Which term is a justified action when the Government no longer needs the goods or services specified in a contract?

Which term is a justified action when the Government no longer needs the goods or services specified in a contract?

• A. Learning curve theory
• B. Aircraft range modification
• C. RDT&E
• D. Termination for convenience

Answer: (D)

In government contracting, when the government's needs have changed and it no longer requires the specified goods or services, it can terminate the contract for convenience. This is a formal mechanism that ends the agreement without fault by the contractor, allowing public funds to be saved from paying for unneeded work. The government typically pays the contractor for work already performed and for direct costs incurred as a result of the termination, plus reasonable closeout costs. The contractor must stop work and mitigate costs, then submit a termination settlement proposal documenting what was accomplished and what costs were incurred. This differs from termination for default, which happens due to the contractor’s failure to perform.

In government contracting, when the government's needs have changed and it no longer requires the specified goods or services, it can terminate the contract for convenience. This is a formal mechanism that ends the agreement without fault by the contractor, allowing public funds to be saved from paying for unneeded work. The government typically pays the contractor for work already performed and for direct costs incurred as a result of the termination, plus reasonable closeout costs. The contractor must stop work and mitigate costs, then submit a termination settlement proposal documenting what was accomplished and what costs were incurred. This differs from termination for default, which happens due to the contractor’s failure to perform.