Which of the following is the MAIN reason for including incentive clauses in a contract?

The right answer is:      C

Option C is the correct answer according to my knowledge and all the other options don't fit in here.

Answer is C. Aligning contractor and buyer goals.

D. Reducing production costs.

The purpose of the incentive is to provide a motivation to be more efficient and effective. Cautioned to say if the contract is not designed as an instrument to effect this and the parties are not collaborating with shared outcomes and goals, it will get lost in translation. Simply put if you want to incentivise a contract then you need the following in your agreement:

1. legal terms and conditions that support incentive arrangement and collaborative outcomes
2. an administrative arrangement that support collaborative outcomes
3. a commercial arrangement that supports Administrative arrangement and is reflected in legal terms and conditions and 
4. a scope that defines what is to be done and by who when that support Legal, Administrative and Commercial arrangements.

Trust me when i say not many people get this right. The defaul is usually conflict and confusion in an adversarial context.

Reducing costs to the buyer.

I think negotiation of cost & Terms between buyer and supplier is that.

 i think answer c is the right one

C. Aligning contractor and buyer goals. Correct Answer.

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