Question: 7. In __, a buyer may use internal engineering estimates about what it costs to produce an item, rely on historical experience and judgment to

7. In __, a buyer may use internal engineering

7. In __, a buyer may use internal engineering estimates about what it costs to produce an item, rely on historical experience and judgment to estimate costs, or review public financial documents to identify key cost data about the seller. a. reverse price analysis b. TCO analysis c. penetration pricing d. using the PPI e. competition pricing 8. Which of the following contracts will instil the lowest risk to supplier but the highest risk to buyer? a. Firm fixed price contract b. Fixed price with escalation c. Fixed price incentive d. Cost plus incentive fee e. Cost plus fixed fee 9. PQR purchases component Y from supplier NMO who charges PQR based on margin pricing model. If the total cost per unit of Y is $60 and a 15% profit margin is considered, what is the price/unit charged by NMO? a. $63.45 b. $65.98 c. $68.57 d. $70.59 e. $72.24

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