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CIPS Ethical and Responsible Sourcing Sample Questions (Q123-Q128):

NEW QUESTION # 123
Raja is a procurement manager who is keen to gain further insight into the current marketplace and whether local suppliers are capable to provide a service he is looking to procure. He wishes to test the market before he begins a formal tender process. What should Raja do?

A. send out a RFI
B. speak with his current suppliers
C. send out a RFQ
D. conduct an open competition

Answer: A

Explanation:
Raja should send out a RFI- request for information; this will allow him to gain feedback from the marketplace prior to tender.
Speaking only with current suppliers will not provide all the information Raja requires.
He should not send out a request for quotation since he is still conducting market research An open competition would be how he can procure, after he's completed his research

NEW QUESTION # 124
Ji Yuan is a procurement manager who is looking for a new supplier to complete reactive maintenance activities throughout his property portfolio. The reactive maintenance will include an array of plumbing tasks as well as fixing electrical items. Suppliers therefore need to be extremely skilled and knowledgeable about a variety of tasks. Ji Yuan has done some initial research and doesn't believe that there are many suppliers who can complete this type of contract. What type of tender should he use?

A. negotiated
B. competitive dialogue
C. open
D. restricted

Answer: C

Explanation:
Open tenders should be used when the buyer expects there to be little interest / fewer bids. The opportunity is advertised widely allowing any supplier that wishes to submit a bid the opportunity.
The other options limit the number of suppliers and Ji Yuan doesn't want to do that, because he risks getting no interest and no supplier.
P.23

NEW QUESTION # 125
Compared with single sourcing, what is a key advantage to dual or multiple sourcing? Select TWO

A. Supplier Loyalty
B. It is easy to drive down costs
C. Low risk of failure to supply
D. There is a risk of failure to supply
E. Economies of scale

Answer: B,C

Explanation:
The correct answers are 'it is easy to drive down costs' (as you can pit the suppliers against each other) and
'low risk of failure to supply' (if one supplier can't provide what you need, the other supplier might be able to).
Economies of scale and supplier loyalty are advantages of single-sourcing.
There is a risk of failure to supply is a risk associated with single sourcing.
There's a useful table of advantages and disadvantages of single / multi sourcing on p.22. Types of sourcing is a key topic for the exam.

NEW QUESTION # 126
Luke has sent out a Request for Information to test the waters of the supply market for a new product he is sourcing. He has received a high number of detailed documents back from suppliers. Which of the following is Luke now likely to know about the marketplace? Select THREE

A. exact costs of the item he's procuring
B. acceptable lead times
C. amount of product competition
D. expected changes in the marketplace
E. samples of the product

Answer: B,C,D

Explanation:
The correct answers are; lead times, product competition and changes in the marketplace.
You wouldn't expect to receive samples or costings from a Request for Information - rather, these should be expected as part of the Tender Competition

NEW QUESTION # 127
In order to assess whether a company is able to meet its current liabilities, which financial ratio should you use?

A. Gearing Ratio
B. Return on Equity
C. Gross Profit Margin
D. Acid Test

Answer: B

Explanation:
"Meet current liabilities" is a posh way of saying "can you pay your bills". You're therefore looking for a liquidity ratio- a ratio that looks at assets vs liabilities (i.e. money in the bank vs money owed out). The Acid Test is a liquidity ratio. It's sometimes called the 'quick ratio'. Both terms come up on the exam. The other options are financial ratios but aren't for liquidity.

NEW QUESTION # 128
......

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100% Pass Quiz L4M4 Marvelous Ethical and Responsible Sourcing Exam Revision Plan

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CIPS Ethical and Responsible Sourcing Sample Questions (Q123-Q128):

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