I have used this question during interviews for "seasoned" GS-1102 positions off and on for a couple of years. Quite frankly, I use it not for a specific answer but to find out if the candidate can actually think and articulate an answer on what is our primary regulatory guide. I have seen applicants with close to 20 years of 1102 experience just stumble around with it.
Personally, my favorite part of the FAR is specifically FAR 1.102(d) - "The role of each member of the Acquisition team is to exercise personal initiative and sound business judgment in providing the best value product or service to meet the customer's needs. In exercising initiative, Government members of the Acquisition Team may assume if a specific strategy, practice, policy or procedure is in the best interests of the Government and is not addressed in the FAR, nor prohibited by law (statute or case law), Executive order or other regulation, that the strategy, practice, policy or procedure is a permissible exercise of authority."
I have also asked variations on how would you describe the FAR. Sad to say many of our "experiened" 1102's don't seem to be able to do that well.