Exam 14: Contract Management

Which of the following is not one of the basic levels of service that a systems supplier can provide to the buyer?

The _____ clause of a contract specifies terms such as "current price," "prior price," and other criteria that determine how or if prices will be adjusted over the course of the contract.

Most commonly used contracts are developed from earlier contracts that are subsequently modified to fit the situation at hand.

Escalation clauses allow increases in the base price but not decreases.

A/An _____ is nonbinding on either the purchaser or the supplier and typically provides discounts to corporate buyers based on total volume for the corporation as a whole, not for any subunits individually.

The _____ clause of a contract stipulates whether the supplier can assign its rights described in the agreement to another party and whether subcontracting is permissible.

Perhaps the most important clause of a consulting contract to the consultant is the assurance of payment.

Fixed price contracts are the most complex and difficult for purchasing to manage because there is a need for extensive auditing or additional input from the purchasing side.

The longer the term of the purchase agreement, the less likely firm-fixed price contracts will be acceptable to the supplier.