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3 Cards in this Set
- Front
- Back
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Output Contract
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An agreement in which a producer agrees to sell his or her ENTIRE PRODUCTION to the buyer.
Buyer get the exclusive rights to the product (so long as they purchase entire output) Buyer Empowered because buyer takes it all Mandates a best efforts (good faith requirement) |
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Output Contract Example
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An almond grower enters into an output contract with an almond packer: thus the producer has a "home" for his entire output of nuts, and the buyer gets exclusivity with the particular product.
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Requirement Contract
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Seller agrees to supply buyer with as much goods as the buyer wants, in exchange for the buyer's agreement not to buy those goods elsewhere.
Seller gets the exclusive promise from the buyer that he won't buy it elsewhere Seller Empowered because Buyer doesn't buy it all |
