Under FAR 15.404-1(a)(3), which statement accurately describes when to use cost analysis and price analysis?

Under FAR 15.404-1(a)(3), which statement accurately describes when to use cost analysis and price analysis?

• A. Price analysis should be used to evaluate the reasonableness of individual cost elements; cost analysis should verify overall price.
• B. Cost analysis shall be used to evaluate the reasonableness of individual cost elements when certified cost or pricing data are required; price analysis should be used to verify that the overall price offered is fair and reasonable.
• C. Cost analysis is optional.
• D. Price analysis is not used in negotiated procurements.

Answer: (B)