Multiple choice

Contract is frustrated due to frustration of ---

  1. Subject matter of contract

  2. Change of one party's desire

  3. Consideration of contract

  4. Capacity to contract
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A Correct answer
Explanation

Frustration of contract occurs when an unforeseen event destroys the fundamental basis of the agreement. The subject matter must become radically different or impossible to perform - not just harder or more expensive. Change of desire, consideration issues, or capacity problems don't constitute frustration.

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