Liability in contract
A)acts as an incentive to commit a breach of contract.
B)acts as an economic deterrent to committing a breach of contract.
C)acts as a punishment for committing a breach of contract.
D)acts as both an economic deterrent and a punishment for committing a breach of contract.
E)all of the above

Question

Quizplus · Accepted Answer

Liability in contract acts as an economic deterrent to committing a breach of contract as it makes the breaching party liable to pay damages or compensation to the other party, which can have a financial impact. It may also act as a punishment, but that is not its primary objective. Furthermore, it does not act as an incentive to commit a breach of contract as it is a legal consequence for failing to fulfill contractual obligations. Therefore, the best choice is B.

Liability in Contract