AGREEMENTS AND CONTRACTS

Question 1

Fixed-price contracts

Answer 1

Fixed-price contracts This category of contract involves setting a fixed price for a well-defined product, service, or result. Fixed-price contracts include firm fixed price (FFP), fixed-price incentive fee (FPIF), and fixed price with economic price adjustment (FP-EPA), among others.

Question 2

Cost-reimbursable contracts

Answer 2

Cost-reimbursable contracts This category of contracts involves payments to the seller for actual costs incurred for completing the work plus a fee representing seller profit. These contracts are often used when the project scope is not well defined or is subject to frequent change. Cost-reimbursable contracts include cost plus award fee (CPAF), cost plus fixed fee (CPFF), and cost plus incentive fee (CPIF).

Question 3

Time and materials (T&M)

Answer 3

Time and materials (T&M) This contract establishes a fixed rate, but not a precise statement of work. It can be used for staff augmentation, subject matter expertise, or other outside support.

Question 4

Indefinite delivery indefinite quantity (IDIQ)

Answer 4

Indefinite delivery indefinite quantity (IDIQ) This contract provides for an indefinite quantity of goods or services, with a stated lower and upper limit, and within a fixed time period. These contracts can be used for architectural, engineering, or information technology engagements.

Question 5

Other agreements

Answer 5

Other agreements Other types of agreements include memorandum of understanding (MOU), memorandum of agreement (MOA), service level agreement (SLA), basic ordering agreement (BOA), among others.