, and brake pads. In order not to overstock, he forecasts the anticipated need based on historical data and making an analysis to determine if any changes in future requirements are anticipated. This analysis is a key function of what process? A) Future usage, B) JIT delivery, C) Inventory Management, D) Supplier Managed Inventory - Verified Answer C) INVENTORY MANAGEMENT An agency mgr submitted a request for a 5yr lease on a special tractor that he plans to modify and use for raking the beach during summer. He has money in his budget to cover the lease cost. What's the most important thing to consider before going forward with the leasing process? A) The monthly cost of the lease may go up in the 2nd yr if it is not priced into the

original lease agreement B) Many lease agreements will not permit modifications of any kind to the leased equipment, C) Check the lease agreement for cancellation provisions D) This decision is not a function of procurement & should be made by the user dept - Verified Answer B) MANY LEASE AGREEMENTS WILL NOT PERMIT MODIFICATIONS OF ANY KIND TO THE LEASED EQUIPMENT Strategic procurement planning (SP2) involves: A) Allocating limited resources among different priorities, B) Transforming mission, goals and objectives into measurable activities, C) Using SWOT to identify strategic barriers & opportunities, D) Planning to take advantage of political changes

• Verified Answer B) TRANSFORMING MISSION, GOALS AND OBJECTIVES INTO MEASURABLE ACTIVITIES Over the last six years, a buyer has been responsible for soliciting bids and making awards for purchases of milk for each of the 12 schools in his district. Although he has solicited more than four different milk providers during this time, a well known supplier is the only one that provides a bid response & the bid prices increase by 1.5% each year. Based on this pattern of bidding, what action should the buyer take? A) Stop sending IFBs to the well known supplier, B) Contact all other bidders to determine why they did not bid on the agency's requirements, C) Report the well- known supplier to the State Auditors for violation of anti-competition laws, D) Report the well-known supplier to the State Inspector General for violation of anti-competition laws - Verified Answer B) CONTACT ALL OTHER BIDDERS TO DETERMINE WHY THEY DID NOT BID ON THE AGENCY'S REQUIREMENTS When an award protest is filed with your agency, the procurement professional should: A) Delay start of the project, B) Start the project since time is on the essence, C) Decide whether or not to start the project based on funding source for the project D) Seek a judicial decision - Verified Answer A) DELAY START OF THE PROJECT A senior buyer is supervising a new buyer. The new buyer has repeatedly failed to keep accurate records of problem shipments despite general training and some ad hoc conversations about requirements to document problems. What step should the senior buyer take? A) Issue an oral warning, B) Issue a written warning, C) Suspend the buyer, D) Demote the buyer - Verified Answer A) ISSUE AN ORAL WARNING

A buyer wants to spot buy propane. What is the best analysis process to ensure the purchase has value? A) Demand Analysis, B) Supplier Analysis, C) Performance Analysis, D) Market Analysis - Verified Answer D) MARKET ANALYSIS What does the RFP tool Best and Final Offer (BAFO) allow? A) Proposers to submit a revised proposal after reviewing the proposals of other suppliers, B) Proposers to adjust their price after submitting their proposal, C) A price change from only the apparent low bidder, D) A price change based on a tie bid - Verified Answer B) PROPOSERS TO ADJUST THEIR PRICE AFTER SUBMITTING THEIR PROPOSAL When items are susceptible to a high incidence of latent defect,s which of the following quality assurance defect prevention techniques should be used to solve this problem? A) Attribute sampling, B) In-process inspection, C) Variable sampling, D) Statistical process control - Verified Answer D) STATISTICAL PROCESS CONTROL The fuel contract for Fleet Svcs Dept is set to expire in 3 mos. Due to budget cuts, the Purchasing Dept is looking at different methods to meet the Fleet Dept's fuel requirements while staying w/i budget. What would be an appropriate method to consider? A) pCard Program, B) Joint Ventures, C) Cooperative Procurement, D) Smart Cards - Verified Answer C) COOPERATIVE PROCUREMENT In his haste to meet the bid closing date and the time the supplier forgot to sign the supplier's bid signature document that accompanied the solicitation. Under what circumstances can a buyer generally accept the supplier's bid without a signature? A) The failure to sign is an obvious oversight, B) The bidder has demonstrated good performance on previously awarded contracts, C) There was insufficient time for the bidder to respond, D) The bidder is not on the "debarred" supplier list - Verified Answer A) THE FAILURE TO SIGN IS AN OBVIOUS OVERSIGHT The buyer has been working closely with the Dept of Public Works to acquire an upgrade to existing proprietary software used with the waste water treatment plant operating equipment. When purchasing this software, what would be the most appropriate method of acquisition? A) Develop and issue a formal competitive bid solicitation, B) The contract should be

