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L4M5 Questions and Answers

Question # 6

Which of the following is active listening?

A.

Encouraging the other party to do all the talking

B.

Agreeing with what the other party has to say

C.

Summarising what has been said

D.

Ignoring what the other party has to say

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Question # 7

What is a benefit to the buyer of having a BATNA (best alternative to a negotiated agreement) in a negotiation?

A.

To aid detailed pre-meeting data gathering and analysis

B.

To reduce financial and logistical risk for both parties

C.

To be able to confidently walk away from an unfavorable deal

D.

To facilitate information sharing between both parties

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Question # 8

A procurement manager has decided to bring in a junior member of their team to a negotiation meeting. Which of the following would be suitable roles for this junior member of the team?

    Note taker

    Expert

    Observer

    Chair

A.

1 and 2

B.

1 and 5

C.

2 and 3

D.

3 and 4

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Question # 9

To buying organisation, savings can be achieved from different saving levers or tactics. Which of the following are means that deliver savings through optimising specifications?

A.

Value engineering

B.

Part substitution

C.

Budget linkages

D.

Compare total cost of ownership

E.

Volume pooling

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Question # 10

A buyer is preparing for an upcoming negotiation with a large supplier on a contract renewal price. The buyer has undertaken some analysis and is concerned that changes in the organisation’s macro-environment over the last year will result in a price increase. The buyer’s analysis has identified changes in which of the following?

A.

Exchange rates

B.

Supplier power

C.

Changes in demand

D.

Internal policies

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Question # 11

According to Dr. Mari Sako, which of the following is potentially the weakest trust to be built?

A.

Competence trust

B.

Goodwill trust

C.

Charitable trust

D.

Contractual trust

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Question # 12

Which type of question should be used to receive affirmation on statement?

A.

Open

B.

Closed

C.

Leading

D.

Narrow

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Question # 13

A procurement professional is sourcing low value items. He conducts market analysis and realise that these items can be provided by many suppliers and switching cost between suppliers is relatively low. He also assume that the relationship between buyer and supplier will be transactional rather than long-term. According to Thomas-Kilmann conflict model instrument, which of the following is the most appropriate style that the procurement professional should adopt when negotiating with these suppliers?

A.

Avoiding

B.

Compromising

C.

Competing

D.

Collaborating

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Question # 14

Finding the middle ground between buyer and supplier by moving towards each other's position is a satisfactory way to complete contract negotiations and maintain ongoing relations for future negotiations. Is this statement correct?

A.

Yes, because both parties will get as close to their end result as possible

B.

Yes, because the buyer will always move further than the supplier

C.

No, because the other party will take advantage if you move your position

D.

No, because it will damage your credibility in contract negotiations

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Question # 15

Where a negotiator uses numerical reasoning with facts as part of their negotiation approach, which of the following techniques will they be adopting?

A.

Threat

B.

Logic

C.

Emotion

D.

Power

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Question # 16

In a detailed cost breakdown, a company has a salary cost of 9%, raw materials cost 51% and overheads cost 24%. Which of the following represents the mark-up of that company?

A.

Approximately 84%

B.

Approximately 19%

C.

Approximately 116%

D.

Approximately 16%

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Question # 17

Which of the following would cause a demand curve for a good to be price inelastic?

A.

There are a great number of substitutes for the good

B.

The consultancy service

C.

The luxury goods

D.

The necessary goods

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Question # 18

Langham Industries is seeking to expand its operations globally. The CEO has asked the procurement department to engage in a macroeconomic analysis for its potential new supply chain to meet organisational objectives and outcomes. Which of the following would be a source of macroeconomic data?

A.

Competitor analysis

B.

Attending trade conferences

C.

Published market indices

D.

Online supplier forums

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Question # 19

Which of the following are recognised techniques in contract negotiation? Select THREE that apply.

A.

Framing and reframing

B.

Ratification

C.

Pacing and leading

D.

Validation

E.

Role ethics

F.

Anchoring

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Question # 20

Which of the following best describes Leverage quadrant in Kraljic matrix?

A.

Low risk, high importance

B.

High value, high complex

C.

Low risk, low importance

D.

High complex, low importance

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Question # 21

Listening is a key activity in any negotiation. Which of the following are characteristics of effective listeners?

