Question

Escalation clause is generally included in case of .................................. contract agreement.

Answer 1

Heya Friend,

Escalation clause is generally included in case of long period contract agreement.

Hence correct word is long period.

Hope it helps...

Answer 2

Escalation clause is generally included in case of long-term contract agreement

Escalation clause definition:

"An escalator clause, also known as an escalation clause, is a provision allowing for an increase in wages or prices. They are inserted into contracts and are activated under certain conditions, such as when the cost of living or inflation rises."

Purpose of escalation clause:

• Escalation clauses are mainly included in long-term contracts in order to avoid loss during market price inflation. It is beneficial to ensure that the contract is fair for both the parties when the market is shifting during the contract period.
• Escalation clauses in employment contracts makes sure that the wage increase is in accordance with the rate of inflation. The inclusion of escalation clause, is common in goods and service supply companies since wild fluctuations occur in those markets.
• In case of rental agreements, the landlords favour escalation clauses because they would not miss higher rents during  market inflation.