QUESTION: 53

Which of the following are features of performance specification?
1. Method of achieving the buyer's desired result
2.
What needs to be achieved when using the product
3. Purposes of the product
4. Technical and physical characteristics of the product

2 and 4 only
1 and 2 only
1 and 4 only
2 and 3 only

Answer(s): D

Explanation:

There are 2 major types of specifications:
1. Performance specifications
These are Specifications that define the purpose of the goods or services in terms of how effectively it will perform. Performance is a logical extension of function. Performance specifications define the task or desired result by focusing on what is to be achieved. They do not describe the method of achieving the desired result.
2. Technical (or conformance) specifications
These are Specifications that define the technical and physical characteristics and/or measurements of a product, such as physical aspects (e.g. dimensions, colour, and surface finish), design details, material properties, energy requirements, processes, maintenance requirements and operational requirements. They are used when functional and performance characteristics are insufficient to define the requirement and are often used for engineering and information technology requirements.

Reference:

- Specification Writing
- CIPS study guide page 9-11 LO 1, AC 1.1

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QUESTION: 54

Danielle buys a car from Aaron. Not long after, she receives an proposal from Brian, who is interested in buying the car but his budget is very constraint. Then, Brian decides to sign a hire purchase agreement with Danielle which lasts 4 years. Brian lives very far from Danielle, so he hires Charlie to deliver the car to his place. During the transport, Charlie has an accident and the car is written off. At the time of accident, who has the title of the car?

Charlie
Aaron
Brian
Danielle

Answer(s): D

Explanation:

Hire purchase is an arrangement for buying expensive consumer goods, where the buyer makes an initial down payment and pays the balance plus interest in installments. The ownership of the merchandise is not officially transferred to the buyer until all the payments have been made. Danielle has purchased the car from Aaron, which means its title has been transferred to her. The accident happens before the last instalment is paid. Therefore, the ownership of the car still belongs to Danielle

Reference:

CIPS study guide page 70 LO 1, AC 1.3

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QUESTION: 55

In a contract, both buyer and supplier agreed the lead time is 3 days. The contract also requires that any variation must be made in writing. Then the buyer places an order by phone call and requests delivery the next day, but the supplier delivers on the third day since the order. Can buyer refuse to pay as supplier did not deliver per time?

No, the supplier delivers within a reasonable time
Yes, late delivery is a force majeure event
Yes, the supplier has breached the contract
No, supplier has shortened lead time to 1 day

Answer(s): A

Explanation:

Lead time is the amount of time that passes from the start of a process until its conclusion. In procurement, lead time can be understood as the amount of time that passes from placing an order until the delivery.
In the scenario, the contract requires the supplier to make a delivery within 3 days since the order. This contract can only be amended with written consent from both parties. Therefore, there is no ground for shortening the lead time to 1 day because the new lead time is only the request of buyer. Then the supplier still makes delivery within agreed lead time. LO 1, AC 1.1

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QUESTION: 56

Which of the following are reasons why a purchaser wants to embed a subcontracting clause into the main contract? Select TWO that apply:

To induce the conflicts between the main contractor and subcontractors
To improve supply chain transparency
To reduce the main contract complexity
To keep main contractor liable
To condemn whole liabilities to subcontractors

Answer(s): B,D

Explanation:

There are number of reasons why the purchaser will want to control the supplier's subcontracting:
- Supply chain transparency: Normally the purchaser has invested a lot of effort into selecting the right contractor. However, the main contractor's selection of subcontractor might not be in such careful manner, which may result in poor performance. Purchaser must know who subcontractors are. Controlling the subcontracting process can help the purchaser control the outcome.
- Contract terms: the purchaser's requirements must be reflected in the subcontracts. The subcontracting clauses may require the main contractor to do this.
- Liability: the main contractor may subcontract the whole or a part of its liabilities. Subcontracting clause may bind the contractor to be liable with the work, it cannot just blame the subcontractor for any faults.

Reference:

CIPS study guide page 154-155 LO 3, AC 3.2

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QUESTION: 53

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QUESTION: 54

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QUESTION: 55

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QUESTION: 56

Explanation:

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