Question 1

The Code defines __________ as "honesty in fact in the conduct or transaction concerned."

Accepted Answer

A)  good faith 
B)  unconscionability 
C)  merchantability 
D)  entrusting 
A)  good faith 
B)  unconscionability 
C)  merchantability 
D)  entrusting

Question 2

A contract has an open price term if the agreement:

Accepted Answer

A)  says nothing as to price. 
B)  provides that the parties shall agree later as to the price and they fail to so agree. 
C)  fixes the price in terms of some agreed market or other standard, as set by a third person or agency, and the price is not so set. 
D)  All of these. 
E)  None of these. 
A)  says nothing as to price. 
B)  provides that the parties shall agree later as to the price and they fail to so agree. 
C)  fixes the price in terms of some agreed market or other standard, as set by a third person or agency, and the price is not so set. 
D)  All of these. 
E)  None of these.

Question 3

"Goods" for purposes of the Code are essentially defined as tangible, movable, personal property.

Accepted Answer

A) True 
 B)False

Question 4

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

Question 5

A contract that does not satisfy the writing requirement of the Article 2 statute of frauds, but which is otherwise valid, is enforceable in which of the following situations?

Accepted Answer

A)  Where the goods have been delivered and accepted. 
B)  Where payment has been accepted. 
C)  Where the goods have been specially manufactured and are not suitable for resale in the ordinary course of business. 
D)  All of these are situations where the contract would be enforceable. 
A)  Where the goods have been delivered and accepted. 
B)  Where payment has been accepted. 
C)  Where the goods have been specially manufactured and are not suitable for resale in the ordinary course of business. 
D)  All of these are situations where the contract would be enforceable.

Question 6

A "merchant" is defined as a person who:

Accepted Answer

A)  is a dealer in a particular type of goods. 
B)  by his occupation holds himself out as having knowledge or skills peculiar to certain goods or practices. 
C)  employs an agent or broker whom he holds out as having such knowledge or skill. 
D)  All of these. 
A)  is a dealer in a particular type of goods. 
B)  by his occupation holds himself out as having knowledge or skills peculiar to certain goods or practices. 
C)  employs an agent or broker whom he holds out as having such knowledge or skill. 
D)  All of these.

Question 7

Albert has a contract to buy 100 tables from Bartholomew at a price of $50 a table. Five days before Bartholomew is to deliver the tables, he calls Albert to say that he is sorry but $50 won't cover his costs, and he will now need at least $75 a table. Albert agrees, because he needs the tables for his special sale. The modified contract is enforceable even though Albert isn't getting any new consideration, so long as Bartholomew is acting in good faith and the agreement to the new price is put in writing.

Accepted Answer

A) True 
 B)False

Question 8

A "sale" of goods happens when:

Accepted Answer

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

Question 9

A finance lease is a special type of lease transaction that generally involves three parties instead of two.

Accepted Answer

A) True 
 B)False

Question 10

Mary and Remaldi Co. have dealt with each other for many years. Mary's Boutique orders 100 assorted lipsticks at $2.00 each from Remaldi Co. Remaldi sends back a confirmation letter with an additional, nonmaterial term. There is:

Accepted Answer

A)  no contract, but a counteroffer. 
B)  a contract with the additional term unless Mary objects. 
C)  a contract with the additional term only if Mary agrees. 
D)  a contract without the additional term. 
A)  no contract, but a counteroffer. 
B)  a contract with the additional term unless Mary objects. 
C)  a contract with the additional term only if Mary agrees. 
D)  a contract without the additional term.

Question 11

The definition of "usage of trade" includes:

Accepted Answer

A)  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. 
B)  a practice regularly observed and followed in a place, vocation, or trade. 
C)  separation rules that apply to transactions between merchants. 
D)  All of these. 
A)  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. 
B)  a practice regularly observed and followed in a place, vocation, or trade. 
C)  separation rules that apply to transactions between merchants. 
D)  All of these.

Question 12

Leases of personal property exceed $100 billion annually and are governed by Article 2A of the UCC.

