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Government contracting comes for a fair bit of comment and criticism here. A lot of it is justified but I also think there are misconceptions. For example, Cost plus fixed fee does not mean you can overrun and still make a profit. The fee is fixed at inception. In an overrun situation you may recover your incurred costs but you progressively dilute your profit - something that the executive suite watches very closely.

The URL describes various contract types and when each is appropriate. It is a small piece of the full FAR.