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CIPS L4M5 Exam Syllabus Topics:

Section	Objectives
Negotiation planning and preparation	- Preparation techniques 1. Information gathering and analysis 2. BATNA and reservation points 3. Setting objectives and targets
Negotiation strategies and tactics	- Approaches to negotiation 1. Concession strategies 2. Collaborative and competitive strategies 3. Tactical behaviours and influence techniques
Negotiation fundamentals	- Principles of commercial negotiation 1. Types of negotiation (distributive vs integrative) 2. Definition and purpose of negotiation
Power, ethics and communication in negotiation	- Influencing factors 1. Ethical considerations in negotiation 2. Sources of negotiation power 3. Communication and interpersonal skills

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CIPS Commercial Negotiation Sample Questions (Q173-Q178):

NEW QUESTION # 173
SBL provides contract bathroom furniture and fittings for a wide variety of domestic and commercial clients.
To some suppliers, SBL spend claims a large portion of their revenue. But SBL is famous for imposing draconian obligations on these suppliers. Which of the following is most likely to be overarching objective of these suppliers to SBL?

A. Charge a higher price to compensate for all the pain SBL has put
B. Hold on and keep SBL happy but make sure that the business is profitable
C. Drop the business with SBL immediately
D. Win and keep business with SBL at any costs, even without profits

Answer: A

Explanation:
:
According to Paul Steele's 'The Seller's Perspective', customer can be classified into 4 categories as below:
Chart, treemap chart Description automatically generated

In this scenario, although SBL's spend claims large portion in suppliers' revenues, their draconian treatment will reduce SBL's attractiveness in supplier's perspective. SBL falls into Exploit quadrant. With exploitable customers, suppliers tend to 'milk' the customer and charge a high price to compensate for all the pain customer put on them.

NEW QUESTION # 174
What are the potential sources of conflict between the buyer and supplier? Select TWO that apply:

A. Persistent late payment of the supplier's invoices
B. Requesting early supplier involvement
C. Planning scheduled visits to the supplier site
D. Scheduling agreed supplier delivery dates
E. Unequal sharing of gains, risks, and costs with the supplier

Answer: A,E

NEW QUESTION # 175
Which of the following are types of questions that are useful in opening and testing phases of a negotiation?
Select the TWO that apply.

A. Leading
B. Open
C. Probing
D. Narrow
E. Closed

Answer: B,C

Explanation:
:
In the opening phase, parties should confirm understanding and get the issues on the table.
The testing phase is an information gathering stage where the hypothesis and assumption you have made in the planning stage can be tested or confirmed or disproved.
Opening questions (those that start with 'what', 'how', 'why') are used at the opening and testing stages to uncover needs and underlying motives, and to allow the buyer to get a feel of what is in store in the negotiation.
Probing questions are also useful to check that the supplier fully understand their offering, as well as your needs, and can also be used to communicate to the supplier that you know this category well. These questions are typically useful at the opening and testing stages.

NEW QUESTION # 176
Which of the following statements about oligopoly isincorrect?

A. Oligopolistic firms recognize their interdependence
B. A few firms play an important role in the sale of a product
C. One firm's behaviour is a function of what its rivals do
D. Prices in oligopoly are predicted to fluctuate widely and frequently

Answer: D

Explanation:
Explanation
An oligopoly exists when there are small number of producers that exert a significant influence in the market.
Oligopoly's main characteristics are discussed as follows:
- Interdependence
The most important feature of oligopolyis the interdependence in decision-making of the few firms which comprise the industry. This is because when the number of competitors is few, any change in price, output, product etc. by a firm will have a direct effect on the fortune of its rivals, which will then retaliate in changing their own prices, output or products as the case may be.
- Importance of advertising and selling costs
A direct effect of interdependence of oligopolists is that the various firms have to employ variousaggressive and defensive marketing weapons to gain a greater share in the market or to prevent a fall in their market share. For this various firms have to incur a good deal of costs on advertising and on other measures of sales promotion. Therefore, thereis a great importance of advertising and selling costs under conditions of market situation characterised by oligopoly
- Group behaviour
Another important feature of oligopoly is that for the proper solution to the problem of determination of price and output under, it analysis of group behaviour is impor-tant.
- Indeterminateness of demand curve facing an oligopolist
In this question, 'Prices in oligopoly are predicted to fluctuate widely and frequently' is an incorrect statement as producers in oligopoly often try to set up price. Prices fluctuate more frequently in perfect competition.
LO 2, AC 2.2

NEW QUESTION # 177
Which of the following are typical characteristics of activity-based costing (ABC) method? Select TWO that apply.

A. Costs are allocated based on volume
B. ABC has tended to over cost products on long runs and under cost those on short runs
C. ABC provides the information required to take action and realise improvements
D. Limited understanding of true costs incurred
E. Variable and all related overhead expenses are specifically assigned to a business activity

Answer: C,E

Explanation:
Activity-based costing is an alternative approach to traditional absorption costing. The characteristics of these two methods are illustrated in the graph below:
Graphical user interface, text, chat or text message, website Description automatically generated

NEW QUESTION # 178
......

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