Deck 14: Agreement

Question 1

Under the mailbox rule, a valid contract is formed if a rejection is dispatched, but before the rejection is received, the acceptance has already been mailed (sent) to the offeror.

Answer 1

True

Question 2

If the offeror becomes incapacitated or dies, the offer immediately terminates.

Answer 2

True

Question 3

Reasonably definite terms are one of the elements of an offer.

Answer 3

True

Question 4

If an offeree makes a mistake and sends an acceptance to the wrong address, there is an acceptance upon dispatch.

Question 5

If the means by which an acceptance can be communicated to the offeror is expressly stated in the offer, it is called an "implied authorization."

Question 6

Courts interpret contracts using both objective and subjective standards.

Question 7

An invitation to negotiate is an offer because it expresses a willingness to be bound by acceptance.

Question 8

An offeror has no legal right to revoke an offer before receiving a reply to their offer.

Question 9

If an offer authorizes certain means of acceptance, use of an unauthorized means of acceptance is acceptable but the contract is not formed until the acceptance is received by the offeror.

Question 10

In order for a court to evaluate whether or not there is a valid contract, what standard does a court use to interpret a contract?

A) An express standard.
B) A subjective standard.
C) A subjective reasonableness standard.
D) A common law reasonableness standard.
E) An objective standard.

Question 11

The mirror-image rule says that terms of an acceptance can slightly be changed in order to benefit both parties.

Question 12

Under the common law, the basic requirements for a valid acceptance parallel those of a valid offer.

Question 13

The case of Lucy v. Zehmer, involving whether or not there was assent to a contract or whether allegations of joking prevented the formation of the contract, what did the court determine?

A) The court ruled that the contract would not be enforced because one of the parties was subjectively joking and that both the Zehmers testified they were joking.
B) The court ruled that the contract would not be enforced because one of the parties was joking, and a reasonable person should have known that.
C) The court ruled that the contract would not be enforced because the parties had been drinking and although they were not intoxicated, there was still no mutual assent.
D) The court ruled that the agreement would be enforced because under the applicable standard, the words and acts, judged by a reasonable standard, manifested an intention to be bound.
E) The court ruled that the contract would be enforced because of what the parties verbally said regardless of whether an objective person would have thought joking was involved.

Question 14

The number of circumstances under which silence can be an acceptance are limited.

Question 15

Which of the following is not a required element of a valid offer?

A) Serious intent by the offeror.
B) Intent by the offeror to be bound by an agreement.
C) Reasonably definite terms.
D) Communication to the offeree.
E) A written document setting forth terms of the offer.

Question 16

Which of the following is true of intent to form a contract?

A) Intent Is not a required element of an offer or acceptance to form a contract.
B) Intent is determined based on the specific motivations of the offeror or offeree, including hidden motivations.
C) Intent is assessed by considering proof of an offeree or offeror's internal thought process.
D) Intent is a required element of an offer or acceptance only if a contract is a contract for the sale of goods.
E) An offeror must show intent to be bound by the offeree's acceptance.

Question 17

What was the result in the Opening Case in which the plaintiff attempted to buy a jet from Pepsi for Pepsi points and some additional funds?

A) The plaintiff prevailed, and Pepsi had to sell the jet as offered because Pepsi failed to specifically reserve details of the offer to a separate writing.
B) The plaintiff prevailed, and Pepsi had to sell the jet as offered because Pepsi's advertisement was considered an offer which the plaintiff validly accepted.
C) The plaintiff prevailed, and Pepsi had to provide the jet as offered because Pepsi did not revoke the offer soon enough.
D) The plaintiff did not prevail because the jet was unobtainable as a military aircraft.
E) The plaintiff did not prevail because Pepsi reserved the details of the offer to a separate writing, and Pepsi had the authority to reject the plaintiff's offer to purchase.

Question 18

If the offeror dies, the offer terminates after notice of the offeree's death or after 10 days, whichever comes first.

Question 19

Only the offeree (or his or her agent) to whom an offer is directed can accept the offer.

Question 20

In the absence of a time condition in either offer, an offer by a retailer to purchase seasonal goods from a wholesaler would lapse later than an offer to purchase goods that could easily be sold all year long.

Question 21

Which of the following terms would be considered material terms?

A) Subject matter, but not price, quantity, quality or parties
B) Price and subject matter, but not quantity, quality or parties
C) Quantity, quality, and subject matter, but not price or parties
D) Subject matter, quality, and price, but not quantity or parties
E) Subject matter, price, parties, quality, and quantity

Question 22

Which of the following is the phrase used to explain why an offeror has the right to revoke an offer before acceptance?

A) The offeror is the "controller of his offer."
B) The offeror is the "master of his offer."
C) The offeror is the "proponent of his offer."
D) The offeror is the "adjudicator of his offer."
E) The offeror is the "arbiter of his offer."

Question 23

Duncan and Maria are going to an auction. Duncan notices that the ad simply says "Auction today." This means that an auction is presumed to be ________ if nothing is stated to the contrary in the terms of the auction.

