Which of the following allows one party to avoid obligations in the contract?

The reason a term that allows one party to unilaterally terminate the contract is considered correct is that this type of term specifically grants one party the discretion to end their obligations as outlined in the contract without requiring consent from the other party. This creates a power imbalance, where one party has the authority to decide whether to continue or discontinue fulfilling the contractual obligations based on their own preferences or circumstances.

The presence of such a unilateral termination clause can serve various purposes, such as providing a safeguard for the party that may face unforeseen difficulties, or allowing flexibility in situations where the contractual relationship becomes untenable. This ability to avoid obligations is significant because it can fundamentally alter the dynamic of the agreement, creating a risk for the party left without recourse.

Other terms mentioned, such as a term that benefits all parties equally, do not inherently allow one party to avoid their contractual duties; they promote mutual benefit and reciprocity. Similarly, a term that mandates approval for contract modifications ensures that both parties must agree to any changes, thereby maintaining the obligations as they stand. Lastly, a mutual agreement clause reflects the necessity of cooperation between both parties to make any adjustments to the contract, reinforcing each party's responsibilities rather than permitting one to opt out unilaterally.