Question 1

What is the difference between the terms course of dealing and course of performance?

Accepted Answer

A) Course of dealing references previous commercial dealings within the particular industry,while course of performance refers to the history of dealings between the parties in the particular contract at issue. 
B) Course of performance references previous commercial transactions between the parties,while course of dealing refers to the history of dealings between the parties in the particular contract at issue. 
C) Course of dealing references previous commercial transactions between the parties,while course of performance refers to the history of dealings between the parties in the particular contract at issue. 
D) Course of dealing and course of performance are treated the same with regard to conforming and nonconforming goods. 
E) Course of dealing is an exception to the perfect tender rule,while course of performance is not an exception to the perfect tender rule.

Question 2

[Softball Trophies] To recognize softball players on his team,Eduardo ordered from Troy 10 trophies showing a softball player swinging a bat.The trophies were to be delivered on May 1st for an award dinner to be held on May 20th.Troy was at first unable to obtain trophies showing a softball player swinging a bat,but by May 13th,he did locate some trophies with a softball player holding a bat.The difference did not substantially impair the value of the trophies,and thinking that the trophies would be acceptable,Troy delivered them on May 14th.Eduardo glanced at the trophies,paid for them with a check,and said nothing.On May 16th Eduardo looked at the trophies more closely and decided that he did not like them.Eduardo canceled payment on his check,and Troy sued him for payment.
-Only considering the issue involving the time set for delivery,what is the likely effect of Troy delivering the trophies after the agreed upon time?

Accepted Answer

A) Eduardo did not waive the performance provisions of the contract regarding the time for delivery only because he canceled the check before it was cashed by Troy. 
B) Eduardo did not waive the performance provisions of the contract regarding the time for delivery because he paid by check. 
C) Eduardo cannot rely upon the performance provisions of the contract regarding the time for delivery because he did not object within 24 hours of the delivery of the trophies and,therefore,did not meet the UCC 24-hour rule. 
D) Eduardo's payment for the trophies without inspection and after the time called for by the contract likely waived the performance provisions of the contract regarding the time for delivery. 
E) Eduardo has the right to rely on the failure of Troy to deliver the trophies in a timely manner and will likely prevail.

Question 3

The substantial-impairment requirement is meant to prevent a party from canceling a contract due to trivial defects.

Accepted Answer

A) True 
 B)False

Question 4

Under the UCC,________ requires that the seller/lessor have and hold conforming goods at the disposal of the buyer/lessee and give the buyer/lessee reasonable notification to enable him or her to take delivery.

Accepted Answer

A) Offer of notification 
B) Offer of delivery 
C) Tender of delivery 
D) Offer of availability 
E) Tender of offer

Question 5

Assuming the berries are nonconforming,can Zelda simply cancel the contract?

Accepted Answer

A) No,although a buyer has a right to cancel a contract,Zelda must provide the seller a chance to cure. 
B) No,even though the goods are nonconforming,Zelda may not cancel the contract. 
C) Yes,a buyer has the right to cancel the contract. 
D) No,a buyer has no right to cancel a contract without giving the seller a chance to cure. 
E) Yes,when goods are nonconforming,a buyer may reject goods and cancel the contract if a condition such as time being of the essence is present.

Question 6

Is Tyler correct that he has a right to remedy and fix the problem?

Accepted Answer

A) Yes,but only if he can provide correctly worded T-shirts by the next day,the last day set for performance. 
B) Yes,Tyler has up to 20 days under the UCC to fix any problem. 
C) No,while the UCC provides a party with the right to fix some problems,the problems with the T-shirts were too serious to afford Tyler that right. 
D) Yes,Tyler has up to 10 days under the UCC to fix any problem. 
E) No,the UCC does not provide a party with the right to fix any problem.

Question 7

Sellers and lessors have the right to ________ or fix problems with nonconforming goods,under sections of the UCC.

Accepted Answer

A) Cure 
B) Deduct 
C) Renounce 
D) Defend 
E) Reject

Question 8

[Business Law Rocks] Business law instructor Courtney ordered 50 T-shirts for her classes that said "Business Law Rocks" on the front.She wanted to distribute them on the last day of class and contracted with Tyler,who owned a T-shirt business,for the shirts to arrive by that day.The shirts arrived on Thursday,the day before the last class on Friday.Unfortunately,the shirts said "Business Law Yuck" on the front.Tyler told Courtney that he would remedy and fix the problem and that he had the right to do so.She told him,however,that she had to have the shirts the next day because the students would be gone after that.Courtney had also ordered some pamphlets on employment law to be used the next fall semester.The seller had agreed to provide the pamphlets 30 days before spring semester ended.The seller,however,erred and sent pamphlets on environmental law,which arrived 28 days before spring semester ended.The seller attempted to remedy the problem by sending the correct pamphlets on employment law,but they did not arrive until 27 days before spring semester ended.None of the parties had any prior dealings.
-By claiming that he had the right to fix the problem,Tyler was alluding to which of the following,under the UCC?

