Question 1

All agreements are contracts.

Accepted Answer

A) True 
 B)False  False

Question 2

Which of the following is not a true contract and has been imposed by law in order to prevent one party benefiting unfairly at another's expense?

Accepted Answer

A) A voidable contract 
B) An informal contract 
C) A quasicontract 
D) A unilateral contract 
A) A voidable contract 
B) An informal contract 
C) A quasicontract 
D) A unilateral contract C

Question 3

An enforceable contract is made by an adult with a minor. Which of the following is most likely to hold true in this case?

Accepted Answer

A) The contract is enforceable against the adult but not against the minor. 
B) The contract is enforceable against the minor but not against the adult. 
C) The contract is not enforceable against either of the parties until the minor attains a majority. 
D) The contract is enforceable against the adult only if the minor ratifies the contract. 
A) The contract is enforceable against the adult but not against the minor. 
B) The contract is enforceable against the minor but not against the adult. 
C) The contract is not enforceable against either of the parties until the minor attains a majority. 
D) The contract is enforceable against the adult only if the minor ratifies the contract. A

Question 4

An executory contract is defined as:

Accepted Answer

A) a contract that may be set aside or avoided by one of the parties. 
B) a contract where the terms of the agreement are specified in words. 
C) a contract that is required to be created in a special form or manner of creation. 
D) a contract in which the terms have not been fully carried out by all parties. 
A) a contract that may be set aside or avoided by one of the parties. 
B) a contract where the terms of the agreement are specified in words. 
C) a contract that is required to be created in a special form or manner of creation. 
D) a contract in which the terms have not been fully carried out by all parties.

Question 5

What is the difference between an agreement and a contract?

Accepted Answer

A) An agreement results whenever two people's minds meet on a subject, but a contract only exists when the parties intend to be legally obligated by the terms of the agreement. 
B) An agreement must be put in writing, whereas a contract may be made orally. 
C) An agreement is binding for a shorter period of time than a formal contract. 
D) An agreement may be made for an unlawful purpose, whereas a contract must be made for a lawful purpose. 
A) An agreement results whenever two people's minds meet on a subject, but a contract only exists when the parties intend to be legally obligated by the terms of the agreement. 
B) An agreement must be put in writing, whereas a contract may be made orally. 
C) An agreement is binding for a shorter period of time than a formal contract. 
D) An agreement may be made for an unlawful purpose, whereas a contract must be made for a lawful purpose.

Question 6

The failure of a party to perform the obligations assumed under a contract is known as a(n): ​

Accepted Answer

A) intrinsic fraud. 
B) misrepresentation 
C) negative pledge. 
D) breach of contract. 
A) intrinsic fraud. 
B) misrepresentation 
C) negative pledge. 
D) breach of contract.

Question 7

​ The promise or obligation of each party to a contract must be supported by consideration in order for the contract to be valid.

Accepted Answer

A) True 
 B)False

Question 8

Most business people prefer making oral contracts regarding matters of great importance.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following is true of quasi-contracts?

Accepted Answer

A) It is an unenforceable contract. 
B) It generally offends ethical principles. 
C) It is always formed by an adult with a minor. 
D) It prevents the unjust enrichment of a party. 
A) It is an unenforceable contract. 
B) It generally offends ethical principles. 
C) It is always formed by an adult with a minor. 
D) It prevents the unjust enrichment of a party.

Question 10

Which of the following best describes the term "recognizance"?

Accepted Answer

A) It refers to the conditions of a formal or simple contract that an adult signs with a minor. 
B) It refers to the obligations that people enter into before a court to do an act required by law. 
C) It refers to the penalties that a party faces if the party fails to honor the obligations of a contract. 
D) It refers to negotiable instruments such as checks, notes, drafts, and certificates of deposit. 
A) It refers to the conditions of a formal or simple contract that an adult signs with a minor. 
B) It refers to the obligations that people enter into before a court to do an act required by law. 
C) It refers to the penalties that a party faces if the party fails to honor the obligations of a contract. 
D) It refers to negotiable instruments such as checks, notes, drafts, and certificates of deposit.

