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Managing Contractual Risk Questions 51–55 (page: 12)

Updated On: 9-Feb-2026

Which of the following will you put into box 7?

  1. liability
  2. payment terms
  3. liquidated damages
  4. Contract variation

Answer(s): D

Explanation:

The correct answers are as follows:



This is a contract variation as they are changing the number of staff and their hours



Which of the following will you put into box 5?

  1. liability
  2. payment terms
  3. liquidated damages
  4. Contract variation

Answer(s): B

Explanation:

The correct answers are as follows:



This is payment terms - the discussion is about amending the payment terms from 60 days to 30 days.



Which of the following will you put into box 1?

  1. subcontracting
  2. reputational damage
  3. penalty clause
  4. consequential loss

Answer(s): A

Explanation:

The correct answers are as follows:



Subcontracting is the correct answer as they're using another company to fulfil the contract



Which of the following will you put into box 1?

  1. subcontracting
  2. reputational damage
  3. penalty clause
  4. consequential loss

Answer(s): B

Explanation:

The correct answers are as follows:



It's reputational damage as the scenario mentions 'bad press'



Which of the following will you put into box 1?

  1. subcontracting
  2. reputational damage
  3. penalty clause
  4. consequential loss

Answer(s): C

Explanation:

The correct answers are as follows:



This is consequential loss. Brian Air is going to lose the profits from the sales of the flights it had sold. Now those flights won't go ahead Brian Air can claim for consequential loss which would help balance the books.



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