A Enters into a Contract with B Under Which a Will

question 12

Multiple Choice

A enters into a contract with B under which A will sell to B 1000 barrels of fish for $8000.00.The contract provides that the risk passes to the buyer on delivery of the shipping documents.B pays a deposit of $1200.00 and A delivers five barrels of fish to B.Five days later A's warehouse is destroyed by an explosion caused by faulty repairs to a gas pipe.Under the modern Frustrated Contracts Acts

• A)A must still complete the contract because it has not been frustrated.
• B)B would get back his deposit less the value of the five barrels of fish delivered to him.
• C)B would get back his full deposit.
• D)all of the above
• E)none of the above

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Definitions:

Substitution Effect

The change in consumption patterns due to a change in relative prices, leading consumers to substitute one product for another.

Output Effect

The impact on total revenue when a firm alters its production level, influencing the quantity of goods sold and potentially the market price.

Fixed Proportions

A production process in which inputs are used in a constant ratio to each other, with no substitution possible between the inputs.

Labor Productivity

An indicator of economic efficiency that evaluates the quantity of goods and services produced (output) relative to the total hours spent in producing those goods and services.