Bid rotation is a form of collusion where contractors alternate the business among themselves.

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Prepare for the Coach CFE Exam. Study using flashcards and multiple-choice questions, each with hints and explanations. Get ready for your assessment!

Multiple Choice

Bid rotation is a form of collusion where contractors alternate the business among themselves.

Explanation:
Collusive bidding includes tactics like bid rotation, where rivals agree to take turns being the winning bidder on contracts. This arrangement ensures each participant gets business in a predictable pattern, reduces price competition, and violates the purpose of competitive bidding. It’s distinct from bid suppression (where some bidders refrain from bidding to keep prices high), market division (where participants divide markets or customers to avoid competition), and subcontracting with rivals (which involves using competitors as subcontractors rather than coordinating the main contract awards). So the described scenario fits bid rotation exactly.

Collusive bidding includes tactics like bid rotation, where rivals agree to take turns being the winning bidder on contracts. This arrangement ensures each participant gets business in a predictable pattern, reduces price competition, and violates the purpose of competitive bidding. It’s distinct from bid suppression (where some bidders refrain from bidding to keep prices high), market division (where participants divide markets or customers to avoid competition), and subcontracting with rivals (which involves using competitors as subcontractors rather than coordinating the main contract awards). So the described scenario fits bid rotation exactly.

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