A.

2 and 4 only (Persuading and Offering immediate solutions)

B.

1 and 2 only (Showing empathy and Persuading)

C.

1 and 3 only (Showing empathy and Paraphrasing)

D.

3 and 4 only (Paraphrasing and Offering immediate solutions)

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Question # 22

Which of the following are hardball tactics in negotiations? Select TWO that apply.

A.

Expand the pie

B.

Snow job

C.

Good cop, bad cop

D.

Sweetening the deal

E.

Bridging

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Question # 23

End users are the only stakeholders that are involved in the preparation of a negotiation. Is this statement true?

A.

Yes, because end-users have greater expert power

B.

Yes, because only end-users understand their demand

C.

No, because end-users are external stakeholders

D.

No, because budget holders also play an important role

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Question # 24

How can having a best alternative to a negotiated agreement (BATNA) support the buyer in a negotiation? Select THREE options that apply.

A.

It helps to be more assertive in a negotiation

B.

It reduces the likelihood of accepting a poor agreement

C.

It guarantees a win-win outcome

D.

It produces an unacceptable outcome

E.

It extends the length of the negotiation period

F.

It helps to identify the point at which the buyer should walk away

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Question # 25

When implementing value analysis or value engineering, which of the following acronyms reminds both buyer and supplier of ideas on removal, substitution and design-out of cost elements?

A.

SMART

B.

STOPS WASTE

C.

OWN-IT

D.

SAMOA

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Question # 26

Active listening in negotiation includes which of the following activities?

1. Hearing

2. Interpreting

3. Rapport

4. Influence

A.

3 and 4 only

B.

1 and 3 only

C.

1 and 2 only

D.

2 and 3 only

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Question # 27

Which of the following are most likely to be sources of conflict that can emerge from the process of commercial negotiations? Select TWO that apply.

A.

Differences in conflict management style

B.

Differences in culture

C.

Types of purchase

D.

Standard terms and conditions

E.

Line of the best fits

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Question # 28

AB Manufacturing seeks to buy a new materials resource planning (MRP) software system. At the ‘defining the business need’ stage of the procurement cycle, the procurement manager ensured that all the internal stakeholders involved had the power to contribute and sign off on requirements. For the MRP system, the procurement manager consulted the head of production planning of AB Manufacturing. The head of production contributed to demand levels, existing manufacturing planning, and existing staff levels. What type of power does the head of production demonstrate?

A.

Expert

B.

Legitimate

C.

Referent

D.

Reward

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Question # 29

Which of the following are examples of variable costs?

    Building and site rent

    Annual insurance premium

    Raw materials expenditure

    Delivery costs for materials

A.

1 and 3

B.

2 and 3

C.

1 and 4

D.

3 and 4

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Question # 30

Which of the following are most likely to be indirect costs of a garment manufacturer? Select THREE that apply.

A.

Packaging material

B.

Textile

C.

Zips pads

D.

Maintenance materials

E.

Utilities

F.

Depreciation of machinery

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Question # 31

Commercial negotiations on prices cover a range of aspects including pricing arrangements. A buyer may negotiate for a 'fixed price agreement'. Why is a fixed price agreement advantageous to the buyer?

A.

The buyer will benefit from the savings that the supplier makes from the efficient cost management of the contract

B.

The buyer will not need to monitor the supplier’s costs relating to the contract

C.

Suppliers always seek price agreements that include cost-sharing incentives

D.

Suppliers calculate prices using fixed costs which the buyer must counteract by pushing for a fixed price agreement

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Question # 32

The purpose of ongoing supplier relationship management following a negotiation and contract award is that it:

A.

1 and 2 (Enables the buyer to monitor supplier performance and persuade the supplier to renegotiate better terms)

B.

1 and 3 (Enables the buyer to monitor supplier performance and work with the supplier to resolve relationship problems)

C.

3 and 4 (Enables the buyer to work with the supplier to resolve relationship problems and evaluate unnecessary concessions)

D.

2 and 3 (Enables the buyer to persuade the supplier to renegotiate better terms and work with the supplier to resolve relationship problems)

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Question # 33

An integrative negotiation style involves ...

A.