A) without controls
B) with controls
C) without reserve
D) with reserve
E) without qualifications

Question 24

Which of the following are ways in which an offer can be terminated:

A) Revocation, rejection, counteroffer, illegality, death, incapacity, and lapse of time.
B) Revocation, acceptance, counteroffer, illegality, and lapse of time.
C) Revocation, adhesion, unilateral termination, and bilateral termination.
D) Rejection, counteroffer, illegality, acceptance, adhesion, lapse of time, and bilateral termination
E) Unilateral termination, bilateral termination, illegality, incapacity, and acceptance.

Question 25

Emily and Sasha are having pizza and talking about cars. Emily asks Sasha if Sasha would consider selling her car for $2,000. Is this a valid offer?

A) No, there is no valid offer.
B) Yes, an offer has been made by Emily, but it may be revoked prior to acceptance.
C) Yes, an offer has been made because Emily and Sasha negotiated.
D) Yes, there is a valid offer and now a contract has been entered into.
E) Yes, there is a valid offer because the parties know each other.

Question 26

An advertisement in a paper states: "first come first served, two new BMX bikes, $150 apiece. Doors open at 10:00 a.m." Would the advertisement be treated as a valid offer?

A) No, because an advertisement is never treated as an offer.
B) Yes, because the advertisement specifies a limited quantity and provides a specific means by which the offer can be accepted.
C) Yes, because the advertisement is treated as an offer if the ad specifies a price that it is willing to sell a product for.
D) No, because the advertisement doesn't say "THIS IS AN OFFER."
E) Yes, because an advertisement placed in a newspaper is always treated as an offer.

Question 27

Which of the following is true when an offer authorizes a certain mode of acceptance but does not require it, and an offeree attempts to accept the offer through a method other than the authorized means?

A) The acceptance becomes a counteroffer that the original offeror may or may not accept.
B) There is no contract, and the attempted acceptance is of no effect.
C) There is a contract only if the acceptance is received by the time that acceptance through the authorized means would have been received.
D) The contract is not formed until the acceptance is received by the offeror.
E) Authorizing but not requiring a certain type of acceptance has no effect, and the mailbox rule applies.

Question 28

In an auction ________, the seller is treated as making an offer to accept the highest bid.

A) Without controls
B) With controls
C) Without reserve
D) With reserve
E) Without qualifications

Question 29

What was the result in the case nugget, Lefkowitz v. Great Minneapolis Surplus Store, Inc., involving an advertisement for the sale of fur coats?

A) The court ruled that the advertisement was not an offer because it involved a luxury good.
B) The court ruled that the advertisement was an offer but that the customer who was suing had not properly accepted.
C) The court ruled that the advertisement was not an offer because it was a ridiculously low offer which the plaintiff should have known was not to be taken seriously.
D) The court ruled that the ad was not an offer because ads are never offers, only invitations for customers to make an offer.
E) The court ruled that the ad was an offer and that the plaintiff properly accepted it.

Question 30

Joe's car is for sale and he tells Tom that Tom can buy the car for $9,000 if he lets him know within that week. Joe later changes his mind and writes a letter to Tom, which he mails. Five minutes after Joe mails the letter, he receives a phone call from Joe accepting the offer to buy the car. Does Joe have to sell Tom the car?

A) Yes, because the offer stated it would be open for a period of time and it was accepted before the revocation reached the offeree.
B) Yes, because an offeror is master of his offer and can revoke it at any time.
C) No, because an offeror is master of his offer and can revoke it at any time.
D) No, because Tom only called and did not come with the money for the car.
E) No, because the mailbox rule says that a revocation becomes valid when it is mailed.

Question 31

Which of the following is not a termination of an offer?

A) Revocation
B) Counteroffer
C) Illegality
D) Lapse of time
E) Delivery of the goods

Question 32

Anna and Vivian are discussing a piece of property in a downtown mall. Anna wishes to ensure that an offer will in fact be held open for her for two weeks while she secures funding. Anna may enter into a[n] ________ with Vivian to hold the offer open for her for two weeks.

A) option contract
B) lease agreement
C) offer agreement
D) adhesion contract
E) property offer

Question 33

Bailey is selling his baseball cards. He writes his friend Molly a letter and tells her she can buy the cards for $100. He closes his later saying: "If you want to buy the cards, let me know by next month. You can give me a call or whatever." Two days later, Bailey receives a letter from Molly saying she will buy the cards for $100. Does Bailey have to sell Molly the cards?

A) No, because there was no definite offer.
B) No, because there was no definite acceptance.
C) No, because Molly did not call Bailey via phone to accept his offer.
D) Yes, but only if Molly goes to pick up the cards and takes him the $100 within two days of the time her letter is received.
E) Yes, because Molly's letter accepting Bailey's offer was received, and Bailey only suggested that Mary call to accept; he did not require it.

Question 34

The terms that would allow a court to determine what the damages would be in the event that one of the parties breaches the contract, are the ________ terms of a contract.

A) Important
B) Significant
C) Material
D) Adequate
E) Identifiable

Question 35

Which of the following is true regarding the termination of an offer based on a rejection?

A) Regardless of how long an offeror states that an offer will be held open, once the offeree rejects it, the offer is terminated.
B) Even on rejection, an offer is not terminated until the expiration of the time period for which it was originally to remain open.
C) An offer must remain open for at least two days before it is terminated following a rejection by an offeree.
D) An offer must remain open for at least three days before it is terminated following a rejection by an offeree.
E) An offer must remain open for at least one day before it is terminated following a rejection by an offeree.

