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Buyer entered into a contract to purchase a custom made bed from Sleep is Us (SU

ID: 330382 • Letter: B

Question

Buyer entered into a contract to purchase a custom made bed from Sleep is Us (SU) company. The agreed price was $3,000. SU would make a profit on this transaction of $1,000. However, one week later Buyer changed her mind and repudiated the contract. SU had not yet begun construction or purchased any materials for the bed. If SU sues, how much money will it be entitled to as damages? (Ignore any incidental expenses or cost savings.)

Nothing, since it is no worse off than if the contract had never been made

Nominal damages only

The lost profits ($1,000)

The contract price ($3,000)

A.

Nothing, since it is no worse off than if the contract had never been made

B.

Nominal damages only

C.

The lost profits ($1,000)

D.

The contract price ($3,000)

Explanation / Answer

How much money will it be entitled to as damages?

Answer = C) The lost profits ($1,000)