Question 1

Which of the following terms refers to a person's ability to be bound by a contract?

Accepted Answer

A)  legality 
B)  capacity 
C)  usability 
D)  negotiability 
E)  measurability 
A)  legality 
B)  capacity 
C)  usability 
D)  negotiability 
E)  measurability

Question 2

Miguel offers to sell Nisha 100 laptops at $50 each.Nisha ponders over the offer but mails her acceptance that evening to Miguel.Before her acceptance reaches Miguel,Miguel finds another buyer who is willing to pay $70 each for the laptops.Miguel sends a revocation mail the next day to cancel his initial offer to Nisha,but a storm has hit the city causing the mail services to halt temporarily.Which of the following statements is true about this situation?

Accepted Answer

A)  As per the mirror image rule, Nisha cannot sue Miguel for revoking his initial offer. 
B)  Miguel can use the doctrine of the promissory estoppel to defend his right to find and sell his laptops to another buyer. 
C)  As per the mailbox rule, Miguel cannot revoke his initial offer to Nisha as she had accepted his offer. 
D)  Nisha cannot sue Miguel as the deposited acceptance does not create a binding contract despite Miguel's revocation. 
E)  Nisha cannot sue Miguel as the storm prevents Miguel from mailing his revocation. 
A)  As per the mirror image rule, Nisha cannot sue Miguel for revoking his initial offer. 
B)  Miguel can use the doctrine of the promissory estoppel to defend his right to find and sell his laptops to another buyer. 
C)  As per the mailbox rule, Miguel cannot revoke his initial offer to Nisha as she had accepted his offer. 
D)  Nisha cannot sue Miguel as the deposited acceptance does not create a binding contract despite Miguel's revocation. 
E)  Nisha cannot sue Miguel as the storm prevents Miguel from mailing his revocation.

Question 3

Which of the following statements is true about a promise to make a gift?

Accepted Answer

A)  Upon delivery of the item, a true gift can be enforceable as a property transfer. 
B)  Promissory estoppel prevents a gift from being enforceable. 
C)  A promise to make a gift is binding as a contract as it usually supports the bargain. 
D)  A promise to make a gift becomes an option when it has a clause in the agreement that revokes the gift. 
E)  Insignificant consideration in return for a great one raises concerns that the exchange is actually not a gift. 
A)  Upon delivery of the item, a true gift can be enforceable as a property transfer. 
B)  Promissory estoppel prevents a gift from being enforceable. 
C)  A promise to make a gift is binding as a contract as it usually supports the bargain. 
D)  A promise to make a gift becomes an option when it has a clause in the agreement that revokes the gift. 
E)  Insignificant consideration in return for a great one raises concerns that the exchange is actually not a gift.

Question 4

A promise to make a gift is not binding as a contract because no bargained-for consideration supports the promise.

Accepted Answer

A) True 
 B)False

Question 5

Andrew,a professor,makes a promise to pay $3.00 to Lily,his student,if Lily gets him a reference book from the library.This is an example of a unilateral contract.

Accepted Answer

A) True 
 B)False

Question 6

Warranties can be disclaimed in writing if the parties so choose.

Accepted Answer

A) True 
 B)False

Question 7

Prestige Contractors has agreed to build Yen's house for $25,000 in two years.However,six months after the work begins,Prestige Contractors demands an additional $5,000 from Yen to complete the work.Yen agrees,but when the work is completed,Yen pays Prestige Contractors only $20,000.Prestige decides to sue Yen.Analyze the case.

Accepted Answer

A party to an agreement does not give co

Question 8

Fiola hires Tring Painters to paint her living room.She selects deluxe paints that will cost her $200.When the painters begin their work,Fiola notices that they are mistakenly using washable finesse paints,which will cost her $500.When the work is done,Fiola refuses to pay Tring Painters the $500 saying she wanted paints that would cost $200.Analyze the rights of the parties in this case.

Accepted Answer

When one party is unjustly enriched at t

Question 9

Vincent agrees to sell 10 cartons of footwear to a local retail outlet at $150 for each carton.Each carton is to contain 30 pairs of footwear,but the local retail outlet finds that most of the cartons have only 25 pairs of footwear.The retail outlet decides to sue Vincent,but they decide to settle the matter outside the court in order to reduce the expenses involved in a lawsuit.Both parties finally agree to revise the rate of each carton to $135 with each carton containing 25 pairs of footwear.This settlement is an example of ______.

Accepted Answer

A)  accord and satisfaction 
B)  duress 
C)  mutual mistake 
D)  undue influence 
E)  promissory estoppel 
A)  accord and satisfaction 
B)  duress 
C)  mutual mistake 
D)  undue influence 
E)  promissory estoppel

Question 10

Which of the following statements is true about the acceptance of an offer?

