The risk associated with unbalanced pricing is primarily assumed by which party?

In contracting, unbalanced pricing refers to a situation where bid prices are not proportionately aligned with the actual costs and can lead to a range of risks during the performance of the contract. This practice often results in certain items being over or underbid, significantly impacting the final contract price.

The primary risk associated with unbalanced pricing is typically assumed by the government in a contract setting. When unbalanced pricing occurs, the contractor might offer lower prices on some line items to win the bid, while inflating the prices on others. If the contract goes beyond the initial expectations or if the actual quantities differ from those estimated in the proposal, the government may end up paying more than anticipated, especially if the contractor has shifted pricing to cover risk on other items.

Moreover, the government is generally responsible for the overall contract performance and outcomes, which means they ultimately bear the financial implications of unbalanced pricing, particularly if those pricing strategies lead to cost overruns or disputes regarding the value of goods and services delivered based on those unbalanced amounts.

In contrast, the contractor also carries some risk since they must manage the delivery of the services or products at the prices they have set; however, the centrality of risk in unbalanced pricing is more heavily tilted towards the