Question 1

The common law "mirror image" rule has been modified by the Code.

Accepted Answer

A) True 
 B)False

Question 2

Categorizing a transaction as a lease rather than a security interest:

Accepted Answer

A)  has significant implications for the parties and for third parties. 
B)  has significant implications only for the parties to the transaction. 
C)  would mean the provisions of Article 9 of the UCC apply to the transaction. 
D)  Two of these are correct. 
A)  has significant implications for the parties and for third parties. 
B)  has significant implications only for the parties to the transaction. 
C)  would mean the provisions of Article 9 of the UCC apply to the transaction. 
D)  Two of these are correct.

Question 3

A "sale" of goods happens when:

Accepted Answer

A)  the parties sign the contract. 
B)  a promise to transfer title is made. 
C)  title to the goods is passed. 
D)  the parties agree. 
A)  the parties sign the contract. 
B)  a promise to transfer title is made. 
C)  title to the goods is passed. 
D)  the parties agree.

Question 4

Which of the following transactions is governed by Article 2 of the UCC?

Accepted Answer

A)  The sale of an apartment complex. 
B)  The sale of common stock of a soft drink company. 
C)  A contract to receive medical services in a hospital. 
D)  The sale of oranges to be picked from a 10-acre grove. 
A)  The sale of an apartment complex. 
B)  The sale of common stock of a soft drink company. 
C)  A contract to receive medical services in a hospital. 
D)  The sale of oranges to be picked from a 10-acre grove.

Question 5

If the original agreement was oral, a subsequent oral modification, which brings the resulting contract within the statute of frauds, is binding on and enforceable by the parties.

Accepted Answer

A) True 
 B)False

Question 6

Under the Code, if the parties have reached no agreement on price, the price is a reasonable one at the time of making the contract.

Accepted Answer

A) True 
 B)False

Question 7

The case of Construction Associates, Inc.v.Fargo Water Equipment Co.illustrates the doctrine of:

Accepted Answer

A)  usage of trade. 
B)  a transaction outside the Code. 
C)  course of dealing. 
D)  unconscionability. 
A)  usage of trade. 
B)  a transaction outside the Code. 
C)  course of dealing. 
D)  unconscionability.

Question 8

Article 2A of the UCC affords special treatment for consumer leases.

Accepted Answer

A) True 
 B)False

Question 9

Edie telephoned the office supply store and agreed to buy a dozen ink cartridges at $26 each.She then realized what a good buy this was and called the store with a request to modify the contract to read two dozen.What is the consequence?

Accepted Answer

A)  The modified contract is unenforceable. 
B)  The modified contract is valid and enforceable. 
C)  There is no consideration, so the contract is void. 
D)  The modified contract is void. 
A)  The modified contract is unenforceable. 
B)  The modified contract is valid and enforceable. 
C)  There is no consideration, so the contract is void. 
D)  The modified contract is void.

Question 10

If a merchant makes a written offer to buy or sell goods, this will be irrevocable only if accompanied by consideration.

Accepted Answer

A) True 
 B)False

Question 11

The definition of "usage of trade" includes:

Accepted Answer

A)  a practice regularly observed and followed in a place, vocation, or trade. 
B)  a sequence of previous conduct between the parties that may fairly be regarded as establishing a common basis of understanding for interpreting their expressions and agreement. 
C)  separation rules that apply to transactions between merchants. 
D)  All of these. 
A)  a practice regularly observed and followed in a place, vocation, or trade. 
B)  a sequence of previous conduct between the parties that may fairly be regarded as establishing a common basis of understanding for interpreting their expressions and agreement. 
C)  separation rules that apply to transactions between merchants. 
D)  All of these.

Question 12

Substantive unconscionability involves scrutiny by the court for "bargaining naughtiness."

Accepted Answer

A) True 
 B)False

Question 13

If a merchant signs a written offer to buy or sell goods, this will be irrevocable only if accompanied by consideration.

Accepted Answer

A) True 
 B)False

Question 14

The Code has made certain offers irrevocable without the offeree's giving any consideration for the promise to keep the offer open.These offers are known as:

Accepted Answer

A)  options. 
B)  firm offers. 
C)  variant acceptances. 
D)  auctions. 
A)  options. 
B)  firm offers. 
C)  variant acceptances. 
D)  auctions.

Question 15

Which of the following is correct with respect to "finance leases"?

Accepted Answer

A)  A finance lease generally involves four parties. 
B)  Finance leases are governed by the Truth in Lending Act rather than the UCC. 
C)  The finance lessor functions as a source of credit. 
D)  All of these are correct. 
A)  A finance lease generally involves four parties. 
B)  Finance leases are governed by the Truth in Lending Act rather than the UCC. 
C)  The finance lessor functions as a source of credit. 
D)  All of these are correct.

Question 16

If a contract does not comply with the statute of frauds, it is void.

Accepted Answer

A) True 
 B)False

Question 17

Haven orally agrees to buy 50 digital cash registers from Thomas for $15,000.Thomas delivers 30  cash registers  to Haven , who receives and accepts them.Which of the following is correct with regard to this transaction?

