Project Management Professional PMP · Free Practice Question Easy
Question 46
Brandon uses a standard graduated fixed-price contract for his work with Gwaltney Software. If Gwaltney charges $175 per hour if they finish on time, what rate are they most likely to charge if they finish late?
- A $160
- B $190
- C There is insufficient information to determine a possible rate.
- D $175
Reveal correct answer
Correct answer: A
Explanation
Because Gwaltney is expected to charge less per hour if they finish late as an incentive for on-time delivery, so $160 is the most reasonable choice for a graduated fixed-price contract. A standard graduated fixed-price contract includes a lower rate for late delivery, so keeping the amount the same at $175 would not be an appropriate choice. A standard graduated fixed-price contract includes a lower rate for late delivery, so increasing the amount to $190 would not be an appropriate choice. There is sufficient information to determine a possible rate in this scenario.Discussion
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