You are the project manager in an engineering project and have recently signed a fixed$-$price contract with a software vendor for the development of a complicated control solution. The software will be used to control machinery which your project team is currently developing. The contractor has estimated a target price which seems rather low to you. Which of the following statements is NOT true in this case?

It is the contractor's risk in this type of contract that their profit may vanish if their costs have been underestimated.

It is likely that your organization may have to assume any unexpected additional costs for the software development.

This form of contract should only be chosen when all requirements are well understood by all parties involved.

In a fixed$-$price contract, change requests can cause issues regarding additional time and extra costs for the changes to be applied.