In a unit price contract, excavation is priced at $12.50 per cubic yard. If the actual excavation required is 2,840 cubic yards, what is the total cost for excavation?
Correct Answer
A) $35,500
Unit price contracts multiply the actual quantity by the agreed unit price. Total cost = 2,840 cubic yards × $12.50 per cubic yard = $35,500.
Why This Is the Correct Answer
In a unit price contract, the total cost is calculated by multiplying the actual quantity of work performed by the predetermined unit price. This is a straightforward multiplication problem: 2,840 cubic yards × $12.50 per cubic yard = $35,500. Unit price contracts are designed to accommodate variations in actual quantities while maintaining a fixed rate per unit of work.
Why the Other Options Are Wrong
Option B: $35,000
This answer of $35,000 appears to be the result of rounding or estimation error, possibly from calculating 2,800 × $12.50 instead of using the actual quantity of 2,840 cubic yards.
Option C: $36,200
This answer of $36,200 is too high and likely results from a calculation error, possibly adding an extra amount or using an incorrect unit price in the multiplication.
Option D: $34,800
This answer of $34,800 is too low and appears to result from using an incorrect quantity or unit price, possibly calculating with 2,784 cubic yards instead of 2,840.
Memory Technique
Remember 'UPC' - Unit Price Contract = Unit price × Quantity = Cost. Always multiply the ACTUAL quantity by the AGREED unit price.
Reference Hint
Look up 'Unit Price Contracts' or 'Contract Types' in construction management or estimating chapters of your reference materials
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