Question 36

Tonya runs a bakery and she wants to attract new customers. She publishes an ad in a community newspaper indicating that the first 200 people who come in on Monday the 24th of August can buy a muffin for just $1 if they arrive between 9:00 AM and 4:00 PM and bring in a dollar bill. Is Tonya's ad an offer?

A) No, it is an offer to make an offer.
B) No, because advertisements can never be offers.
C) No, because it does not reflect Tonya's specific intent to make an offer.
D) Yes, because all advertisements are offers.
E) Yes, because it specified a limited quantity and provided a specific means by which the offer could be accepted.

Question 37

When, generally speaking, is a revocation effective?

A) When it is mailed by the offeror.
B) When it is received by the offeree.
C) Immediately upon the offeror's decision to revoke.
D) Within 24 hours of the offer being made.
E) Whenever the offeror decides not to accept the offer.

Question 38

Why is an invitation to negotiate not an offer?

A) An invitation to negotiate is an offer.
B) An invitation to negotiate is not an offer because it does not express any willingness to be bound by an acceptance.
C) An invitation to negotiate is not an offer because there is no way to determine the reasonable intent of the negotiating parties.
D) An invitation to negotiate is not an offer because the invitation does not apply to a specific offeree.
E) An invitation to negotiate is not an offer because an offer becomes an offer only when accepted.

Question 39

Mary is selling her house for $100,000 and Felipe, who is expecting an inheritance soon, wants to have the option to buy it next month at that price. Felipe gives Mary a $1,000 deposit in exchange for Mary's promise that he can buy the house next month at $100,000 if he gets his inheritance. Mary and Felipe:

A) Do not have a contract because Felipe has not promised to buy.
B) Do not have a contract because Felipe does not have the money yet.
C) Have a standard sales contract.
D) Have an option contract.
E) Have an adhesion contract.

Question 40

Which of the following is true of an offer made in jest?

A) Even if an offer is clearly a joke, the words are treated as an offer.
B) A joke is always treated as a serious offer, unless the person specifically states: "I'm joking."
C) A joke is never treated as a serious offer.
D) A joke is treated as a serious offer if the outward manifestation of intent would lead a reasonable person to believe it was intended as a serious offer.
E) The court will look to a person's secret or hidden intent to attempt to discern if a joke was an offer or not.

Question 41

Katrina and Kellen have discussed the sale of a new washer and dryer. Kellen offers to sell the washer and dryer for $1,000. When would the offer expire?

A) In three weeks
B) In seven days
C) In forty-eight hours
D) After a reasonable amount of time
E) Offers never expire.

Question 42

Belinda sends an email to Equador offering to sell her entire entertainment set to him for $2,500. Equador responds that the price seems a bit high and offers to buy the entertainment set for $2,000. Equador's response is considered a(n) ________?

A) illegal response
B) acceptance
C) revocation
D) counteroffer
E) bilateral offer

Question 43

When a counteroffer is made, what happens to the original offer?

A) It remains in effect in all circumstances.
B) It remains in effect only if the original offer specified a designated acceptance time.
C) It remains in effect unless the counteroffer is materially different.
D) It terminates.
E) It terminates, but only if the counteroffer specifically states that the original offer is unacceptable.

Question 44

If no means of communicating an acceptance is specified in an offer, which of the following is generally true?

A) The acceptance must be in writing.
B) The acceptance must be made verbally either by telephone or in person.
C) No valid contract may be entered into because the offer must specify a means by which to accept.
D) Acceptance may be made by any reasonable means.
E) Acceptance must be made orally or in writing within twenty-four hours.

Question 45

Gordon asks Nina to paint his room purple for him for $150. Nina says she will try to get to it this week. Nina goes and gets purple paint and paints Gordon's room. Do they have a contract?

A) No, there was no offer for Nina to accept.
B) No, Nina did not say she accepted the offer.
C) Yes, but only if Gordon likes the color of paint.
D) Yes, Nina accepted the unilateral contract by buying the paint and painting the room.
E) Yes, but only if Gordon likes how Nina painted the room.

Question 46

Which of the following is true regarding acceptable means of acceptance if no means of communicating an acceptance is specified in an offer?

A) If no means of communicating an acceptance is specified in an offer, acceptance must be done through the U.S. mail system.
B) If no means of communicating an acceptance is specified in an offer, acceptance must be done either in person or through telephone communication.
C) If no means of communicating an acceptance is specified in an offer, acceptance must be done either through the U.S. mail or through fax transmittal.
D) If no means of communicating an acceptance is specified in an offer, acceptance must be done either through U.S. mail or through e-mail.
E) If no means of communicating the acceptance is specified, any reasonable means is generally acceptable.

Question 47

Camila, wanting to sell a used business law book, calls Jada and tells her that if she does not hear from her within twenty-four hours, she will assume that Jada wishes to purchase the book for $50. Which of the following is correct regarding the status of the proposed book sale?

A) There is no contract because in this situation silence cannot be used to form a contract.
B) There can be no contract because the offer was not made in person.
C) There can be no contract because the offer was not made in writing.
D) Jada can avoid the creation of a contract only if she can prove by a preponderance of the evidence that she did not hear about the offer before the stated expiration time.
E) Jada can avoid the creation of a contract only if she can prove beyond a reasonable doubt that she did not hear about the offer before the stated expiration time.

