Match each Dynamics 365 Project Operations pricing method to its description.
Drag a concept onto its matching description — or click a concept then click the description.
Customer pays a predetermined total amount
Customer pays based on actual time and costs
Customer pays cost plus a markup
Customer pays a recurring fixed fee
Invoices triggered by project milestones
Answer choices
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
Cost plus: Customer pays actual costs plus an agreed-upon profit margin.
In Dynamics 365 Project Operations, Cost plus covers actual costs plus profit, Fixed price is a predetermined total, and Time and materials charges based on actual hours and materials. The distractors swap these definitions.
Answer analysis
For each option: why learners choose it and why it is or isn't the right answer here.
Cost plus: Customer pays actual costs plus an agreed-upon profit margin.
Why this is correct
Cost plus pricing covers direct costs (labor, materials) plus an additional profit margin, providing transparency for the customer.
Fixed price: Customer pays a set amount, regardless of actual costs incurred.
Why this is correct
Fixed price is a predetermined total contract value, shifting cost risk to the vendor.
Time and materials: Customer pays for actual time and materials consumed.
Why this is correct
Time and materials billing is based on recorded hours and material usage, common in consulting or services.
Fixed price: Customer pays based on actual time and materials.
Why it's wrong here
This describes time and materials pricing, not fixed price. Fixed price is a set amount regardless of actuals.
Time and materials: Customer pays a set amount.
Why it's wrong here
This describes fixed price pricing, not time and materials. T&M varies with actual consumption.
Cost plus: Customer pays only for materials, not labor.
Why it's wrong here
Cost plus includes both materials and labor, plus a profit margin. This option incorrectly excludes labor.
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