Deck 10: Agreement

Question 1

Generally,advertisements,catalogs,price lists,etc.are not treated as offers.

Answer 1

True

Question 2

In an auction without reserve,the seller must accept the highest bid and cannot withdraw the goods from sale.

Answer 2

True

Question 3

In an auction without reserve,the seller is the offeror.

Answer 3

True

Question 4

The offeree has the power to create a contract by accepting the offer.

Question 5

A counteroffer is treated as both a revocation and a new offer.

Question 6

Revocation refers to the offeree communicating to the offeror that the offeree does not want to accept the offer.

Question 7

The making of an offer occurs prior to the formation of a contract.

Question 8

The communication of an offer can be made by the offeror or the offeror's agent.

Question 9

To be entitled to collect on a reward offer,a person need only perform the requested act.

Question 10

Under modern law,the court can supply a missing contract term if a reasonable term can be implied.

Question 11

Objective intent refers to the actual intent of a particular person.

Question 12

Where the terms of an offer are indefinite,the court can supply a missing term if a reasonable term can be implied.

Question 13

An offer made in anger,where a reasonable person would not have known that it was made in anger,cannot result in a contract.

Question 14

The effectiveness of an offer is partially dependent upon whether or not it has been communicated to the offeree.

Question 15

A rejection of an offer is generally not effective until it is received by the offeror.

Question 16

An advertisement reading,"Our last Trailconquerer XL100 mountain bike,stock number T990234,will be sold to the first buyer with $700," would not be treated as an offer.

Question 17

Reward offers are offers to enter into a unilateral contract.

Question 18

An offer is considered communicated to the offeree so long as it has been communicated to the offeree in some way by someone.

Question 19

With mutual assent between the parties,there is no contract.

Question 20

An offer made in jest,where a reasonable person would conclude that it was made in jest,cannot result in a contract.

Question 21

In general,who can effectively accept an offer for a unilateral contract?

A) Any person who performs the action requested in the offer,which can occur either before or after learning of the offer.
B) Any person who performs the action requested in the offer,so long as the offer had been communicated to that person prior to the performance of the act.
C) Any person who promises to perform the action requested in the offer,which can occur either before of after learning of the offer.
D) Any person who promises to perform the action requested in the offer,so long as the offer had been communicated to that person prior to the making of the return promise.

Question 22

Which of the following are necessary to meet the requirements of a definite offer?

A) identification of the parties,subject matter,and quantity
B) consideration to be paid
C) time of performance
D) A,B,and C
E) A and B only

Question 23

If an offeree rejects an offer and then attempts to accept that same offer,the offer is now construed as a new offer that the original offeror is free to accept or reject.

Question 24

Generally,an offeror can specify the manner in which he/she wants his/her offer to be accepted.

Question 25

A rejection is effective upon dispatch.

Question 26

In certain circumstances,silence can operate as acceptance.

Question 27

In order for an offer to be valid,the following must be met EXCEPT for which of the following?

A) There is an objective intent by the offeror to enter into a contract.
B) The offer must be in writing and signed by the offeror.
C) The offer must be communicated to the offeree.
D) The offer must be certain enough that most people can figure out what is being offered.

Question 28

Revocation of an offer may be done anytime prior to acceptance by the offeror.

Question 29

In order to collect a reward,the person must:

A) perform the requested act
B) have knowledge of the reward before performing the act
C) have knowledge of the reward before collecting the reward
D) A and B only
E) A and C only

Question 30

The objective theory of contracts is based on the which of the following premises?

A) Even offers made in obvious jest can be the basis of a contract.
B) Every contract must have a central object to it.
C) Every contract must have consideration given by both parties.
D) Whether the intent is present is based on how a reasonable person would view the parties' actions rather than on the actual intentions of the parties.
E) The intent to be bound is determined after the parties have had a chance to perform the contract.

Question 31

If the object of an offer becomes illegal after the offer was made,but before it is accepted,the offer remains valid because it was legal when made.

Question 32

Death of the offeror terminates an offer even if the offer could still be carried out by the estate of the offeror,such as the sale of property of the offeror.

Question 33

The basic concept that both parties to a contract should have agreed to the same terms is referred to as:

A) bilateral agreement
B) mutual assent
C) co-agreement
D) common intent

Question 34

If a contract omitted some terms,which of the following terms could be implied by the court?

A) quantity
B) time for performance
C) price,if a reasonable price can be determined
D) A,B,and C
E) B and C only

Question 35

The concept of objective intent with respect to contract law means which of the following?

