Dilla University

College of Engineering and Technology

School of Architecture and CoTM
Department of Construction Technology and Management

Model Exit Exam on Procurement Management and Contract Administration

MULTIPLE CHOICE QUESTIONS

1. Which of the following statements do you think has greatest validity?

A. Purchasing has a broader meaning than procurement
B. Procurement is broadly equivalent to purchasing.
C. Procurement has a broader meaning than purchasing.
D. None of the above
2. Which sequence is most typical for the procurement process?
A. Originator to buyer to approver to supplier.
B. Supplier to originator to approver to buyer.
C. Originator to approver to buyer to supplier.
D. Approver to originator to buyer to supplier.
E. None of the above
3. One aim of e-procurement is increasing savings by sourcing items ______.
A. from the right source
B. of the right quantity
C. at the right price
D. of the right quality
E. none of the above

4. It is a usual practice that public procurement authorities communicate with the prospective
bidders during the course of public procurement. Which of the following is the most
acceptable form of communication during the pre-bid period?
A. Any bidder may, in writing, seek clarifications from the procuring entity in respect of the
bidding documents
B. Any bidder may seek clarifications over the official phone in respect of the bidding
documents
C. Any bidder may seek clarifications by meeting the tender accepting authority in person in
respect of the bidding documents
D. Any bidder may seek clarifications by meeting the tender evaluating authority in person
5. An agreement enforceable at law is a_____________.
A. Enforceable acceptance
B. Accepted offer
C. Approved promise
D. Contract
6. Every promise and every set of promises, forming the consideration for each other, is an
A. Agreement
B. Contract
C. Offer
D. Acceptance

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7. Void agreement signifies
A. Agreement illegal in nature
B. Agreement not enforceable by law
C. Agreement violating legal procedure
D. Agreement against public policy.
8. Which one is correct?
A. Proposal + acceptance = promise
B. Promise + consideration = agreement
C. Agreement + enforceability = contract
D. All the above.
9. In a valid contract, what comes first?
A. Enforceability
B. Acceptance
C. Promise
D. Proposal
10. In the Ethiopian legal system, hierarchy of laws according to their precedence is:
A. Regulations, Proclamations, Constitutions and Directive
B. Proclamations, Constitutions, Directive and Regulations
C. Constitutions , Proclamations, Regulations, and Directive
D. Directive, Constitutions, Regulations and Proclamations

11. It is important to review the performance of subcontractor during post-contract evaluations. This
review establishes the baseline for_______
A. Payment of current bills and incentives bonuses
B. Demonstrated performance and future potential
C. Future pricing and costs
D. Work measurement and work standards
12. A tender is advertised in____________
A. Business environment
B. Domestic markets
C. Newspapers
D. Sellers
13. Which of these is not mentioned in a tender?
A. Sign
B. Designation
C. Notice number
D. Date
14. Which one of the following element is not necessary for a contract?
A. competent parties
B. Free consent
C. Lawful consideration
D. Reasonable terms and conditions
15. An agreement becomes a contract if:
A. It is by free consent of the parties
B. Parties are competent
C. It is enforceable by law
D. None of the above

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16. The correct sequence in the formation of contract is:
A. Offer, acceptance, agreement, consideration
B. Agreement, , consideration, Offer, acceptance
C. Offer, consideration, acceptance, agreement
D. Offer, acceptance, consideration, agreement

17. Where both parties are under mistake as to matter of fact, the agreement will be:
A. Enforceable
B. Not void
C. Void
D. Voidable
18. A person has the legal capacity to inter into contract if;
A. He is a major and sound mind
B. He can fully understand the nature of his contract
C. He is not disqualified from contracting by any law to which he is subject
D. He full fill all the above conditions
19. A contractor accepts all liability for engineering errors, poor workmanship and consequential
damages under ______________ construction contract.
A. Variable production
B. Incentive fee
C. Fixed price
D. Cost-plus
20. Cost-Plus Percentage of Cost contract has an estimated cost of USD 120,000 with an agreed profit
of 10% of the costs. The actual cost of the project is USD 130,000. What is the total reimbursement
to the contractor?
A. USD 143,000
B. USD 140,000
C. USD 132,000
D. USD 250,000
21. Cost-Plus incentive fee (CPIF) contract has an estimated cost of USD 150,000 with a
predetermined fee of USD 15,000 and a share ratio of 80/20. The actual cost of the project is USD
130,000. How much profit does the contractor make?

