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CIPS Exam L4M3 Topic 10 Question 2 Discussion
Actual exam question for
CIPS's
L4M3 exam
Question #: 2
Topic #: 10
[All L4M3 Questions]
Topic #: 10
Which of the following is always an advantage of using fixed price arrangement in a contract for buying organisation?
Suggested Answer:
A
Advantages of using fixed pricing arrangement are as below:
- Budget/income certainty - prices are fixed up front and should not change
- The impact of changes to the supplier's cost base is not fed through to the purchaser. If costs diminish, the supplier will benefit from this, and if costs rise, the purchaser will benefit
LO 3, AC 3.3
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