Requirements must be described in terms of:

Describing requirements in terms of functions, performance, and characteristics is essential because it focuses on what the end user needs the product or service to achieve, rather than strictly how it is delivered or at what cost. Functions refer to the capabilities that the product or service must provide, which ensure it meets the intended objectives. Performance outlines the required levels of efficiency, reliability, and speed, which are crucial for assessing how well the product or service will operate in real-world conditions. Characteristics include specific attributes that affect the quality and usability of the offerings, such as durability or user-friendliness. This approach allows for a more comprehensive understanding of the needs, which can be used to assess potential solutions more effectively.

The other options focus on aspects like pricing, payment, technical details, and vendor evaluations, which, while important to the overall procurement process, do not directly address the core functional and performance requirements that define the success of the product or service in meeting user needs. Focusing solely on contract types or vendor evaluations may lead to overlooking the essential functionalities that the procurement aims to fulfill.