Maintaining a distant (arm's length) relationship with a supplier and the avoidance of information sharing

B.

The buyer demanding concessions without offering anything in return

C.

Creating mutually beneficial outcomes for all parties and collaborative problem solving with a supplier

D.

A competitive approach with a focus on winning at all costs

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Question # 34

When is the best time for buyer to propose the negotiation agenda to potential supplier?

A.

At opening stage

B.

At conclusion stage

C.

At testing stage

D.

At preparation stage

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Question # 35

Which of the following two are recognized strategies to achieve a win-lose outcome?

Making the other party lower its resistance point

Making the other party think this settlement is the best it can achieve

Employ empathy to gain mutual understanding

Using compromise and creativity tactics

A.

1 and 2 only

B.

3 and 4 only

C.

1 and 3 only

D.

2 and 4 only

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Question # 36

In order to mitigate all risks involved in the negotiation process, the buyer only needs to undertake pre-negotiation research on the supply market and establish a BATNA. Is this a correct suggestion?

A.

No, the buyer should also keep the top management and all employees informed

B.

No, the buyer should make preparations in other areas such as determining the negotiation team

C.

Yes, establishing a fallback position is important because it signifies that the negotiations will reach an impasse

D.

Yes, because the market price should be the target price of the negotiations

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Question # 37

Which of the following is a true statement regarding macroeconomic factors and their potential impact on negotiations?

A.

Macroeconomic factors always directly influence the negotiations

B.

Expectations on macroeconomic prospect are always correct

C.

Changes in macroeconomic factors may affect businesses and individuals differently

D.

Macroeconomic factors cannot be influenced by anyone's expectation or sentiment

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Question # 38

Which of the following can help both parties to break the vicious cycle of blame when a relationship needs repairing? Select TWO that apply.

A.

Both parties understand each other's goals

B.

Focusing on positions

C.

Conflict management skills

D.

Constant shadowing and oversights

E.

Emotional-based assessment

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Question # 39

During a negotiation, Jose Gomez, the salesperson for a strategic supplier, states that his sales director will not approve discounts against initial purchases. However, Jose offers a 5% discount against the aftercare package, which will provide the same monetary saving. Sally Pampas requires both the product and the aftercare package and has an objective to achieve a 5% discount off the purchase price. To achieve a win-win (integrative) negotiation, Sally should:

A.

Ask Jose to apply the 5% discount against the purchase price

B.

Decline the offer and walk away from the negotiation

C.

Ask Jose to apply a discount against the price

D.

Accept the offer of a discount against the aftercare package

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Question # 40

What are the potential sources of conflict between the buyer and supplier? Select TWO that apply.

A.

Persistent late payment of the supplier’s invoices

B.

Unequal sharing of gains, risks, and costs with the supplier

C.

Requesting early supplier involvement

D.

Planning scheduled visits to the supplier site

E.

Scheduling agreed supplier delivery dates

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Question # 41

Which of the following is considered a weakness of a ‘dealer’ style negotiator?

A.

May shift position quickly

B.

May be too assertive

C.

Focuses on the facts and not the people

D.

Very precise

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Question # 42

The procurement manager of a private healthcare provider is running an IT project. Who would be the stakeholders?

    General public

    Pharmaceutical suppliers

    Senior Management

    Software support developers

A.

2 and 4 only

B.

1 and 3 only

C.

1 and 2 only

D.

3 and 4 only

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Question # 43

Any commercial negotiation process has only three potential stakeholders: procurement, the budget holders, and the users. Is this TRUE?

A.

Yes, and the budget holder is the most important one because of the finances involved

B.

Yes, the role of procurement is to ensure that the technical specifications are fit for purpose

C.

No, only procurement, the user, and suppliers have an interest in the products negotiated

D.

No, other stakeholders, such as directors, and IT might also be interested in the negotiation outcomes

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Question # 44

A procurement team has discussed, in advance of a negotiation, what they will do if there is no agreement with the current supplier. They have decided that they will perform the services themselves in-house on a trial basis if no deal is made. Which of the following describes what they have prepared here?

A.

Best Alternative to a Negotiated Agreement

B.

The Bargaining Mix

C.

Offer of Agreement

D.

Walk Away Point

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Question # 45

A negotiation process ends once the negotiating meeting has finished. Is this statement true?

