Practice Quiz

Paralegal Exam Prep

Category - Contracts

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What is a requirements contract?
  1. A contract in which a seller agrees to sell all of the goods that it can produce to the buyer.
  2. A contract that does not involve the sale of goods.
  3. A contract in which the seller agrees to supply as much of a good or service that the buyer needs.
  4. A contract that involves the performance of a service.
  5. A contract in which a seller only buys once a year.
Explanation
Answer: C. A requirements contract is a contract in which the seller agrees to supply as much of a good or service that the buyer needs. In a requirements contract, the buyer also agrees to purchase the goods or services exclusively from the seller. In contrast, an output contract is a contract in which a seller agrees to sell all of the goods that it can produce to the buyer, and the buyer agrees to buy all that the seller can produce.
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