There are many different types of government contracts, but they can generally be categorized into two main types: fixed-price contracts and cost-reimbursement contracts.
Fixed-price contracts are contracts in which the contractor agrees to provide goods or services at a set price. The price is not usually negotiable and does not change, regardless of how much it costs the contractor to provide the goods or services.
Cost-reimbursement contracts are contracts in which the government reimburses the contractor for all of the costs incurred in providing the goods or services. The price is not set in advance and can be higher or lower than the original estimate, depending on the actual costs incurred.