A.

Yes, provided that the meeting results in a win-win for both parties

B.

Yes, because both parties have all of the emotional intelligence they need to proceed

C.

No, best practice would include a period of reflection after the meeting as part of the process

D.

No, the negotiation of terms should always continue after the meeting and until signed by the supplier only

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Question # 46

JCB is a large manufacturer of heavy machinery. The CPO is going to a negotiation with a Chinese supplier about procuring some major components. He is wondering about balance of power in the negotiation. Which of the following micro factors are most likely to shift the balance of power towards the buying organisation in this commercial negotiation? Select TWO that apply

A.

Buyers purchase in small volumes

B.

Suppliers are more concentrated than buyer

C.

Eruption of epidemic in supply market

D.

JCB's switching costs are low

E.

These components are highly standardised

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Question # 47

A procurement manager has decided to bring in a junior member of their team to a negotiation meeting. Which of the following would be suitable roles for this junior member of the team?

A.

1 and 2 (Note taker and Expert)

B.

1 and 3 (Note taker and Observer)

C.

2 and 3 (Expert and Observer)

D.

3 and 4 (Observer and an unspecified fourth option - assumed error)

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Question # 48

There are many factors which will influence supplier pricing decisions. Which of the following are external factors that may apply? Select THREE that apply:

A.

Customer perceptions of value

B.

Cost of production

C.

Price elasticity of demand

D.

Environmental factors affecting the cost of raw materials

E.

Where the product is in its ‘lifecycle’

F.

Objectives of the organisation

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Question # 49

Which of the following are most likely to help buyer become preferred customer in supplier's perspective? Select TWO that apply.

A.

Onerous supplier terms and conditions

B.

Compliance with agreed repair lead time

C.

Shorter payment period

D.

Reduction in delivery errors

E.

Ensuring an increased number of repeat orders

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Question # 50

All of the following shift the supply of watches to the right except...?

A.

An advance in the technology used to manufacture watches

B.

A decrease in the wage of workers employed to manufacture watches

C.

An increase in the price of watches

D.

Manufacturers' expectation of higher watch prices in the future

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Question # 51

When prices of input materials increase, supply curve shifts to the left while demand remains stable. The shift of supply will tend to cause which of the following?

A.

An increase in the equilibrium price and quantity

B.

A decrease in the equilibrium price and quantity

C.

A decrease in the equilibrium price and an increase in the equilibrium quantity

D.

An increase in the equilibrium price and a decrease in the equilibrium quantity

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Question # 52

Which of the following is considered a strength of a ‘logical’ style negotiator?

A.

Assertive

B.

Methodical

C.

Friendly and accessible

D.

Interrelate issues easily and make quick decisions

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Question # 53

In which of the following scenarios could you adopt a distributive-based negotiation approach?

A.

When asking for changes to the provision of a strategic service provided by a monopoly supplier

B.

When determining costs to incorporate a unique product into your design with the patent holder

C.

When your organisation is dependent on a supplier for delivery of a large contract in the future

D.

When procuring a widely available commodity item which is not strategic to your organisation

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Question # 54

A garden furniture supplier currently in negotiations for a high-value contract has offered the procurement manager a visit to their site. The supplier suggests that during this visit, they can undertake the contract negotiation. What would be an appropriate response from the procurement manager?

A.

Accept the offer as this would be an ideal opportunity to see what the supplier can offer and will provide the supplier with familiarity while negotiating

B.

Accept the offer as this would save time. A supplier visit and negotiation could be done at the same time

C.

Decline the offer as it would take too much time to go and visit the supplier

D.

Decline the offer as negotiating while on a site visit will provide the supplier with an unfair advantage because they will be in a familiar environment

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Question # 55

Which of the following can be prepared before a negotiation with a supplier to achieve an agreement to benefit both parties?

Zone of potential agreement

Attendee list for the negotiation talks

Walk-away point

Venue for the negotiation talks

A.

1 and 2

B.

1 and 3

C.

3 and 4

D.

2 and 3

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Question # 56

Which of the following are most likely to be the potential cultural differences that can make transactions with an international supplier more problematic that with local suppliers? Select TWO that apply.

A.

Incoterms and logistics difficulties

B.