A) When forming a contract,each party must expressly state an intent to be obligated under the terms of an agreement.
B) The parties must each intend to be bound by the terms of an agreement based on each party's true intent,whether or not that intent is known by the other party.
C) The parties' intent to be bound by the terms of a contract is based on whether an outsider observing the parties' words and conduct would reasonably conclude that the parties have the needed intent.
D) So long as one party intends to be bound by the terms of an agreement,the objective intent requirement will be met.

Question 36

If nothing is stated about how long an offer is to remain open,it remains open until it is revoked by the offeror.

Question 37

If no mode of acceptance is stated in the offer,then any mode which is reasonable in the circumstances may be used.

Question 38

The communication of an offer can be made by:

A) the offeror only
B) the offeror or an agent of the offeror
C) the agent of the offeror only
D) the offeror,the offeror's agent,or any other party who learns of an offer

Question 39

Offers made to the public may be revoked by communicating the revocation by the same means used to make the offer.

Question 40

Advertisements are usually considered to be:

A) offers that can be accepted only by those who have seen the advertisement
B) invitations to deal
C) offers that can be accepted by anyone attempting to purchase the item whether or not that person has seen the actual advertisement
D) counteroffers to any previous advertisements

Question 41

Pam offers a reward for the return of the pet snake that escaped from her purse while she was having dinner at a restaurant.Fred finds the snake and returns it to her.Which of the following is relevant in deciding whether Pam must pay the reward?

A) whether Fred is a minor
B) whether Fred knew about the reward when he returned the snake
C) whether Fred intended to get the reward
D) whether the offer for the reward was in writing

Question 42

Supervening illegality of the object of a contract occurs in which of the following circumstances?

A) The illegality existed when the offer was made.
B) The object of the contract is illegal where made,but would be legal in another location.
C) The object of the contract is illegal to be performed by the offeree,but could be legally performed by a different party.
D) The object of the contract was legal when the offer was made,but has subsequently become illegal.
E) The offeror had an honest and reasonable belief that the object of the contract was legal when the offer was made,but later learned that the offer was illegal.

Question 43

The rejection of an offer:

A) is effective when received by the offeror,and prevents the offeree from later accepting that offer
B) is effective when sent to the offeror,and prevents the offeree from later accepting that offer
C) is effective when received by the offeror,but does not prevent the offeree from later accepting that offer
D) is effective when sent to the offeror,but does not prevent the offeree from later accepting that offer

Question 44

Which of the following is correct regarding a "counteroffer?"

A) It is no different from any other offer.
B) It is not really an offer,but operates as the revocation of an offer.
C) It operates as both an offer and an acceptance.
D) It is treated as both a rejection of an offer and a new offer.
E) It is treated as a new offer,but does not terminate the original offer.

Question 45

In an auction when the highest bid has been made and no higher bids are forthcoming,the highest bid is treated as an acceptance in:

A) auctions with reserve,but not in auctions without reserve
B) auctions without reserve,but not in auctions with reserve
C) both of these kinds of auctions
D) neither of these kinds of auctions

Question 46

Sally owns a very expensive fur coat that Mary would like to buy.During the course of conversation,Mary asks how much Sally would take for the coat.Sally replies,"I am not sure I want to sell the coat,but I think it is worth about $3,000." Mary says,"That is a little more than I wanted to spend." Several days later,Mary calls Sally on the telephone and says,"I'll bring over the $3,000 today." Sally refuses to sell the coat,and Mary sues.What results?

A) Mary wins; a valid contract was created.
B) Sally wins; there was never any offer for Mary to accept.
C) Sally wins; when Mary said $3,000 was too much to pay,Mary rejected the offer.
D) Sally wins; Mary did not accept the offer in a reasonable manner.
E) Sally wins; Sally's offer expired due to the passing of a reasonable time.

Question 47

Silence will operate as acceptance in the following circumstances EXCEPT:

A) when the offeree indicates that silence will operate as acceptance
B) when the offeror indicates that silence will operate as acceptance
C) when prior dealings between the parties indicate that silence is acceptance
D) when the offeree signs an agreement that future shipments would be accepted until further notification

Question 48

Jess says to a friend,"I'll sell you my 2-year-old Toyota Camry for $4,000." The friend says,"I'll take it," and they sign a short agreement to that effect.The friend didn't know this,but Jess intended the offer as a joke.There will be a contract if which of the following is true?

A) The approximate fair value of the car is $4,000.
B) A reasonable person would have concluded that Jess was serious when making the offer.
C) Jess failed to disaffirm the contract within a reasonable time after the offer was accepted.
D) The written agreement spells out all provisions of the contract.

