Incentive Contracts: Examination of Fixed-Price Incentive Contracts

摘要

The report examines a number of fixed-price incentive (FPI) contracts to determine how the final price of each compared with the contract's established target and ceiling price. FPI contracts are usually used for operational system, development, first production, and follow-on production contracts where the government has a sound basis to estimate contract costs, but where uncertainties exist that make a firm fixed-price contract impractical.