Question 1

When should liquidated damages clauses be written into a contract?

Options :

A : When the breaching party wants to exclude all its liabilities

B : When the innocent party wants to punish the breaching party.

C : When the loss to the innocent party will be either too uncertain or too difficult to calculate.

D : When the court approves the damages amount before the contract is executed.

Answer: C

Question 2

Which of the following is the term that describes an item bought for a single and non-recurring use or purpose?

Options :

A : Stock purchase

B : Call-off purchase

C : Ad-hoc purchase

D : Operational purchase

Answer: C

Question 3

Which of the following usually have no legal standing? Select TWO that apply:

Options :

A : Commission

B : Framework agreement

C : Framework arrangement

D : Estimate

E : Service level agreement

Answer: C,D

Question 4

Which of the following are true statements about RFQ process? Select TWO that apply.

Options :

A : RFQ process creates heavier administrative burdens than tendering process

B : Price is often the only variable in the RFQ and quotations

C : Buying organisation should only send RFQ to pre-qualified suppliers

D : RFQ process is not suitable for low value purchase

E : RFQ process requires the suppliers to submit their technical proposals

Answer: B,C

Question 5

A purchase order can become a contract between supplier and purchaser if it is...?

Options :

A : Issued by the buyer

B : Received by the supplier

C : Accepted by the supplier

D : Edited by the supplier

Answer: C

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