Question 49

Which of the following would be a valid offer?

A) Bob's brand new riding lawn mower will not start,so Bob yells,"I'd sell this thing for $10."
B) Jane is a real estate agent,and while looking at a house she says,"I think we can get $50,000 for this place."
C) Mary goes to a garage sale,sees a dresser she wants,and says,"Would you take $25 for this dresser?"
D) John tells Rhoda,"I'll give you $500 for your motorcycle."

Question 50

Which of the following will not generally automatically terminate an open offer?

A) death of the offeror
B) death of the offeree
C) changed economic circumstances
D) destruction of the subject matter of the contract
E) supervening illegality of the object of the contract

Question 51

Which of the following would terminate an offer?

A) revocation by the offeror
B) rejection by the offeree
C) counteroffer by the offeree
D) A,B,and C
E) A and B only

Question 52

Sandy notices a dog tied to a chain behind a fence and recognizes it as belonging to an acquaintance who lives a couple of blocks away.Sandy goes to the acquaintance's house and says,"Your dog is tied up in someone's yard,and for $100 I will tell you where." The dog's owner says,"No way! I can't believe you won't simply tell me where the dog is!" The dog's owner drives around the neighborhood and finds the dog and retrieves it.The next day Sandy notices an advertisement in the paper where the owner offered a reward of $200 for information leading to the return of her dog.Sandy is:

A) entitled to $100 because she made a counteroffer to the $200 reward offer,thereby lowering the amount she can claim
B) entitled to $200 solely because she gave the dog's owner information leading to the return of the dog
C) entitled to the $200 because she offered to pay money and the reward offer was outstanding
D) not entitled to any money because she rejected the original offer and the dog's owner did not accept Sandy's counteroffer
E) not entitled to any money because there was no offer that was accepted

Question 53

David decides to sell his coin collection at an auction that is advertised as being "without reserve." Can David change his mind and withdraw the collection from the auction?

A) He can withdraw the collection at anytime before the auctioneer announces that it has been sold.
B) He can withdraw the collection at anytime before the items in the collection are delivered to the buyers.
C) He can withdraw the collection only if the bids are extremely low.
D) He can withdraw the collection only before the auction begins.
E) He cannot withdraw the collection once the auction has been advertised.

Question 54

What is the legal effect of an auction being with reserve?

A) The seller has the right to reject all of the bids.
B) Certain bidders have reserved bids of specified amounts in advance.
C) The bidders must be given an opportunity to inspect the items prior to the bidding.
D) Bidders must make a cash deposit in advance to show the financial ability to carry through with the purchase of any item for which they are the highest bidder.

Question 55

The requirement that the terms of the acceptance be the same as those of the offer is the:

A) mirror image rule
B) identical terms rule
C) counteroffer equals rejection rule
D) doctrine against offer modifications
E) promissory estoppel doctrine

Question 56

Which of the following statements is true regarding acceptances?

A) If an offer is made to Mary in front of a group of people,any of the group may accept the offer.
B) If an auction is "without reserve," the item must be sold to the highest bidder.
C) Generally,an acceptance may contain new terms.
D) Generally,silence operates as an acceptance.

Question 57

The mailbox rule means which of the following?

A) Offers and acceptances must be communicated through the mail in order to be effective.
B) Offers and acceptances are effective when placed in the mail.
C) A properly dispatched acceptance is effective even if the offeror never receives it.
D) A revocation is effective when sent.

Question 58

If an offeree gives a rejection to the offeror,which of the following is true at this point?

A) The offeree is still able to accept the original offer until its original expiration time.
B) The offeree has made a counteroffer.
C) The offeree cannot later enter into a contract on the terms of the rejected offer.
D) The offeree can now transfer the rejected offer to a different party who becomes the new offeree.
E) The offeree has lost the ability to accept the original offer.

Question 59

Mary,the seller,and Jane contract for the sale of 500 sweaters.They agree on color and style,but not on price or time of delivery.Mary refuses to deliver the sweaters,and Jane sues.What results?

A) Mary wins; because all these terms were omitted from the agreement,the contract is not definite enough to be valid.
B) Jane wins; the courts will fill in all the above-mentioned missing terms.
C) Mary wins; the courts will fill in many missing terms,but never price.
D) Mary wins; the courts will fill in many missing terms,but never time of delivery.

Question 60

What does an offeree use to simply indicate that he/she is not interested in an offer?

