1617-Price Analysis Techniques Flashcards
What are the 5 bases for price analysis?
Other proposed prices Commercial prices Previously proposed prices & contract prices Parametric & rough yardsticks Independent Government Estimates (IGE’s)
What are the factors that affect comparison?
Market Conditions Purchasing Power Technology Quantity of Size Extent of Competition Geographic Location Government Unique Requirements
Which of the 5 bases for price comparison is the most preferred?
Competition
What type of questions would affect historical price comparison?
Has the product/service been purchase before?
What was the historical price?
Was the historical price fair & reasonable?
Is the comparison valid?
What are the situations for using price index numbers?
Inflate or deflate prices or costs for comparison
Inflate or deflate prices or costs to facilitate trend analysis
Estimate project price or cost over the period of contract performance
Adjust contract price or cost for inflation or deflation
How do you adjust historical data to current year dollars and make an analysis of data (price index)?
a
How do you use historical data and prepare a cost volume profit analysis?
a
How is an Independent Government Estimate prepared?
Value analysis – results from a specialized analysis of the function of a product and its related price
Visual analysis – results from a visual inspection of an item, or drawing of an item, to estimate its probable value
Who prepares an Independent Government Estimate (IGE)?
Normally prepared by the requiring activity
What is fixed cost?
A price that does not change due to production
What is a variable cost?
A cost that fluctuates
What is a semi-variable cost?
A cost that has a fixed portion and a cost that fluctuates
