Escalators present in a contract must state:
A)at what interval the contract price should automatically change at a fixed rate.
B)when the price will change and by what formula the new price will be calculated.
C)when the contract should be terminated and how the cost of termination should be shared.
D)when the contract should be renewed and the terms governing the renewal.

Question

Quizplus · Accepted Answer

Escalators in a contract typically refer to a formula for calculating price adjustments. Therefore, it is necessary to state when the price will change and by what formula the new price will be calculated. This information is important to avoid disputes and ensure that both parties are aware of the terms of the contract. Options A, C, and D relate to other aspects of the contract, but they are not directly related to escalators.

Escalators Present in a Contract Must State