The use and interpretation of body language

C.

Currency exchange fluctuation

D.

The importance of timescales

E.

Payment mechanism

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Question # 57

Which of the following is potentially a major source of conflict?

A.

Power imbalance

B.

Information gathering

C.

Shared goals and values

D.

Teamwork

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Question # 58

According to Fiona Dent and Mike Brent, which of the following are characteristics of Push approach? Select TWO that apply.

A.

Inspirational

B.

Persuasion

C.

Collaborative

D.

Seeking commitment

E.

Directive

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Question # 59

An experienced procurement professional is developing strategies for forthcoming negotiations with her key supplier. To avoid negotiation deadlocks, she identifies the reasons why negotiations could fail. Which of the following are most likely to be reasons for negotiation failures? Select TWO that apply.

A.

Underlying interests of TOP are overlooked

B.

MIL objectives are well established

C.

Both parties focus on common interests

D.

Buyer helps to create a co-operative atmosphere

E.

Unachievable objectives were set up

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Question # 60

Which of the following are factors that might shift the demand curve for a consumer good to the right?

1. Prices of complementary goods decrease

2. Price of the consumer good decreases

3. Customers' expectation of higher prices in the future

4. Consumer tastes shift toward substitute products

A.

3 and 4 only

B.

4 and 2 only

C.

1 and 3 only

D.

1 and 2 only

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Question # 61

When is an adversarial style of negotiation appropriate?

A.

When one party has high bargaining power

B.

When a buyer feels the relationship is important

C.

When both parties want a win/win outcome

D.

When a sustainable partnership is key

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Question # 62

Effective listening is important in integrative negotiations. Is this statement correct?

A.

Yes, as it allows issues to be shared and understood between all parties

B.

Yes, as it means the supplier’s attempts at negotiation can be stopped quickly with reasoning

C.

No, as what the other party has to say is not important

D.

No, as effective listening is important only in a distributive negotiation

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Question # 63

Which of the following are ways of developing rapport when undertaking a negotiation?

A.

1 and 3 only (Engaging in assertive communication and Engaging in active listening)

B.

1 and 2 only (Engaging in assertive communication and Using probing questions)

C.

3 and 4 only (Engaging in active listening and Actively showing empathy)

D.

2 and 4 only (Using probing questions and Actively showing empathy)

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Question # 64

Tony is undertaking a negotiation with a strategic supplier and is frustrated by the lack of progress. He proposes using threats to get what he wants from the negotiations. Is this the correct course of action?

A.

Yes, Tony will get what he requires from the negotiations

B.

Yes, a long-term relationship is not required with the supplier

C.

No, a long-term relationship built on trust is required with the supplier

D.

No, it does not guarantee Tony will get what he requires from the negotiations

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Question # 65

In a negotiation for a new contract, the supplier suggests the buyer to shorten payment period from 45 days to 15 days because they are investing in new facilities to expand the supply capacity. The buyer replies that she can only sign off the deal if the payment period is 30 days ormore since it often takes at least 30 days for her company to collect the payment from customers. A permission from senior management is required for this suggestion. In order to ensure that supplier understands the matter, she reiterates it throughout the meeting. Which tactics is she using?

1. Outrageous initial demand

2. Salami slicing

3. Lack of authority

4. Broken record

A.

1 and 3 only

B.

2 and 4 only

C.

3 and 4 only

D.

1 and 2 only

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Question # 66

Which of the following are types of questions that are useful in opening and testing phases of a negotiation? Select the TWO that apply.

A.

Closed

B.

Narrow

C.

Probing

D.

Leading

E.

Open

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Question # 67

Information generated through Purchase Price Cost Analysis can be useful to the purchaser, by helping to identify which of the following costs relating to the supplier? Select the THREE that apply.

A.

External costs

B.

Profit

C.

Material costs

D.

Market costs

E.

Budgeted costs

F.

Depreciation on equipment

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Question # 68

When is the best time to adopt accommodating style according to Thomas-Kilmann conflict mode instrument?

A.

When both buyer and supplier want to find an integrative solution as their concerns are too important to be compromised

B.

When buyer needs to gather more information to gain more advantages in later negotiations

C.

When preserving harmony and avoiding disruption with supplier are especially important

D.

