Question 1

Carrie promises Tim she will clean his house and in exchange,Tim promises to pay Carrie $50.This is an example of what type of contract?

Accepted Answer

A) A bilateral contract 
B) An implied contract 
C) A contract created through promissory estoppel 
D) A unilateral contract 
E) An invalid contract 
A) A bilateral contract 
B) An implied contract 
C) A contract created through promissory estoppel 
D) A unilateral contract 
E) An invalid contract A

Question 2

Gabrielle is three months behind on her mortgage,and her lender filed negative information affecting her credit rating.Gabrielle mailed one monthly payment to the lender along with a letter stating that she was making the payment on the condition that the lender remove negative material sent to credit reporting agencies affecting her credit rating.The lender cashed the check but did not remove the negative information.Gabrielle sues the bank for breach of contract.Which of the following is the most likely result?

Accepted Answer

A) The bank will win because under federal law,once correct negative information is reported regarding a customer,it can be removed only if it is found to be untruthful. 
B) Gabrielle will win because the bank's cashing the check constituted acceptance of her offer,and a valid contract existed. 
C) The bank will win because under state law,once correct negative information is reported regarding a customer,it can be removed only if it is found to be untruthful. 
D) Gabrielle will win because the bank had an obligation to notify her that it was not accepting her offer before cashing the check. 
E) The bank will win because under the preexisting duty rule,Gabrielle was already legally obligated to make the payment,and there was no consideration to support the contract. 
A) The bank will win because under federal law,once correct negative information is reported regarding a customer,it can be removed only if it is found to be untruthful. 
B) Gabrielle will win because the bank's cashing the check constituted acceptance of her offer,and a valid contract existed. 
C) The bank will win because under state law,once correct negative information is reported regarding a customer,it can be removed only if it is found to be untruthful. 
D) Gabrielle will win because the bank had an obligation to notify her that it was not accepting her offer before cashing the check. 
E) The bank will win because under the preexisting duty rule,Gabrielle was already legally obligated to make the payment,and there was no consideration to support the contract. E

Question 3

If a check is marked "paid in full," which of the following is true under the UCC?

Accepted Answer

A) If a business inadvertently cashes such a check,the business has 90 days from the date it cashed that check to offer repayment in the same amount to the debtor and avoid an accord and satisfaction. 
B) If a business inadvertently cashes such a check,the business has 120 days from the date it cashed that check to offer repayment in the same amount to the debtor and avoid an accord and satisfaction. 
C) The business has no recourse,and the debt is deemed discharged and satisfied. 
D) If a business inadvertently cashes such a check,the business has 30 days from the date it cashed that check to offer repayment in the same amount to the debtor and avoid an accord and satisfaction. 
E) If a business inadvertently cashes such a check,the business has 60 days from the date it cashed that check to offer repayment in the same amount to the debtor and avoid an accord and satisfaction. 
A) If a business inadvertently cashes such a check,the business has 90 days from the date it cashed that check to offer repayment in the same amount to the debtor and avoid an accord and satisfaction. 
B) If a business inadvertently cashes such a check,the business has 120 days from the date it cashed that check to offer repayment in the same amount to the debtor and avoid an accord and satisfaction. 
C) The business has no recourse,and the debt is deemed discharged and satisfied. 
D) If a business inadvertently cashes such a check,the business has 30 days from the date it cashed that check to offer repayment in the same amount to the debtor and avoid an accord and satisfaction. 
E) If a business inadvertently cashes such a check,the business has 60 days from the date it cashed that check to offer repayment in the same amount to the debtor and avoid an accord and satisfaction. A

Question 4

What is the preexisting duty rule?

Accepted Answer

The performance of a duty one

Question 5

When are promises based on past consideration enforceable?

Accepted Answer

A) When a sale of goods is involved 
B) Always 
C) When an illusory promise is made 
D) When enforcement is necessary to avoid injustice 
E) Never 
A) When a sale of goods is involved 
B) Always 
C) When an illusory promise is made 
D) When enforcement is necessary to avoid injustice 
E) Never

Question 6

Which of the following is true regarding the dispute between Ezra and Diego regarding whether Diego must return anything?

Accepted Answer

A) Diego must return only the communications book. 
B) Diego must return only the computer. 
C) Diego does not legally have to return anything. 
D) Diego must return the computer,the business law book,and the communications book. 
E) Diego must return only the business law book. 
A) Diego must return only the communications book. 
B) Diego must return only the computer. 
C) Diego does not legally have to return anything. 
D) Diego must return the computer,the business law book,and the communications book. 
E) Diego must return only the business law book.

Question 7

Which of the following is true regarding Ezra's claim concerning the inadequacy of house cleaning as consideration?

Accepted Answer

A) Ezra is correct because cleaning house would not constitute a benefit to the promisor. 
B) Ezra is correct because cleaning house would not constitute a detriment to the promisee. 
C) Ezra is incorrect because house cleaning can constitute consideration that would support a contract,and the court would not likely be concerned with the fact that the cleaning duties would be light. 
D) Although,contrary to Ezra's assertion,house cleaning can be consideration,it was not in this case,as his apartment was already fairly clean. 
E) Ezra is correct because Irina had only promised,but had not actually performed. 
A) Ezra is correct because cleaning house would not constitute a benefit to the promisor. 
B) Ezra is correct because cleaning house would not constitute a detriment to the promisee. 
C) Ezra is incorrect because house cleaning can constitute consideration that would support a contract,and the court would not likely be concerned with the fact that the cleaning duties would be light. 
D) Although,contrary to Ezra's assertion,house cleaning can be consideration,it was not in this case,as his apartment was already fairly clean. 
E) Ezra is correct because Irina had only promised,but had not actually performed.

Question 8

In an unliquidated debt,the parties agree on whether money is owed and agree upon the amount but disagree on the repayment schedule.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following is an exception to the rule requiring consideration?

Accepted Answer

A) Promissory estoppel 
B) Promissory agreement 
C) Promissory performance 
D) Quasi estoppel 
E) Quasi agreement 
A) Promissory estoppel 
B) Promissory agreement 
C) Promissory performance 
D) Quasi estoppel 
E) Quasi agreement

Question 10

Tim promises to pay Carrie $50 to clean his house and Carrie comes over and cleans is house.Tim and Carrie have.

Accepted Answer

A) A contract not supported by consideration 
B) A unilateral contract 
C) An implied contract 
D) A bilateral contract 
E) An invalid contract 
A) A contract not supported by consideration 
B) A unilateral contract 
C) An implied contract 
D) A bilateral contract 
E) An invalid contract

Question 11

What is a key difference between a bilateral and a unilateral contract?

Accepted Answer

A) Only a bilateral contract requires consideration. 
B) Only a unilateral contract requires consideration. 
C) The adequacy of consideration. 
D) The type of consideration. 
E) The existence of promissory estoppel in bilateral contracts only. 
A) Only a bilateral contract requires consideration. 
B) Only a unilateral contract requires consideration. 
C) The adequacy of consideration. 
D) The type of consideration. 
E) The existence of promissory estoppel in bilateral contracts only.

Question 12

When determining whether consideration is sufficient to support a contract for the sale of goods under the UCC,one relevant factor is whether both parties received a good deal under UCC rules and principles.

Accepted Answer

A) True 
 B)False

Question 13

When an accord and satisfaction is at issue,what is the debtor's payment of the reduced amount called?

Accepted Answer

A) Satisfaction 
B) Accord 
C) Seal 
D) Written acknowledgement 
E) Written compromise 
A) Satisfaction 
B) Accord 
C) Seal 
D) Written acknowledgement 
E) Written compromise

Question 14

Past consideration generally qualifies as consideration.

Accepted Answer

A) True 
 B)False

Question 15

What is Isabella's best argument in attempting to avoid obligations to Credit Card Company A?

Accepted Answer

A) That the debt became illusory based on the promise made by Credit Card Company A. 
B) That because of unforeseen circumstances,she should be able to avoid the debt. 
C) That she reasonably relied to her detriment and that she should be able to enforce the company's promise under a theory of promissory estoppel. 
D) That her promise did indeed constitute consideration because of the theory of moral consideration,and Credit Card Company A clearly expressed its concern with student debt. 
E) That her promise did indeed constitute consideration because it allowed Credit Card Company A to report forgiveness of debt rather than default on its financial reports. 
A) That the debt became illusory based on the promise made by Credit Card Company A. 
B) That because of unforeseen circumstances,she should be able to avoid the debt. 
C) That she reasonably relied to her detriment and that she should be able to enforce the company's promise under a theory of promissory estoppel. 
D) That her promise did indeed constitute consideration because of the theory of moral consideration,and Credit Card Company A clearly expressed its concern with student debt. 
E) That her promise did indeed constitute consideration because it allowed Credit Card Company A to report forgiveness of debt rather than default on its financial reports.

Question 16

An unliquidated debt may be the subject of an accord and satisfaction.

Accepted Answer

A) True 
 B)False

Question 17

What must you prove in a successful promissory estoppel case?

Accepted Answer

A) The mutual exchange of promises. 
B) The exchange of adequate consideration. 
C) Intent of both parties to enter into a legally binding agreement 
D) The existence of consideration. 
E) Reasonable reliance on a promise to your detriment. 
A) The mutual exchange of promises. 
B) The exchange of adequate consideration. 
C) Intent of both parties to enter into a legally binding agreement 
D) The existence of consideration. 
E) Reasonable reliance on a promise to your detriment.

Question 18

Which of the following is true regarding the effect of a debtor offering to pay a different type of payment,for example,goods instead of money,on a debt for which there is not a dispute over the amount or existence of the debt,and the creditor agrees?

Accepted Answer

A) A liquidated debt is involved,and there is an accord but no satisfaction. 
B) A liquidated debt is involved,and there is not a satisfaction or an accord. 
C) An unliquidated debt is involved,and there is an accord but not satisfaction. 
D) An unliquidated debt is involved,and there is an accord and satisfaction. 
E) A liquidated debt is involved,and there is an accord and satisfaction. 
A) A liquidated debt is involved,and there is an accord but no satisfaction. 
B) A liquidated debt is involved,and there is not a satisfaction or an accord. 
C) An unliquidated debt is involved,and there is an accord but not satisfaction. 
D) An unliquidated debt is involved,and there is an accord and satisfaction. 
E) A liquidated debt is involved,and there is an accord and satisfaction.

Question 19

Which of the following is not an example of consideration?

Accepted Answer

A) A promise to stay in a job until a particular project is complete. 
B) A promise to your football coach to refrain from riding your motorcycle during football season,even though you love riding it. 
C) A promise to stop staying out late at night during exam week. 
D) A promise to buy skis for $300 if you like them. 
E) A promise to cook dinner for your roommate for the next six months. 
A) A promise to stay in a job until a particular project is complete. 
B) A promise to your football coach to refrain from riding your motorcycle during football season,even though you love riding it. 
C) A promise to stop staying out late at night during exam week. 
D) A promise to buy skis for $300 if you like them. 
E) A promise to cook dinner for your roommate for the next six months.

Question 20

Raphael,who owes $10,000 to his credit card company,sends a check to his credit card company for $50 and marks the check "paid in full." The credit card company inadvertently cashes the check,but the mistake is caught two weeks later and they offer to repay Raphael his $50.Raphael does not respond.Does accord and satisfaction exist?

Accepted Answer

A) No,because the $50 payment accounted for less than 10 percent of the balance due. 
B) No,because the bank offered to repay the money in a timely manner. 
C) Yes,because Raphael did not accept the bank's offer for repayment. 
D) Yes,because the bank cashed the check and this is sufficient for accord and satisfaction. 
E) Yes,because the bank has to offer a refund to Raphael within one week to avoid accord and satisfaction. 
A) No,because the $50 payment accounted for less than 10 percent of the balance due. 
B) No,because the bank offered to repay the money in a timely manner. 
C) Yes,because Raphael did not accept the bank's offer for repayment. 
D) Yes,because the bank cashed the check and this is sufficient for accord and satisfaction. 
E) Yes,because the bank has to offer a refund to Raphael within one week to avoid accord and satisfaction.

Exam 15: Consideration

Carrie promises Tim she will clean his house and in exchange,Tim promises to pay Carrie $50.This is an example of what type of contract?

If a check is marked "paid in full," which of the following is true under the UCC?

What is the preexisting duty rule?

When are promises based on past consideration enforceable?

Which of the following is true regarding the dispute between Ezra and Diego regarding whether Diego must return anything?

Which of the following is true regarding Ezra's claim concerning the inadequacy of house cleaning as consideration?

In an unliquidated debt,the parties agree on whether money is owed and agree upon the amount but disagree on the repayment schedule.

Which of the following is an exception to the rule requiring consideration?

Tim promises to pay Carrie $50 to clean his house and Carrie comes over and cleans is house.Tim and Carrie have.

What is a key difference between a bilateral and a unilateral contract?

When determining whether consideration is sufficient to support a contract for the sale of goods under the UCC,one relevant factor is whether both parties received a good deal under UCC rules and principles.

When an accord and satisfaction is at issue,what is the debtor's payment of the reduced amount called?

Past consideration generally qualifies as consideration.

What is Isabella's best argument in attempting to avoid obligations to Credit Card Company A?

An unliquidated debt may be the subject of an accord and satisfaction.

What must you prove in a successful promissory estoppel case?

Which of the following is true regarding the effect of a debtor offering to pay a different type of payment,for example,goods instead of money,on a debt for which there is not a dispute over the amount or existence of the debt,and the creditor agrees?

Which of the following is not an example of consideration?

An Introduction to Dynamic Business Law

Business Ethics

The Uslegal System

Alternative Dispute Resolution

Constitutional Principles

International and Comparative Law

Crime and the Business Community

Tort Law

Negligence and Strict Liability

Product Liability

Liability of Accountants and Other Professionals

Intellectual Property

Introduction to Contracts

Agreement

Capacity and Legality

Legal Assent

Contracts in Writing

Third-Party Rights to Contracts

Discharge and Remedies

Introduction to Sales and Lease Contracts

Title,risk of Loss,and Insurable Interest

Performance and Obligations Under Sales and Leases

Remedies for Breach of Sales and Lease Contracts

Warranties

Negotiable Instruments: Negotiability and Transferability

Negotiation, holder in Due Course, and Defenses

Liability, defenses, and Discharge

Checks and Electronic Fund Transfers

Secured Transactions

Other Creditors Remedies and Suretyship

Bankruptcy and Reorganization

Agency Formation and Duties

Liability to Third Parties and Termination

Forms of Business Organization

Partnerships: Nature, formation, and Operation

Partnerships: Termination and Limited Partnerships

Corporations: Formation and Financing

Corporations: Directors, officers, and Shareholders

Corporations: Mergers, consolidations, terminations

Corporations: Securities and Investor Protection

Employment and Labor Law

Employment Discrimination

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Consumer Law

Environmental Law

Antitrust Law

The Nature of Property, personal Property, and Bailments

Real Property

Landlord-Tenant Law

Insurance Law

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