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A. cost plus incentive fee
B. Cost plus incentive fee and firm fixed price
C. firm fixed price
D. cost plus fixed fee
E. unit price
option C is most suitable choice
yes in the fixed price contract , the contractor must take seriously the control of cost ,shedule and scope changes
Option C (Fixed Bid) - Schedule delays or budget expansion will cause cost escalation, which in turn will eat up the profit margins.
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C. firm fixed price
In firm fixed price contact, all risk is borne by the contractor. So, the contractor has to control cost, schedule and scope changes in order to make predetermined profit.
C. firm fixed price Is the answer
Obiviously answer has to be C .
In firm fixed price contract , contractor is supposed to execute the contract successfully in an agreed fixed amount. So contractor has to take care of all the constraints.
In the contract of unit price because in this case because the money that you get depends on the amount of work performed so you have to control your cost in order to make profit while in the other contracts no matter how much the cost is you will be paid the cost plus fees as profit moreover the fees are usually as percentage of the cost so the higher the cost the higher the profit.
Firm Fixed price, in this contract you need more cost controlling and scheduling.
