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CIPS Commercial Negotiation Sample Questions (Q142-Q147):

NEW QUESTION # 142
A public agency opens a tendering process for a road building project that lasts approximately 1 year. They post theirrequirements on public journal and receive some interests. After conducting due diligence process and selecting the lowest bidder, the project commences. However, the supplier complains that price of material increases because of a shortage of supply, thenthey demands an 5% uptick in contract value. The agency investigates the increment and sees that there is indeed a fluctuation in prices of supplier's input. They are likely to accept the proposal, but they are also concerned that supplier may demand more. To avoid making another concession with the supplier, which of the following should be a priority action of the agency?

A. Postpone the decision making until the budget is ready
B. Disapprove supplier's demands until they finish the project
C. Document a contract variationthat only allows another concession if some specific conditions arise
D. Seek approval from higher authority

Answer: C

Explanation:
Explanation
The agency (buyer) has made a concession about the price. Possibly the supplier will request another concession (the salami tactics). To avoid this to be happened, the agency should only allow a concession as an exception, make sure that the concession is documented and only permitted against some exceptional circumstances, and seek agreement to this from the supplier.
LO 3, AC 3.2

NEW QUESTION # 143
Understanding supplier's mark-up and margin can provide procurement professional a comprehensive insight into supplier's net profits. Is this statement true?

A. Yes, becausesupplier's mark-up and margin are two most valuable sources of information to procurement
B. Yes,because these are two indicators of supplier's future prospect
C. No, because mark-up and margin inform little about supplier's net profit
D. No, because margin is enough to tell procurement about supplier's profitability

Answer: C

Explanation:
Explanation
Mark-up and margin allow supplier to make gross profit. Remember that every supplier operates under different cost structures and some are set up to be most profitableat a particular level of volume, so it is dangerous to assume all suppliers can survive on a lower margin if their volume increases. Intelligent buyers understand that mark-up and margin may define gross profits, but they tell you very little about a supplier's net profits.
LO 2, AC 2.1

NEW QUESTION # 144
What is the most likely outcome when two organisations with adversarial relationship negotiate with each other?

A. Deadlocked
B. Win win
C. Win lose
D. Lose lose

Answer: C

Explanation:
:
An adversarial relationship in purchasing and supply arises when identical or equivalent good or services are available from competing suppliers and buyers/sellers are trying to gain an advantage over each other. Low levels of trust are characteristic of adversarial relationships. The outcome when two organisations with adversarial negotiate is most likely to be win-lose.

NEW QUESTION # 145
Telephone is most likely to be used for which of the following negotiations?

A. Routine transactions
B. Contract for purchasing a specialised product
C. Complex one-off purchase
D. High value contract

Answer: A

Explanation:
Many commercial negotiations could be considered routine or just not worth the investment for buyers, and using the phone can make more sense and can be more immediate.
LO 2, AC 2.4

NEW QUESTION # 146
The activity of listening in a negotiation includes which of the following processes?
Hearing
Interpreting
Rapport
Influencing

A. 1 and 2 only
B. 2 and 3 only
C. 2 and 4 only
D. 1 and 3 only

Answer: A

Explanation:
Listening involves both hearing (1) and interpreting (2) the information shared by the other party. Effective listening is an active process that goes beyond simply hearing words; it involves interpreting meaning, understanding the speaker's intent, and responding accordingly. CIPS emphasizes these steps as part of effective communication in negotiations.

NEW QUESTION # 147
......

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Reliable L4M5 Test Materials & L4M5 New Braindumps Sheet

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CIPS Commercial Negotiation Sample Questions (Q142-Q147):

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