Certified Professional Public Buyer (CPPB) Practice Test

What type of agreements are typically involved in statutory laws?

1. Informal gentleman's agreements

2. Oral agreements and arrangements

3. Formal contracts and charters passed by governments

4. Non-binding intentions documented in reports

The correct answer is: Formal contracts and charters passed by governments

The correct choice focuses on formal contracts and charters that are established through statutory laws, reflecting the authoritative and binding nature of these agreements. Statutory laws are created by legislatures and are formal rules that govern society. They are enacted through a process that typically involves drafting, reviewing, and passing specific legislation. Formal contracts and charters, as referenced in the correct choice, have legal standing and are enforceable in a court of law. They outline specific obligations, rights, and duties as determined by governing bodies, ensuring that parties involved have clear guidelines to follow. This level of formality distinguishes them from the other types of agreements listed. The alternatives do not align with the essence of statutory laws. Informal agreements and oral arrangements lack the legal structure and enforceability of statutory agreements. Non-binding intentions, such as those documented in reports, do not create a legal obligation and therefore cannot be classified under statutory law. Understanding the distinction between these types of agreements is crucial for recognizing how statutory laws operate within the public procurement and legal framework.