Which Pair of Statements Is BEST

question 79

Multiple Choice

Which pair of statements is BEST?

• A)Cost-plus contracts are prone to budget overruns while turnkey contracts are typically underbid by the contractor.
• B)Cost-plus contracts are prone to a budget surplus while turnkey contracts are typically underbid by the contractor.
• C)Cost-plus contracts are prone to a budget surplus while turnkey contracts are typically overbid by the contractor.
• D)Cost-plus contracts are prone to budget overruns while turnkey contracts are typically overbid by the contractor.

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Definitions:

Cost Analysis

This refers to the process and methods used to evaluate the costs associated with a project or a business operation in order to determine its feasibility or cost-efficiency.

Activity Rate

A measure used in activity-based costing to allocate overhead costs to products or services based on specific activities.

Complexity-Related

Pertains to issues or aspects that are complicated by multiple factors, including systems, processes, or products that are challenging to understand, manage, or operate due to their intricate nature.

Size-Related

Pertaining to factors or characteristics that depend on the size or scale of an operation or entity, often influencing costs and efficiencies.