Free CIPS L4M7 Exam Questions

Become CIPS Certified with updated L4M7 exam questions and correct answers

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Total 343 Questions | Updated On: Jan 13, 2026

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Question 1

Amanda is the purchasing manager for AB Construction based in France. She is considering purchasing an asset from overseas but knows she must account for fluctuations in exchange rates in the contract. Is Amanda correct?

A : No, as it will be better to purchase the asset in AB Construction's local currency as it would be efficient and more stable

B : Yes, as AB Construction could pay more for the asset than intended and Amanda should include a currency fluctuation clause

C : No, as the price can be re-negotiated post-contract sign-off by AB Construction and the supplier

D : Yes, as Amanda will be able to decide the currency exchange rates to be used

Answer: B

Question 2

XYZ Ltd is looking for new office space overseas. To keep the overhead expense minimal, it chooses leasing rather than purchasing new office. In leasing contract, which of the following costs are most likely to be attributable to the lessee?

1. Disposal costs

2. Rentals

3. Operating costs

4. Vendor selection costs

A : 1, 3 and 4

B : 1, 2 and 3

C : 2, 3 and 4

D : 1, 2 and 4

Answer: C

Question 3

Which of the following is the core idea of Lean manufacturing?

A : iness Continuity Planning

B : te elimination

C : w product development

D : proving response to erratic demand

Answer: B

Question 4

Which of the following is the formula for calculating the re-order level?

A : erage usage in a lead-time / Required level of safety stock

B : erage usage in a lead-time + Required level of safety stock

C : quired level of safety stock x Average usage in a lead-time.

D : quired level of safety stock – Average usage in a lead-time

Answer: B

Question 5

In the periodic review system, the order quantity is the same for each order. Is this statement true?

A : , the order quantity should be equal to economic order quantity

B : , the inventory position at each review point differs from each other

C : , in periodic review system items are reviewed when the Kanban is triggered

D : , the next order quantity must be larger than the previous one

Answer: B

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Total 343 Questions | Updated On: Jan 13, 2026

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