With cost-plus percentage fee contracts,all the risks are on the contractor.

Question

Quizplus · Accepted Answer

With cost-plus percentage fee contracts, both the contractor and the client share the risks. The contractor is incentivized to keep the costs low as their fee is a percentage of the total cost, but there is a risk for them to inflate the costs to increase their fee. On the other hand, the client bears the risk of any unexpected cost overruns, as they are responsible for paying the additional costs.

With Cost-Plus Percentage Fee Contracts,all the Risks Are on the Contractor