Contracts
Under Colorado law, a contract provision that specifies a predetermined dollar amount of damages in case of breach is called a:
AForfeiture clause
BLiquidated damages clause✓ Correct
CHold harmless provision
DIndemnification clause
Explanation
A liquidated damages clause specifies in advance the amount of damages to be paid in case of breach. In Colorado real estate contracts, the earnest money is often designated as liquidated damages. Such clauses are enforceable when actual damages would be difficult to calculate.
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