In a contract with guaranteed prices for goods and services, what happens if actual prices increase before the time of need?

In a contract with guaranteed prices for goods and services, the fundamental principle is that the price is locked in at the time the contract is signed. This means that the specified prices remain unchanged even if market conditions result in actual prices increasing before the goods or services are needed. Therefore, the consumer is not responsible for any cost overruns due to price hikes in the marketplace.

This locked-in pricing feature is intended to provide financial certainty for both the provider and the client. It ensures that clients know their costs upfront and can budget accordingly without the concern of fluctuating prices impacting the final bill. This aspect of guaranteed pricing is especially critical in industries like funeral services, where planning and budgeting can be sensitive issues for families.

The other options suggest scenarios that would not apply under a guaranteed price contract. There will not be additional costs incurred, nor will the service be canceled or need to be renegotiated simply because of price increases experienced in the market prior to the time of need.