PMI Scheduling Professional Certification (PMI-SP) Practice Exam 2026 - Free PMI-SP Practice Questions and Study Guide

A Fixed Price contract is characterized by a predetermined payment amount that remains constant throughout the life of the contract, independent of the actual resources or time involved in delivering the project. This means that the seller is obligated to complete the project for the agreed-upon price regardless of any changes in expenses or time requirements. This type of contract provides clarity and predictability for budget management for both the buyer and seller, as the financial risk is primarily borne by the seller.

The other options do not accurately describe the nature of a Fixed Price contract. Variability in payment based on resources used, sharing of costs between buyer and seller, or allowing unlimited modifications in scope are features that align more closely with other types of contracts, such as cost-reimbursable contracts or contracts with time-and-materials arrangements. In contrast, Fixed Price contracts are designed to minimize ambiguity and ensure that both parties adhere to the original terms.