Foodshopper Ltd, a Supermarket Operator, Has Been Contracting with Berry's

question 13

Multiple Choice

Foodshopper Ltd, a supermarket operator, has been contracting with Berry's Ltd, a fruit wholesaler, for the past three years. Each year the contract is renegotiated. This year, Berry's sends Foodshopper the following offer '100 kilos of citrus fruits for £250'. Foodshopper calls Berry's and leaves a message: 'Could we agree on 100 kilos for £200?' Berry's fails to respond, and, after a week, Foodshopper amends Berry's written offer with the handwritten messages '100 kilos for £200', 'Please send 400 kilos'. After receiving the altered document, Berry's ships 400 kilos to Foodshopper. Enclosed is an invoice for £1000. Foodshopper responds immediately with the following message: 'We agreed upon £200 per kilo, your invoice is incorrect, will pay £800 by Friday'. Knowing that the citrus fruit will go bad in a week, Foodshopper decides to sell the fruit. Have Foodshopper Ltd and Berry's Ltd concluded a binding contract, and if so, on what terms?

• A) No, Foodshopper and Berry's never reached agreement on the terms as evidenced by Foodshopper's amendment and Berry's invoice.
• B) Yes, the contract agreed upon is 100 kilos for £250. Foodshopper made a new proposal but this was not explicitly agreed to by Berry's. Berry's sent an invoice confirming the initial terms of the offer and Foodshopper proceeded with the sale of the goods.
• C) Yes, the contract agreed upon is 100 kilos for £200. Foodshopper's amendment was accepted by Berry's when they shipped the fruit.
• D) No, since Berry's is providing the goods, it is up to them to make an offer and Foodshopper's amendment has no effect other than to revoke Berry's first offer.

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Definitions:

Credit Sales

Sales made by a business for which payment will be made at a later date, as opposed to immediate cash sales.

Confidence Interval

A confidence interval is a range of values, derived from sample statistics, that is likely to contain the value of an unknown population parameter.

Standard Deviation

A statistical measure of the dispersion or spread of data points in a data set, indicating how much the individual data points differ from the mean.

Population Mean

The average of a set of characteristics or numbers in the entire population.