A. USD 41,000
B. USD 15,000
C. USD 19,000
D. USD 26,000
22. The________ specification is a document describing the quality, type and standard with which the
required goods, services, works or consultancy services should comply.
A. Performance
B. Technical
C. Bid
D. Functional
23. Which contract type should be used by the owner on a high way risk project?
A. Lump sum
B. Cost plus percentage of cost
C. Cost plus incentive fee
D. Fixed price plus incentive fee

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24. In which contract closing parts the retentions, bonds and guarantees are released.
A. Acceptances and completion
B. Contract Evaluation
C. Closing accounts
D. Outstanding issues settlements
25. Fixed price and incentive type contracts place responsibility for performance and financial risks
associated with delay or non-performance on the ___________.
A. Owner
B. Contractor
C. Project manager
D. Lending institution
26. The quality expected to each trade of items or services whereby confirmation and approval required
are clearly stated in__________
A. Conditions of Contract
B. Specifications
C. Letter of acceptance
D. Drawings
27. Cost reimbursable contracts are equivalent to:
A. Cost plus contracts
B. Fixed price contracts
C. Progress payment contracts
D. Extra work order contracts
28. The Bid Evaluation process is characterized by all of the following activities except?
A. Evaluation of suppliers financial resources
B. Ability to comply with technical specifications
C. Delivery schedule and cost factors
D. Competitors method of sourcing
E. Performance record
29. In which Dispute Resolution method the disputing parties shall have not full control both over the
process & the outcome.
A. Amicable
B. judgmental
C. Non-Judgmental
D. A and C

30. Which principle of engineering deals with planning, monitoring and evaluation of construction
projects?
A. Engineering Economics
B. Construction contract and specification
C. Construction Management
D. Construction material
31. Which one of the following is a type of contract experienced more in Ethiopia?
A. Unite price contract
B. Lump sum contract
C. Cost plus fixed fee contract
D. None

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32. A liquidated damage stands for;
A. Amount of money a client pays for contractor
B. Amount of money a contractor pays for client
C. Amount of money a government pays for public
D. All
33. One of the following is not included in construction contract documents?
A. Condition of the contract
B. Specification
C. Drawing
D. Payment certificate
E. None
34. Which one of the following contract type governs all?
A. Special condition of contract
B. General condition of contract
C. FIDIC
D. None
35. Who has the right to approve design change during construction process?
A. Consulting Engineer
B. Project Manager
C. Office Engineer
D. Site Engineer
36. A type of bond which is a legal agreement that ensures contractors fulfill their stated obligations on
a project
A. Performance bond
B. Bid bond
C. Payment bond
D. None
37. The type of bond that protects the project owner from losses incurred as a result of the contractor
failing to finish the job or deliver on the contractual obligations is,
A. Performance bond
B. Bid bond
C. Payment bond
D. None
38. From the following Project delivery system which one is appropriate to deliver a project more
quickly than others?
A. Construction Management at Risk (CMR)
B. Design-Bid-Build (DBB)
C. Design-Build (DB)
D. All types are used to deliver projects equal
39. Among the followings which one shows the best method summary of owner considerations to
select the project delivery systems?
A. Desire to have direct relationship with designer
B. Willingness to establish a more professional relationship with contractor
C. Desire to avoid adversarial relationships
D. Desire to avoid delays due to disputes or claims
E. All of the above are best considerations

