ISM CORE Actual Questions

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Question 72

A buying company concludes the request for proposal (RFP) process and signs a contract for its primary logistics provider. Company policy requires that the supply manager notify and debriefall unsuccessful bidders. During these debriefings, one of the bidders—Supplier X— states that it will offer a price discount lower than that of the successful bidder. Supplier X's proposal is very strong, and the firm has a track record of success with the buying company. Given this situation, which of the following is the BEST course of action for the supply manager to take?

Options:

Escalate Supplier X's proposal to executive management

Re-open the RFP for all suppliers to re-submit proposals

Reject Supplier X's offer

Withdraw the award from the selected bidder and re-award the contract to Supplier X

Question 73

A supplier is awarded a contract to network all of a buying company's production and forecasting applications. The supplier completes the work on time. However, follow-up tests by the buying organization's IT department determine that performance does not meet contract specifications. Given this situation, which of the following is the BEST course of action for the buying firm to take?

Options:

Review the contract warranty terms and remedies

Accept the network and sign a maintenance contract to fix the problems

Have another supplier review the network to estimate the cost of repairs

Have IT attempt to repair the network so it works correctly

Question 74

Which of the following BEST describes a cash flow budget?

Options:

A budget that links expenditures to revenue within each budgetary period

A process in which managers must begin each budgetary period with no predetermined allocations

A financial plan specifying the amount of money to be spent on plant and equipment

A budget that shows individual expenses without tying the expenses to broader goals

Question 75

A chief procurement officer (CPO) is asked by the company corporate travel department to present strategies and tactics related to the acquisition of travel services. Which of the following approaches will BEST demonstrate an understanding of the travel department's needs?

Options:

Presenting benchmarks on the average costs of domestic and international airline tickets, to employ during negotiations over airline contracts

Highlighting the negotiating of airline contracts, given that air travel represents the largest element of the budget and other travel spend categories are less important and harder to control

Focusing on supply (e.g. airlines, hotels) and demand (e.g. company travel policy, classes of travel), and how supply management can optimize both

Emphasizing the company-wide implementation of a corporate card as a tool to monitor every aspect of the travel spend