When buyer and supplier have equal power but are strongly committed to mutually exclusive goals

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Question # 69

Citywide Developments Ltd (CDL) is a construction programme management company that delivers the design and build of high-value property development schemes. CDL uses third-party consultant design services, using named consultants in the contract. CDL has recently observed increases in the consultancy day rate for these consultants. Which of the following tradeable concessions could CDL offer when negotiating with the suppliers of design services, in order to achieve lower rates of pay, but without lowering the quality of service?

A.

Accept unqualified trainee consultants

B.

Offer a shorter consultant working day

C.

Reduce the volume-based rate discounts

D.

Remove the requirement for the named personnel

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Question # 70

During a negotiation, a procurement manager suggests that the two companies should split the difference which would benefit both the supplier and buyer. Which persuasion method is she using?

A.

Compromise

B.

Threat

C.

Good cop/bad cop

D.

Logic

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Question # 71

What are the potential sources of conflict between the buyer and supplier? Select TWO that apply.

A.

Scheduling agreed supplier delivery dates

B.

Persistent late payment of the supplier’s invoices

C.

Unequal sharing of gains, risks and costs with the supplier

D.

Requesting early supplier involvement

E.

Planning scheduled visits to the supplier site

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Question # 72

Macroeconomics can have an impact on commercial negotiations. Is this statement correct?

A.

Yes, because factors such as inflation might influence pricing decisions

B.

No, because these considerations only affect the buyer

C.

Yes, because sales volumes are a key factor in the discussions

D.

No, because these macroeconomics can be discussed and addressed with a WIN/WIN (integrative) strategy

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Question # 73

Which of the following are typical characteristics of activity-based costing (ABC) method? Select TWO that apply.

A.

ABC provides the information required to take action and realise improvements

B.

Limited understanding of true costs incurred

C.

ABC has tended to over cost products on long runs and under cost those on short runs

D.

Costs are allocated based on volume

E.

Variable and all related overhead expenses are specifically assigned to a business activity

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Question # 74

Economic growth can be measured by...?

A.

The PPI

B.

GDP

C.

The CPI

D.

SBLI

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Question # 75

A procurement manager is preparing for a negotiation with an important supplier. He plans to withhold some crucial information so that his company gains the upper hand in the negotiation. Is this correct when considering using integrative approach to the negotiation?

A.

No, this approach requires honest and open discussion

B.

Yes, the supplier must know what buyer wants and how to provide that even when the buyer is silent on these matters

C.

Yes, the buying organisation must maximise its gain, even at the detriment of the other party

D.

No, holding back information will prompt the supplier gain higher negotiation power

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Question # 76

Which of the following are types of non-verbal communication that could be used during a negotiation meeting? Select THREE that apply.

A.

Meeting location

B.

Reference materials

C.

Hand gestures

D.

Room layout

E.

Eye contact

F.

Facial expressions

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Question # 77

Which of the following is categorised as fixed cost?

A.

Additional pallet hires due to higher demand in year-end season

B.

Land rental paid in advance

C.

Governments taxes

D.

Raw materials for next year production

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Question # 78

The sourcing manager has decided to adopt an adversarial style of negotiation to take advantage of the buyer’s greater bargaining power over the suppliers. In what other circumstances should an adversarial relationship be used?

A.

When the issues concerned are non-negotiable, for example, health and safety commitments

B.

In a monopoly market as the supplier will respond by conceding quantity discounts

C.

In all forms of negotiation as each party is always trying to gain advantage over the other

D.

When the supplier is likely to respond with further concessions to maintain a long-term relationship

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Question # 79

Should a buyer use closed questions in a negotiation?

A.

Yes, because closed questions help to reconfirm certain facts

B.

Yes, because they urge the supplier to provide more :

C.

No, the buyer should maximise the use of open questions

D.

No, supplier will consider closed questions as provocation

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Question # 80

In preparation for holding negotiation meetings with existing suppliers, category manager Stephen would like to appraise the bargaining strength of his organisation. Which of the following are examples of buyer power? Select TWO that apply:

A.

Ability to easily switch suppliers

B.

Suppliers are limited in number

C.

Collusion between competitor suppliers

D.

Buyer is large in size relative to suppliers

E.