A) revocation
B) rejection
C) counteroffer
D) promissory estoppel
E) option

Question 61

Lefty's Surplus Store placed an advertisement in the newspaper offering one new bath tub,regularly priced at $500,for sale for only $10,to the first person who came to the store the next day.Judy was the first person to appear the next day and she demanded the bath tub for $10.Lefty's refused to sell to her.Judy sued.What is the likely outcome?

Question 62

Should the rules of offer and acceptance be changed to reflect the increasing use of instantaneous communications such as fax machines and online commercial transactions? How does doing business in this environment differ from in the past? What changes,if any,should a business make in the terms or manner of offers and acceptances?

Question 63

Offeror says,"I will sell you my dog for $100.You have a week to decide." Two days later she tells the offeree,"I've changed my mind.I'm keeping the dog." This last statement is:

A) an effective revocation
B) an effective rejection
C) ineffective in terminating the offer
D) a counteroffer

Question 64

Sam receives an offer that states: "I will sell you my car for $8,500,you have 10 days to accept." On Day 4,Sam tells the seller that he will give him $8,000,but the seller rejects this.Which of the following is true?

A) If Sam tells the seller within 6 days that he'll pay the $8,500,a contract is formed.
B) Sam's only alternative is to pay the asking price for the car.
C) If the seller changes his mind within 6 days,he can make Sam buy the car for $8,000.
D) There is no open offer.
E) If the seller does not want to sell his car to Sam for $8,500,he must revoke his offer.

Question 65

Erin receives an offer in the mail from Susan on July 14 that says,"I will sell you my vacation home for $80,000.You may accept this offer by signing the bottom of this letter and placing it in the mail so that it is postmarked by July 31." Which is true?

A) Susan will be liable for breach of contract if she sells that home to anyone else prior to July 31.
B) If Erin accepts the offer on July 20 by meeting the terms of the offer,she (Erin) can change her mind up until July 31 so long as Susan is notified by that date.
C) Assuming Erin has not paid Susan for an option contract,Susan may revoke the offer at any time so long as she does so before Erin accepts.
D) If Erin counteroffers with a price of $75,000,and Susan rejects,Erin can create a contract by accepting the original offer by July 31.

Question 66

What problems in connection with offer and acceptance might arise in an online auction situation? Are there any rules that could address these?

Question 67

Offeror says,"I'll sell you my car for $10,000." Offeree says,"I accept your offer but will pay $9,700." As a result,at this point which of the following are true?

A) There are two open offers.
B) This was a conditional acceptance.
C) Offeror must sell car to offeree if offeree gives offeror $10,000.
D) The only open offer is for $9,700.

Question 68

The owner of a small business is having lunch with an employee.He says,"I'm so tired of the problems that we are having lately that I would sell the entire business to you now for a nickel!" The employee quickly slams a nickel on the table and exclaims,"I accept!" Is there a valid contract?

A) Yes; the offer was made and accepted in a timely fashion.
B) Yes; the offer was made and the employee conferred the requested consideration.
C) No; the consideration is inadequate for the purchase.
D) No; there is a lack of objective intent.

Question 69

Marilyn decides to sell the diamond broach she inherited from her grandmother at an auction "with reserve." Can she withdraw the broach from sale?

A) She can withdraw the broach any time before the auction announces it has been sold.
B) She can withdraw the broach any time before it is delivered to the buyers.
C) She can withdraw the broach only if the bids are extremely low.
D) She can withdraw the broach only before the auction begins.
E) She cannot withdraw the broach once the auction has been advertised.

Question 70

Sam places an advertisement in the newspaper for his Dodge Viper which states,"I hate to sell it,but high insurance costs force me to sell my 1999 Dodge Viper.The first $45,000 cash takes it." Betty goes to look at the car and says to Sam,"I'll give you $42,000 for it." Sam then says,"That's not the deal." Betty says nothing and leaves.A couple of weeks later Betty notices that the ad is still in the paper,so she takes $45,000 cash over to Sam's house.He hasn't sold the car,but says to Betty,"You rejected my offer of $45,000,so I don't have to sell it to you for that.You can have it for $47,000." Is Sam obligated to sell the car to Betty for $45,000? Give all possible arguments for each party.

Question 71

Denny is selling his house at an auction with reserve.Albert offers $50,000.Betty says,"I'll pay $60,000,if the bank will loan me that much." Denny says,"Forget it! I am not going through with the sale of my house." Carl then says,"I'll pay you $70,000 for it." Who gets the house?