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40. One of the following is included in change order of construction contract used to make
modification of a contract in writing.
A. Change in scope of project
B. Unforeseen conditions
C. Errors and omissions
D. All
41. Which type of delivery system is often used when projects are small and places are remote where
reaching them is difficult and in general places are not attractive enough to call the attention of
Bidders?
A. Design Build
B. Design Bid Build
C. Force account
D. Build own operate Transfer
42. ______is a tendering type where financial evaluation is carried out first and rank bidders on the
basis of their offer for tender price.
A. General procurement notice
B. Pre-qualification
C. Post qualification
D. Procurement of Works
43. The type of project delivery system used to Promotes Public Private Partnership and required when
the municipality faced shortage of budget and thus decided to involve the private sector with new
technology is,
A. DBB
B. BOT
C. DB
D. Force account
44. ______is an amount of money that is assessed to the contractor for a failure to meet a specified
completion date of the project.
A. Retention money
B. Advanced payment
C. Retain age
D. Liquidated damages
45. The stage in construction where the owner puts his visions and wishes is
A. Planning and design stage
B. Construction stage
C. Inception and Feasibility
D. Tendering, evaluation and award stage
46. If the project is delayed by an event that impacts on the completion date, but is not the fault of the
contractor, then contractor may be granted to __________.
A. Liquidated damages
B. Extension of Time
C. Advance payment
D. All are correct
47. Which one is a voluntary and an unstructured process agreed by both parties, privately and
confidentially to settle the disputes?
A. Negotiation
B. Mediation
C. Mini-trial

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 D. Conciliation
E. All are unstructured process
48. Which one is legally allowed to enter into contract and provides statements of facts (statement of
opinion and knowledge) for the ability to perform all the required obligations.
A. Intent
B. Legal and distinct
C. Lawful and capable
D. Standard
49. Which category of contract is used for items whose actual quantity varies from the estimated
quantity by more than 15 or 20%, either above or below the estimated quantity?
A. Lump-sum contract
B. Unit-price contract
C. Cost plus Fixed Fee Contact
D. None
50. Which of the following project delivery methods involves a multiparty agreement where the
common procurement option in selecting the team based on qualifications?
A. Construction management at risk (CMR)
B. Design build (DB)
C. Public/ private partnerships (PPP)
D. Integrated project delivery (IPD)
51. Under the construction manager at risk (CMR) delivery method, which of the following entities
holds the primary contract for design of the project with the design profession?
A. Owner
B. General Contractor
C. Finance company
D. Agency construction manager
52. When construction begins before the design is 100 percent complete, it is commonly referred to as,
A. Fast-designing
B. Fast-balling
C. Fast-tracking
D. None
53. In which of the following contract; contractor is required to offer a fixed sum for job in all respect
as per given drawings and details?
A. Item rate contract
B. Lump-sum contract
C. Labor contract
D. All
54. In which of the following construction contract; contractor is quickly being agreed and work on
job?
A. Lump-sum contract
B. Piece work agreement
C. Labor contract
D. Cost plus percentage rate contract
55. Which one is not true about Time Related Claims?
A. Liquidated Damages only
B. Time Extension and Cost Compensation
C. Additions requiring rate adjustments
D. Reliving of Obligation

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56. From the following which one is not true about lump sum contract?
A. The contractor offers to do the whole work as shown in drawings and described by
specifications
B. The qualities of the material required can be calculated with sufficient accuracy
C. It is more suitable for works in which contractors have prior construction experiences
D. The amount to be received by the contractor depend on the quantities of work actually executed
57. Which one is false about illustrative of administrative sanctions?
A. Suspending a business license
B. Revoking a business license
C. Deprivation of life, by way of death sentence or capital punishment
D. None
58. ___________is a systematic process of ensuring that a building performs in accordance with the
design intent, contract documents, and the owners operational needs.
A. Constructability
B. Commissioning
C. BIM
D. None
59. Type of contract which specifies a penalty or reward to a contractor, depending on whether the
actual cost is greater than or less than the c0ntractor’s estimated direct project cost.
A. Lump-sum contract
B. Unit price contract
C. Target Estimate contract
D. Guaranteed Maximum contract
60. Which form of construction contract type is particularly suitable for turnkey operation?
A. Guaranteed Maximum contract
B. Lump-sum contract
C. Unit price contract
D. Target Estimate contract
61. Which one is false about Design Build/Turnkey contract delivery system?
A. It employ only one procurement process
B. Reducing fragmentation and Project Owners’ risk
C. Has three prime players or main stakeholders enter into contract
D. It can deliver a project more quickly than conventional DBB or CMR

