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CIPS Commercial Negotiation Sample Questions (Q281-Q286):

NEW QUESTION # 281
Which of the following is the most appropriate approach to investors or shareholders who have high level of influence but low interest in the running of business?

Answer: B

Explanation:
Investors or shareholders who have high level of influence but low interest belong to 'Keep satisfied' quadrant of Mendelow's Stakeholder Matrix.
You may read 2 versions from L4M1 and L4M5 here:
Table Description automatically generated
LO 1, AC 1.1


NEW QUESTION # 282
Different types of relationships impact negotiations. Which source of leverage would most support the buyer?

Answer: D

Explanation:
Legitimate power comes from formal authority and organisational backing, making it a credible and sustainable leverage source in negotiations. Personality power or reliance on colleagues and friends lacks long- term weight and may not influence suppliers strategically. Buyers who use legitimate power, backed by governance and authority, negotiate from a position of credibility and professionalism, reinforcing stronger outcomes.
Reference: CIPS L4M5 (2nd ed.), LO 3.1 - Sources of power: legitimate, coercive, expert, referent.


NEW QUESTION # 283
Commercial negotiation ends at the award of a contract. Is this statement true?

Answer: B

Explanation:
Explanation
Negotiation doesn't end after the contract is awarded. The needs for negotiation can arise in anypost-award stages. For example, at supplier development and relationship management stage, improvement in supplier capability, capacity, and product/service range can be negotiated. Negotiations with long-term strategic critical suppliers should be carriedout in a partnering style, with a win-win starting point assumed.
In some sectors such as transport, utilities and infrastructure, tenderers may 'bid low' or even make a loss to win major contracts with a view to negotiating lucrative changes, variationsand 'add-ons' over the life of the contract when the supplier is bedded in and the buyer is in the weaker position to push back or challenge. Even in less complex contract, it is very likely that there will be a need to negotiate with that supplier again after the awarding of the contract.
LO 1, AC 1.1


NEW QUESTION # 284
Which of the following is a disadvantage of absorption costing method?

Answer: B

Explanation:
Absorption costing is an approach to allocating overheads in which indirect costs are loaded or absorbed into direct costs related to specific jobs, processes or outputs, using an estimated basis of allocation.
Graphical user interface, text, chat or text message, website Description automatically generated


NEW QUESTION # 285
If the price of a good is above the equilibrium price, which of the following will happen?

Answer: D

Explanation:
:
In microeconomics, equilibrium price is determined when the quantity demanded is equal to the quantity supplied at equilibrium price in a market, there will be no shortages and no surpluses. If we combine our supply and demand curves on one graph, the point at which they converge determines the equilibrium price. If the price is set above this price and you read across the graph you will see the supply excess demand and there will be a surplus. In order to reduce this surplus, the price will need to fall. The scenario is illustrated in the graph below:
Chart, line chart Description automatically generated


NEW QUESTION # 286
......

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