You are reading through the bid documents for a major tender you are leading for your company. The documents call for a Bid Guarantee of 5% of the contract amount. 

If you intend to bid €20 million, estimate how much the guarantee will cost your company if the guarantee is for 6 months? (You will need to estimate interest rates and fees) 

1. If you lose the bid, do you get the cost of the Bid Guarantee back? 

2. If you win the bid and refuse to sign, what will the buyer do? 

3. To whom do your pay the cost of the guarantee?