CIPS DEFINING BUSINESS
NEED L4M2 PRACTICE
TEST FULL 60
Question 1: What should a testing-and-acceptance section state?
Choices:
1) How compliance will be tested and the criteria for acceptance 2) Only the supplier's advertising claims 3) The buyer's annual leave policy 4) The future resale price of the supplier's shares
Correct Answer: How compliance will be tested and the criteria for acceptance
Explanation: Testing and acceptance provisions de�ne evidence, methods, thresholds, responsibilities, and conditions that determine whether the requirement has been met.Page 1
Question 2: A facilities team reorders the same standard printer paper from the
same approved supplier under unchanged terms. Which type of purchase is this?
Choices:
1) New purchase 2) Modi�ed rebuy 3) Straight rebuy 4) Capital purchase
Correct Answer: Straight rebuy
Explanation: A straight rebuy is a routine repeat purchase where the requirement and buying approach remain substantially unchanged.Question 3: A manufacturer plans to buy its �rst robotic vision-inspection system.Which purchasing situation is most likely?
Choices:
1) New purchase 2) Straight rebuy 3) Modi�ed rebuy 4) Call-o� purchase
Correct Answer: New purchase
Explanation: A �rst-time requirement is a new purchase and normally requires more research, stakeholder input, and supply-market analysis than a routine rebuy.Page 2
Question 4: When procurement contributes to a business case for a major external purchase, which activity adds the most distinctive procurement value?
Choices:
1) Writing the organisation's annual report 2) Providing supply-market, supplier, price, and sourcing insight 3) Approving employee leave requests 4) Designing the supplier's internal production process
Correct Answer: Providing supply-market, supplier, price, and sourcing insight
Explanation: Procurement contributes commercial and supply-market knowledge, including supplier capability, pricing, sourcing options, risk, and market conditions.Question 5: Which source would be most useful for estimating the future purchase price of a metal whose price closely follows a traded commodity?
Choices:
1) An employee holiday calendar 2) A relevant commodity price index and market forecast 3) The supplier's o�ce �oor plan 4) A list of internal job titles
Correct Answer: A relevant commodity price index and market forecast
Explanation: Commodity indices and credible market forecasts can provide objective market data for estimating likely price movements.Page 3