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Free L3M1 Exam Braindumps (page: 8)

Page 7 of 23
PDF with 90 Questions

`The optimum combination of whole life costs and quality' is one definition of:

  1. Quality circles
  2. Life cycle costing
  3. Contractual agreement (in English law)
  4. Value for money

Answer(s): D

Explanation:

An earlier widely-used definition of value for money as the right combination of price and quality has been updated to include the notion of whole-life costing.
The other answers shown are simply 'red herrings'.



`A - - - - - - - - is a price in which the supplier and buyer agree that the supplier can charge a price based on actual costs incurred, plus a margin for profit'.

  1. A whole life cost
  2. A target cost incentive price
  3. A fixed price
  4. A cost-based price

Answer(s): D

Explanation:

This should be an easy QUESTION NO :. The definition describes nicely one possible form of cost- based price. It is important to try to be able to distinguish cost from price. The 'target cost incentive' method of pricing might have been tempting as an answer, since the defi- nition shown mentions cost, but it mentions neither target nor incentive, and can therefore be ruled out.
And whole life cost is a different concept altogether.



Because of the need for frequent or semi-frequent uses of competition, public sector buyers are less likely to find themselves in a close partnership arrangement with a supplier than private sector buy- ers. True or false?

  1. False
  2. True

Answer(s): B

Explanation:

This is true.



'Open tendering may impose a substantial administrative burden on the procurement function.' True or false?

  1. True
  2. False

Answer(s): A

Explanation:

Because a wide range of organisations (or even individuals) may respond to an open tender, consid- erable administrative resource may have to be devoted to analysing offers.






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