100% PASS QUIZ 2025 CIPS EFFICIENT L4M3: NEW CIPS COMMERCIAL CONTRACTING TEST OBJECTIVES

100% Pass Quiz 2025 CIPS Efficient L4M3: New CIPS Commercial Contracting Test Objectives

100% Pass Quiz 2025 CIPS Efficient L4M3: New CIPS Commercial Contracting Test Objectives

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Tags: New L4M3 Test Objectives, Test L4M3 Engine, L4M3 Reliable Exam Topics, Valid Real L4M3 Exam, Latest L4M3 Test Fee

CIPS L4M3 exam include all the important concepts leaving behind the stories to tell for some other time. For the complete and quick CIPS L4M3 preparation the CIPS L4M3 Exam Questions are the best study material. With CIPS L4M3 Exam Practice test questions you can ace your CIPS L4M3 exam preparation simply and quickly to pass the final L4M3 exam easily.

For individuals seeking the CIPS L4M3 certification, it is recommended that they have at least two years of relevant experience in procurement and supply chain management roles. CIPS Commercial Contracting certification exam is relevant for professionals working in both the public and private sectors, including commercial, non-profit, and government organizations.

The CIPS L4M3 exam covers a broad range of topics related to commercial contracting, including contract formation and negotiation, contract management, contract performance monitoring, and dispute resolution. It also includes questions related to legal and regulatory compliance, ethics, and risk management. L4M3 Exam is designed to test both theoretical knowledge and practical application of commercial contracting concepts, and requires candidates to demonstrate their ability to analyze and solve complex contracting problems.

CIPS L4M3 exam is an excellent opportunity for procurement professionals to demonstrate their expertise in commercial contracting and advance their careers in this field. By passing L4M3 exam, candidates can gain recognition from employers and peers, as well as enhance their knowledge and skills in procurement and supply chain management.

>> New L4M3 Test Objectives <<

100% Pass Quiz 2025 L4M3: Updated New CIPS Commercial Contracting Test Objectives

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CIPS Commercial Contracting Sample Questions (Q79-Q84):

NEW QUESTION # 79
Which of the following is always automatically considered as a contract?

  • A. Framework agreement
  • B. Framework arrangement
  • C. Performance management framework
  • D. Call-off

Answer: D

Explanation:
- A call off or a term contract is one which exists for a fixed period of time, rather than for a specific purpose
- A formal framework agreement does have some legal standing but it is not a contract, primarily because there is no consideration involved, but it is an overarching (or umbrella) agreement under which contracts can be created (this holds true in English law but may not be right in other jurisdiction)
- A framework arrangement is a rather loose set-up, without any legal standing. It usually occurs when an organisation has decided for itself to limit the number of suppliers it is willing to work with and, through a purely internal process, sets up an approved list of such suppliers.
- A performance management framework including KPIs and targets, the assessment scheme and incentives, disincentives, bonuses and penalties. It is a schedule to a contract and only legally binding if it is referred from contract clauses.
Reference:
LO 1, AC 1.3


NEW QUESTION # 80
Sally places a purchase order to the supplier for some components that her company requires. The supplier delivers the goods as she asks, but the quality assurance team finds that these components are defective and unfit for the company's operations. Which document is the ground to decide whether the goods received are fit for purpose?

  • A. Code of conduct
  • B. Specification
  • C. Pre-qualification questionnaire
  • D. CSR policies

Answer: B

Explanation:
According to USLegal Inc, fitness for purpose refers to the standard that must be met by a seller in the course of a business. Generally, when a buyer makes known to a seller the particular purpose for which the goods are bought, there is an implied condition that the goods are reasonably fit for that purpose (customer's requirements, needs, or desires). Specification is the ground for deciding whether goods received are fit for purpose.
We already know that there are two types of specifications: conformance and performance specifications. With conformance specification, the buyer lists out technical requirements to which the goods must conform. Lacking of any requirement may be enough for the goods to be unfit. On the other hand, if performance specification is in use, the goods must be fit for specific outputs that buyer has listed in the specification.
Providing the 'fit for purpose' goods is one of the fundamental obligations of seller in sale contract. Unfulfilling this obligation would lead to legal consequences. If the goods are unfit for purpose, seller may have to:
- replace the non-conforming goods
- pay the damages to the buyer
Reference:
- Why you should keep attention to the specification when contracting with suppliers
- CIPS study guide page 137
LO 3, AC 3.1


NEW QUESTION # 81
A tire manufacturer entered into a contract with a distributor. In the contract, the distributor is prohibited from selling the tire under the price list. The distributor must pay $5 for each tire sold in breach. The amount of $5 is known as...?

  • A. Penalty
  • B. Quantum meruit
  • C. Liquidated damages
  • D. Caveat Emptor

Answer: C

Explanation:
This scenario is in fact based on a famous case law: Dunlop Pneumatic Tyre Company v New Garage & Motor co [1915] AC 79. In this case law, the House of Lords identified the clause as liquidated damages, and therefore enforceable.
However, if this case had happened in 2015 or afterwards, there would be some legal issues:
- The price agreement is prohibited by Competition Act 1998
- If the agreement is allowed by Competition Act, as in the case Cavendish Square Holding BV (Appellant) v Talal El Makdessi (Respondent), the clause can also be identified as a penalty and it is still enforceable.
Reference: CIPS study guide page 158-159
LO 3, AC 3.2


NEW QUESTION # 82
What is the pricing method that incentivises the supplier to control their costs?

  • A. Cost-plus pricing
  • B. Penetration pricing
  • C. Skimming pricing
  • D. Target Costing

Answer: D

Explanation:
Penetration pricing is a marketing strategy used by businesses to attract customers to a new product or service by offering a lower price during its initial offering. The lower price helps a new product or service penetrate the market and attract customers away from competitors.
Price skimming is a product pricing strategy by which a firm charges the highest initial price that customers will pay and then lowers it over time. As the demand of the first customers is satisfied and competition enters the market, the firm lowers the price to attract another, more price-sensitive segment of the population. The skimming strategy gets its name from "skimming" successive layers of cream, or customer segments, as prices are lowered over time.
Incentive contracts allow sharing of the risks between the contractor and the client. The contractor is reimbursed all its justifiable costs in addition to a calculated fee. Target costing is an element of incentive contracts.
Cost-plus pricing is also known as markup pricing. It's a pricing method where a fixed percentage is added on top of the cost to produce Reference: CIPS study guide page 185 LO 3, AC 3.3


NEW QUESTION # 83
Company A based in copyright signed a commercial contract with Company B in Egypt. Both countries are Contracting States to Vienna Convention on Contracts for the International Sale of Goods. The contract states that "The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of copyright". Which of the following set of rules will be applied if dispute between contracting parties occurs?

  • A. copyright's legal system
  • B. CISG
  • C. Egypt's legal system
  • D. WTO rules

Answer: A

Explanation:
Where the sale of goods is between two businesses in different Contracting States, then it is international and the CISG rules of law automatically apply unless they have been excluded. A contract clause stating that the contract is subject to the legal systems and courts of a particular country overrides or excludes the CISG rules, since the local rules of that country would apply instead.
So the answer should be copyright's legal system.
Reference:
LO 1, AC 1.2


NEW QUESTION # 84
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