62. In the area of contracting, there are two basic types of contracts that reflect how the total price is
determined. The ___________ contract has an objective of a pre-determined end-price while
the_____________ contract has an objective of a target end price.
A. Full value; Partial value
B. Incentive fee; award fee
C. Definitive ;undefined
D. Fixed price; cost plus

63. Requirements and specifications are always changing in the systems of integration projects or
business. Therefore the best form of contract required for this environment would be:
A. Fixed Price
B. Cost plus contract
C. Reimbursement
D. B and C

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64. Which one is not a factor in choosing a contractor to perform the construction works?
A. Competency
B. Capacity
C. Complexity of requirements
D. Price competition
E. None of the above
65. To relieve pressure on the project schedule, Dilla University (DU) decided to fast-track and hires
the contractor to do part of the work. Which form of contract(s) should DU consider?
A. Fixed lump sum
B. Cost plus incentive
C. Cost plus percentage of cost
D. All except A
66. Which one of the following is not the consequence of discharge a contract by Breach?
A. Entitlement to Liquidated damages
B. Natural catastrophe
C. If serious it gives right to termination or compensation
D. None of the above
67. ____________ is a written order directing the contractor to make changes according to the
provisions of the contract documents.
A. Change order
B. Contract order modifications
C. Owner directive
D. Contractor claim
68. __________is a stage in the procurement process extending from advertisement of or invitation to
bid up to signing of contract.
A. Standard Bidding Document
B. Procurement Unit
C. Bid
D. None
69. Which discharge of the contract results from an occurrence of over which the contracting parties
have no control or normally not foresee and which prevents them absolutely from performing their
obligation?
A. By Breach
B. By Frustration
C. By Agreement
D. By Performance
70. Contracts are a way to formalize the responsibilities of owner and contractor and to share risk. For a
contract to be a legal document, it must have all of the following, except:
A. Offer and Acceptance
B. Point of Total Assumption
C. Legal and distinct
D. Consideration
71. Which of these is not an input to the Control Procurements process?
A. Agreements
B. Change requests
C. Work performance data
D. Work performance reports
72. Which of the following is accurate regarding agreements in Project Procurement Management?
A. Agreements can never be terminated.

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 B. Terms and conditions never include the contractor’s proposal
C. Agreements are informal documents
D. Agreements are legal documents between a owner and a contractor
73. You have received a proposal for a Request for Proposal (RFP) that was sent to contractors. One of
the contractors has proposed doing the project for $120,500. The cost for the project is $100,000
and their profit will be $20,500. Which type of contract is most suitable for this situation?
A. Cost plus Fixed Fee
B. Cost plus Percentage of Cost
C. Fixed price
D. Cost plus Incentive Fee
74. What is the purpose of a bidder conference?
A. Awarding a contract to the most suitable contractor
B. Pre-qualifying the potential contractors
C. Ensuring all contractors has a clear understanding of the procurement
D. Developing a comprehensive contractors list
75. You are building a villa that will have copper roofs. The duration of the project will be
approximately two years. You have built into the contract that, as the price of copper increases,
your price increases as a percentage of the cost of the copper. However, all other costs are fixed.
This is an example of what type of contract?
A. Fixed Price with Economic Price Adjustment
B. Fixed Price Incentive Fee
C. Unit Price
D. Cost plus Fixed Fee
76. The decisions on proposed Delivery Systems and types of contracts that can be used in a project are
documented in the___________.
A. Request for Proposal (RFP)
B. Contract planning document
C. Procurement management
D. Work breakdown structure (WBS)
77. _________ is a process of reaching contractual agreement for implementation, its administration
and finally concluding the contract.
A. Contract planning
B. Contract management
C. Cost-reimbursable
D. None
78. The type of tendering exceptionally exercised when the project under consideration is very urgent
or needs special skill whereby the required skill is rarely available.
A. Competitive tendering
B. Open bid tendering
C. Negotiated tendering
D. All of the above
79. ________is a tendering type where technical evaluation is carried out first and rank bidders on the
basis of their experience and past performance, capability in respect of personnel and equipment.
A. General procurement notice
B. Pre-qualification
C. Post qualification
D. Procurement of Works

