Question $2$ of $5.$

Which of the following is a despription of a fixed$-$price incentive contract?

The contractor is paid a fixed amount, but the amount is revised depending on changes in specified prices, costs, or indices.

The contractor is rewarded with increased profit when they incur costs below the target cost.

The contractor is paid a fixed amount for the initial period; subsequent periods are adjusted based on actual costs incurred.

The contractor is paid a fixed amount and may earn an award fee.