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AACE International Exam CCP Topic 5 Question 10 Discussion

Actual exam question for AACE International's CCP exam
Question #: 10
Topic #: 5
[All CCP Questions]

Which of the following is a disadvantage to using target contract as a method of contracting?

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Suggested Answer: B

A target contract is a form of contract where both the owner and contractor agree on a target cost, and both parties share any cost savings or overruns. This contract type encourages efficiency but has some drawbacks.

Key Points:

Disadvantages of Target Contracts:

No Competitive Bidding for Targets: The target cost is typically negotiated rather than competitively bid, which could lead to less competitive pricing.

Other Points: While target contracts encourage timely and economical completion and allow for early start and flexibility, the lack of competitive bidding for the targets can be a significant disadvantage.

Conclusion: The correct answer is B. No opportunity to competitively bid the targets because this is a specific disadvantage associated with target contracts.


by Benton at Sep 17, 2024, 05:46 PM

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Matthew
6 months ago
Option B all the way! Competitive bidding is the way to go, unless you want to end up with the contractor's cousin getting the job.
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Chantell
5 months ago
True, but it's important to weigh the pros and cons before making a decision.
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Sol
5 months ago
But target contracts can also provide flexibility in controlling the work.
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Shenika
5 months ago
I agree, competitive bidding ensures fairness and transparency.
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Felix
6 months ago
A might sound good, but I'd rather take my time and do it right than rush through it. Slow and steady wins the race, am I right?
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Lenora
5 months ago
D) Flexibility in controlling the work
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Chery
5 months ago
I agree, taking your time can lead to better results in the long run.
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Berry
5 months ago
B) No opportunity to competitively bid the targets
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Lanie
6 months ago
A) Encourages economic and speedy completion
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Launa
6 months ago
But on the other hand, target contracts encourage economic and speedy completion, which can be beneficial.
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Willodean
7 months ago
I agree with Fausto, not being able to competitively bid can lead to higher costs.
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Jerilyn
7 months ago
D sounds great, but I bet the 'flexibility' comes with a hefty price tag. No thanks!
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Kayleigh
7 months ago
C is pretty tempting, but starting work without a clear scope? Yikes, recipe for disaster if you ask me.
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Fausto
7 months ago
I think the disadvantage is B) No opportunity to competitively bid the targets.
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Mollie
7 months ago
I think option B is the correct answer. How can you have a fair competition without bidding?
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Andra
6 months ago
Without competitive bidding, it can lead to potential issues with fairness and transparency in the contracting process.
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Laticia
6 months ago
I agree, option B is a disadvantage because there is no opportunity to competitively bid the targets.
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