If a Party's Performance Falls Short of the Standard Required

question 2

Multiple Choice

If a party's performance falls short of the standard required by the contract only in some relatively trivial aspect, how does the doctrine of substantive performance operate to mitigate its liability?

• A) The party in breach is entitled to the contract price, but the innocent party may counterclaim for any loss sustained as a result of the defective performance.
• B) The party in breach is entitled to recover from the innocent party a sum representing the value of the benefit conferred upon the other.
• C) The party in breach is entitled to recover from the innocent party all costs incurred in the performance of the contract.
• D) None of the options provided is correct.

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Definitions:

Firm-Specific Risk

Firm-specific risk refers to the risk associated with events or factors that are unique to a particular company, which can affect its stock price.

Market Risk

The risk of losses in financial markets arising from movements in market prices.

Stocks

Financial securities representing partial ownership in a company, allowing investors to claim on the company's assets and earnings.

Annuity

A financial product that pays out a fixed stream of payments to an individual, typically used as an income stream for retirees. It's a contract between an individual and an insurance company.