Which statement about a Guaranteed Maximum Price (GMP) contract is accurate?

The guaranteed maximum price (GMP) contract is designed to provide a cap on the maximum cost that the owner will incur for the construction project. This means that while the contractor is responsible for managing the project within this financial limit, any costs incurred beyond the GMP are typically absorbed by the contractor, rather than passed on to the owner.

This characteristic makes option B accurate, as it highlights the nature of the GMP as a cost-control mechanism that protects the owner's budget by establishing a predetermined maximum. In scenarios where costs come in under the GMP, the savings can often be shared between the owner and the contractor, promoting collaboration rather than conflict.

In contrast, the other statements do not accurately encapsulate the essence of a GMP contract. The idea that the construction manager assumes all project risk is misleading; while they have significant responsibility, risks are shared in a GMP arrangement. Similarly, the claim that the contractor passes all costs to the owner contradicts the fundamental principle of a GMP contract, which is to limit the owner's financial exposure. Lastly, the assertion that the owner assumes all project risk is incorrect because a key goal of a GMP contract is to transfer specific risks to the contractor, ensuring a balanced distribution of risk between the owner and the contractor.