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CIPS Commercial Negotiation L4M5 Question # 11 Topic 2 Discussion

CIPS Commercial Negotiation L4M5 Question # 11 Topic 2 Discussion

L4M5 Exam Topic 2 Question 11 Discussion:
Question #: 11
Topic #: 2

Freefields Housing Authority (FHA) is a housing provider that has outsourced a range of management services using fixed-price long-term contracts. FHA’s regular supplier credit reviews have identified that some key outsourced service suppliers are at risk of insolvency due to high inflation rates observed in the macroeconomic climate. Which of the following actions would enable FHA to reduce this risk for the lifetime of the affected contracts?


A.

Allow affected suppliers to review and resubmit their fixed costs


B.

Introduce indexation of contracts linked to the Consumer Prices Index


C.

End the contracts and procure the services


D.

Offer advance payment terms to the affected suppliers


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