Accepted Answer

A)  The contract is enforceable to the extent of the 30  cash registers  that have been received and accepted. 
B)  Haven can enforce the contract for the additional 20  cash registers  . 
C)  The entire contract is in violation of the statute of frauds and cannot be enforced. 
D)  This is a bad deal, and is therefore commercially unconscionable from the beginning and is unenforceable. 
A)  The contract is enforceable to the extent of the 30  cash registers  that have been received and accepted. 
B)  Haven can enforce the contract for the additional 20  cash registers  . 
C)  The entire contract is in violation of the statute of frauds and cannot be enforced. 
D)  This is a bad deal, and is therefore commercially unconscionable from the beginning and is unenforceable.

Question 18

An example of the "course of dealing" concept that courts will use in interpreting a contract under the UCC would be:

Accepted Answer

A)  Bob sees an ad in the local paper for heritage flower seeds sold by Mel. He calls Mel and is so excited by his find that he orders a quantity of the seeds to be shipped as soon as possible but does not inquire as to price. Mel sends him the seeds and the invoice. 
B)  Temaco, Superior Oil, and AllBig, are the largest national oil companies in the country. In each refinery, orders are placed at the beginning of each quarter for priority delivery to distributors. 
C)  Steven and Michelle have been involved in contracts together for over 5 years. Steven maintains the sign for Michelle's restaurant. Each time Steven sees the sign needs repair, he fixes it without need of express consent from Michelle. Michelle has always paid the bill promptly. 
D)  All of these are examples of "course of dealing." 
A)  Bob sees an ad in the local paper for heritage flower seeds sold by Mel. He calls Mel and is so excited by his find that he orders a quantity of the seeds to be shipped as soon as possible but does not inquire as to price. Mel sends him the seeds and the invoice. 
B)  Temaco, Superior Oil, and AllBig, are the largest national oil companies in the country. In each refinery, orders are placed at the beginning of each quarter for priority delivery to distributors. 
C)  Steven and Michelle have been involved in contracts together for over 5 years. Steven maintains the sign for Michelle's restaurant. Each time Steven sees the sign needs repair, he fixes it without need of express consent from Michelle. Michelle has always paid the bill promptly. 
D)  All of these are examples of "course of dealing."

Question 19

Under the Code, a contract to sell or lease personal property is recognized whenever the parties manifest such an intent, even if they cannot identify a precise moment the contract was formed.

Accepted Answer

A) True 
 B)False

Question 20

Under the CISG, which of the following would not always be considered a material alteration to an offer?

Accepted Answer

A)  A change in time of delivery. 
B)  A change in color of goods ordered. 
C)  The addition of an arbitration clause for settlement of disputes. 
D)  A change in payment. 
A)  A change in time of delivery. 
B)  A change in color of goods ordered. 
C)  The addition of an arbitration clause for settlement of disputes. 
D)  A change in payment.

Exam 19: Introduction to Sales and Leases

The common law "mirror image" rule has been modified by the Code.

Categorizing a transaction as a lease rather than a security interest:

A "sale" of goods happens when:

Which of the following transactions is governed by Article 2 of the UCC?

If the original agreement was oral, a subsequent oral modification, which brings the resulting contract within the statute of frauds, is binding on and enforceable by the parties.

Under the Code, if the parties have reached no agreement on price, the price is a reasonable one at the time of making the contract.

The case of Construction Associates, Inc.v.Fargo Water Equipment Co.illustrates the doctrine of:

Article 2A of the UCC affords special treatment for consumer leases.

Edie telephoned the office supply store and agreed to buy a dozen ink cartridges at $26 each.She then realized what a good buy this was and called the store with a request to modify the contract to read two dozen.What is the consequence?

If a merchant makes a written offer to buy or sell goods, this will be irrevocable only if accompanied by consideration.

The definition of "usage of trade" includes:

Substantive unconscionability involves scrutiny by the court for "bargaining naughtiness."

If a merchant signs a written offer to buy or sell goods, this will be irrevocable only if accompanied by consideration.

The Code has made certain offers irrevocable without the offeree's giving any consideration for the promise to keep the offer open.These offers are known as:

Which of the following is correct with respect to "finance leases"?

If a contract does not comply with the statute of frauds, it is void.

Haven orally agrees to buy 50 digital cash registers from Thomas for $15,000.Thomas delivers 30 cash registers to Haven , who receives and accepts them.Which of the following is correct with regard to this transaction?

An example of the "course of dealing" concept that courts will use in interpreting a contract under the UCC would be:

Under the Code, a contract to sell or lease personal property is recognized whenever the parties manifest such an intent, even if they cannot identify a precise moment the contract was formed.

Under the CISG, which of the following would not always be considered a material alteration to an offer?

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

Consideration

Illegal Bargains

Contractual Capacity

Contracts in Writing

Third Parties to Contracts

Performance, Breach, and Discharge

Contract Remediespart Iv: Sales

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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