Deck 9: Formation in Traditional and E-Contracts

Question 1

A person who does not know about a reward can still claim it.

Answer 1

False

Question 2

An implied contract is implied from the conduct of the parties.

Answer 2

True

Question 3

An effective offer requires reasonably certain terms.

Answer 3

True

Question 4

An acceptance that materially changes a term in the offer will still be considered an acceptance.

Question 5

Parties can form a contract without putting the terms in writing.

Question 6

A unilateral contract is formed when the one receiving the offer completes the requested act or performance.

Question 7

To be valid,a contract must be enforceable by all of the parties to it.

Question 8

Offers may not be revoked before they are accepted.

Question 9

If a voidable contract is avoided,the parties to it are released from it.

Question 10

A letter of credit is a formal contract.

Question 11

One of the requirements of a valid contract is its acceptance.

Question 12

An invitation to negotiate-"can you afford this"-is an offer.

Question 13

The intention to enter into a contract is judged by objective facts as interpreted by a reasonable person.

Question 14

An executory contract is one that has been fully performed.

Question 15

Contract law shows what excuses our society accepts for breaking certain types of promises.

Question 16

An offer must be practical to be effective.

Question 17

An expression of opinion-"your customers will like this"-is an offer.

Question 18

There are no exceptions to the rule that contracts voluntarily entered into will be enforced.

Question 19

A void contract is enforceable if it is in writing.

Question 20

An offer to form a bilateral contract is accepted only by completing the contract performance.

Question 21

A contract is void if one of the parties was intoxicated at the time of its formation.

Question 22

Bobbie claims that Carl breached their contract.Carl responds that he never intended to enter into a contract with Bobbie.The intent to enter into a contract is determined with reference to

A)the conscious theory of contracts.
B)the objective theory of contracts.
C)the personal theory of contracts.
D)the subjective theory of contracts.

Question 23

Parties are not usually free to bargain as they wish.

Question 24

The terms of a shrink-wrap agreement may be enforced in the same way as the terms of other contracts.

Question 25

Legally,a minor may not contract with an adult.

Question 26

Digital Architecture,Inc.,enters into a contract to design robotic software for Chassis Assembly Corporation.The freedom to enter into contracts is

A)a fundamental public policy of the United States.
B)an ambiguous business goal that is irrelevant in terms of the law
C)a philosophical concept that underlies international law.
D)a principle that describes contracting parties' intent.

Question 27

An obligation is enforceable only if it is supported by past consideration.

Question 28

Contractual capacity refers to the size or volume of a contract.

Question 29

In contract law,"consideration" refers to the courtesy that one party shows another in negotiating a deal.

Question 30

An e-contract must meet the same basic requirements as a paper contract.

Question 31

On Monday,Neil tells Outdoor Landscaping,Inc.,that he will pay Outdoor $500 if a variety of tasks are completed by Friday.On Wednesday,when Outdoor is more than half done with the work,Neil says that he has changed his mind.These parties had

A)an expired contract when Neil said that he had changed his mind.
B)a bilateral contract when Neil said that he would pay for certain work.
C)a unilateral contract as soon as Outdoor began to perform.
D)no contract.

Question 32

An online offer should include provisions relating to dispute settlement.

Question 33

InTown Delivery Service promises to deliver a certain couch to Kurt,who promises to pay for the service.If InTown does not perform,the firm may be required to

A)do nothing.
B)make another promise.
B)perform a different service.
C)pay damages.

Question 34

A contract to do something that is prohibited by law is void.

Question 35

A partnering agreement reduces the likelihood that a dispute will arise under a contract.

Question 36

Inadequate consideration may reflect a lack of bargained-for exchange.

Question 37

The E-Sign Act preempts the uniform version of the Uniform Electronic Transactions Act.

Question 38

On behalf of the rock group Uno,their manager Thalia agrees to a performance in Seaside Amphitheatre on July 4.Rex,acting for Seaside Productions,sends a written copy of the agreement to Thalia to be signed.Typically,businesspersons put their contracts in writing to

A)ensure proof of the contracts' existence.
B)create substance from form.
C)obtain a check.
D)practice their "letters of credit."

Question 39

The Uniform Electronic Transactions Act does not create rules for e-transactions.

Question 40

A partnering agreement can indicate the parties' intent with respect to subsequent contracts.

Question 41

When Jeff's car breaks down,he asks Kwik Tow,Inc.,to tow it from its location to Loyal Repair Shop.There is no discussion of a price,and Jeff and Kwik do not sign any documents.After the tow,Kwik sends Jeff a bill.With respect to Jeff's obligation to pay the bill,this is

A)an express contract.
B)an implied contract.
C)a formal contract.
D)no contract.

Question 42

Greco promises to buy illegal copies of CDs and DVDs from Fava,who promises to deliver on April 15.These promises are most likely

A)enforceable.
B)valid.
C)void.
D)voidable.

Question 43

Scot and Tiffany enter into an implied contract.The parties' conduct

A)defines the contract's terms.
B)finds the contract's facts.
C)terminates any unintended consequences.
D)undercuts any terms based on the facts.

