Cost plus percentage stands for a form of a contract, for example for construction work. According to such a contact, a contractor is paid for the costs needed to perform the work plus a percentage fee --- 10 per cent, for example. The cost-plus-percentage contact implies that higher costs lead to higher profits for a contractor and hence it is much less desirable for the purchaser than, for example, the cost plus one lump sum. Use a calculator to compute the cost plus 10 per cent value.
Look up a contract to find out the estimated cost for a work. For example, the cost is £8,168.8.
Multiply the cost by 10 and then divide by 100 to compute the 10-percent value. In this example, it is ($12,567.50 x 10) / 100 = £816.8.
Add the value from Step 2 to the cost to calculate the cost-plus-10-percent value. In this example, £8,168.8 + £816.8 = £8,985.7.
- "Economics"; Roger A. Arnold; 2010
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