If Controlling the Level of Military Expenditures Is the Most

question 34

Multiple Choice

If controlling the level of military expenditures is the most important goal,the most appropriate type of procurement contract would be _____.

• A)fixed fee
• B)cost plus fixed fee
• C)cost plus percentage fee
• D)cost plus incentive fee

---

Definitions:

Net Present Value

A method of evaluating investment opportunities that calculates the difference between the present value of cash inflows and outflows over a period of time.

Capital Expenditure

Funds used by a company to acquire, upgrade, and maintain physical assets such as property, industrial buildings, or equipment.

Net Income

The total profit of a company after all expenses, taxes, and costs have been subtracted from total revenue.

Salvage Value

The projected value of an asset for sale at the conclusion of its operational lifespan.