Accepted Answer

A)  Bilateral contracts are predominantly accepted by the offeree performing the act. 
B)  Unilateral contracts are accepted by making a promise. 
C)  The language of an offer is optional in determining the nature of contract and its acceptance. 
D)  Counteroffer usually means an acceptance of an offer. 
E)  Acceptance must follow the mirror image rule to create a binding contract. 
A)  Bilateral contracts are predominantly accepted by the offeree performing the act. 
B)  Unilateral contracts are accepted by making a promise. 
C)  The language of an offer is optional in determining the nature of contract and its acceptance. 
D)  Counteroffer usually means an acceptance of an offer. 
E)  Acceptance must follow the mirror image rule to create a binding contract.

Question 11

Casper offers to sell a car to Amanda for $1,000,to which Amanda agrees.Both the parties sign a contract with all the details of the transaction that will be executed in 1 day.This contract is an example of a firm offer.

Accepted Answer

A) True 
 B)False

Question 12

Performance made before parties discuss their agreement counts as a valid consideration.

Accepted Answer

A) True 
 B)False

Question 13

The doctrine of part performance creates an exception to the requirement that sales of interests in land must be in writing.

Accepted Answer

A) True 
 B)False

Question 14

If a debtor overpays a creditor by $5,000,the debtor can force the creditor to return that amount by suing under quasi-contract.

Accepted Answer

A) True 
 B)False

Question 15

Darcy offers Kate his farm house for $200,000.However,before Kate communicates her acceptance,the farm house is destroyed in a fire.In this situation,Kate can sue Darcy for breach of contract.

Accepted Answer

A) True 
 B)False

Question 16

Mayra offers to sell her home to Hanna for "about $100,000 plus closing costs." Hanna accepts Mayra's offer.Later,a dispute arises over the precise dollar amount of the purchase price.How will a court most likely resolve this dispute?

Accepted Answer

A)  The court will determine a reasonable price to be paid by Hanna. 
B)  The court will determine that Hanna pay only the figures mentioned in the contract. 
C)  The court will appoint a licensed real estate appraiser to determine the price to be paid by Hanna. 
D)  The court will require Hanna to pay the average of her price and Mayra's price. 
E)  The court will declare the purchase price and terms too indefinite to create a binding contract. 
A)  The court will determine a reasonable price to be paid by Hanna. 
B)  The court will determine that Hanna pay only the figures mentioned in the contract. 
C)  The court will appoint a licensed real estate appraiser to determine the price to be paid by Hanna. 
D)  The court will require Hanna to pay the average of her price and Mayra's price. 
E)  The court will declare the purchase price and terms too indefinite to create a binding contract.

Question 17

Allan promises to pay William $400 if he can steal the next day's test paper from their professor.That night,William steals the test paper and brings it to Allan.Allan,who is now worried about getting caught,tells William he does not want the test paper and refuses to pay him the $400.Has Allan breached the contract between him and William?

Accepted Answer

This is a case of a void contract since

Question 18

Josh announces a reward of $500 for his dog,Ginger,that ran away from his house.Josh spreads the word only by pinning up posters in his neighborhood.Amanda,Josh's colleague,sees Ginger and brings her back to Josh without ever seeing the poster.After returning the dog,Amanda sees one of the reward posters and returns to claim the money.In the context of this scenario,which of the following statements is true?

Accepted Answer

A)  Amanda is not entitled to the money because the offer was not communicated to her. 
B)  Amanda is not entitled to the money because she is Josh's colleague and acted in good faith. 
C)  Amanda is entitled to the money because the poster constituted an offer and is effective for the entire neighborhood. 
D)  Amanda is entitled to the money since performance of the requested act in the poster indicates acceptance. 
E)  Amanda is not entitled to the money since she did not communicate the acceptance of the offer in writing. 
A)  Amanda is not entitled to the money because the offer was not communicated to her. 
B)  Amanda is not entitled to the money because she is Josh's colleague and acted in good faith. 
C)  Amanda is entitled to the money because the poster constituted an offer and is effective for the entire neighborhood. 
D)  Amanda is entitled to the money since performance of the requested act in the poster indicates acceptance. 
E)  Amanda is not entitled to the money since she did not communicate the acceptance of the offer in writing.

Question 19

Which of the following statements is true about the consideration in a contract?

Accepted Answer

A)  Courts usually enforce contractual promises in the absence of consideration. 
B)  The amount of the consideration is the most important and relevant part of a contract for a legal action. 
C)  The consideration must be contemporaneous and a part of both parties' understanding of the contract terms. 
D)  The consideration in any unilateral contract is usually absent. 
E)  Performance made before parties discuss their agreement counts as a consideration. 
A)  Courts usually enforce contractual promises in the absence of consideration. 
B)  The amount of the consideration is the most important and relevant part of a contract for a legal action. 
C)  The consideration must be contemporaneous and a part of both parties' understanding of the contract terms. 
D)  The consideration in any unilateral contract is usually absent. 
E)  Performance made before parties discuss their agreement counts as a consideration.

