When a Contractual Agreement Is Formed Between Two Parties, but If

question 54

Multiple Choice

When a contractual agreement is formed between two parties, but if one party cannot perform because a previously unforeseeable circumstance makes performance impossible, which party is relieved of its duties?

• A) only the party that was offering to perform
• B) only the party that was receiving the performance
• C) both parties, since the contractual agreement would be discharged
• D) both parties, but only if the court finds substantial performance

Analyze the impact of government-imposed price controls on consumer and producer behavior.

Explain the concept of illegal markets (black markets) and their relation to price controls.

Understand how quantity demanded and quantity supplied are affected by changes in price controls.

Grasp the equilibrium concept in market economics and how it is achieved or altered by external interventions.

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Definitions:

Earning Power

An indication of a company's ability to generate profit from its operations, often used by investors to assess financial health.

Inflation

The rate at which the typical cost levels of goods and services elevate, undermining the power to buy.

Real Rate

The interest rate adjusted for inflation, providing a more accurate indication of the borrowing cost or investment return in terms of real purchasing power.

Principal

The original sum of money borrowed in a loan, or the original amount invested, excluding any interest or dividends.