Question 11

Judy promises to pay Ashley $50 to babysit her children.   After Ashley babysits the children, Judy pays Ashley the $50; thus each party has completed performance of each part of the contract. This is an example of a(n):

Accepted Answer

A) executed contract. 
B) executory contract. 
C) quasi-contract. 
D) recognizance . 
A) executed contract. 
B) executory contract. 
C) quasi-contract. 
D) recognizance .

Question 12

A contract must be in a special form or be created in a certain way.

Accepted Answer

A) formal 
B) implied 
C) sealed 
D) simple 
A) formal 
B) implied 
C) sealed 
D) simple

Question 13

What is a contract? What are the five definite requirements that every contract must fulfill? ​

Accepted Answer

A contract can be defined as a legally e

Question 14

There is no difference between a void contract and an unenforceable contract.

Accepted Answer

A) True 
 B)False

Question 15

The law states that a unilateral contract can be formed when performance is started.

Accepted Answer

A) True 
 B)False

Question 16

The legal term for one party benefiting unfairly at the expense of another is unjust enrichment.

Accepted Answer

A) True 
 B)False

Question 17

An agreement between two parties to perform an illegal act is a quasi-contract.

Accepted Answer

A) True 
 B)False

Question 18

One may have rights and obligations imposed by law even when no real contract exists.

Accepted Answer

A) True 
 B)False

Question 19

When a contract is required to be sealed, a substitute for an actual seal may be used.

Accepted Answer

A) True 
 B)False

Question 20

A contract for the sale of goods is governed by the Uniform Commercial Code.

Accepted Answer

A) True 
 B)False

Exam 5: Nature and Classes of Contracts

All agreements are contracts.

Which of the following is not a true contract and has been imposed by law in order to prevent one party benefiting unfairly at another's expense?

An enforceable contract is made by an adult with a minor. Which of the following is most likely to hold true in this case?

An executory contract is defined as:

What is the difference between an agreement and a contract?

The failure of a party to perform the obligations assumed under a contract is known as a(n): ​

​ The promise or obligation of each party to a contract must be supported by consideration in order for the contract to be valid.

Most business people prefer making oral contracts regarding matters of great importance.

Which of the following is true of quasi-contracts?

Which of the following best describes the term "recognizance"?

Judy promises to pay Ashley $50 to babysit her children. After Ashley babysits the children, Judy pays Ashley the $50; thus each party has completed performance of each part of the contract. This is an example of a(n):

A contract must be in a special form or be created in a certain way.

What is a contract? What are the five definite requirements that every contract must fulfill? ​

There is no difference between a void contract and an unenforceable contract.

The law states that a unilateral contract can be formed when performance is started.

The legal term for one party benefiting unfairly at the expense of another is unjust enrichment.

An agreement between two parties to perform an illegal act is a quasi-contract.

One may have rights and obligations imposed by law even when no real contract exists.

When a contract is required to be sealed, a substitute for an actual seal may be used.

A contract for the sale of goods is governed by the Uniform Commercial Code.

Introduction to Law

Courts and Court Procedures

Business Torts and Crimes

Government Regulation of Business

Offer and Acceptance

Capacity to Contract

Consideration

Defective Agreements

Illegal Agreements

Written Contracts

Third Parties and Contracts

Termination of Contracts

Nature of Personal Property

Special Bailments

Sales of Personal Property

Formalities of a Sale

Transfer of Title and Risk in Sales Contracts

Warranties Product Liability and Consumer Protection

Nature of Negotiable Instruments

Essentials of Negotiability

Promissory Notes and Drafts

Negotiation and Discharge

Liabilities of Parties, Holders in Due Course and Defenses

Nature and Creation of an Agency

Operation and Termination of an Agency

Employer and Employee Relations

Employees Rights

Introduction to Business Organizations

Creation and Operation of a Partnership

Dissolution of a Partnership

Nature of a Corporation

Ownership of a Corporation

Management and Dissolution of a Corporation

Principles of Insurance

Types of Insurance

Security Devices

Bankruptcy

Nature of Real Property

Transfer of Real Property

Real Estate Mortgages

Landlord and Tenant

Wills Inheritances and Trust

Filters

The failure of a party to perform the obligations assumed under a contract is known as a(n):

The promise or obligation of each party to a contract must be supported by consideration in order for the contract to be valid.

What is a contract? What are the five definite requirements that every contract must fulfill?