High barriers of entry exist for new suppliers

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Question # 81

Jessica Taylor, a senior buyer, is reflecting on her most recent negotiation. She has been asked by her manager to create a written record of performance.

Which of the following should Jessica include in this negotiation performance report? Select THREE that apply.

A.

Evaluation of the negotiator's performance

B.

Other suppliers that could have been used

C.

A checklist of points learned for the future

D.

Travel expenses to attend the meeting

E.

A detailed pricing structure

F.

A comparison of actual versus set objectives

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Question # 82

Which of the following are the most typical characteristics of integrative approach to negotiation? Select TWO that apply.

A.

Positional-based

B.

Claiming value

C.

Interest-based

D.

Short-term wins

E.

Creating more value

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Question # 83

Which of the following are rules of attentive listening? Select TWO that apply.

A.

Prepare for what to say next

B.

React to the person who is speaking

C.

Listen deliberately

D.

Only focus on verbal cues

E.

Do not interrupt when the other party is speaking

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Question # 84

Effective listening is important in integrative negotiations. Is this statement correct?

A.

Yes, as it allows issues to be shared and understood between all parties

B.

Yes, as it means the supplier's attempts at negotiation can be stopped quickly with reasoning

C.

No, as what the other party has to say is not important

D.

No, as effective listening is important only in a distributive negotiation

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Question # 85

Which of the following tactics would be appropriate in an integrative negotiation?

A.

Lowball/Highball

B.

Take it or leave it

C.

Expanding the Pie

D.

Mother Hubbard

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Question # 86

Which of the following are features of a single-sourced type of relationship on the relationship spectrum?

Exclusivity granted in relation to a particular product

The supplier is an oligopoly market structure

The supplier is trusted and collaborative

Framework contracts are used to identify the supplier

A.

1 and 2 only

B.

1 and 3 only

C.

2 and 3 only

D.

2 and 4 only

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Question # 87

Which of the following is a source of power in organisational relationships?

A.

Referent power

B.

Given power

C.

Tactical power

D.

Intruded power

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Question # 88

Which of the following would help build trust in a relationship?

    Mediation attendance

    Regular meetings

    Keep promises

    Coercion

A.

2 and 4 only

B.

2 and 3 only

C.

1 and 4 only

D.

1 and 3 only

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Question # 89

Where there are high levels of commitment to relationships between both the buyer and supplier, this is seen as collaborative and beneficial to negotiations. Is this statement correct?

A.

Yes, characteristics include risk management and strategic planning

B.

No, this can be classified as adversarial

C.

Yes, characteristics include arm's length transactions and minimal communication

D.

No, collaboration does not require commitments from either side

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Question # 90

Lina Rawlins is a senior buyer working for a medical equipment company. Lina is in charge of the company’s largest supplier account, Great Barrington Gas (GBG), a medical equipment supplier. Recently, GBG's performance has declined, leading to an increasing number of rejected items. Lina is aware of the seriousness of this and has asked GBG to attend an urgent meeting. In the meeting, Lina asked the GBG representative, “Can you tell me exactly what you are doing to ensure quality?" What type of question is Lina asking?

A.

Probing

B.

Leading

C.

Reflective

D.

Hypothetical

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Question # 91

A supplier has offered international football tickets to the procurement manager while they are in the middle of a contract negotiation. What should the procurement manager do?

A.

Accept the offer of the tickets as this will enhance the relationship between both parties

B.

Accept the offer as this will not affect the relationship with the supplier

C.

Reject the offer as this may be seen as a conflict of interest during the negotiation

D.

Reject the offer as the procurement manager will have to repay the gesture

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Question # 92

Which of the following stages of the CIPS Procurement Cycle are typically where commercial negotiations take place?

Contract management and improvement

Develop tender documentation

Market sector analysis

Contract award and implementation

A.

1 and 4

B.

1 and 3

C.

3 and 4

D.

2 and 3

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Question # 93

Which of the following are behaviours that builds trust between the buyer and the supplier in business relationship? Select TWO that apply.

A.

Conducting transparent procurement process

B.

Over-inflated contingency funds

C.

Allowing supplier to involve in early product development

D.

Commercial espionage

E.

Tendency to blame other party

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