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The government uses grants and cooperative agreements as a means of assisting researchers in developing research for the public good, whereas it uses contracts as a means of procuring a service for the benefit of the government. Grants are much more flexible than contracts.
Grant Programs. The federal government provides grant funds for students attending colleges, career schools, and universities. Grants, unlike loans, are sources of free money and do not have to be repaid.* The major federal student grant programs are. briefly described below.