In which type of contract does a seller agree to sell all products it produces to a buyer?

In an output contract, a seller commits to selling all of the products they produce to a specified buyer. This arrangement ensures that the buyer secures a consistent supply of goods directly from the producer, while the seller agrees to fulfill the buyer's demand without seeking additional customers for those goods. This type of contract is often beneficial in industries where production levels can vary or when a buyer wants to ensure a reliable source of supply.

The nature of this agreement helps to stabilize the market for both parties—giving the seller a guaranteed buyer for their full production and providing the buyer with assurance that their supply needs will be met. Output contracts are commonly used in situations where the relationship between supplier and buyer is critical, such as in agricultural or manufacturing sectors, where production quantities can fluctuate significantly.

Other options like requirement contracts involve the buyer agreeing to purchase all their needs from a particular seller, but they do not entail the seller providing all output produced. Exclusive contracts can involve different aspects, such as exclusivity in sales territories or rights. Revenue contracts are less about supply commitments and more about securing future income streams. Therefore, the focus on the seller's total output in an output contract makes it the correct choice in this scenario.