Cost-Plus contracts typically place the team's profit at risk. True or False?

Cost-Plus contracts are designed to reimburse contractors for their allowable costs incurred while performing the contract work, plus an additional amount for profit. In these contracts, the contractor is generally guaranteed to cover their costs, which minimizes financial risk compared to fixed-price contracts. The profit is typically not contingent on the project's overall success or profitability, making it less vulnerable to the project’s performance.

In this scenario, the team’s profit is not directly at risk because it is predetermined or based on the percentage of costs, as outlined in the contract. The structure of cost-plus contracts protects the contractor's profit in most circumstances, meaning that their financial return is secured regardless of any issues that might arise in the delivery of the project.