Question 1

Obligations contingent upon a stated event are known as conditional promises.

Accepted Answer

A) True 
 B)False  True

Question 2

D owes C a past-due undisputed debt of $500.D sees C in a bar and pays him $400.C then says to D, "Forget about the other $100 you owe me.I'm glad to get the $400." C's promise to discharge the remainder of the debt is binding.

Accepted Answer

A) True 
 B)False  False

Question 3

Which of the following would not be enforceable without additional consideration?

Accepted Answer

A)  A promise to pay a debt barred by the statute of limitations. 
B)  A promise to pay a debt discharged in bankruptcy where the promise meets the requirements of the Bankruptcy Code. 
C)  A promise which falls within the doctrine of promissory estoppel. 
D)  The settlement of an undisputed debt. 
A)  A promise to pay a debt barred by the statute of limitations. 
B)  A promise to pay a debt discharged in bankruptcy where the promise meets the requirements of the Bankruptcy Code. 
C)  A promise which falls within the doctrine of promissory estoppel. 
D)  The settlement of an undisputed debt. D

Question 4

Jan promises Eli $4,000 for one of his original paintings on the condition that she receives $1 million from her mother's will.Jan's promise:

Accepted Answer

A)  is illusory. 
B)  is legally sufficient unless Jan knows she cannot inherit the $1 million. 
C)  is a conditional promise, which is not sufficient to form consideration. 
D)  is legally inadequate, and the courts will therefore not enforce it. 
A)  is illusory. 
B)  is legally sufficient unless Jan knows she cannot inherit the $1 million. 
C)  is a conditional promise, which is not sufficient to form consideration. 
D)  is legally inadequate, and the courts will therefore not enforce it.

Question 5

Barbara, a wealthy widow, promises the pastor of her church that she will donate $30,000 to the church to help pay off its mortgage if the stewardship committee can obtain enough pledges for the balance of the $60,000 mortgage.Other pledges are obtained to pay off the mortgage, but now Barbara has changed her mind and plans to take an around-the-world cruise instead.In this case:

Accepted Answer

A)  Barbara's promise to pay $30,000 is enforceable because it was a promise made to satisfy a preexisting moral obligation. 
B)  the promise to pay $30,000 is a promise to give a gift and is therefore not enforceable. 
C)  under the Restatement of Contracts, Barbara's promise is enforceable. 
D)  Two of these. 
A)  Barbara's promise to pay $30,000 is enforceable because it was a promise made to satisfy a preexisting moral obligation. 
B)  the promise to pay $30,000 is a promise to give a gift and is therefore not enforceable. 
C)  under the Restatement of Contracts, Barbara's promise is enforceable. 
D)  Two of these.

Question 6

In a bilateral contract, if one party is not bound, neither party is bound.

Accepted Answer

A) True 
 B)False

Question 7

Exclusive dealing contracts are illegal and therefore always void.

Accepted Answer

A) True 
 B)False

Question 8

Clint contests the amount of a bill he received from Car Care Specialists.Under the Restatement, settlement of the claim:

Accepted Answer

A)  is not valid consideration. 
B)  is not a legal detriment to Clint if his contentions were not made in good faith. 
C)  is valid consideration if at the time of the settlement the claim was doubtful because of uncertainty as to the facts. 
D)  does not involve a disputed debt unless Clint contests both the existence of the obligation and the amount of the bill. 
A)  is not valid consideration. 
B)  is not a legal detriment to Clint if his contentions were not made in good faith. 
C)  is valid consideration if at the time of the settlement the claim was doubtful because of uncertainty as to the facts. 
D)  does not involve a disputed debt unless Clint contests both the existence of the obligation and the amount of the bill.

Question 9

Which of the following is correct with regard to consideration?

Accepted Answer

A)  In a unilateral contract, a promise is exchanged for an act or forbearance to act. 
B)  In a bilateral contract, there is an exchange of promises. 
C)  Legal sufficiency is always related to adequacy of consideration. 
D)  Two of these are correct. 
A)  In a unilateral contract, a promise is exchanged for an act or forbearance to act. 
B)  In a bilateral contract, there is an exchange of promises. 
C)  Legal sufficiency is always related to adequacy of consideration. 
D)  Two of these are correct.

