The transport minister of Anhaltia decided to construct a new main airport according to the public-private partnership
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Question:
The transport minister of “Anhaltia” decided to construct a new main airport according to the public-private partnership model. A firm called “V.P. Constructions” won the auction. The contract between “Anhaltia” and “V.P. Constructions” includes among others an airport terminal of 20,000 square meters.
a) What exactly will be “V.P. Constructions” responsibilities?
b) What incentives has “V.P. Constructions” with respect to the airport quality?
c) In which points of the contract with “V.P. Constructions” should the transport minister of “Anhaltia” be very cautious? How should the minister react, if the firm faces cost increases during construction?
Related Book For
Managerial Accounting
ISBN: 9780073526706
12th Edition
Authors: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer
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