Question 20

Robert is about to graduate from his university.His parents tell him that as he is the first member of the family to graduate college,they want to buy him a new but inexpensive car.They have the money to buy the car,and Robert is excited to receive his gift.On graduation day,his parents tell him that they have decided to use the car money for a vacation and that there will be no car.In this situation,can Robert sue his parents?

Accepted Answer

A)  Robert can successfully sue based on promissory estoppel. 
B)  Robert can successfully sue based on the promise of a gift. 
C)  Robert cannot sue because the promise was not reasonable and did not follow the mailbox rule. 
D)  Robert cannot sue because he did not suffer any legal detriment in the receipt of the promise. 
E)  Robert can sue since the promise is his legal benefit, and it is an implied-in-fact contract. 
A)  Robert can successfully sue based on promissory estoppel. 
B)  Robert can successfully sue based on the promise of a gift. 
C)  Robert cannot sue because the promise was not reasonable and did not follow the mailbox rule. 
D)  Robert cannot sue because he did not suffer any legal detriment in the receipt of the promise. 
E)  Robert can sue since the promise is his legal benefit, and it is an implied-in-fact contract.

Which of the following terms refers to a person's ability to be bound by a contract?

Which of the following statements is true about a promise to make a gift?

A promise to make a gift is not binding as a contract because no bargained-for consideration supports the promise.

Andrew,a professor,makes a promise to pay $3.00 to Lily,his student,if Lily gets him a reference book from the library.This is an example of a unilateral contract.

Warranties can be disclaimed in writing if the parties so choose.

Which of the following statements is true about the acceptance of an offer?

Casper offers to sell a car to Amanda for $1,000,to which Amanda agrees.Both the parties sign a contract with all the details of the transaction that will be executed in 1 day.This contract is an example of a firm offer.

Performance made before parties discuss their agreement counts as a valid consideration.

The doctrine of part performance creates an exception to the requirement that sales of interests in land must be in writing.

If a debtor overpays a creditor by $5,000,the debtor can force the creditor to return that amount by suing under quasi-contract.

Darcy offers Kate his farm house for $200,000.However,before Kate communicates her acceptance,the farm house is destroyed in a fire.In this situation,Kate can sue Darcy for breach of contract.

Mayra offers to sell her home to Hanna for "about $100,000 plus closing costs." Hanna accepts Mayra's offer.Later,a dispute arises over the precise dollar amount of the purchase price.How will a court most likely resolve this dispute?

Which of the following statements is true about the consideration in a contract?

Law As a Foundation for Business

The Role of Ethics in Decision Making

The Court System

Litigation

Alternative Dispute Resolution

The Constitution

The Property System

Contractual Performance and Breach

Torts Affecting Business

Intellectual Property

International Law

Criminal Law and Business

Business Organizations

The Regulatory Process

Regulating Competitionantitrust Laws

Financial and Securities Regulations

Regulations Protecting Consumer Purchases, privacy, and Financial Activities

Environmental Regulation

Discrimination in Employment

Employment Laws

Labormanagement Relationship

Filters

Exam 8: Contract Formation

Which of the following terms refers to a person's ability to be bound by a contract?

Which of the following statements is true about a promise to make a gift?

A promise to make a gift is not binding as a contract because no bargained-for consideration supports the promise.

Andrew,a professor,makes a promise to pay $3.00 to Lily,his student,if Lily gets him a reference book from the library.This is an example of a unilateral contract.

Warranties can be disclaimed in writing if the parties so choose.

Which of the following statements is true about the acceptance of an offer?

Casper offers to sell a car to Amanda for $1,000,to which Amanda agrees.Both the parties sign a contract with all the details of the transaction that will be executed in 1 day.This contract is an example of a firm offer.

Performance made before parties discuss their agreement counts as a valid consideration.

The doctrine of part performance creates an exception to the requirement that sales of interests in land must be in writing.

If a debtor overpays a creditor by $5,000,the debtor can force the creditor to return that amount by suing under quasi-contract.

Darcy offers Kate his farm house for $200,000.However,before Kate communicates her acceptance,the farm house is destroyed in a fire.In this situation,Kate can sue Darcy for breach of contract.

Mayra offers to sell her home to Hanna for "about $100,000 plus closing costs." Hanna accepts Mayra's offer.Later,a dispute arises over the precise dollar amount of the purchase price.How will a court most likely resolve this dispute?

Which of the following statements is true about the consideration in a contract?

Law As a Foundation for Business

The Role of Ethics in Decision Making

The Court System

Litigation

Alternative Dispute Resolution

The Constitution

The Property System

Contractual Performance and Breach

Torts Affecting Business

Intellectual Property

International Law

Criminal Law and Business

Business Organizations

The Regulatory Process

Regulating Competitionantitrust Laws

Financial and Securities Regulations

Regulations Protecting Consumer Purchases, privacy, and Financial Activities

Environmental Regulation

Discrimination in Employment

Employment Laws

Labormanagement Relationship

Filters