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[Music] right when you get into contracts you might often see two terms you might see cost-plus and you might see lump sum or fixed price and this is interesting because if you think about it lets say I make these these little glass white boards and I put you who is my wholesaler thank you very much for being my wholesaler and youre going to sell me these youre going to sell these things for me and our agreement is on a cost-plus relationship so what happens is normally it costs me $100 to produce this and this is what you base your math on youre also selling it for what hang on Ill sell it to you Im selling it to you for 110 dollars normally thats a normal rate alright so weve got 10 percent increase set that cost plus cost plus 10 percent now if this thing changes this will also change our price so as the cost of materials go up the cost of wood the cost of glass start going up so does our price so with the ticks with the cost plus it relationship as the cost of generating
