Question
The transport minister of Anhaltia decided to construct a new main airport according to the public-private partnership model. A firm called V.P. Constructions won the
The transport minister of “Anhaltia” decided to construct a new main airport according to the public-private partnership model. A firm called “V.P. Constructions” won the auction. The contract between “Anhaltia” and “V.P. Constructions” includes among others an airport terminal of 20,000 square meters.
a) What exactly will be “V.P. Constructions” responsibilities?
b) What incentives has “V.P. Constructions” with respect to the airport quality?
c) In which points of the contract with “V.P. Constructions” should the transport minister of “Anhaltia” be very cautious? How should the minister react, if the firm faces cost increases during construction?
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a As per the contract VP Constructions will be responsible for the construction of the new main airport including the airport terminal of 20000 square ...
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Managerial Accounting
Authors: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer
12th Edition
978-0073526706, 9780073526706