negotiated with the supplier, C) The informal competitive bid method should be used, D) A formal request for proposal method should be used - Verified Answer B) THE CONTRACT SHOULD BE NEGOTIATED WITH THE SUPPLIER An agency wishes to improve its service to its stakeholders and its productivity. What is the first step it should take? A) Conduct a customer survey, B) Define its mission and strategic goals, C) Conduct a benchmark study, D) Develop process measures - Verified Answer B) DEFINE ITS MISSION AND STRATEGIC GOALS What is the purpose of a blanket contract? A) Allows the provider to be reimbursed for costs plus be paid a fee independent of the costs, B) Provides for specified items, or services to be delivered w/i a specific time frame, C) Provides for fixed hourly rates for labor and parts at the stated contractors cost, D) Allows ordering items, or services on an "as needed" basis - Verified Answer D) ALLOWS ORDERING ITEMS, OR SERVICES ON AN "AS NEEDED" BASIS An agency purchased specialized software. Four weeks after the software was accepted & installed, a defect in the software became apparent. The procurement dept can file a claim for what type of loss or damage? A) Known loss, B) Known damage, C) Concealed loss, D) Latent defect - Verified Answer D) LATENT DEFECT Governmental agencies sometimes hold supplier interviews during the planning process of a solicitation. What is a benefit of conducting such interviews? A) Allows procurement to disqualify some suppliers from the solicitation process, B) Allows the suppliers to pre-view the solicitation, C) Allows the two parties to negotiate pricing in advance, D) Provides the entity with information to use when developing the solicitation - Verified Answer D) PROVIDES THE ENTITY WITH INFORMATION TO USE WHEN DEVELOPING THE SOLICITATION A govt agency is negotiating the procurement of a major contract. Which of the following persons should be included on the team to esnure that a newly mfgd product meets the requirements of the item to be acquired? A) The procurement official, B) A certified engineer, C) The in-house attorney, D) The contractor - Verified Answer B) A CERTIFIED ENGINEER

A buyer is tendering security guard svcs. The buyer wants to protect the agency from security guards stealing expensive equipment while on shift. Which is the most appropriate item to require of the successful bidder in order to mitigate the risk? A) Fidelity bond, B) Performance Bond, C) Professional Liability Insurance, D) General Liability Insurance - Verified Answer A) FIDELITY BOND When preparing for a negotiation session, what knowledge will give the governmental negotiator the most power? A) Knowing when to walk away from the table, B) Having the most knowledge of cost analysis, C) Identifying a secondary supplier in case the negotiations are not successful, D) Knowing what the other side really wants and needs - Verified Answer D) KNOWING WHAT THE OTHER SIDE REALLY WANTS & NEEDS The governmental agency has a contract with a haz materials mgmt company to remove asbestos from 83 school buildings. What is the best method for the agency to employ to ensure compliance with the contract specifications? A) Random Sampling, B) 3rd Party certification, C) Spot Inspection, D) 50% inspection by your agency's project mgr. - Verified Answer B) THIRD PARTY CERTIFICATION What is the goal of a principled negotiation? A) Avoid Litigation, B) Generate many options, C) Win/Win, D) Use objective criteria - Verified Answer C) WIN/WIN A govtl agency has a non-competition threshold that says any purchase below $5,000 does not require competition. Over a 3 mo. period a requesting user has asked on 3 separate occasions to directly purchase w/o competition, products needed by the agency. On each occasion the value of the purchase was approximately $4,500. What should the buyer do? A) Point out the repetitive nature of the orders B) Remind the requester of the code restrictions on splitting orders, C) Extend the purchase order, D) Ask a peer to place the order - Verified Answer B) REMIND THE REQUESTER OF THE CODE RESTRICTIONS ON SPLITTING ORDERS In a typical product acquisition, when does the risk of loss pass to the purchaser? A) At the supplier's loading dock when loaded onto the freight carrier, B) At the purchaser's loading dock when off-loaded and formally received by the purchasing agent, C) At the time specified in the FOB