Question 48

Generally, how do the Japanese tend to view contracts?

A) The Japanese see relationships only as business deals and keep each other at arm's length.
B) The Japanese tend to view contracts as relationships in which parties work with each other to smooth out any problems that arise in performance.
C) The Japanese want long and very detailed contracts.
D) The Japanese have no flexibility in their contracts.
E) The Japanese do not desire that any terms be left to be decided later.

Question 49

Madison signs a contract with Rainbow Readers Book Club without reading it. The contract provides that new books will be sent to her eBook reader every month unless she sends notification rejecting the receipt of new books. Which of the following is true regarding whether the contract is binding?

A) The contract is not binding because it illegally attempts to enforce acceptance by silence.
B) The contract is binding but only if the parties have extensive previous dealings whereby acceptance by silence became an accepted form of business.
C) The contract is not binding unless Madison pays for at least one month's supply of books thereby indicating her intent to be bound.
D) The contract is not binding because transmittal using electronics is involved.
E) The contract is binding.

Question 50

Before Glenn died, he had an option contract with Jerome. The administrator of Glenn's estate ________

A) must hold the offer open until it expires in accordance with the contract.
B) is not obligated to hold the offer open to Jerome since Glenn died.
C) can decide if he or she wants to keep the option contract with Jerome.
D) must seek a court's permission to honor the option contract.
E) the estate's heirs can decide to hold the option contract open.

Question 51

What is an implied-in-fact contract?

A) A contract created when an offeree receives and accepts in silence the benefits of an offered service with reasonable opportunity for rejection and with an understanding that some form of compensation will be required.
B) A contract created when an offeror provides a benefit to an offeree in a unilateral contract.
C) A contract created when one party makes an offer that can be accepted only by performance.
D) A contract that is created when a party's intent to enter into a contract is unclear but the other party relies on a belief that promises have been made.
E) A contract that is created by a mutual exchange of promises.

Question 52

Kai offers to sell a rare book to Penny for $1,000. Penny wants to do more research first, but gives Kai $10 to hold the book for her for a week so she can buy it at the end of the week if her research shows the book is worth it. Kai takes Penny's $10 but dies the next day. Penny notifies Kai's widow that she wants to buy the book anyway. Does Penny have the right to buy the book for $1,000?

A) Yes, but only if Kai's surviving family members do not object.
B) Yes, but only if she sent her acceptance in the mail prior to Kai's death.
C) Yes, but only if the acceptance was received by Kai prior to his death.
D) Yes, as long as she acted to buy the book within a week of the original agreement.
E) No, because Paul's death invalidates their original agreement.

Question 53

Dameon offers to sell his camper trailer to Wanette. Before Wanette can decide if she wants to buy the camper, a storm destroys the camper. The offer ________.

A) must be upheld
B) is extended until Dameon can replace the camper
C) is extended for twenty-one days
D) is automatically terminated
E) would be left to a court to decide whether or not to be upheld.

Question 54

When considering whether an offer has expired, what is presumed to be a reasonable amount of time?

A) Forty-eight hours.
B) Seven days.
C) Ten days.
D) Forty-five days.
E) There is no set amount of time, and what constitutes a reasonable amount of time varies depending upon the subject matter of the offer.

Question 55

Jasmine offers $100 to anyone who can return her lost dog, Champ. Kayla returns the dog and requests the money. Jasmine says that there is no binding contract. Which of the following is true regarding Jasmine's statement?

A) Jasmine is incorrect because there is a binding bilateral contract.
B) Jasmine is incorrect because there is a binding unilateral contract which Kayla accepted by performing.
C) Jasmine is correct because there is no binding bilateral contract.
D) Jasmine is correct because there is no binding unilateral contract.
E) Jasmine is correct because Kayla acted incorrectly by her manner of attempted acceptance.

Question 56

Which of the following is the result if the subject matter of an offer becomes illegal?

A) The offer immediately terminates.
B) There is no effect as long as the offer was made at least one day before the subject matter of the offer became illegal.
C) There is no effect as long as the offer was made at least ten days before the subject matter of the offer became illegal.
D) There is no effect as long as the offer was made at least fifteen days before the subject matter of the offer became illegal.
E) There is no effect as long as the offer was made at least thirty days before the subject matter of the offer became illegal.

Question 57

When acceptance is examined under the common law, how do the basic requirements for a valid acceptance compare with those for a valid offer?

A) The basic requirements for a valid acceptance are materially different from those for a valid offer.
B) The basic requirements for a valid acceptance parallel those for a valid offer.
C) The basic requirements for a valid acceptance are different from those for a valid offer only because an offer must be in writing.
D) The basic requirements for a valid acceptance are different from those for a valid offer only because an acceptance must be in writing.
E) The basic requirements for a valid acceptance are different from those for a valid offer only because an offer must be revoked immediately but acceptance can be withheld for a reasonable period of time.

Question 58

Under which of the following situations does an offer immediately terminate?

