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In this tutorial, Matt, a contracting officer, explains the time and materials contract type, commonly used in construction and product development. This contract allows payment based on the actual time spent and materials used, making it suitable for projects where size and changes cannot be accurately estimated, contrasting with fixed-price contracts. Defined under federal acquisition regulation subpart 16.6, it includes direct labor hours charged at specified fixed hourly rates, covering wages, overhead, administrative expenses, profit, and actual material costs. A time and materials contract is recommended when project scope is uncertain.