Check the Free demo of our L4M5 Exam Dumps with 165 Questions [Q79-Q97]

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Check the Free demo of our L4M5 Exam Dumps with 165 Questions

Clear your concepts with L4M5 Questions Before Attempting Real exam

CIPS L4M5 Exam Syllabus Topics:

Topic	Details
Topic 1	Macroeconomics and its influence on commercial negotiations Contrast the economic factors that impact on commercial negotiations
Topic 2	Team management and the influence of stakeholders in negotiations Definitions of commercial negotiation
Topic 3	Analyse the application of commercial negotiations in the work of procurement and supply Negotiation in relation to the stages of the sourcing process
Topic 4	Building relationships based on reputation, and trust Repairing a relationship The relationship spectrum
Topic 5	Organisational power: comparing the relative power of purchasers and suppliers Explain how the balance of power in commercial negotiations can affect outcomes
Topic 6	Costing methods such as absorption, marginal or variable and activity based costing Know how to prepare for negotiations with external organisations
Topic 7	Identify the different types of relationships that impact on commercial negotiations Pragmatic and principled styles of negotiation
Topic 8	Differentiate between the types of approaches that can be pursued in commercial negotiations Distributive win-lose, distributive approaches to negotiation
Topic 9	How purchasers can improve leverage with suppliers The importance of power in commercial negotiations

QUESTION 79
A good negotiator invests time in understanding the needs of the individuals in a negotiation. Is this statement true?

Yes, because individuals’ needs always unify with their own organisation’s needs and wants

No, becausenegotiator should attempt to satisfy the needs of the other organisation only

No, because satisfying individual needs will lead to conflict of interest and unethical practices

Yes, because individual needs largely influence the outcomes of the negotiation

QUESTION 80
Which type of power is considered the opposite of coercive power?

Referent power

Informational power

Reward power

Expert power

QUESTION 81
In airline industry, suppliers prefer to adopt dynamic pricing in order to constantly monitor and change their fares inresponse to market conditions. Dynamics pricing is based on which costing method?

Activity-based costing

Cost plus costing

Absorption costing

Marginal costing

QUESTION 82
Economic growth can be measured by…?

The PPI

GDP

The CPI

SBLI

QUESTION 83
Which of the following is the true statement?

External stakeholders such as suppliers can largely influence an organisation’s procurement negotiations

Internal stakeholder support will be important for both negotiation and contract performance

All connected stakeholders have a low level of impact on procurement negotiations

Commercial negotiation objectives should be driven by just the instincts of procurement

QUESTION 84
Which of the following are typical characteristics of activity-based costing (ABC) method? Select TWO that apply.

ABC provides the information required to take action and realise improvements

Limited understanding of true costs incurred

ABC has tended to over cost products on long runs and under cost those on short runs

Costs are allocated based on volume

Variable and all related overhead expenses are specifically assigned to a business activity

QUESTION 85
Which of the following are factors that might shift the demand curve for a consumer good to the right?
1. Prices of complementary goods decrease
2. Price of the consumer good decreases
3. Customers’ expectation of higher prices in the future
4. Consumer tastes shift toward substitute products

3 and 4 only

4 and 2 only

1 and 3 only

1 and 2 only

QUESTION 86
Collaborative approach in negotiation not only can fully satisfies the concerns of both, but also ensure that neither party will seek to be opportunistic in later time during the life of the contract. Is this statement true?

Yes, because all parties must have exactly the same goals in integrative negotiation

No, because any party may leverage its own advantage during the contract

Yes, because both parties have well understood each other’s goals when they engage in collaborative negotiation

No, because the parties will always find a compromise solution in integrative approach

QUESTION 87
The trust is built based on the other party’s professional qualifications or proven or certified technical capability or experience is known as…?

Goodwill trust

Contractual trust

Irrevocable Trust

Competence trust

QUESTION 88
JCB is a large manufacturer of heavy machinery. The CPO is going to a negotiation with a Chinese supplier about procuring some major components. He is wondering about balance of power in the negotiation. Which of the following micro factors are most likely to shift the balance of power towards the buying organisation in this commercial negotiation? Select TWO that apply

Buyers purchase in small volumes

Suppliers are more concentrated than buyer

Eruption of epidemic in supply market

JCB’s switching costs are low

These components are highly standardised

QUESTION 89
Which of the following is considered a weakness of a ‘dealer’ style negotiator?

May shift position quickly

May be too assertive

Focuses on the facts and not the people

Very precise

QUESTION 90
Ma Bell was the sole provider of landline telephoneservice to most of the US in 1980s. This is an example of…?

Monopsony

Monopoly

Monopolistic competition

Perfect competition

QUESTION 91
Which of the following is a disadvantage of absorption costing method?

Fixedcost allocated to products on the basis of the cost of activities used in producing them

Variable costs are not taken into product final costs

Using marginal cost of producing addition units

Limited understanding of true costs incurred

QUESTION 92
In which of the following costing methods, overhead costs are applied in proportion to production volume?

Absorption costing

Mark-up costing

Activity-based costing

Marginal costing

QUESTION 93
Which of thefollowing are most likely to be sources of conflict that can emerge from the content of commercial negotiations? Select TWO that apply.

Framework arrangement

Payment terms

Contract governing law

Requisition

Cultural differences

QUESTION 94
Should a buyer use closed questions in a negotiation?

Yes, because closed questions help to reconfirm certain facts

Yes, because they urge the supplier to provide more detailedExplanation::

No, the buyer should maximise the use of open questions

No, supplier will consider closed questions as provocation

QUESTION 95
Which of the following are hardball tactics in negotiations? Select TWO that apply.

Expand the pie

Snow job

Good cop, bad cop

Sweetening the deal

Bridging

QUESTION 96
Which of the following are most likely to be fundamentals of Fisher & Ury’s principled negotiation?
1. Depersonalise the argument
2. Focuson positions
3. Generate creative options
4. Using subjective criteria

2 and 3 only

2 and 4 only

1 and 3 only

1 and 4 only