Accepted Answer

A) True 
 B)False

Question 13

In the case of Pittsley v. Houser, the court:

Accepted Answer

A)  held that the contract should be severed into different parts, applying the UCC to the part of the contract involving goods and the common law to the services part of the contract. 
B)  held that the "predominant factor" test contravened the UCC's declared purpose. 
C)  found the "predominant factor" test was the better, more prudent rule. 
D)  found the CISG governed the contract in question. 
A)  held that the contract should be severed into different parts, applying the UCC to the part of the contract involving goods and the common law to the services part of the contract. 
B)  held that the "predominant factor" test contravened the UCC's declared purpose. 
C)  found the "predominant factor" test was the better, more prudent rule. 
D)  found the CISG governed the contract in question.

Question 14

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

Accepted Answer

A)  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. 
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)  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. 
D)  None of the above. 
A)  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. 
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)  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. 
D)  None of the above.

Question 15

The definition of "goods" in the UCC may include timber, minerals, growing crops, or a building.

Accepted Answer

A) True 
 B)False

Question 16

The most important element in determining whether a sales contract has been made is the:

Accepted Answer

A)  language of the contract. 
B)  fact that the terms of the offer and acceptance are exactly alike. 
C)  number of open terms. 
D)  intent of the parties to make a contract. 
A)  language of the contract. 
B)  fact that the terms of the offer and acceptance are exactly alike. 
C)  number of open terms. 
D)  intent of the parties to make a contract.

Question 17

Explain when a writing is required under the UCC for a contract for the sale of goods and what is needed in that writing. Identify three exceptions to the requirement of a writing or record for the sale of goods.

Accepted Answer

The UCC statute of frauds provides that

Question 18

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

Accepted Answer

A) True 
 B)False

Question 19

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

Accepted Answer

A) True 
 B)False

Question 20

Leslie, the owner of a shoe store, purchased 500 Model XT-50 running shoes from her supplier, but a price was not stated in the contract. The contract is voidable at Leslie's option until the parties agree on a price.

Accepted Answer

A) True 
 B)False

Exam 19: Introduction to Sales and Leases

The Code defines __________ as "honesty in fact in the conduct or transaction concerned."

A contract has an open price term if the agreement:

"Goods" for purposes of the Code are essentially defined as tangible, movable, personal property.

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?

A contract that does not satisfy the writing requirement of the Article 2 statute of frauds, but which is otherwise valid, is enforceable in which of the following situations?

A "merchant" is defined as a person who:

A "sale" of goods happens when:

A finance lease is a special type of lease transaction that generally involves three parties instead of two.

Mary and Remaldi Co. have dealt with each other for many years. Mary's Boutique orders 100 assorted lipsticks at $2.00 each from Remaldi Co. Remaldi sends back a confirmation letter with an additional, nonmaterial term. There is:

The definition of "usage of trade" includes:

Leases of personal property exceed $100 billion annually and are governed by Article 2A of the UCC.

In the case of Pittsley v. Houser, the court:

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

The definition of "goods" in the UCC may include timber, minerals, growing crops, or a building.

The most important element in determining whether a sales contract has been made is the:

Explain when a writing is required under the UCC for a contract for the sale of goods and what is needed in that writing. Identify three exceptions to the requirement of a writing or record for the sale of goods.

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

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

Leslie, the owner of a shoe store, purchased 500 Model XT-50 running shoes from her supplier, but a price was not stated in the contract. The contract is voidable at Leslie's option until the parties agree on a price.

Introduction to Law

Business Ethics

Civil Dispute Resolution

Constitutional Law

Administrative Law

Criminal Law

Intentional Torts

Negligence and Strict Liability

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 Remedies

Performance

Transfer of Title and Risk of Loss

Product Liability: Warranties and Strict Liability

Sales Remedies

Form and Content

Transfer and Holder in Due Course

Liability of Parties

Bank Deposits, Collections, and Funds Transfers

Relationship of Principal and Agent

Relationship With Third Parties

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 Corporations

Secured Transactions and Suretyship

Bankruptcy

Securities Regulation

Intellectual Property

Employment Law

Antitrust

Accountants Legal Liability

Consumer Protection

Environmental Law

International Business Law

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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