Contracts
Under NC contract law, which of the following is an example of 'liquidated damages'?
AA court-ordered payment after a lawsuit
BA pre-agreed amount of damages (such as the earnest money deposit) specified in the contract as remedy for breach✓ Correct
CA payment to cover attorney's fees
DAn open-ended payment to cover all losses from a breach
Explanation
Liquidated damages are a pre-determined remedy agreed upon in the contract for a specific breach — in real estate, the earnest money deposit commonly serves as liquidated damages if the buyer defaults.
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