Assuming a Buyer That Is Solvent Has Breached a Contract

question 62

Multiple Choice

Assuming a buyer that is solvent has breached a contract by not paying for goods that are in transit,which of the following may occur?

• A) The carrier may stop delivery on the entire shipment.
• B) The carrier may stop delivery only if the quantity shipped is a large shipment such as a carload or truckload.
• C) The carrier may stop delivery only if a signed writing exists by which the buyer agreed to the remedy of stopping shipment.
• D) The carrier may stop delivery only if ordered to do so by the bankruptcy judge.
• E) The carrier may not stop delivery under any circumstances.

---

Definitions:

Speculative Forward Contract

A financial derivative used to speculate on the future price of an asset, involving an agreement to buy or sell the asset at a future date for a price determined today.

Fair Value Hedge

A risk management technique that uses financial instruments to mitigate the risk associated with changes in the fair value of an asset or liability.

Firm Commitment

An agreement between a buyer and an underwriter in which the underwriter guarantees the sale of a certain amount of securities.

Cash Flow Hedge

A hedging strategy used to manage risk associated with variability in cash flows, typically related to interest rates or currency exchange rates.