2012年5月29日 星期二

Cost-plus-incentive fee - Wikipedia, the free encyclopedia

Cost-plus-incentive fee - Wikipedia, the free encyclopedia

For example, assume a CPIF with:
target costs = 1000,
fixed fee = 100 (also called Target Profit),
benefit/cost sharing = 80% Buyer / 20% Seller,

If the final costs are higher than the target, say 1100, the Buyer will pay 1000 + 100 + 0.8*(1100-1000)=1180[2] (seller earns 80 which is less than if he had reached the target cost). 1180 (final payout) - 1100 (actual cost) = 80 profit.

If the final costs are lower than the target, say 900, the buyer will pay 1000 + 100 + 0.8*(900-1000) = 1020 (seller earns 120 which is more than if he had reached the target cost). 1020 (final payout) - 900 (actual cost) = 120 profit.

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