Which of the following is not typical of a CPAF arrangement?
A) The award fee is a pool of money established by the buyer
B) The award fee is a pool of money to reward the supplier in meeting the buyer's stated needs
C) Receipt of the fee is based on the buying firm's objective evaluation
D) Receipt of the fee is based on the buying firm's subjective evaluation
E) The arrangement works as a flexible tool

Question

Quizplus · Accepted Answer

In a Cost Plus Award Fee (CPAF) arrangement, the receipt of the award fee is typically based on the buying firm's subjective evaluation of the supplier's performance, not an objective evaluation. This allows the buyer to assess factors that are not easily quantifiable.

Which of the Following Is Not Typical of a CPAF