Question 44

Michelle gives out a business card with an e-mail address on it.According to the comments that accompany the UETA,it may be reasonable to infer that Michelle has consented to

A)transact business electronically.
B)submit to the jurisdiction of any selected forum.
C)accept and respond to any correspondence sent to that address.
D)nothing.

Question 45

Deb buys a song through eSongs,an online music vendor.Before completing the purchase and downloading the song,Deb must agree to a provision not to sell copies of the song.This provision is

A)a browse-wrap term.
B)a click-on agreement.
C)a shrink-wrap agreement.
D)none of the choices.

Question 46

Lou claims that he and Myra entered into an implied contract.To establish this contract,it is not necessary to show that

A)a court imposed a promise in the interest of fairness.
B)Lou expected to be paid for providing services or prop?erty.
C)Lou provided Myra with services or property.
D)Myra failed to reject services or property provided by Lou.

Question 47

Lovett County Bank offers to lend money to Kino,the owner of Java Stop,at 15 percent interest.Before Kino accepts,a state statute is enacted prohibiting loans at rates greater than 12 percent.Kino and the bank have

A)a contract for a loan at 15 percent interest.
B)a contract for a loan at 12 percent interest.
C)a contract for a loan at 0 percent interest.
D)no contract.

Question 48

Employment Sources,Inc.,enters into a contract with Fred.If Fred is a minor,this contract is most likely

A)enforceable.
B)unenforceable.
C)void.
D)voidable.

Question 49

Vernon claims that his contract with Ulani is voidable.If their contract is avoided

A)both parties are released from it.
B)both parties must fully perform their obligations under it.
C)a wholly different contract is agreed to.
D)a wholly different contract is imposed "as if" the parties had agreed.

Question 50

Wanda tells Vito that she would like to buy his Chocolate Goodies store.Vito declines,but later decides to sell and sends to Wanda,and others,a flyer describing the details.Wanda responds with a letter of "acceptance." Wanda and Vito have

A)a contract.
B)no contract,because Vito sent the letter to more than one party.
C)no contract,because Vito was only inviting bids.
D)no contract,because the letter was an invitation to negotiate.

Question 51

Business Properties,Inc.(BPI),offers to sell a warehouse to Corporate Investments.Corporate says that it will pay BPI $100 to hold the offer open for three business days.This

A)creates an illegal contract by adding a clause to BPI's offer.
B)makes the offer irrevocable for three days if BPI accepts.
C)negates BPI's offer by changing the price term.
D)voids BPI's offer by extending the time term.

Question 52

GR8 Marketing Company and Hot Tunes,Inc.,sign a document that states GR8 agrees to create a marketing campaign for Hot and Hot agrees to pay GR8 for the service.GR8 and Hot have

A)an executed contract.
B)an express contract.
C)an implied contract.
D)no contract.

Question 53

Jane offers to sell Kyle three desks for his Lights & Lamps Company administrative office.Kyle sends a rejection first,then changes his mind and sends an acceptance.Whether they have a contract is determined by

A)Kyle's rejection.
B)Kyle's subjective intent.
C)whatever Jane decides.
D)whether Kyle's rejection or acceptance is received first.

Question 54

Mica buys "Nature," a movie,through Open View,an online entertainment vendor.Before completing the purchase and downloading "Nature," Mica must review a warning not to make and sell a copy of it.This warning is

A)a browse-wrap term.
B)a click-on agreement.
C)a shrink-wrap agreement.
D)none of the choices.

Question 55

Shelby offers to make digital copies of Relay Company's business conference videotapes,CDs,DVDs,and other media for $500.Under the mailbox rule,Relay's acceptance by e-mail will be considered effective when

A)received.
B)sent.
C)followed up by a confirmation letter sent by regular mail.
D)composed on a Relay computer.

Question 56

Lightspeed Corporation makes computers,each of which is packaged with a shrink-wrap agreement.Milo buys a Lightspeed desktop.The shrink-wrap agreement is most likely enforceable if

A)Milo buys the computer directly from Lightspeed.
B)Milo expressly agrees to the terms in the shrink-wrap agreement.
C)Milo reads the shrink-wrap agreement.
D)the terms in the shrink-wrap agreement concern warranties.

Question 57

Lively Toys Store and Movin' Products Company (MPC)enter into an e-contract under which MPC agrees to ship a case of electronic,remote-controlled bugs to Lively Toys,which agrees to pay on delivery.The Uniform Electronics Transactions Act (UETA)

A)denies the enforcement of such contracts.
B)does not apply to such contracts.
C)preempts all other laws with respect to such contracts.
D)supports the enforcement of such contracts.

Question 58

Kim sends an offer to Leo to cut down and remove a tree for $200.Kim says,"If you say nothing,I will consider you to have accepted my offer." If Leo does not respond,he will be deemed to

A)accept the offer.
B)make a counteroffer.
C)reject the offer.
D)none of the choices.

