A material line item of $210,000 is subject to an approved 6% escalation adjustment. What is the adjustment amount?
Correct Answer
C) $12,600
Escalation adjustment is $210,000 x 6% = $12,600.
Why This Is the Correct Answer
Escalation adjustment is $210,000 x 6% = $12,600.
Why the Other Options Are Wrong
Option A: $6,000
escalation adjustment, choice a: $6,000 backs into 100,000 when divided by 6%; the accepted setup gives 210,000 on that same base.
Option B: $21,000
escalation adjustment, choice b: $21,000 adds an extra unstated add-on/subtraction; the numeric gap is $8,400.
Option D: $222,600
escalation adjustment, choice d: $222,600 is produced by $210,000 x 1.06. The error is using that partial/alternate setup.
Memory Technique
Store escalation adjustment with its last math move; nearby answers are usually unfinished versions of $12,600.
Reference Hint
Open NASCLA Contractors Guide to Business, Law and Project Management, 14th Ed.; use the index entry or section for "material escalation" to confirm that Escalation adjustment is $210,000 x 6% = $12,600.
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