AACE International CCP Exam - Topic 5 Question 1 Discussion

Actual exam question for AACE International's CCP exam

Question #: 1
Topic #: 5

When using a fixed-price./lump-sum contract, which of the following; situations can a payment be made for the adjustment of fluctuations in the cost of of construction resources?

AFor changes in prices calculated in accordance with a methodology proposed by the contractor at tender stage.

BFor changes in construction cost 'or varied works carried out beyond the original dale of completion

CIn no situation

DFor changes in The cost of resources beyond the control of either party

Show Suggested Answer

Suggested Answer: C

In a fixed-price/lump-sum contract, the agreed price is fixed and generally not subject to adjustment based on fluctuations in costs, unless explicitly stated in the contract terms. Payment for adjustments in construction costs due to fluctuations in resource prices or delays is typically not allowed unless there is a specific provision for such adjustments, which is rare in fixed-price contracts. Therefore, the correct answer is C. In no situation.

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by Eun at Aug 27, 2024, 01:52 PM

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Dominic

9 months ago

No way it's C. There are always exceptions in contracts!

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Barrett

9 months ago

Wait, can you really adjust for costs like that? Seems odd!

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Tequila

9 months ago

B is a common situation, but I don't think it applies here.

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Britt

10 months ago

A makes sense too, but it depends on the methodology.

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Nu

10 months ago

I think it's D for sure. Costs outside anyone's control should be covered.

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Avery

10 months ago

I lean towards option C, as I recall that fixed-price contracts are meant to be firm, so adjustments might not be allowed at all.

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Hoa

10 months ago

I feel like option A could be a possibility since it refers to a methodology proposed at the tender stage, but I’m not confident.

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Lynna

10 months ago

I'm not entirely sure, but I remember a practice question that discussed how fixed-price contracts usually don’t allow for adjustments unless specified.

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Julene

11 months ago

I think option D might be correct because it mentions costs beyond the control of either party, which seems reasonable for adjustments.

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Jacklyn

11 months ago

I'm confident I know the answer to this. Option D seems to be the correct choice - adjustments can be made for changes in the cost of resources that are beyond the control of the contractor or the client.

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Daniel

11 months ago

Okay, I think I've got this. The key is to identify the situations where the contract allows for adjustments to the fixed price, like changes in resource costs beyond the control of either party.

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Elvera

11 months ago

Hmm, I'm a bit unsure about this one. I'll need to carefully review the options and think through the different scenarios where a payment adjustment might be allowed.

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Tom

11 months ago

This question seems straightforward, but I want to make sure I understand the key details about fixed-price/lump-sum contracts and when adjustments can be made.

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Santos

11 months ago

This seems like a tricky question. I'll need to think carefully about the key requirements of Industry 4.0 and how 5G's capabilities can address them.

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Candida

11 months ago

Hmm, I'm not too sure about the differences between OM3 and OM4 fiber optic cables. I'll need to review my notes on the core diameters to figure this one out.

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Veronica

2 years ago

I'll take 'Unexpected Cost Overruns' for $500, Alex. Option D is the clear winner here.

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Dortha

2 years ago

Ha! Good luck trying to predict construction costs these days. Option D is the only way to go if you don't want to end up broke.

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Brinda

2 years ago

D) For changes in The cost of resources beyond the control of either party

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Verona

2 years ago

B) For changes in construction cost 'or varied works carried out beyond the original dale of completion

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Annice

2 years ago

A) For changes in prices calculated in accordance with a methodology proposed by the contractor at tender stage.

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Aleisha

2 years ago

I agree with Mindy. Fluctuations in the cost of construction resources are often unpredictable, and the contract should have a provision to adjust for those changes.

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Na

2 years ago

D) For changes in The cost of resources beyond the control of either party

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Annelle

2 years ago

B) For changes in construction cost 'or varied works carried out beyond the original dale of completion

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Rasheeda

2 years ago

A) For changes in prices calculated in accordance with a methodology proposed by the contractor at tender stage.

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Mindy

2 years ago

Option D seems like the most reasonable choice. Changes in resource costs beyond the control of either party should be accounted for in a fixed-price contract.

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Nakita

2 years ago

Option D seems like the most reasonable choice. Changes in resource costs beyond the control of either party should be accounted for in a fixed-price contract.

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