Question

Sam Consultancy has a large internal project to be initiated. To staff this project, Sam Consultancy is working with People Consultancy to provide three resources for six months. The resources will be part of the team managed by Sam Consultancy for six months. Which contract type should be used by Sam Consultancy?

Answer 1

Complete Question:

Sam Consultancy has a large internal project to be initiated. To staff this project, Sam Consultancy is working with People Consultancy to provide three resources for six months. The resources will be part of the team managed by Sam Consultancy for six months. Which contract type should be used by Sam Consultancy?

Group of answer choices

a. Purchase Order

b. Cost plus Fee

c. Fixed cost

d. Time and Material

Answer:

d. Time and Material

Explanation:

Time and material is a type of contract used mostly for construction or manufacturing services, in which the client pays the contractor's employees (workers) based on the amount of time spent and quantity of materials used for the execution of the project.

Generally, a Time and Material (T&M) is peculiar to projects that cannot be easily estimated by size or duration and when project requirements are likely to be changed.

Hence, a Time and Material (T&M) contract is considered to be more flexible and suitable for a long-term project than a fixed-cost contract.