Question 10

The Restatement recognizes moral obligations as consideration.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following would not be a promise statutorily made enforceable without consideration?

Accepted Answer

A)  Hawkins, in good faith, changes the quantity of square yards of carpet ordered from Grant Mills. 
B)  Jones promises to pay his cousin's past-due cell phone bill. 
C)  Dodds signs and delivers a waiver of a claim arising out of a breach of contract by Keys. 
D)  A signed, written offer by Marcum Jewelers to sell four dozen 18" gold chains to the Alpha Sorority for $480 within the next 30 days. 
A)  Hawkins, in good faith, changes the quantity of square yards of carpet ordered from Grant Mills. 
B)  Jones promises to pay his cousin's past-due cell phone bill. 
C)  Dodds signs and delivers a waiver of a claim arising out of a breach of contract by Keys. 
D)  A signed, written offer by Marcum Jewelers to sell four dozen 18" gold chains to the Alpha Sorority for $480 within the next 30 days.

Question 12

In a contract for the sale of lawn care services, an issue arises about whether the homeowner would receive disproportionately less in service than the lawn care company would receive in compensation.This disparity may be relevant to the:

Accepted Answer

A)  requirement of legally sufficient consideration. 
B)  availability of certain defenses and remedies. 
C)  the voidability of the contract due to undue influence. 
D)  All of these. 
A)  requirement of legally sufficient consideration. 
B)  availability of certain defenses and remedies. 
C)  the voidability of the contract due to undue influence. 
D)  All of these.

Question 13

Dana gives care to Marnie's dog when Dana finds Marnie's dog ill on the side of the road.After Marnie locates her dog, Marnie promises to reimburse Dana for the cost of treating the dog.Marnie's promise is binding, because there is a bargained-for-exchange.

Accepted Answer

A) True 
 B)False

Question 14

Mary agrees to sew Georgia's prom dress for $50 plus costs.Georgia decides that she wants ruffles around the neck and calls Mary who says it will now cost $60.When Mary finishes the dress (with ruffles), Georgia must pay:

Accepted Answer

A)  $50, since that is the original agreement. 
B)  $50, since a modification must be in writing. 
C)  $60, since the modified agreement is supported by additional consideration. 
D)  $60, since any subsequent agreement is enforceable. 
A)  $50, since that is the original agreement. 
B)  $50, since a modification must be in writing. 
C)  $60, since the modified agreement is supported by additional consideration. 
D)  $60, since any subsequent agreement is enforceable.

Question 15

The performance of a pre-existing contractual duty which is neither doubtful nor the subject of an honest dispute is legally sufficient consideration to support a second contract.

Accepted Answer

A) True 
 B)False

Question 16

Harold purchased 400 pairs of gloves from Isaac at a contract price of $800.Fifty of the gloves were defective and a dispute arose as to the amount due and owing under the contract.Harold refuses to pay the $800, and Isaac is threatening to sue.Which of the following is correct with regard to this transaction?

Accepted Answer

A)  If Isaac agrees to accept $600 to settle the dispute and Harold agrees to pay that amount, the agreement is enforceable. 
B)  If Isaac agrees to accept $600 to settle the dispute and Harold pays that amount, Isaac can still sue for the balance of $200 and will win the lawsuit. 
C)  Harold is under a pre-existing legal obligation to pay the $800. 
D)  Two of these but not all three 
A)  If Isaac agrees to accept $600 to settle the dispute and Harold agrees to pay that amount, the agreement is enforceable. 
B)  If Isaac agrees to accept $600 to settle the dispute and Harold pays that amount, Isaac can still sue for the balance of $200 and will win the lawsuit. 
C)  Harold is under a pre-existing legal obligation to pay the $800. 
D)  Two of these but not all three

Question 17

A promisee's consideration is effective only if given directly to the promisor by the promisee.

