Question 1

A revocation of an offer is ordinarily effective only when it is communicated to the offeree.

Accepted Answer

A) True 
 B)False

Question 2

A customer requested a price from a carpenter on a teak cabinet to be built according to the buyer's specifications. Because teak wood is difficult to obtain, the customer agreed to pay the cost of the wood plus $175 and the carpenter agreed to build it. Which of the following is correct?

Accepted Answer

A) Although the price is somewhat unclear, the parties have entered into a contract. 
B) This is an agreement to agree, and is not binding. 
C) This agreement fails for indefiniteness. 
D) The carpenter is bound by the agreement, but not the customer. 
A) Although the price is somewhat unclear, the parties have entered into a contract. 
B) This is an agreement to agree, and is not binding. 
C) This agreement fails for indefiniteness. 
D) The carpenter is bound by the agreement, but not the customer.

Question 3

Social invitations can be offers.

Accepted Answer

A) True 
 B)False

Question 4

If an offer is indefinite or vague, no contract arises from an attempt to accept it.

Accepted Answer

A) True 
 B)False

Question 5

Mary offered to sell Mike several pieces of rare Chinese art at a very good price because they were duplicates in her own collection. Mike could not accept the offer at that time, but he did give Mary $500 in return for her promise to keep her offer open for three (3) weeks. Mike returned with the agreed-upon balance two weeks later to find that Mary already had sold the pieces she had offered to sell to him. Mary explained that she had been able to get a better price from another buyer. She offered to return Mike's $500 and insisted that this was all she was obligated to do. Is Mary right?

Accepted Answer

Mary is incorrect. By offering and accep

Question 6

Offers, acceptances of offers, and revocations of offers are all effective when mailed in a properly-addressed envelope bearing the proper amount of postage.

Accepted Answer

A) True 
 B)False

Question 7

Under the Uniform Commercial Code (UCC), a firm offer applies to:

Accepted Answer

A) a written, signed offer by a merchant to buy or sell goods. 
B) an unwritten but definite offer to buy or sell goods. 
C) a written, signed offer by anyone to buy or sell goods. 
D) an unlimited, stipulated period of time. 
A) a written, signed offer by a merchant to buy or sell goods. 
B) an unwritten but definite offer to buy or sell goods. 
C) a written, signed offer by anyone to buy or sell goods. 
D) an unlimited, stipulated period of time.

Question 8

If no time is stated for the duration of an offer, it continues indefinitely if the offer relates to durable goods or land.

Accepted Answer

A) True 
 B)False

Question 9

Contractual intention is determined by objective standards.

Accepted Answer

A) True 
 B)False

Question 10

An agreement is not too indefinite to be binding if a standard or formula is provided by which variable factors can be determined.

Accepted Answer

A) True 
 B)False

Question 11

An option is itself a contract to refrain from revoking an offer.

Accepted Answer

A) True 
 B)False

Question 12

An offer is effective only if it is communicated by the offeror in person.

Accepted Answer

A) True 
 B)False

Question 13

On April 15, Morgan sent a letter to Clark offering to sell her business to Clark for $200,000. The offer stated that it would expire on May 1. On April 30, Morgan sent another letter to Clark that stated that she was withdrawing the offer. Clark received that letter on May 1. Also on April 30, Clark sent a letter to Morgan accepting the offer. Morgan received that letter of acceptance on May 1. Morgan refused to sell the business to Clark, claiming that no contract had been formed. Clark brought suit to enforce the contract against Morgan. Based on what you have learned in this chapter, decide the probable outcome of the case.

Accepted Answer

Judgment would be for Clark. Per the mai

Question 14

If an offeree dies before the offer has been accepted, the offer:

Accepted Answer

A) may be rejected by the surviving spouse of the offeree. 
B) may be accepted by the surviving spouse of the offeree. 
C) is automatically revoked by the death of the offeree. 
D) may be accepted by the guardian appointed for any minor children of the offeree. 
A) may be rejected by the surviving spouse of the offeree. 
B) may be accepted by the surviving spouse of the offeree. 
C) is automatically revoked by the death of the offeree. 
D) may be accepted by the guardian appointed for any minor children of the offeree.

