CL611: Contracts II. Purdue University Global

CL611 CONTACTS: Module 6 Video 1 Learning Activity Quiz

Attempt Score 5 / 5 - 100 % Overall Grade (Highest Attempt) 5 / 5 - 100 %

Question 1 1 / 1 point

The standard measure of damages:

a) is the basic measure of damages for all non-breaching parties.

b) doesn't work for non-breaching service providers.

c) doesn't work for non-breaching lost volume sellers.

d) B and C.

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D is correct, while the standard measure of damages is the basic measure of damages for most non-breaching parties, it does not work for non-breaching service providers or lost volume sellers.

Question 2 1 / 1 point

Lost profits represent:

a) the total contract price that should have been paid.

b) the total contract price minus the cost of performance.

c) the benefit of the bargain for the non-breaching party.

d) B and C.

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D is correct, lost profits represent the benefit of the bargain for the non-breaching party, by calculating damages as the total contract price minus the cost of performance. A is incorrect, lost profits allow the recovery of net profits (not gross receipts).

Question 3 1 / 1 point

Cost of performance includes:

a) cost of goods sold.

b) cost of services provided.

c) A and B.

d) Neither A nor B.

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C is correct, the cost of performance includes both the cost of goods sold and the cost of services provided by the non-breaching party.

Question 4 1 / 1 point

With contracts for services, lost profits are the total contract price:

a) minus the cost of providing services.

b) minus the cost of providing services, which may include the cost of goods used in providing the performance.

c) minus the cost of goods sold.

d) minus the cost of goods sold, which may include the cost of services related to the goods sold.

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B is the best answer, because it explains what may be included in the cost of providing services (such as paint and painting supplies in a contract to paint a house). A is correct as far as it goes, but B provides a more complete articulation of the rule and is the best answer. C and D are incorrect, as they do not apply to contracts for services.

Question 5 1 / 1 point

With lost volume profits, lost profits are the total contract price:

a) minus the cost of providing services.

b) minus the cost of providing services, which may include the cost of goods used in providing the performance.

c) minus the cost of goods sold.

d) minus the cost of goods sold, which may include the cost of services related to the goods sold.

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D is the best answer, because it explains what may be included in the cost of goods sold (services such as delivery, installation, etc.). C is correct as far as it goes, but D provides a more complete articulation of the rule and is the best answer. A and B are incorrect, as they do not apply to lost volume profits.