What is the difference between a fixed-price contract and a time and materials contract?

A fixed-price contract and a time and materials contract are two types of construction contracts that are commonly used in West Virginia. A fixed-price contract is a contract between a buyer and a seller that sets a predetermined cost for labor and materials. This type of contract is often used when the project is clear and well-defined, and both the buyer and seller agree on the cost upfront. The advantage of this type of contract is that the buyer knows the exact cost of the project, and there is no risk of unexpected costs. A time and materials contract is a type of contract in which the buyer agrees to pay for labor and materials at an agreed upon rate. In this type of contract, the buyer is not provided with an exact estimate of the total cost of the project. Instead, the cost is derived from the number of hours worked and the materials used on the project. The advantage of this type of contract is that it allows for flexibility if the project changes during the construction process, since the rate of labor and materials can be adjusted accordingly.

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What is the difference between a fixed-price contract and a time and materials contract?

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