Question 15

To make an offer, the offeror must appear to intend to create a binding obligation.

Accepted Answer

A) True 
 B)False

Question 16

If either the offeror or offeree dies or becomes mentally incompetent before the offer is accepted, the offer is automatically terminated.

Accepted Answer

A) True 
 B)False

Question 17

If the offeree purports to accept an offer but in so doing makes any change to the terms of the offer, such action is a counteroffer that rejects the original offer.

Accepted Answer

A) True 
 B)False

Question 18

When it is claimed that a contract is too indefinite to be enforced, a court will do its best to find the intent of the parties and thereby reach the conclusion that the contract is not too indefinite.

Accepted Answer

A) True 
 B)False

Question 19

An agreement cannot be enforced if it does not set forth every contractual detail.

Accepted Answer

A) True 
 B)False

Question 20

If an offer does not state how long it shall remain open, it remains open for ten days.

Accepted Answer

A) True 
 B)False

Exam 13: Formation of Contracts: Offer and Acceptance

A revocation of an offer is ordinarily effective only when it is communicated to the offeree.

A customer requested a price from a carpenter on a teak cabinet to be built according to the buyer's specifications. Because teak wood is difficult to obtain, the customer agreed to pay the cost of the wood plus $175 and the carpenter agreed to build it. Which of the following is correct?

Social invitations can be offers.

If an offer is indefinite or vague, no contract arises from an attempt to accept it.

Offers, acceptances of offers, and revocations of offers are all effective when mailed in a properly-addressed envelope bearing the proper amount of postage.

Under the Uniform Commercial Code (UCC), a firm offer applies to:

If no time is stated for the duration of an offer, it continues indefinitely if the offer relates to durable goods or land.

Contractual intention is determined by objective standards.

An agreement is not too indefinite to be binding if a standard or formula is provided by which variable factors can be determined.

An option is itself a contract to refrain from revoking an offer.

An offer is effective only if it is communicated by the offeror in person.

If an offeree dies before the offer has been accepted, the offer:

To make an offer, the offeror must appear to intend to create a binding obligation.

If either the offeror or offeree dies or becomes mentally incompetent before the offer is accepted, the offer is automatically terminated.

If the offeree purports to accept an offer but in so doing makes any change to the terms of the offer, such action is a counteroffer that rejects the original offer.

When it is claimed that a contract is too indefinite to be enforced, a court will do its best to find the intent of the parties and thereby reach the conclusion that the contract is not too indefinite.

An agreement cannot be enforced if it does not set forth every contractual detail.

If an offer does not state how long it shall remain open, it remains open for ten days.

The Nature and Sources of Law

The Court System and Dispute Resolution

Business Ethics, Social Forces, and the Law

The Constitution As the Foundation of the Legal Environment

Government Regulation of Competition and Prices

Administrative Agencies

The Legal Environment of International Trade

Crimes

Torts

Intellectual Property Rights

Cyberlaw

Nature and Classes of Contracts: Contracting on the Internet

Capacity and Genuine Assent

Consideration

Legality and Public Policy

Writing, Electronic Forms, and Interpretation of Contracts

Third Persons and Contracts

Discharge of Contracts

Breach of Contract and Remedies

Personal Property and Bailments

Legal Aspects of Supply Chain Management

Nature and Form of Sales

Title and Risk of Loss

Product Liability: Warranties and Torts

Obligations and Performance

Remedies for Breach of Sales Contracts

Kinds of Instruments, Parties, and Negotiability

Transfers of Negotiable Instruments and Warranties of Parties

Liability of the Parties Under Negotiable Instruments

Checks and Funds Transfers

Nature of the Debtor-Creditor Relationship

Consumer Protection

Secured Transactions in Personal Property

Bankruptcy

Insurance

Agency

Third Persons in Agency

Regulation of Employment

Equal Employment Opportunity Law

Types of Business Organizations

Partnerships

LPS, LlCS, and LlPS

Corporate Formation

Shareholder Rights in Corporations

Securities Regulation

Accountants Liability and Malpractice

Management of Corporations

Real Property

Environmental Law and Land Use Controls

Leases

Decedents Estates and Trusts

Filters