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CIPS L4M4

Ethical and Responsible Sourcing

Verified practice questions with detailed answers, clear explanations, and community discussion.

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See all 48 questions

Question 1 of 48

A business may be faced with the challenge of deciding whether to source some of its requirements from external suppliers or whether to make them internally. There are many factors that need to be considered before arriving at such a decision.
Which of the following factors is likely to justify the decision to make the requirements internally?
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Correct answer: B

The availability of in-house competencies and production capacity supports an internal manufacturing decision because the business already has the skills, resources, and capability needed to meet its requirements. Making internally can provide greater control over quality, delivery, and intellectual property when those capabilities are established. Older supplier technology or suspected overcharging may require investigation, but they do not by themselves prove that internal production is viable. Tendering complexity is an administrative issue rather than a strategic justification for making the item internally.

Question 2 of 48

A buyer has been tasked with placing an order for steel from another country and using Incoterms for the delivery. The buyer’s organization has an in-house transportation and export clearance department. During negotiations, the buyer has been able to achieve a 25% cost reduction, due to the buyer accepting responsibility to arrange the loading, transportation and export clearance.
Which Incoterm has been agreed?
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Correct answer: A

Ex Works places the minimum delivery obligation on the seller: the goods are made available at the seller’s premises or another named place. The buyer then arranges loading, export clearance and the main transportation, which suits an organisation with its own transport and export capability. FCA, FOB and CIP require the seller to undertake additional delivery or carriage responsibilities.

Question 3 of 48

Tariffs and import duties imposed on a buying organization for goods purchased from an international supplier provide benefit to __________.
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Correct answer: B

Domestic industry benefits because tariffs and import duties raise the cost of imported goods, making them less price-competitive against locally produced alternatives. This reduced competition can protect domestic producers’ market share and support local employment. The charges are paid to the importing country’s government, not as additional payment to the supplier, and they generally increase rather than reduce prices for consumers.

Question 4 of 48

A restricted tender process involves supplier selection.
This process focuses on which of the following?
1. Production capacity
2. Decommissioning costs
3. Total life cost
4. Financial stability
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Correct answer: C

A restricted tender process prequalifies a limited number of suppliers before inviting bids. It focuses on whether suppliers have sufficient production capacity to meet the requirement and the financial stability to perform throughout the contract. These checks reduce the risk of selecting a supplier that cannot deliver or may fail financially. Total life cost and decommissioning costs are more commonly assessed when evaluating the bid or whole-life value.

Question 5 of 48

An international supplier of shirts provides four different prices for each garment depending on the Incoterm selected by the buyer.
Which Incoterm would support achieving the lowest unit price per garment?
Answer choices
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Correct answer: A

EXW places the minimum delivery obligation on the supplier, requiring the garments only to be made available at its premises. The buyer takes responsibility for collection, export arrangements, main transport, insurance, import formalities and onward delivery. Because the supplier includes fewer logistics activities, costs and risks in the quoted price, the unit price is normally lowest under EXW. DAP, DDP and CPT require the supplier to arrange transport to a greater extent, increasing its price.

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Charles Sirois
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As this was my first certification exam, I was understandably nervous about what to expect. These study materials made the preparation process much easier, and many of the questions closely reflected those on the actual exam.
Lance Chambers
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Wasted about a month going through the free dump sites scattered all over reddit, half the answers were wrong and the other half were for a version of the exam that doesn't even exist anymore. Eventually gave in and paid the small fee here, and the difference was night and day.
Alisha Kelly
Italy
Honestly, I had already gone through the official documentation quite thoroughly, but still didn't feel fully confident going in. This helped things finally click for me. I realized I knew the material, but just hadn't connected all the pieces yet.
Casper Claassen
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Used this along with Microsoft Learn and the combo worked really well. The practice questions made the stuff I'd read actually stick. Passed first attempt, no complaints from me.
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Morgan Farmer
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I don't usually leave reviews, but this one felt worth sharing. The questions were quite close to what actually appeared on the exam, more than I expected. I spent about a week going through the material before my test, and it helped me feel more prepared.
Remi Nuyts
United States
Passed ITIL 4 Foundation with 87%. Material was enough by itself.
Archie Hopkins
United States
I had a smooth experience from start to finish. Access was available right away, no technical issues, which made it easy to get started. The content felt relevant and aligned well with what I was looking for.
Nancy Mcbride
United States
Does what it says it does. Content felt solid, nothing confusing to navigate and I didn't run into any weird issues. I been putting off scheduling the exam for a while and going through this gave me enough confidence to finally book it and pass.
Neil Savage
United States
A very quick response was received via email when a link issue occurred. The study materials provided were high quality and extremely helpful. I was able to complete the test successfully. Many thanks for the excellent support.

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