In Certain High-Cost Defense Contracts Involving New Weapons and Equipment

question 133

Multiple Choice

In certain high-cost defense contracts involving new weapons and equipment, contracts are rarely subject to competitive bidding because ________.

• A) the government taxes the defense companies at a higher level than that of other public sector companies
• B) there is an implicit agreement among defense contractors to "share contracts"
• C) all defense contractors have essentially the same cost structure
• D) no contractor is willing to assume all the risk of receiving a fixed price for the contract

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Definitions:

Foreign Policy

A government's strategy in dealing with other nations, involving diplomacy, economic measures, military action, and treaties to advance national interests.

Harry S. Truman

The 33rd President of the United States, serving from 1945 to 1953, known for implementing the Marshall Plan to rebuild the economy of Western Europe, and for leading the U.S. during the early Cold War.

Vyachslaw Molotov

A prominent Soviet politician and diplomat known for his role in the Stalin administration, including as Foreign Minister.