Explain What Output and Requirements Contracts Are

question 19

Essay

Explain what output and requirements contracts are.
In some cases, the parties may state the quantity of goods covered by their sales contract in an indefinite way. Contracts that obligate a buyer to purchase a seller's output of a certain item or all the buyer's requirements of a certain item are commonly encountered. These contracts caused frequent problems under the common law because of the indefiniteness of the parties' obligations. If the seller decided to double its output, did the buyer have to accept the entire amount? If the market price of the item soared much higher than the contract price, could the buyer double or triple its demands?

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Definitions:

Hypothesis

A proposed explanation for a phenomenon, set forth as a basis for further investigation.

Opinion

A personal view, attitude, or appraisal formed about something, not necessarily based on fact or knowledge.

Scientific Theories

Systematically organized knowledge applicable in a relatively wide variety of circumstances, especially a system of assumptions, accepted principles, and rules of procedure devised to analyze, predict, or explain the nature or behavior of a specified set of phenomena.

Science Goal

The objective or purpose pursued in scientific inquiry, often involving the generation, verification, and application of knowledge.