In a _____ contract, the supplier receives reimbursement for all of its allowable costs up to a predetermined amount plus a fixed fee, which typically represents a percentage of the targeted cost of the good or service being procured.
A) cost plus fixed-fee
B) fixed-price with redetermination
C) time and materials
D) fixed-price plus fixed-fee
E) None of the above.

Question

Quizplus · Accepted Answer

This option describes a cost-plus contract where the supplier is reimbursed for all allowable costs, plus a fixed fee. It is often used for complex projects where the costs are harder to estimate, and the fixed fee provides an incentive for the supplier to control costs as much as possible. The other options (B) fixed-price with redetermination, (C) time and materials, and (D) fixed-price plus fixed-fee, do not fit the description provided in the question.

In a _____ Contract, the Supplier Receives Reimbursement for All