A) Revocation
B) Revocation and rejection
C) Death or incapacity of the offeror or illegality
D) Revocation and death or incapacity of the offeror
E) Illegality or lapse of time

Question 59

Regarding unsolicited merchandise received from a seller, what have most states done?

A) Most states have passed laws providing that unsolicited merchandise does not have to be returned and the recipient may keep it as a gift, with no contract being formed.
B) Most states have passed laws providing that unsolicited merchandise must be returned to the seller within 7 days.
C) Most states have passed laws providing that unsolicited merchandise must be returned to the seller within 10 days.
D) Most states have passed laws providing that unsolicited merchandise must be returned to the seller within 30 days.
E) Most states have passed laws providing that unsolicited merchandise must be returned to the seller within 60 days.

Question 60

The ________ sets forth the common law rule that the terms of an acceptance must mirror the terms of an offer.

A) matching rule
B) competence rule
C) mirror image rule
D) mailbox rule
E) parallel rule

Question 61

Which of the following is true regarding the Uniform Commercial Code?

A) It does not affect the making of an agreement and only applies after an agreement is formed.
B) It applies only in situations not addressed at all by the common law.
C) It applies only to clarify common law in situations in which the common law is unclear.
D) It applies in all situations involving agreements.
E) Some elements of a contract under the common law have been modified under the UCC for contracts for the sale of goods.

Question 62

When distinguishing an offer from an invitation to negotiate, which of the following is accurate?

A) Whether an offer in fact existed is a question of law.
B) Whether an offer in fact existed is a question of fact.
C) Whether an offer in fact existed is a mixed question of law and fact.
D) Whether an offer in fact existed depends solely on whether the alleged offer included a specific price.
E) Whether an offer in fact existed depends solely on whether an acceptance of the alleged offer was made immediately so that the offeror knew he or she was bound.

Question 63

Judith, an ill-tempered business law teacher, offers $50 to any student who will mow her lawn. Peter goes right over and begins mowing. Just before he finishes, Judith goes over and tells him that she revokes her offer. Which of the following is true regarding Peter's entitlement to payment?

A) Peter is not entitled to payment because a bilateral contract was involved that could only be accepted by full performance prior to revocation.
B) Peter is not entitled to payment because a unilateral contract was involved that could only be accepted by full performance prior to revocation.
C) Peter is entitled to only a proportional recovery based on the amount of work he had done prior to the revocation because Judith always retained the right to validly revoke.
D) Peter is entitled to recover because a unilateral contract was involved, and he was entitled to a reasonable amount of time to complete the job.
E) Peter is entitled to recover because a bilateral contract was involved, and he was entitled to a reasonable amount of time to complete the job.

Question 64

[Used Car Sales] Edwin sells used cars. He is looking for a way to increase sales and profits so that he can take his girlfriend on a nice diving trip to the Grand Cayman Islands. The first thing that Edwin does is say that during the first week of December, he will give a $500 rebate on used cars that are under two years old. To spice things up, he also offers to sell any car on the lot that is over five years old for $1,000 to the first three customers who can jump rope for ten hours straight on December 7th. Edwin was not very concerned about the jumping rope issue because he thought that no one would be able to jump rope for ten hours straight. Edwin put an advertisement pertaining to the rebate and the jump rope opportunity in the local newspaper. The promotion went over very well. Although Edwin had several cars available, he ran out of cars under two years old within one day. During the rest of the week shoppers were told that cars of that description were no longer available. Josh was very angry at Edwin for not having a car available that was under two years old so that he could get a good deal and a $500 rebate. On December 7th, while Edwin was watching people jump rope, Brandi was shopping for a car. She was in college and did not have much money. She saw one, an older car, a real clunker, that she liked; but wasn't sure if it could be repaired sufficiently to be dependable. Edwin had not even put a price on it because he planned to have it crushed. Brandi was going to talk to her parents about it. Edwin eventually approached her, and Brandi asked him if he would take $450 for the car. Edwin said, "Yes, sold." Brandi tried to explain that she needed to talk to her parents first, but Edwin would not hear of it. While Edwin was still fuming from his encounter with Brandi, Zack walked up and started to criticize the nature of Edwin's inventory. Edwin told him that he had great cars. Zack pointed at a beater that was banged up, had 200,000 miles on it, and a cracked windshield. Zack said, "Sure, I'll pay $100,000 for that car!" Edwin said, "Sold." Zack said, "Wait a minute. I was only kidding." Edwin said, "No way." Meanwhile all the people jumping rope dropped out well prior to ten hours except for Emma. She completed the jumping rope and asked for her car for $1,000. Edwin refused saying that the offer was revoked. Josh and Emma sued Edwin, and Edwin sued Zack and Brandi. Under the applicable law in Edwin's state, common law will be applied, and there are no state statutes impacting the situation.
What is the most likely result in the lawsuit brought by Emma against Edwin?

A) Edwin will win because he was only engaged in preliminary negotiations.
B) Edwin will win because the advertisement was simply inviting customers, such as Emma, to make an offer.
C) Edwin will win because he properly revoked the offer.
D) Emma will win because the ad would be treated as an offer that she properly accepted.
E) Emma will win because she properly made an offer that was accepted by Edwin when she did the jump roping.

