Chef and Remodeler enter into a contract under the terms of which Remodeler will remodel Chef's kitchen for a price of $10,000. It will cost Remodeler $6,000 for the appliances and other materials she will need to complete the job. When Remodeler has incurred $4,000 in unrecoverable costs, Chef breaches. Prior to the breach, Chef had paid Remodeler $5,000 in progress payments.

Let's calculate Remodeler's damages.

First, what is her "loss in value?"

 
$4,000
 
$5,000.
 
$6,000
 
$10,000