Question 59

Nero and Oona negotiate a contract.Nero prints out a hard copy to review before both parties sign the electronic form of the contract.Neither party signs the hard copy.Under the Electronic Signatures in Global and National Commerce Act (E-SIGN Act),the signatures can

A)be denied effect because they are in electronic form.
B)be denied effect because Nero has not signed a hard copy.
C)be denied effect because Oona has not signed a hard copy.
D)not be denied effect because they are in electronic form.

Question 60

Demi promises to buy a house from Caleb,who promises to vacate the property on June 1.If these promises are in writing,they are most likely

A)enforceable.
B)unenforceable.
C)void.
D)voidable.

Question 61

Rollo promises to perform,for a price,shoe repair services in affiliation with Togs 'n Things,a clothing store.To support a contract,the consideration exchanged by the parties must be

A)adequately considerate.
B)equally valuable.
C)legally sufficient.
D)wisely priced.

Question 62

Myra owns a house,which she advertises for sale for $200,000.On May 1,Nicole offers Myra $180,000 for the house.On May 5,Myra delivers to Nicole a form that includes additional terms but does not state a price.At 9
a.m.on May 6,Nicole signs the form and gives it to Odell,her administrative assistant,with instructions to mail it.At 10
a.m.,Myra calls to tell Nicole that the deal is off.The next day,Odell mails the signed form to Myra.When Myra refuses to sell the house,Nicole files a suit against her,alleging breach of contract.Myra claims that there was no contract.What are arguments supporting each party's position? What is the court likely to rule? Explain.

Question 63

Under a contract with Bucolic Farms,Agro Excavation,Inc.,begins digging an agricultural pond.In mid-project,Agro asks for $15,000 over the contract price,claiming an increase in the "cost of doing business." Bucolic agrees but later refuses to pay.Their agreement is

A)unenforceable because Agro's performance was a preexisting duty.
B)unenforceable because Bucolic's promise was illusory.
C)enforceable.
D)unenforceable because its performance is unforeseeably difficult.

Question 64

U-Can-Own-It Corporation sells appliances to less educated consumers,including Viv,on installment plans.U-Can-Own-It files a suit against Viv when she stops making payments.Viv claims that the deal is unconscionable.The court will most likely consider

A)the geographic area of the relevant market.
B)the parties' relative bargaining power.
C)the quality of related products in the general market.
D)the relation of this deal to those of other customers.

Question 65

On May 1,Brand Name Industries,Inc.(BNI),sent Carol a letter,via overnight delivery,offering to employ her to audit BNI's financial statements for the current year for $10,000.In the letter,BNI stated that Carol had ten days to accept.On May 5,Carol sent BNI a fax that stated,"The price for the audit seems too low.Would you consider paying $12,000" BNI received the fax.The next day,Dan offered to conduct the audit for $8,000.On learning of Dan's offer,Carol immediately e-mailed BNI,agreeing to do the work for $10,000.BNI received this e-mail on May 7.Explain why BNI and Carol do,or do not,have a contract.

Question 66

Jolie signs a contract with Keaton,an unlicensed physician,to perform plastic surgery-a medical procedure.This contract is enforceable by

A)Jolie.
B)Jolie's medical insurance company.
C)Keaton.
D)no one.

Question 67

Kylie signs a covenant not to compete as part of a sale of her ongoing medical equipment business to Lake Valley Medico,Inc.,in exchange for a bonus payment.The covenant is most likely enforceable by

A)both parties.
B)Kylie,but not Lake Valley.
C)Lake Valley,but not Kylie.
D)no one.

Question 68

Panini Vittles,Inc.,contracts with Qino to deliver its sandwiches.Later,the parties decide to cancel their contract.They can

A)rescind their entire contract.
B)rescind their contract to the extent that it is executory.
C)rescind their contract if they make a new contract at the same time.
D)not rescind their contract.

Question 69

Chip's Chips Company agrees to supply Delicioso Café with all the corn chips that it requires for a year.A sudden demand for ethanol results in a shortage of corn,and the price rises sharply.Chip's asks Delicioso to pay a higher price for the chips.This request is

A)invalid as an attempt at extortion or the so-called holdup game.
B)invalid under the preexisting duty rule.
C)valid as a risk ordinarily assumed in business.
D)valid due to the unforeseen difficulty of the sudden price increase.

Question 70

Jenna,a minor acting on her own,signs a contract to buy a horse and its tack from Field Equine Ranch.Later,after taking possession of the horse and tack,Jenna disaffirms the deal.She

A)can keep the horse and the tack.
B)can keep the horse but not the tack.
C)can keep the tack but not the horse.
D)must return both the horse and the tack.

Question 71

Quality Aluminum Corporation files a suit against Rite Tool Company,claiming that the consideration for their contract is inadequate.The court will most likely not examine the adequacy of the consideration if

A)it is obvious that the consideration is adequate.
B)Rite Tool asserts that there is adequate consideration.
C)something of value passed between the parties.
D)the consideration is worth more than $100.