Contractor and government personnel are repeatedly misusing the terms “cost,” “price” and “estimate.” Many times it does not make any difference, but there are times when misuse of these terms causes a critical communication problem. This monograph explains the correct usage of these terms and the gray areas that one needs to be concerned about.

This government contracting personnel problem is very serious for contractors and their management. They must deal with these new contracting officers and inexperienced personnel—they can create problem contracts that have disastrous impact on contractors—including staggering losses and default terminations.