Contracts and Sales Multistate Bar Practice Exam

Under what condition can a buyer demand payment for an installment sale?

1. When the entire contract is fulfilled

2. Only when the final installment is due

3. For each installment as it is delivered

4. Only after inspection of all goods received

The correct answer is: For each installment as it is delivered

In an installment sale, the buyer has the right to demand payment for each installment as it is delivered. This aligns with the nature of an installment sale, where the payment is typically structured in multiple parts, corresponding to the delivery of goods or services over time. Each installment is treated independently, allowing the buyer to seek payment upon receipt of each specific installment rather than waiting until all goods or the entire contract has been fulfilled. This approach ensures that buyers can manage their cash flow and obligations effectively, prompting payment only for the specific goods they have received. It also provides a level of security for the buyer, as they can evaluate each installment's quality and performance before making further payments. The other options do not reflect the operational dynamics of an installment sale, as they either suggest a cumulative demand for payment or a conditional delay based on inspection, which is not standard practice for these types of transactions.