Saler Company Entered into Two Contractual Agreements with Two Customers

question 96

Multiple Choice

Saler Company entered into two contractual agreements with two customers. Customer 1 agreed to buy 5,000 units of Product X11 per month for 24 months at $25 per unit. Customer 2 agreed to purchase advisory services for 12 months at $16,000 per month. Both customers agreed to modify their contracts after 6 months had passed. I. If Customer 1 decides to buy more than 5,000 units in any given month, the price will be $21 for the additional units, which is representative of the stand-alone price for this product in similar situations.
II) Customer 2 agrees to extend the period of time for advisory services to 15 months at the same price and to purchase 2,000 units of Product X11 per month for the next nine months at $15 per unit.
Which of these contract modifications creates a separate contract?

• A) I only
• B) II only
• C) Both I and II
• D) Neither I nor II

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Definitions:

Type II Error

The error that occurs when the null hypothesis is wrongly accepted, failing to detect an effect or difference when there is one.

Testing Agency

An organization or body that performs standard tests or assessments on products, services, or individuals to ensure compliance with required specifications, standards, or regulations.

Level Of Significance

A threshold in hypothesis testing that defines the probability of rejecting a true null hypothesis, commonly set at 0.05 or 5%.

Insulin Administration

The process of delivering insulin into the body, typically by injection or through an insulin pump, to manage blood glucose levels.