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Guaranteed maximum price for construction contracts. A guaranteed maximum price (GMP) is a form of agreement with a contractor in which it is agreed that the contract sum will not exceed a specified maximum.
A fixed price contract allows for the party contracting for a project or result to have a reasonable degree of certainty regarding how much it will cost to take the project to completion. For instance, a party may enter into a fixed price contract wherein a contract agrees to build a home for $200,000.