_________ is the money put down in addition to the tender.

Question

Question

This question was previously asked in

SSC JE Electrical 11 Oct 2023 Shift 3 Official Paper-I

Answer 1

The correct answer is option 3.

Earnest money deposit

It is a small refundable fee collected by the department from each bidder to ensure that a bidder does not submit a dummy bid or back out at the time of tender opening.
It is returned when all the bids are opened & tender is awarded to another firm.
It is generally 2% of the tender value.

Security deposit

It is the amount of money that has to be deposited with the buyer once the tender is awarded to a bidder to ensure that if he does not complete the task as per the work order, the buyer can recover the loss by forfeiting his security deposit.
It can be in the form of a demand draft or bank guarantee.
When the contractor completes the project, he gets its security deposit returned.
It is generally 10% of the tender value.

Additional Information Caution money:

It is the amount of money that someone has to pay when they rent property, use a service, etc. which will not be refunded if they damage something or owe money at the end of their contract.

Bank guarantee:

It is a written contract given by a bank on behalf of a customer that undertakes to pay or discharge the liability of the debtor in case of any default.