Final answer:
An escape clause benefits the buyer by allowing them to back out of a contract without penalty under certain predefined circumstances, like issues with financing or property inspections. It serves as protection for the buyer.
Step-by-step explanation:
The statement "The 'escape' clause is for the benefit of the buyer, not seller" is generally true. An escape clause is a contractual provision that allows one party, typically the buyer, to back out of the contract under certain circumstances without facing legal consequences or losing their deposit. It serves as a form of protection for the buyer in situations where they may need to withdraw, such as not securing financing or discovering significant issues during a property inspection.
For example, during the release of a highly anticipated video game, the demand may exceed the supply, causing buyers to pay more than the equilibrium price to secure a copy. Additionally, in situations where the good has a unique or desirable characteristic, buyers may be willing to pay a premium price.