CAPM (Certified Associate in Project Management) Practice Exam

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Study for the CAPM Test. Study with flashcards and multiple choice questions, each question has hints and explanations. Get ready for your exam!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

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What is a letter of intent?

A legally binding commitment
A letter without legal binding that signifies intention to hire
A signed document agreeing on the contract price
The final contract sent to the seller

The correct answer is: A letter without legal binding that signifies intention to hire

A letter of intent is a non-legally binding document that signifies an intention to hire or do business in the future. It outlines the key terms and conditions of a potential agreement between parties, serving as a starting point for negotiations before a formal contract is created. Option A is incorrect because a letter of intent is not a legally binding commitment. Option C is incorrect because a letter of intent does not typically include the contract price; instead, it focuses on the key terms and objectives of the potential agreement. Option D is incorrect as a letter of intent is not the final contract; it precedes the finalization of a formal agreement and acts as a preliminary document outlining key points.