Contracts

An Iowa purchase agreement includes an escalation clause stating the buyer will beat any competing offer by $2,000 up to a maximum of $315,000. A competing offer comes in at $308,000. What is the buyer's escalated price?

A$308,000
B$310,000✓ Correct
C$312,000
D$315,000

Explanation

Escalated price = Competing offer + $2,000 = $308,000 + $2,000 = $310,000. This is below the $315,000 cap, so the buyer's price is $310,000.

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