Under what circumstance would it be logical to leave contracts vague and open-ended?
A)When performance may be ambiguous or difficult to measure.
B)When one of the firms in the contract is much larger than the other firm
C)If there are many other firms that can provide the same service or product
D)When the cost of writing the contract is too high
E)If the smaller of the two contracting firms is the upstream firm

Question

Quizplus · Accepted Answer

Leaving contracts vague and open-ended may be logical when performance may be ambiguous or difficult to measure. In such circumstances, it may be difficult to specify precise outcomes, and a vague contract may allow for more flexibility in negotiating and adapting to changing circumstances.

Under What Circumstance Would It Be Logical to Leave Contracts