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80. Which one is false about Agreement?
A. It is wide in scope rather than contract
B. It does not creates legal obligation
C. Elements of agreement is offer and acceptance
D. It is necessarily written and registered
81. Which one the following is different from other?
A. Two staged
B. Pre-qualification
C. Negotiated tendering
D. Post-qualification
82. Ethiopian Procurement Regulation states that a Procurement team consisting of a minimum of
____________members.
A. Four
B. Five
C. Two
D. unlimited
83. A contractor can be eligible for preference margin if and only if;
A. Its majority of works are undertaken in the Employers’ Country / Region
B. Its majority of the board of directors members are the Employers’ Country / Region
C. Its 50 % key personnel are nationals of the Employers’ Country / Region
D. Its majority of capital shares are held by the Employers’ Country / Region
E. All of the above
84. A delay that occurred due to causes which are beyond the control of project doer/contractor.
A. Cost related delay
B. Justified delay
C. Concurrent delay
D. All
85. Which one of the following project delivery method has high loss of control, cost of tender and
risks?
A. Force Account
B. Design Bid Build
C. Design Build
D. None
86. If there is an omission or removal of any part of the projects, the time for completion (Duration) of
project:
A. Is more than allotted duration
B. Is less than allotted duration
C. Remains constant
D. All of the above
87. _______ is a contract type based on one’s interests that contain obligations on both parties or
between employer and contractor.
A. Bilateral Contracts
B. Unilateral contract
C. Multilateral Contracts
D. None of the above
88. The statements saying excess in quantity for a particular item by more than 25 % and its effect on
the total exceeds by 5 % will be adjusted for a new rate and Initial contract Price exceeding by
more than 15 % will be adjusted for a new rate are included in General condition of contract
(GCC). Which part of GCC contains these statements?

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 A. Time Control
B. Finishing of Contract
C. Cost Control
D. Quality Control
89. What is the remedy to the contractor if the employer were liable for delay?
A. Liquidated damages
B. Extension of Time and Prolongation Cost
C. Suspension of works
D. None
90. Parties that cannot be entering into contract lawfully and capable of contracting are,
A. Minors (under the age of 18)
B. Mentally Disable
C. Non-authorized Agents
D. Companies declared bankrupt
E. All of the above
91. The very feature of ___________ settlement is that the disputing parties shall have full control both
over the process & the outcome.
A. Amicable
B. Judgmental
C. Non-judgmental
D. A and C
E. A and B
92. The total project cost of work in unit price contract can be calculated ……………
A. After the completion of the work
B. Before the sign the contract
C. After the sign the contract
D. Before the completion of the work
93. Within the documents forming a contract document, the priority of BOQs, specifications and
drawings while making interpretations in case if any ambiguities or discrepancies among them shall
generally be:
A. The priced BOQ, the specifications and the drawings
B. The specifications, the drawings and the priced of BOQ
C. The drawings, the specification and the priced BOQ
D. The specification, the priced BOQ and the drawings
94. ……………………….. is a process by which the claimant is obliged to claim within a reasonable
period of time followed by her/his preparation for all substantial documents and legal aspects
supporting hers/his entitlements.
A. Claim processing
B. Claim handling
C. Claim Submittal
D. Claim enforcement
95. Based on PPA 2011, what is the maximum amount of retention payment retained from interim
payment shall not exceed………………..
A. 5%
B. 10%
C. 30%
D. 2.5%

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