terms, D) At the time of purchase - Verified Answer C) AT THE TIME SPECIFIED IN THE FOB TERMS The govtl agency has entered into a performance-based contract with a local cleaning service to clean the offices at the county govt center. What should the buyer focus on to ensure supplier compliance? A) Inspecting the company's adherence to process steps defined in the Performance of Work Statement, B) Identifying potential occurrences of agency opportunism by the company, C) Monitoring the desired outcomes defined in the Statement of Work, D) Overcoming information asymmetry - Verified Answer C) MONITORING THE DESIRED OUTCOMES DEFINED IN THE STATEMENT OF WORK A buyer is charged with purchasing diesel fuel for the transit system. What type of study should be conducted to determine how best to make this purchase? A) Value analysis, B) Supplier selection, C) Demand analysis, D) Market analysis - Verified Answer D) MARKET ANALYSIS A govtl agency wants to implement a JIT system for paper, toner, and cartridges. The buyer is reviewing a proposal from a supplier. What would be the primary purpose of a site visit? A) To determine if the supplier has sufficient staff, B) To assess the supplier's Quality Control processes, C) To evaluate the supplier's on-line ordering & warehousing capability, D) To evaluate the supplier's LIFO inventory to support the planned JIT program - Verified Answer C) TO EVALUATE THE SUPPLIER'S ON-LINE ORDERING & WAREHOUSING CAPABILITY If a jurisdiction wants to allow discontinuation of a contract prior to its completion b/c of the jurisdiction's own needs & not the poor performance of the selected contractor, the RFP document will need to include what type of clause? A) Insurance Reqmts clause, B) Agreement Termination clause, C) Termination for convenience clause, D) Assignments clause - Verified Answer C) TERMINATION FOR CONVENIENCE CLAUSE A general contractor (GC) recvd Notice to Proceed from a govt agency for a building construction project. After analyzing the plans & specs, the GC proposed a substitute material that would save the agency 20% of material cost w/ better performance. What type of process is this? A) Value analysis, B) Value engineering, C) Process improvement, D) Benchmark - Verified Answer B) VALUE ENGINEERING

Which of the following statements best describes a brand name specification? A) Establishes the QPL characteristics, in significant details, that an item must possess, B) Sets forth the capabilities & performance characteristics, C) Describes the STD of quality & performance w/ a unique qualifier, D) Describes all physical & functional characteristics of a commercial standard spec - Verified Answer C) DESCRIBES THE STD OF QLTY & PERFORMANCE W/ UNIQUE QUALIFER A buyer placed an order for the purchase of circuit breakers which will be installed in a new substation. The supplier was unsure when the goods would be available for delivery. What would be the most appropriate action for the buyer to take to ensure the goods arrive on time? A) Follow-up, B) Expedite, C) Change FOB point, D) Accept a substation offered by the supplier - Verified Answer A) FOLLOW-UP An organization's mission statement should: A) Express the organization's purpose for existence, B) Identify roles and responsibilities of key stakeholders, C) Articulate the goals & objectives of the organization, D) Communicate particular organizational strategies for success - Verified Answer A) EXPRESS THE ORGANIZATION'S PURPOSE FOR EXISTENCE Changes to a contract creates addtl work & expenses for the contractor which allows the contractor to request addtl payment. To allow this, contract must contain provision for a price adjustment. What is this called? A) Request for Equitable adjustment, B) Constructive change, C) Escalation clauses, D) Allowable costs - Verified Answer A) REQUEST FOR EQUITABLE ADJUSTMENT A buyer consults a well-established indicator that identifies economic trends. What is this indicator? A) Consumer Reports, B) Stock Markets, C) Purchasing Managers Index, D) Gartner DataQuest - Verified Answer C) PURCHASING MGRS INDEX A buyer is asked to conduct a review & evaluation of a supplier's cost date in order to determine actual costs or estimates of costs to be incurred. This process is know as: A) Cost containment, B) Cost analysis, C) Cost Breakdown, D) Cost Adjustment - Verified Answer B) COST ANALYSIS

As part of the planning process the negotiation team should decide the course of action that it will take if the current negotiations fail and an agreement cannot be reached. What is this called? A) BATNA, B) Lose/Lose, C) Spiraling agreements, D) Walk away point - Verified Answer A) BATNA