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A contracts to deliver 50 maunds of saltpetre to B on 1 January at a certain price. Before 1 January, B…

Illustration (o) to section 73: "the market price of the first of January, and not the profit which would have arisen to B from the sale to C" is taken into account. B's…

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A contracts to deliver 50 maunds of saltpetre to B on 1 January at a certain price. Before 1 January, B contracts to sell the saltpetre to C at a price higher than the market price of 1 January. A breaks his promise. What is taken into account in estimating B's compensation?

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Correct answer D

Illustration (o) to section 73: "the market price of the first of January, and not the profit which would have arisen to B from the sale to C" is taken into account. B's resale was his own later arrangement, so its extra profit is not a loss that naturally arises from A's breach. B could buy saltpetre in the market on 1 January, so the market price measures his loss.

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