In a firm fixed price contract if market prices ____ the stated contract price due to outside factors,such as competition,changes in technology,or raw material prices,the ____ assumes the risk or financial loss.
A) rise above....purchaser
B) stay the same....seller
C) stay the same....purchaser
D) fall below....purchaser
E) None of these choices.

Question

Quizplus · Accepted Answer

In a firm fixed price contract, if market prices fall below the stated contract price due to outside factors, the purchaser assumes the risk or financial loss. This is because the purchaser is locked into the agreed-upon price even if market conditions change, putting the seller at a disadvantage.

In a Firm Fixed Price Contract If Market Prices ____