A) Albert,because he made a definite and certain offer,and did so before Denny stopped the bidding.
B) Betty,because she offered the highest amount before Denny stopped the bidding.
C) Carl,because he offered the highest amount.
D) Denny,because he could withdraw the property from sale at any time.

Question 72

On Monday,Cindy says to Ruth,"I will sell you my car for $10,000.You have until Friday to decide." As of Wednesday,Ruth has paid nothing to Cindy and has not indicated if she is interested in buying the car.At this point,which is true?

A) Cindy can revoke the offer on Wednesday.
B) Ruth must reject Cindy's offer by Friday,or else she has bought the car.
C) Cindy cannot revoke the offer on Wednesday.
D) Ruth could send $250 to Cindy,which would make the offer irrevocable.

Question 73

Anita offered to sell her condo to Bill.Before Bill could accept,one of the parties was killed in a car accident.The remaining party wishes to go through with the contract.Which of the following best describes this situation?

A) The death of either party terminated the offer.
B) If Anita died,Bill can still accept the offer; Anita's estate will be liable for the contract.
C) If Bill died,Bill's heirs can still accept the offer.
D) If Anita died,the offer is terminated; if Bill died,Bill's heirs can still accept the offer.

Question 74

John offered to sell Jane his 1959 Thunderbird automobile.Before Jane could accept the offer,lightning struck the car,and it was totally destroyed.Which of the following is true?

A) Jane can still accept the offer and John must find a 1959 Thunderbird to sell.
B) The offer is terminated by operation of law.
C) John can still revoke his offer,if he does so before Jane accepts.
D) Jane can still accept the offer; she will be entitled to the insurance proceeds.

Question 75

Susan offered to sell her couch to Martin for $200.Martin said that $200 was too much,but that he would give her $125.Susan said no.Then,Martin said that he would pay Susan the entire $200.

A) Martin has accepted Susan's original offer.
B) Martin's statement that he would give Susan $125 was a rejection of Susan's original offer.
C) Martin's statement that he would give Susan $125 was an offer by Martin.
D) A and C only are true.
E) B and C only are true.

Question 76

Larry loses his wallet on the bus.He places posters around the bus stop locations offering a reward for the wallet.Mary finds that wallet on the street and contacts Larry.After she had returned the wallet to Larry,a friend advised her that Larry had been offering a reward for the wallet.She later contacts Larry about the reward money.How much is she entitled to?

A) the ancillary costs associated with returning the wallet
B) one half of the reward money
C) the entire reward
D) none

Question 77

Fred's beautiful photograph of the Washington Monument is hanging in a Washington Gallery.Jed is looking at it and Fred tells Jed he can have it for $1,000.Jed says,"No way,man! I won't pay that!" The next day,Jed reconsiders and goes to the gallery and tells Fred he'll take it for $1,000.Which is true at this point?

A) Fred can tell Jed that the price is now $1,200.
B) Jed can't force Fred to take the $1,000 because of the prior day's revocation.
C) If they can't agree,a court would set the price at $1,100.
D) Jed's acceptance of the $1,000 offer is effective only if Fred has not yet revoked his offer.

Question 78

Under the mailbox rule there is a period of time when the offeror may be in a contract and not be aware of it.If the rule were changed such that acceptances were effective upon receipt,would this eliminate the problem of someone being in a contract without being aware of it? Is there any rule or set of rules that will eliminate the problem of one party or the other having a period of uncertainty,if all correspondence is conducted through the mail? If either the offeree or offeror must go through a period of uncertainty,which should it be? Why? What can the offeror do to avoid this uncertainty? Is the mailbox becoming more important or less important?

Question 79

Kristin offers to sell land to Ian for $5,000.Ian says that $5,000 is too much,but he will pay $4,000.Kristin says no.Two days later,Ian accepts Kristin's original offer.Which of the following best describes this situation?

A) There is now a valid contract between Kristin and Ian.
B) Ian made a counteroffer; that terminated Kristin's offer.
C) Kristin may now accept Ian's counteroffer.
D) Ian made a counteroffer,but Kristin's offer may still be accepted.

Question 80

Seasonal Selections,Inc.sends a copy of its catalog to William along with a personalized computer-generated letter inviting him to purchase any two items in the catalog at the advertised price.Has Seasonal Selections made an offer?

A) Yes; the letter is an offer.
B) It is an offer only if William is already a customer.
C) The catalog and letter are an offer,because there is no room to negotiate a price.
D) Seasonal Selections has not made an offer. The catalog is a solicitation of an offer by William.
E) None of these are correct.