CIPS Exam A8 Topic 1 Question 64 Discussion

Actual exam question for CIPS's A8 exam

Question #: 64
Topic #: 1

[All A8 Questions]

In which of the following situations is a 'fixed price contract' most appropriate?

AIn highly volatile market conditions where raw material prices fluctuate at regular intervals

BWhere the supplier is unable to give an accurate estimate of materials to be used in completing the contract

CFor a contract where the work can accurately be foreseen and accurately measured

DFor the provision of a service where there are likely to be numerous changes to the service requirement.

Show Suggested Answer

Suggested Answer: A

by Karma at Jul 14, 2024, 12:13 PM

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Artie

8 months ago

I'm torn between B and D. Maybe we can just put a fixed price on a random number of materials and hope for the best? Or how about a service that changes so often, the price just becomes a suggestion? Sounds solid to me!

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Yuette

8 months ago

Option D, definitely. I love the idea of a fixed price contract for a service that's constantly changing. It'll be like playing contract roulette - you never know what you're gonna get!

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Zona

7 months ago

Dalene: That's true, but it could also lead to some interesting opportunities for both parties.

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Dalene

7 months ago

I agree, it adds an element of unpredictability to the contract.

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Hoa

7 months ago

I think it could be risky though, not knowing what changes might come up.

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Tammi

7 months ago

Option D sounds exciting! It's like a surprise every time.

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Wade

8 months ago

I'm going with C as well. It's the only one that makes sense for a fixed price contract. The other options sound like they'd lead to a lot of headaches and cost overruns.

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Teri

8 months ago

Yeah, option C is definitely the most suitable for a fixed price contract. The others seem too risky.

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Celestine

8 months ago

I agree, option C seems like the best choice for a fixed price contract.

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Hillary

8 months ago

Option C all the way! A fixed price contract is perfect when you know exactly what you're getting. Trying to pin down a price when things are changing all the time? No thank you!

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Kizzy

7 months ago

Ngoc: Exactly, it just eliminates any uncertainties and makes everything clear from the start.

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Ngoc

7 months ago

Yeah, it makes sense to go with a fixed price when the work can be accurately measured.

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Ira

8 months ago

I agree, option C is definitely the best choice for a fixed price contract.

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Lilli

8 months ago

Definitely C. I mean, why would you want a fixed price contract if the market is volatile or the supplier can't estimate the materials? That's just asking for trouble!

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Annabelle

7 months ago

It's all about minimizing risk and ensuring clarity in the agreement, which is why option C is the best choice.

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Nicholle

7 months ago

I think it's important to avoid any surprises or unexpected costs, that's why a fixed price contract is the way to go.

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Tamie

7 months ago

Yeah, it just makes sense to have a fixed price when you know exactly what needs to be done.

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Blair

8 months ago

I agree, a fixed price contract is definitely most appropriate for work that can be accurately foreseen and measured.

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Nikita

8 months ago

That could be risky, as changes to the service requirement could lead to additional costs in a fixed price contract.

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Annita

9 months ago

But what about option D) For the provision of a service where there are likely to be numerous changes to the service requirement?

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Mariann

9 months ago

I think option C is the right answer. A fixed price contract is best when the work can be accurately measured and foreseen. Anything else just seems like a recipe for disaster!

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Carlota

7 months ago

I think option C is definitely the safest bet for avoiding any unexpected costs or issues.

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Scarlet

7 months ago

Yeah, it makes sense to go with a fixed price when the work can be accurately measured and foreseen.

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Sherita

7 months ago

I agree, option C seems like the most appropriate choice for a fixed price contract.

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Lorean

7 months ago

I think option C is the safest choice. It helps avoid any unexpected costs or disputes.

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Elouise

8 months ago

Yeah, option C makes the most sense. It's important to have a clear understanding of the work involved.

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Ressie

8 months ago

I agree, option C is definitely the most appropriate for a fixed price contract.

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Carmen

9 months ago

I agree with Nikita, fixed price contracts work best when the scope of work is well-defined.

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Nikita

9 months ago

I think C) For a contract where the work can accurately be foreseen and accurately measured is the most appropriate.

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