A Contract Has an Open Price Term If the Agreement

question 54

Multiple Choice

A contract has an open price term if the agreement:

• A) says nothing as to price.
• B) provides that the parties shall agree later as to the price and they fail to so agree.
• C) fixes the price in terms of some agreed market or other standard, as set by a third person or agency, and the price is not so set.
• D) All of these.
• E) None of these.

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Definitions:

Transfer Prices

Prices charged for goods, services, or intangible property transferred between units of the same organization.

External Market Price

The price at which a product or service is sold in the open market to external customers, outside of the company or organization.

Producing Division

The producing division refers to a department or segment within a company responsible for the production of goods or services.

Decentralised Organisation

A type of organizational structure where decision-making is distributed among various levels and departments rather than being concentrated at the top.