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All L4M5 Test Inside CIPS Questions

Page: 5 / 28
Total 373 questions

Commercial Negotiation Questions and Answers

Question 17

A skilled negotiator will use a range of questioning techniques in a negotiation. If they wished to explore options with the other party without making any formal commitment, which type of question style would they use?

Options:

A.

Leading

B.

Hypothetical

C.

Reflective

D.

Closed

Question 18

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?

Options:

A.

Value engineering

B.

Part substitution

C.

Budget linkages

D.

Compare total cost of ownership

E.

Volume pooling

Question 19

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

Options:

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

Question 20

Buyers should have the ability to analyse the costs of their purchases not only for determining their impact to their organisation’s cost but also for the purpose of reducing them during commercial negotiations to contribute to the profitability of their organisation. One way ofanalysing costs is to classify them into direct and indirect costs. Which ONE of the following is an explanation of ‘direct costs’?

Options:

A.

Costs that are only related to manufacturing firms where raw materials are directly converted into specific product units

B.

Costs of materials, labour, and other expenses that are directly identified with manufactured units of a product

C.

Costs that are connected with materials and labour, excluding expenses used directly in manufacturing products

D.

Costs of labour and expenses incurred directly whether or not the production fluctuates owing to demand or downtime

Page: 5 / 28
Total 373 questions