Which of the following is a key factor in determining contract type selection?

The selection of contract type is influenced significantly by the impact on competition levels. When determining the appropriate contract type, it is essential to consider how the chosen type will affect the competitive landscape for procurement. Certain contract types may encourage or discourage competition based on their structure and requirements. For instance, fixed-price contracts usually promote competition by allowing bidders to propose their prices, whereas cost-reimbursement contracts might limit competition to a smaller pool of qualified contractors who can manage and justify costs.

In evaluating this factor, contracting officers aim to facilitate an environment that attracts a variety of bidders, fostering innovation and cost-effectiveness. The ability of a procurement to stimulate healthy competition is crucial, as it can influence the quality of proposals and drive down costs, ultimately benefiting the government and taxpayers. This focus on competition underscores why it is a key factor in the decision-making process for contract type selection.