Accepted Answer

A) The right to perform 
B) The right to review 
C) The right to claim 
D) The right to cure 
E) The right to reclaim

Question 9

Which of the following was the result on appeal in Donovan v.RRL Corporation,the case in the text in which the plaintiff attempted to enforce a price for an automobile contained in an ad,and the defendant car dealership claimed that a mistake was involved?

Accepted Answer

A) The court ruled in favor of the dealership because ads can never constitute offers. 
B) The court ruled in favor of the plaintiff on the basis of unilateral mistake and unconscionability. 
C) The court ruled in favor of the plaintiff because the ad constituted an enforceable offer. 
D) The court ruled in favor of the dealership on a combination of mistake and unconscionability. 
E) The court ruled in favor of the dealership because an intentional misrepresentation is needed before an ad can be considered an offer,and there was no proof of an intentional misrepresentation on the part of the dealership.

Question 10

Margot,a jewelry dealer,sent a shipment of diamond bracelets to Halden's Jewelry Store according to their contract.If Halden's does not reject the goods within a reasonable period,what are Margot's obligations under the contract?

Accepted Answer

A) Margot must provide prompt notice of her intent to cure. 
B) Margot can presume Halden's accepted the goods. 
C) Margot must follow up to ensure inspection is complete. 
D) Margot has the obligation to demand if the contract is accepted. 
E) Margot must confirm the goods were received.

Question 11

[Smeared cupcakes] Kai orders forty decorated cupcakes from Liu's bakery next door to be sold in his restaurant.During delivery,Lui trips and the box tips over.When Kai opens the box to inspect the cupcakes,the frosted decorations on the cupcakes are smeared.
-Must Kai accept the cupcakes?

Accepted Answer

A) Yes,if they are still sellable,he must perform under the terms of the contract. 
B) Yes,unless the contract specifically states otherwise. 
C) No,since the goods are partially destroyed,Lui may treat the contract as void. 
D) No,but he must provide Lui with time to cure. 
E) No,since the goods are partially destroyed,Kai may treat the contract as void.

Question 12

The UCC requires ________ in addition to honesty in fact when parties are merchants.

Accepted Answer

A) reasonable commercial standards of fair dealing 
B) honesty in law 
C) honesty in equity 
D) honesty in equity and also reasonable commercial standards of fair dealing 
E) honesty in equity and honesty in law

Question 13

Which of these is the most likely result if Troy claims he had reasonable grounds to believe the trophies were acceptable?

Accepted Answer

A) He would be correct because of the special UCC exception for sports-related items. 
B) He would be incorrect because Eduardo did not confirm orally or in writing that the trophies were acceptable. 
C) He would be incorrect because Eduardo did not confirm in writing that the trophies were acceptable. 
D) He would be correct because Eduardo's payment by check for the goods upon their delivery provided Troy with a measure of reliance that they would be acceptable. 
E) He would be correct because of the special UCC exception for school-related items.

Question 14

A buyer who has accepted goods may later revoke the acceptance if the buyer can show that the defects ________ the value of the goods.

Accepted Answer

A) Reduced by 5% 
B) Reduced in any manner 
C) Violated the perfect tender rule 
D) Substantially impaired 
E) Reduced by 10%

Question 15

Define the Uniform Computer Information Transactions Act;and describe an important way,discussed in the text,by which the act protects software vendors?

Accepted Answer

The answer of Define the Uniform Computer Information Transactions Act;and...

Question 16

The seller must obtain substitute goods if goods identified to a contract are destroyed through no fault of the parties before the risk of loss passes to the buyer.

Accepted Answer

A) True 
 B)False

Question 17

The buyer or lessee typically inspects goods ________ paying,unless the parties agree otherwise.

Accepted Answer

A) Within 7 days after 
B) Within 48 hours after 
C) Immediately after 
D) Before 
E) Within 24 hours after

Question 18

Letizia,who owns a candy shop,agreed to sell Rudy,a teacher,all the chocolate candy bars in her shop for treats for his class.Unfortunately,through no fault of hers,Letizia's air conditioner broke and the chocolate bars partially melted.What are the rights and duties of the parties in relation to the contract?

Accepted Answer

The answer of Letizia,who owns a candy shop,agreed to sell...

Question 19

Assuming the berries are nonconforming,does Zelda have any options other than simply canceling the contract?

Accepted Answer

A) No. 
B) Yes,but Zelda's only other option is to accept the nonconforming berries and adjust the contract accordingly. 
C) Yes,but Zelda's only other option is to reject the nonconforming berries subject to cure. 
D) Yes,Zelda may reject the nonconforming berries subject to cure,or accept the nonconforming berries and adjust the contract accordingly. 
E) Yes,but the course of dealing makes other options void.

Question 20

Which term refers to the history of dealings between the parties in the particular contract at issue,under the UCC?

Accepted Answer

A) Usage of trade 
B) Trade norm 
C) Course of performance 
D) Course of dealing 
E) Anticipated trade dealing

Exam 23: Performance and Obligations Under Sales and Leases