Question 65

[Saturday Auction] Randy, an auctioneer, held an auction on a Saturday morning. At the beginning of the auction, Randy announced that the auction was being held without reserve. Erin, Maria, and Steve were all in attendance. Erin saw an old cash register with a stuck drawer that she thought would look great in her den. The auctioneer put the cash register up for sale noting that the drawer was stuck but that it could probably be fixed with little effort. Erin bought it for $20. When she got it home, she discovered that it actually contained $5,000 in cash. Unfortunately, Erin had a teenage son who started bragging to his friends about the family's good fortune. Randy heard about what had happened and sued Erin for return of the $5,000. At the same auction, Maria saw a great deal on a used table, and bid $20 on it. No one else bid anything. Randy announced that $20 was clearly insufficient for the table, that it was worth much more than that, and that he was taking it out of the auction. Steve started bidding on a diamond ring for his girlfriend. He bid $2,000. Just as Randy was getting ready to say "Sold," Steve looked over at his girlfriend, decided that he was not sure about marriage, and jumped up yelling "I revoke." Randy, however, immediately after, yelled "Sold." Randy sues Steve attempting to obtain the money for the engagement ring. Randy also sues Erin seeking to recover the $5,000 contained in the stuck drawer. Maria sues Randy attempting to obtain possession of the table.
In the lawsuit in which Randy sues Erin for return of the $5,000, which of the following is the most likely result?

A) Randy will win because when an auction is held without reserve, the auctioneer is entitled to repossess any item at will.
B) Randy will lose only because he was not the actual seller. He was only selling at auction for someone else. The seller, however, would win in an action against Erin.
C) Randy would win because Erin made an insufficient offer.
D) Erin will win only if she can show that Randy had knowledge that cash was in the drawer before he sold it.
E) Erin will win because the auction was without reserve, and she properly bid on and bought the cash register with everyone knowing that the cash drawer was stuck.

Question 66

Which of the following was the result in the case in the text Adone v. Paletto involving the rejection of a purported acceptance of an offer of compromise because it was not made within the time limit of 10 days specified in the offer?

A) Rejection of the acceptance was unjustified because offers of compromise may not contain time limits.
B) Rejection of the acceptance was unjustified because allowing only 10 days for acceptance is unreasonable.
C) Rejection of the acceptance was unjustified because of the plaintiffs' severe injuries.
D) Rejection of the acceptance was enforceable because a trial had already been held.
E) Rejection of the acceptance was enforceable because the 10 days in which the other party had to accept had expired.

Question 67

Mari tells Daniel that she will mow his yard during the summer for $800. Daniel considers it and then drops a note in the mail to Mari telling her that he rejects her offer. However, he thinks about it again and calls her to tell her that he accepts the offer before she receives his rejection. Which of the following is true under the mailbox rule?

A) The offer was no longer outstanding because of the rejection.
B) Daniel could not accept verbally.
C) Daniel validly accepted, but his acceptance was revoked when Mari received the rejection.
D) The acceptance was invalid because the mailbox rule requires that the time of payment be specifically set forth before an acceptance is formalized.
E) The acceptance is valid, and the rejection has no effect.

Question 68

Hermine left a very high paying job to join John's law firm based on John's promise to give her a job if she would come to his firm. John tells Hermine that he really did not want to give her the job and she should not have quit her job. If Hermine sues John, which doctrine may courts use to estop, or prevent, John from revoking his offer?

A) Promissory estoppel
B) Reliance on a promise rule
C) Contract essential rule
D) Ethical conduct rule
E) Doctrine of equitable treatment

Question 69

The Uniform Electronic Transactions Act seems to create what?

A) An electronic version of the mailbox rule.
B) An exception to option contracts made by email.
C) An electronic way to accept a contract.
D) An exception that allows courts to forgo the mailbox rule.
E) An exception that allows for unilateral contracts to be binding as soon as the offer is made.

Question 70

[Used Car Sales] Edwin sells used cars. He is looking for a way to increase sales and profits so that he can take his girlfriend on a nice diving trip to the Grand Cayman Islands. The first thing that Edwin does is say that during the first week of December, he will give a $500 rebate on used cars that are under two years old. To spice things up, he also offers to sell any car on the lot that is over five years old for $1,000 to the first three customers who can jump rope for ten hours straight on December 7th. Edwin was not very concerned about the jumping rope issue because he thought that no one would be able to jump rope for ten hours straight. Edwin put an advertisement pertaining to the rebate and the jump rope opportunity in the local newspaper. The promotion went over very well. Although Edwin had several cars available, he ran out of cars under two years old within one day. During the rest of the week shoppers were told that cars of that description were no longer available. Josh was very angry at Edwin for not having a car available that was under two years old so that he could get a good deal and a $500 rebate. On December 7th, while Edwin was watching people jump rope, Brandi was shopping for a car. She was in college and did not have much money. She saw one, an older car, a real clunker, that she liked; but wasn't sure if it could be repaired sufficiently to be dependable. Edwin had not even put a price on it because he planned to have it crushed. Brandi was going to talk to her parents about it. Edwin eventually approached her, and Brandi asked him if he would take $450 for the car. Edwin said, "Yes, sold." Brandi tried to explain that she needed to talk to her parents first, but Edwin would not hear of it. While Edwin was still fuming from his encounter with Brandi, Zack walked up and started to criticize the nature of Edwin's inventory. Edwin told him that he had great cars. Zack pointed at a beater that was banged up, had 200,000 miles on it, and a cracked windshield. Zack said, "Sure, I'll pay $100,000 for that car!" Edwin said, "Sold." Zack said, "Wait a minute. I was only kidding." Edwin said, "No way." Meanwhile all the people jumping rope dropped out well prior to ten hours except for Emma. She completed the jumping rope and asked for her car for $1,000. Edwin refused saying that the offer was revoked. Josh and Emma sued Edwin, and Edwin sued Zack and Brandi. Under the applicable law in Edwin's state, common law will be applied, and there are no state statutes impacting the situation.
What is the most likely result in Edwin's lawsuit against Brandi in which he claims that she must pay $450 for the car at issue?

