Question 1

An option contract is created when an offeror promises to hold an offer open for a specified period of time in return for a payment given by the offeree.

Accepted Answer

A) True 
 B)False

Question 2

An "offer" to sell an item on an online auction site generally is treated an invitation to negotiate.

Accepted Answer

A) True 
 B)False

Question 3

On December 1, Petro, Inc., sent Rachel & Rico (R&R) a letter, via overnight delivery, offering to employ R&R to review Petro's tax situation for the current year for $10,000. In the letter, the company stated that R&R had ten days to accept. On December 5, R&R sent an e-mail message that stated, "The price for the tax analysis seems too low. Would you consider paying $15,000?" Petro received the message without responding immediately. The next day, Smith & Taylor, an R&R competitor, offered to conduct the appraisal for $8,000. On learning of this offer, R&R immediately e-mailed Petro, agreeing to do the work for $10,000. Petro received this message on December 7. Explain why R&R and Petro do, or do not, have a contract.

Accepted Answer

The answer of On December 1, Petro, Inc., sent Rachel...

Question 4

Fix-It-Quik, Inc., offers Gina a job as a plumber. No time for acceptance is specified in the offer. The offer will terminate

Accepted Answer

A)  ​after a reasonable period. 
B)  ​after a work week (five business days). 
C)  ​after a month (thirty calendar days). 
D)  ​never.

Question 5

Anton tells Brooke, who has no knowledge of Shakespearean comedy, that he will tutor her in the subject for $50. As an offer, this is

Accepted Answer

A)  ​effective. 
B)  ​not effective because comedy is not a serious subject. 
C)  ​not effective because Anton's tutoring will be subjective. 
D)  ​not effective because Brooke has no knowledge of the subject.

Question 6

Corporate Code, Inc., sells business software-accounting and book-keeping 2, blank business forms, inventory control functions, and the like-in different combinations, in different packages, at different prices. Each package includes a shrink-wrap agreement that limits warranties and remedies. Developmental Research Corporation (DRC) buys a Corporate Code package and uses the product. Later, DRC files a suit against the software seller, claiming that the product was flawed and that the flaws caused DRC to suffer business losses. DRC asks for relief that exceeds the limits in the shrink-wrap agreement. What is a shrink-wrap agreement? Are such agreements always enforced? Under what circumstances is a court likely to enforce this agreement?

Accepted Answer

The answer of Corporate Code, Inc., sells business software-accounting and...

Question 7

Maya tries to start her new car with no success. She yells that she will sell the car to anyone for $10. Nero, a passerby who owns Nero's Motors, hands Maya $10. This is

Accepted Answer

A)  ​a valid acceptance because Maya is seriously frustrated. 
B)  ​a valid acceptance because Nero is a professional dealer. 
C)  ​not a valid acceptance because Maya does not seriously intend to sell. 
D)  ​not a valid acceptance because Nero is only passing by.

Question 8

An offeror's subjective intent determines the effectiveness of an offer.

Accepted Answer

A) True 
 B)False

Question 9

Nevin negotiates a deal for the sale of twenty-five acres of farmland to Otis. Nevin promises to hold the offer open in return for a small payment but does not state an exact period of time. With respect to this offer

Accepted Answer

A)  ​the deal is binding except for the promise to hold the offer open. 
B)  ​a reasonable period of time is implied. 
C)  ​the offer must be held open for an indefinite period. 
D)  ​the deal is done.

Question 10

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

Accepted Answer

A) True 
 B)False

Question 11

Contracting parties cannot opt out of the terms of the UETA.

Accepted Answer

A) True 
 B)False

Question 12

Browse-wrap terms are often unenforceable.

Accepted Answer

A) True 
 B)False

Question 13

Most ads-"this property for sale"-are offers.

Accepted Answer

A) True 
 B)False

Question 14

Pacific Charter Company offers to provide an air-conditioned bus to Quincy's tour group for $1,500 plus the cost of the fuel. The mailbox rule applies if Quincy accepts the offer by

Accepted Answer

A)  ​e-mail. 
B)  ​phone. 
C)  ​regular mail. 
D)  ​any of the choices.

Question 15

Terms in a shrink-wrap agreement have been enforced in the same way as the terms of other contracts.

Accepted Answer

A) True 
 B)False

Question 16

An offer terminates automatically when the time specified in the offer has passed.

Accepted Answer

A) True 
 B)False

Question 17

Play-It-Loud, LLC, provides music-streaming services online subject to complex pricing schedules. To control specific offers for the services and thus the resulting contracts, important terms to provide online include

Accepted Answer

A)  ​a provision relating to the resolution of any dispute. 
B)  ​a detailed history of the music business. 
C)  ​positive reviews from users of the service. 
D)  ​an updated list of the music available through the service.

Question 18

A price list is an invitation to negotiate.

Accepted Answer

A) True 
 B)False

Question 19

If no time for acceptance is specified in an offer, the offer terminates after a reasonable length of time.

Accepted Answer

A) True 
 B)False

Question 20

A preliminary agreement cannot constitute a binding contract.

Accepted Answer

A) True 
 B)False

Exam 8: Agreement in Traditional and E-Contracts

An option contract is created when an offeror promises to hold an offer open for a specified period of time in return for a payment given by the offeree.

An "offer" to sell an item on an online auction site generally is treated an invitation to negotiate.

Fix-It-Quik, Inc., offers Gina a job as a plumber. No time for acceptance is specified in the offer. The offer will terminate

Anton tells Brooke, who has no knowledge of Shakespearean comedy, that he will tutor her in the subject for $50. As an offer, this is

Maya tries to start her new car with no success. She yells that she will sell the car to anyone for $10. Nero, a passerby who owns Nero's Motors, hands Maya $10. This is

An offeror's subjective intent determines the effectiveness of an offer.

Nevin negotiates a deal for the sale of twenty-five acres of farmland to Otis. Nevin promises to hold the offer open in return for a small payment but does not state an exact period of time. With respect to this offer

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

Contracting parties cannot opt out of the terms of the UETA.

Browse-wrap terms are often unenforceable.

Most ads-"this property for sale"-are offers.

Pacific Charter Company offers to provide an air-conditioned bus to Quincy's tour group for $1,500 plus the cost of the fuel. The mailbox rule applies if Quincy accepts the offer by

Terms in a shrink-wrap agreement have been enforced in the same way as the terms of other contracts.

An offer terminates automatically when the time specified in the offer has passed.

Play-It-Loud, LLC, provides music-streaming services online subject to complex pricing schedules. To control specific offers for the services and thus the resulting contracts, important terms to provide online include

A price list is an invitation to negotiate.

If no time for acceptance is specified in an offer, the offer terminates after a reasonable length of time.

A preliminary agreement cannot constitute a binding contract.