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A fixed-price contract is a type of contract for the supply of goods or services, such that the agreed payment amount will not ... Firm-fixed-price, level-of-effort ...
A fixed-price contract is a contract where the contract payment does not depend on the amount of resources or time expended by the contractor, as opposed to cost-plus contracts. Fixed-price contracts are often used for military and government contractors to put the risk on the side of the vendor and control costs.
Calculation of Point of Total assumption (the case when EAC exceeds PTA that should be treated as a risk trigger, is shown) The point of total assumption (PTA) is a point on the cost line of the profit-cost curve determined by the contract elements associated with a fixed price plus incentive-Firm Target (FPI) contract above which the seller effectively bears all the costs of a cost overrun.
Take-or-pay clauses are common in the energy industry and, in particular, for gas sales; see volume risk. The High Court in England and Wales recognises such clauses as "a familiar provision in commercial contracts", but also notes that they have been a source of commercial dispute "for more than 100 years". [ 1 ] :
Typical Lump Sum Contract Structure. A lump sum contract in construction is one type of construction contract, sometimes referred to as stipulated-sum, where a single price is quoted for an entire project based on plans and specifications and covers the entire project and the owner knows exactly how much the work will cost in advance. [1]
A contract is a legally binding agreement made between parties involved in a transaction for the exchange of goods or services. The agreement often comes in the form of a written instrument that provides the terms or conditions of the arrangement, each of which correspond to an obligation that one of the parties entering the agreement is obliged to fulfill.
One applies to fixed-price contracts, another to cost reimbursement contracts, and the third to time and materials or labor hours. [5] All three of these clauses give the government the right, at any time and without notice to the sureties, to make changes in the work within the general scope of the contract. The clause for fixed-price ...
Performance-based contracting (PBC) or results-based contracting, is a procurement strategy used to achieve measurable supplier performance. A PBC approach focuses on developing strategic performance metrics and directly relating contracting payment to performance against these metrics.