Project Contract Management - Quiz #1

Once signed, a contract is legally binding unless:

• One party is unable to perform

• One party is unable to finance its part of the work

• It is in violation of applicable law

• It is declared null and void by either party's legal counsel

With a clear procurement statement of work, a seller completes work as specified, but the buyer is not pleased with the results. The contract is considered to be:

• Null and void

• Incomplete

• Complete

• Waived

All of the following statements concerning procurement documents are incorrect EXCEPT:

• Well-designed procurement documents can simplify comparison of responses.

• Procurement documents must be rigorous with no flexibility to allow consideration of seller suggestions.

• In general, procurement documents should not include selection criteria.

• Well-designed procurement documents do not include a procurement statement of work.

A project manager for the seller is told by her management that the project should do whatever possible to be awared incentive money. The primary objective of incentive clauses in a contract is to:

• Reduce costs for the buyer.

• Help the seller control costs.

• Synchronize objectives.

• Reduce risk for the seller by shifting risk to the buyer.

All of the following statements about change control are incorrect EXCEPT:

• A fixed price contract will minimize the need for change control.

• Changes seldom provide real benefits to the project.

• Contracts should include procedures to accommodate changes.

• More detailed specifications eliminate the causes of changes.

A routine audit of a cost reimbursable (CR) contract determines that overcharges are being made. If the contract does not specify corrective action, the buyer should:

• Continue to make project payments.

• Halt payments until the problem is corrected.

• Void the contract and start legal action to recover overpayments.

• Change the contract to require more frequent audits.

The primary objective of contract negotiation is to:

• Get the most from the other side.

• Protect the relationship.

• Get the highest monetary return.

• Define objectives and stick to them.

A seller is working on a cost reimbursable (CR) contract when the buyer decides he would like to expand the scope of service and change a fixed price (FP) contract. All of the following are the seller's options EXCEPT:

• Completing the original work on a cost reimbursable basis and then negotiating a fixed price for the additional work.

• Completing the original work and rejecting the additional work.

• Negotiating a fixed price contract that includes the work.

• Starting over with a new contract.

Bidder conferences are part of:

• Plan procurements.

• Administer Procurements.

• Conduct Procurements.

• Communications Management.

All of the following MUST be present to have a contract EXCEPT:

• A procurement statement of work.

• Acceptance

• The address of the seller.

• Buyers' signatures.