Asked by Allie Luker on May 19, 2024
Verified
In an output contract, the seller can operate a factory on a 24-hour-a-day schedule and insist that the buyer take all of the output when that buyer had operated only eight hours a day at the time the contract was made and the buyer had knowledge only of the eight-hours-a-day operating schedule.
24-Hour Schedule
A rotation or work schedule that covers all hours of the day across a team or installation, ensuring operations or service availability around the clock.
Output Contract
An agreement between a seller and a buyer where the seller agrees to sell all the production to the buyer, who in turn agrees to purchase the entire output.
Operating Schedule
A plan or timetable outlining the hours or periods a facility, service, or piece of equipment is in operation.
- Scrutinize the elements of offer, acceptance, and agreement in diverse contractual environments.
Verified Answer
KO
Kyley OlneyMay 21, 2024
Final Answer :
False
Explanation :
In an output contract, the quantity of goods to be purchased is determined by the seller's output, but the seller cannot unreasonably increase their output to force the buyer to purchase more than could be expected based on the circumstances at the time the contract was made. Operating a factory 24 hours a day when the buyer was aware of and based their agreement on an 8-hour operating schedule would likely be considered an unreasonable increase in output.
Learning Objectives
- Scrutinize the elements of offer, acceptance, and agreement in diverse contractual environments.