A) Edwin will win because Brandi made an offer that he properly accepted.
B) Edwin will win because Brandi agreed to pay a reasonable amount for the vehicle.
C) Brandi will win because the agreement was not put into written form and signed by both parties.
D) Brandi will win because she merely expressed interest and did not make an offer.
E) Brandi will win because she was not provided sufficient time in which to consider the offer.

Question 71

[Saturday Auction] Randy, an auctioneer, held an auction on a Saturday morning. At the beginning of the auction, Randy announced that the auction was being held without reserve. Erin, Maria, and Steve were all in attendance. Erin saw an old cash register with a stuck drawer that she thought would look great in her den. The auctioneer put the cash register up for sale noting that the drawer was stuck but that it could probably be fixed with little effort. Erin bought it for $20. When she got it home, she discovered that it actually contained $5,000 in cash. Unfortunately, Erin had a teenage son who started bragging to his friends about the family's good fortune. Randy heard about what had happened and sued Erin for return of the $5,000. At the same auction, Maria saw a great deal on a used table, and bid $20 on it. No one else bid anything. Randy announced that $20 was clearly insufficient for the table, that it was worth much more than that, and that he was taking it out of the auction. Steve started bidding on a diamond ring for his girlfriend. He bid $2,000. Just as Randy was getting ready to say "Sold," Steve looked over at his girlfriend, decided that he was not sure about marriage, and jumped up yelling "I revoke." Randy, however, immediately after, yelled "Sold." Randy sues Steve attempting to obtain the money for the engagement ring. Randy also sues Erin seeking to recover the $5,000 contained in the stuck drawer. Maria sues Randy attempting to obtain possession of the table.
What is the likely result in the lawsuit brought by Maria against Randy for the table?

A) Randy will win because Maria was simply making an offer that he was free to decline.
B) Randy will win because the price was clearly insufficient for the table.
C) Randy will win because no acceptance occurred.
D) Maria will win because the auction was without reserve, and Randy had agreed to accept the highest bid.
E) Randy will win because he did not inform attendees in writing that the auction was without reserve.

Question 72

Which of the following is true of the Uniform Electronic Transactions Act rule for emails?

A) It is an act prohibiting emails from constituting acceptance to an offer.
B) It provides that an email is considered received when it enters an information processing system designated by the recipient, provided certain criteria are met.
C) It is a repudiation of the mailbox rule for email.
D) It is an act establishing the circumstances under which an email can be considered an offer.
E) It is a rule establishing when an email creates an implied contract.

Question 73

According to the Restatement, if no mode of communication is specified in the offer, then ________.

A) the offer is invalid
B) the acceptance is valid, but only if made within a month
C) the acceptance cannot be valid
D) any reasonable means of acceptance is valid
E) there must be a written acceptance of the offer to be valid

Question 74

Which of the below rules allows that an acceptance is valid when it is placed in the mailbox?

A) The Acceptance Rule
B) The Contract Rule
C) The Reasonable Rule
D) The Mailbox Rule
E) The Contract Legality Rule

Question 75

[Used Car Sales] Edwin sells used cars. He is looking for a way to increase sales and profits so that he can take his girlfriend on a nice diving trip to the Grand Cayman Islands. The first thing that Edwin does is say that during the first week of December, he will give a $500 rebate on used cars that are under two years old. To spice things up, he also offers to sell any car on the lot that is over five years old for $1,000 to the first three customers who can jump rope for ten hours straight on December 7th. Edwin was not very concerned about the jumping rope issue because he thought that no one would be able to jump rope for ten hours straight. Edwin put an advertisement pertaining to the rebate and the jump rope opportunity in the local newspaper. The promotion went over very well. Although Edwin had several cars available, he ran out of cars under two years old within one day. During the rest of the week shoppers were told that cars of that description were no longer available. Josh was very angry at Edwin for not having a car available that was under two years old so that he could get a good deal and a $500 rebate. On December 7th, while Edwin was watching people jump rope, Brandi was shopping for a car. She was in college and did not have much money. She saw one, an older car, a real clunker, that she liked; but wasn't sure if it could be repaired sufficiently to be dependable. Edwin had not even put a price on it because he planned to have it crushed. Brandi was going to talk to her parents about it. Edwin eventually approached her, and Brandi asked him if he would take $450 for the car. Edwin said, "Yes, sold." Brandi tried to explain that she needed to talk to her parents first, but Edwin would not hear of it. While Edwin was still fuming from his encounter with Brandi, Zack walked up and started to criticize the nature of Edwin's inventory. Edwin told him that he had great cars. Zack pointed at a beater that was banged up, had 200,000 miles on it, and a cracked windshield. Zack said, "Sure, I'll pay $100,000 for that car!" Edwin said, "Sold." Zack said, "Wait a minute. I was only kidding." Edwin said, "No way." Meanwhile all the people jumping rope dropped out well prior to ten hours except for Emma. She completed the jumping rope and asked for her car for $1,000. Edwin refused saying that the offer was revoked. Josh and Emma sued Edwin, and Edwin sued Zack and Brandi. Under the applicable law in Edwin's state, common law will be applied, and there are no state statutes impacting the situation.
What is the most likely result in the lawsuit brought by Edwin against Zack?

