Project Management - Case Study Questions Answers

From the case study, the last TRDSS contract for K though L was signed as a fixed price incentive fee (FPIF) contract. The terms of the contract were as follows, all in US Dollars:

Target Cost: $618 million
Target Fee: $79 million
Target Price: $697 million
Ceiling Price: $772 million
Share ratio: 70/30 (buyer/seller)
Schedule incentive: $1.25 million/month

Calculate the following values based on the scenario costs below:

1.    Buyer's share (amount based on share ratio)

2.    Seller’s share (amount based on share ratio)

3.    Adjusted fee

4.    Contract price

Scenario 1:
Project Cost = $525 million

Scenario 2:
Project Cost = $926 million

Scenario 3:
Project Cost = $710 million

Ignore the schedule incentive listed in the case study and only focus on the cost incentives within the contract type. Show how you calculated the values listed in 1-4.

Include a 1 page summary analysis of the affects of each scenario pages including calculations.