The cost-plus contract method is far more likely to produce a price that is an accurate forecast of the actual costs of building a construction project than any other estimating method.

Question

Quizplus · Accepted Answer

The cost-plus contract method is not a reliable method for accurately forecasting the actual costs of a construction project. This is because it involves the client paying for the actual costs of the project, plus an additional percentage (known as a markup) to cover the contractor's overhead and profit. This method can lead to potential conflicts of interest, and the contractor may have less incentive to control costs. Other estimating methods, such as unit price or lump sum contracts, may be more effective in producing a more accurate forecast of project costs.

The Cost-Plus Contract Method Is Far More Likely to Produce