QUESTION: 41

`The CIPS Code of Conduct states that procurement professionals should not accept any business gifts under any circumstances.' True or false?

True
False

Answer(s): B

Explanation:

Surprisingly, 'declared gifts of nominal value' can be accepted.

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QUESTION: 42

What do we call the point when the supply firm makes neither a profit nor a loss ie where all costs are covered yet no profit is made?

Breakeven point
Trig point
Point of no return
Tipping point

Answer(s): B

Explanation:

Breakeven point. The firm breaks even: covers all of its fixed costs. At this point the firm has made neither a profit nor a loss, and hopefully is about to enter profitability.

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QUESTION: 43

According to Lysons and Farrington, two authors recommended by CIPS, which of the following are cost-based pricing models, as opposed to market-driven pricing models? Choose two.

Penetration pricing
Promotional pricing
Marginal pricing
Rate of return pricing

Answer(s): C,D

Explanation:

Both penetration pricing and promotional pricing begin with the market price. Marginal pricing and rate of return pricing both look at the costs of doing something, and base their calculations on cost. These last two are therefore cost-based approaches to pricing.

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QUESTION: 44

Which of the following is unlikely to be regarded as a conformance specification?

A chemical formula
A statement of outputs
Drawings
A brand name

Answer(s): B

Explanation:

Outputs link to the concept of a performance (or 'output') specification, not a conformance specifi- cation.

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QUESTION: 41

Explanation:

QUESTION: 42

Explanation:

QUESTION: 43

Explanation:

QUESTION: 44

Explanation: