Question 1

A contract must show mutual agreement, which is also referred to as "a meeting of the minds."

Accepted Answer

A) True 
 B)False

Question 2

A contract may be extended and revised as needed to reflect the wishes of the parties.

Accepted Answer

A) True 
 B)False

Question 3

The parties to a contract must have a clear understanding of what they are undertaking; that is, the contract must show:

Accepted Answer

A)  mutual agreement. 
B)  legality of purpose. 
C)  consideration. 
D)  competency of the parties. 
A)  mutual agreement. 
B)  legality of purpose. 
C)  consideration. 
D)  competency of the parties.

Question 4

Competent parties can be of any age as long as they understand the terms of a contract.

Accepted Answer

A) True 
 B)False

Question 5

The part of the Uniform Commercial Code (UCC) that is relevant to contract law is Article number:

Accepted Answer

A)  1 
B)  2 
C)  3 
D)  4 
A)  1 
B)  2 
C)  3 
D)  4

Question 6

Entering into a contract with persons of legal age and normal mentality is considered within the element of:

Accepted Answer

A)  legality of purpose. 
B)  competency of the parties. 
C)  mutual agreement. 
D)  proper form. 
A)  legality of purpose. 
B)  competency of the parties. 
C)  mutual agreement. 
D)  proper form.

Question 7

It is usually advisable to put a contract in writing if the transaction is important, complicated, involves a large amount of money, or will extend over a long period of time.

Accepted Answer

A) True 
 B)False

Question 8

An entire contract is also known as a(n):

Accepted Answer

A)  simple contract. 
B)  indivisible contract. 
C)  specialty contract. 
D)  executed contract. 
A)  simple contract. 
B)  indivisible contract. 
C)  specialty contract. 
D)  executed contract.

Question 9

Briefly explain the kinds of contracts.

Accepted Answer

Contracts may be classified into many ca

Question 10

When a customer asks a merchant to deliver an article to his home with no mention of payment, the buyer implies that he or she will pay the market price of the article when it is delivered or when the bill is presented. This is an illustration of:

Accepted Answer

A)  a simple contract. 
B)  consideration. 
C)  an implied contract. 
D)  a formal contract. 
A)  a simple contract. 
B)  consideration. 
C)  an implied contract. 
D)  a formal contract.

Question 11

The seal on a formal contract may consist of any of the following, EXCEPT:

Accepted Answer

A)  the word "Seal.." 
B)  the letters "L.S." 
C)  an impression on the paper. 
D)  a stamped signature. 
A)  the word "Seal.." 
B)  the letters "L.S." 
C)  an impression on the paper. 
D)  a stamped signature.

Question 12

Legality of purposes is the requirement that a contract:

Accepted Answer

A)  must not violate the law. 
B)  can be void. 
C)  may contain a malafide intention. 
D)  need not be valid. 
A)  must not violate the law. 
B)  can be void. 
C)  may contain a malafide intention. 
D)  need not be valid.

Question 13

Contracts can be created for:

Accepted Answer

A)  only one specific purpose. 
B)  one or two purposes. 
C)  only for agreements that involve monetary transactions. 
D)  any number of purposes. 
A)  only one specific purpose. 
B)  one or two purposes. 
C)  only for agreements that involve monetary transactions. 
D)  any number of purposes.

Question 14

An offer is a proposal made by one party (offeror) to another (offeree) that indicates willingness to:

Accepted Answer

A)  enter into a contract. 
B)  negotiate a service or exchange. 
C)  consider a service or exchange. 
D)  reject an offer. 
A)  enter into a contract. 
B)  negotiate a service or exchange. 
C)  consider a service or exchange. 
D)  reject an offer.

Question 15

A contract in which some future act or obligation remains to be performed under its terms is known as a(n):

Accepted Answer

A)  executed contract. 
B)  statutory contract. 
C)  contingent contract. 
D)  executory contract. 
A)  executed contract. 
B)  statutory contract. 
C)  contingent contract. 
D)  executory contract.

Question 16

If only one party promises something, such as paying a certain amount of money, and the other party promises nothing, then the agreement lacks:

Accepted Answer

A)  consideration. 
B)  competence. 
C)  legality of purpose. 
D)  offer and acceptance. 
A)  consideration. 
B)  competence. 
C)  legality of purpose. 
D)  offer and acceptance.

Question 17

An agreement that may be rejected by one of the parties for a legally acceptable reason is a(n):

Accepted Answer

A)  implied contract. 
B)  void contract. 
C)  voidable contract. 
D)  valid contract. 
A)  implied contract. 
B)  void contract. 
C)  voidable contract. 
D)  valid contract.

Question 18

A divisible contract is made up of two or more parts, each part being independent of the others.

Accepted Answer

A) True 
 B)False

Question 19

Define "contract" and state the elements of a valid contract.

Accepted Answer

A contract is a legally enforceable agre

Question 20

All but one of the following elements is required of an enforceable contract. The exception is:

Accepted Answer

A)  offer and acceptance. 
B)  mutual agreement. 
C)  consideration. 
D)  malafide intention. 
A)  offer and acceptance. 
B)  mutual agreement. 
C)  consideration. 
D)  malafide intention.

Exam 7: Introduction to Contracts

A contract must show mutual agreement, which is also referred to as "a meeting of the minds."

A contract may be extended and revised as needed to reflect the wishes of the parties.

The parties to a contract must have a clear understanding of what they are undertaking; that is, the contract must show:

Competent parties can be of any age as long as they understand the terms of a contract.

The part of the Uniform Commercial Code (UCC) that is relevant to contract law is Article number:

Entering into a contract with persons of legal age and normal mentality is considered within the element of:

It is usually advisable to put a contract in writing if the transaction is important, complicated, involves a large amount of money, or will extend over a long period of time.

An entire contract is also known as a(n):

Briefly explain the kinds of contracts.

When a customer asks a merchant to deliver an article to his home with no mention of payment, the buyer implies that he or she will pay the market price of the article when it is delivered or when the bill is presented. This is an illustration of:

The seal on a formal contract may consist of any of the following, EXCEPT:

Legality of purposes is the requirement that a contract:

Contracts can be created for:

An offer is a proposal made by one party (offeror) to another (offeree) that indicates willingness to:

A contract in which some future act or obligation remains to be performed under its terms is known as a(n):

If only one party promises something, such as paying a certain amount of money, and the other party promises nothing, then the agreement lacks:

An agreement that may be rejected by one of the parties for a legally acceptable reason is a(n):

A divisible contract is made up of two or more parts, each part being independent of the others.

Define "contract" and state the elements of a valid contract.

All but one of the following elements is required of an enforceable contract. The exception is:

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