L6M5 practice question 13 of 15

In a fixed lump sum contract, this pricing mechanism does not allow for any changes in price. Is this statement TRUE? Fixed lump sum contracts are widely used in construction and infrastructure projects. Answer Options:

Full set: 83 questions

Answer options

A: Yes – the price is fixed before the contract is signed

B: Yes – the contractor assumes all risks should they exceed the budget

C: No – price changes are allowed as it is impossible to predict prices concretely in advance

D: No – price variations are permitted if they are written into the contract Correct answer

Correct Answer:

D. No – price variations are permitted if they are written into the contract

Explanation

Fixed Lump Sum contracts allow limited price changes under specific conditions (p.55), such as client variation requests, force majeure, or inflation adjustments. Firm Fixed Price contracts, however, do not allow any changes. [P.55]

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