Accepted Answer

A) True 
 B)False

Question 18

Legal sufficiency of consideration and adequacy of consideration are virtually synonymous terms.

Accepted Answer

A) True 
 B)False

Question 19

The parties to a contract may modify the agreement with no additional consideration by simply substituting a new contract.

Accepted Answer

A) True 
 B)False

Question 20

An agreement to sell the entire production of a particular plant is a requirements contract.

Accepted Answer

A) True 
 B)False

Exam 12: Consideration

Obligations contingent upon a stated event are known as conditional promises.

D owes C a past-due undisputed debt of $500.D sees C in a bar and pays him $400.C then says to D, "Forget about the other $100 you owe me.I'm glad to get the $400." C's promise to discharge the remainder of the debt is binding.

Which of the following would not be enforceable without additional consideration?

Jan promises Eli $4,000 for one of his original paintings on the condition that she receives $1 million from her mother's will.Jan's promise:

In a bilateral contract, if one party is not bound, neither party is bound.

Exclusive dealing contracts are illegal and therefore always void.

Clint contests the amount of a bill he received from Car Care Specialists.Under the Restatement, settlement of the claim:

Which of the following is correct with regard to consideration?

The Restatement recognizes moral obligations as consideration.

Which of the following would not be a promise statutorily made enforceable without consideration?

In a contract for the sale of lawn care services, an issue arises about whether the homeowner would receive disproportionately less in service than the lawn care company would receive in compensation.This disparity may be relevant to the:

Dana gives care to Marnie's dog when Dana finds Marnie's dog ill on the side of the road.After Marnie locates her dog, Marnie promises to reimburse Dana for the cost of treating the dog.Marnie's promise is binding, because there is a bargained-for-exchange.

Mary agrees to sew Georgia's prom dress for $50 plus costs.Georgia decides that she wants ruffles around the neck and calls Mary who says it will now cost $60.When Mary finishes the dress (with ruffles), Georgia must pay:

The performance of a pre-existing contractual duty which is neither doubtful nor the subject of an honest dispute is legally sufficient consideration to support a second contract.

A promisee's consideration is effective only if given directly to the promisor by the promisee.

Legal sufficiency of consideration and adequacy of consideration are virtually synonymous terms.

The parties to a contract may modify the agreement with no additional consideration by simply substituting a new contract.

An agreement to sell the entire production of a particular plant is a requirements contract.

Introduction to Law

Business Ethicspart Ii: the Legal Environment of Business

Civil Dispute Resolution

Constitutional Law

Administrative Law

Criminal Law

Negligence and Strict Liabilitypart Iii: Contracts

Introduction to Contracts

Mutual Assent

Conduct Invalidating Assent

Illegal Bargains

Contractual Capacity

Contracts in Writing

Third Parties to Contracts

Performance, Breach, and Discharge

Contract Remediespart Iv: Sales

Introduction to Sales and Leases

Performance

Transfer of Title and Risk of Loss

Product Liability: Warranties and Strict Liability

Sales Remediespart V: Negotiable Instruments

Form and Content

Transfer and Holder in Due Course

Liability of Parties

Bank Deposits, Collections, and Funds Transferspart Vi: Agency

Relationship of Principal and Agent

Relationship With Third Partiespart Vii: Business Associations

Formation and Internal Relations of General Partnerships

Operation and Dissolution of General Partnerships

Limited Partnerships and Limited Liability Companies

Nature and Formation of Corporations

Financial Structure of Corporations

Management Structure of Corporations

Fundamental Changes of Corporationspart Viii: Debtor and Creditor Relations

Secured Transactions and Suretyship

Bankruptcypart Ix: Regulation of Business

Securities Regulation

Intellectual Property

Employment Law

Antitrust

Accountants Legal Liability

Consumer Protection

International Business Lawpart X: Property

Introduction to Property, Property Insurance, Bailments, and Documents of Title

Interests in Real Property

Transfer and Control of Real Property

Trusts and Wills

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