A) Edwin will win because Zack properly made an offer that Edwin accepted.
B) Zack will win because he was merely expressing possible interest.
C) Zack will win because Edwin did not properly accept.
D) Zack will win because under a subjective standard he was joking.
E) Zack will win because under an objective standard, it appears he was joking.

Question 76

Mary accepts Joe's offer to buy 100 comic books. She sends her acceptance via fax. Mary and Joe live in a jurisdiction that applies the mailbox rule to faxes. When does her fax become effective?

A) Faxes are effective upon receipt.
B) Faxes are effective upon dispatch.
C) Faxes are effective as determined by the court's fact-based assessment of the particular case.
D) Faxes are not a valid form of acceptance.
E) Faxes are effective only if the contract expressly states they are effective upon receipt.

Question 77

[Used Car Sales] Edwin sells used cars. He is looking for a way to increase sales and profits so that he can take his girlfriend on a nice diving trip to the Grand Cayman Islands. The first thing that Edwin does is say that during the first week of December, he will give a $500 rebate on used cars that are under two years old. To spice things up, he also offers to sell any car on the lot that is over five years old for $1,000 to the first three customers who can jump rope for ten hours straight on December 7th. Edwin was not very concerned about the jumping rope issue because he thought that no one would be able to jump rope for ten hours straight. Edwin put an advertisement pertaining to the rebate and the jump rope opportunity in the local newspaper. The promotion went over very well. Although Edwin had several cars available, he ran out of cars under two years old within one day. During the rest of the week shoppers were told that cars of that description were no longer available. Josh was very angry at Edwin for not having a car available that was under two years old so that he could get a good deal and a $500 rebate. On December 7th, while Edwin was watching people jump rope, Brandi was shopping for a car. She was in college and did not have much money. She saw one, an older car, a real clunker, that she liked; but wasn't sure if it could be repaired sufficiently to be dependable. Edwin had not even put a price on it because he planned to have it crushed. Brandi was going to talk to her parents about it. Edwin eventually approached her, and Brandi asked him if he would take $450 for the car. Edwin said, "Yes, sold." Brandi tried to explain that she needed to talk to her parents first, but Edwin would not hear of it. While Edwin was still fuming from his encounter with Brandi, Zack walked up and started to criticize the nature of Edwin's inventory. Edwin told him that he had great cars. Zack pointed at a beater that was banged up, had 200,000 miles on it, and a cracked windshield. Zack said, "Sure, I'll pay $100,000 for that car!" Edwin said, "Sold." Zack said, "Wait a minute. I was only kidding." Edwin said, "No way." Meanwhile all the people jumping rope dropped out well prior to ten hours except for Emma. She completed the jumping rope and asked for her car for $1,000. Edwin refused saying that the offer was revoked. Josh and Emma sued Edwin, and Edwin sued Zack and Brandi. Under the applicable law in Edwin's state, common law will be applied, and there are no state statutes impacting the situation.
Which of the following is the most likely result in the lawsuit brought by Josh complaining that Edwin ran out of cars available for a rebate?

A) Josh will win because Edwin was required to have sufficient cars on hand for anyone who requested one.
B) Josh will win because a rebate was involved.
C) Josh will win because Edwin should have run another ad revoking the offer.
D) Josh will lose because he did not properly accept the offer.
E) Josh will lose because a court would interpret the intent of Edwin as being to invite readers to make an offer that Edwin was free to reject.

Question 78

Which of the following provides that a revocation is effective only when received by the offeree?

A) The Acceptance Rule
B) The Contract Rule
C) The Reasonable Rule
D) The Mailbox Rule
E) The Contract Legality Rule

Question 79

Mary accepts Joe's offer to buy 100 comic books. She sends her acceptance via fax. Mary and Joe live in a jurisdiction that applies the majority rule. When does her fax become effective?

A) Faxes are effective upon receipt.
B) Faxes are effective upon dispatch.
C) Faxes are effective as determined by the mailbox rule.
D) Faxes are not a valid form of acceptance.
E) Faxes are effective only if the contract expressly states they are effective upon receipt.

Question 80

Which of the following is true of online businesses and disclosures?

A) Online businesses always give full disclosure of terms about products before payment.
B) Online businesses commonly refrain from giving full disclosure of terms about a product until they receive a customer's payment information.
C) Online businesses are required to make full disclosures easily accessible to consumers before collecting payment information.
D) Online businesses generally make links to online disclosures very easy for consumers to find.
E) Online businesses never make disclosures to consumers about product terms.