Question 1

For purposes of fraudulent misrepresentation, scienter clearly exists if a party asserting a fact knows it is not as stated.

Accepted Answer

A) True 
 B)False

Question 2

A misunderstanding concerning a basic assumption on which a contract is made will support the rescission of the deal if the mistake is

Accepted Answer

A)  bilateral. 
B)  unilateral. 
C)  lateral. 
D)  any of the choices. 
A)  bilateral. 
B)  unilateral. 
C)  lateral. 
D)  any of the choices.

Question 3

Orin, an employee of Plumbing LLC, makes a substantial mathematical mistake in totaling the estimated costs for a project for which Quality Built Inc. is seeking bids. Consequently, Plumbing's bid is significantly low. Any contract with Quality Built that includes the mistake may be rescinded

Accepted Answer

A)  if Quality Built knew or should have known of the mistake. 
B)  if Orin's supervisor did not know of the mistake. 
C)  if Plumbing knew or should have known of the mistake. 
D)  under no circumstances. 
A)  if Quality Built knew or should have known of the mistake. 
B)  if Orin's supervisor did not know of the mistake. 
C)  if Plumbing knew or should have known of the mistake. 
D)  under no circumstances.

Question 4

A misrepresentation must be expressly made through the words or writings of another.

Accepted Answer

A) True 
 B)False

Question 5

Ruth, who is Sal's guardian, convinces him to buy a certain parcel of land from Tyrone at a greatly inflated price. Ruth may be liable for

Accepted Answer

A)  duress. 
B)  fraudulent misrepresentation. 
C)  mistake. 
D)  undue influence. 
A)  duress. 
B)  fraudulent misrepresentation. 
C)  mistake. 
D)  undue influence.

Question 6

An otherwise valid contract is enforceable even if the parties have not genuinely agreed to its terms.

Accepted Answer

A) True 
 B)False

Question 7

An innocent party who does not suffer harm as a result of a misrepresentation can nevertheless collect damages.

Accepted Answer

A) True 
 B)False

Question 8

Restaurant Food Inc. intends to sell a certain quantity of beef for $1,000. In e-mail, however, the firm's sales representative mistakenly offers to sell the beef to Steak House for $100, Steak's manager immediately accepts. The seller

Accepted Answer

A)  is bound to the deal at the offered price. 
B)  can rescind the deal. 
C)  is bound to the deal but can charge the intended price. 
D)  can rescind the deal and recover damages for the mistake. 
A)  is bound to the deal at the offered price. 
B)  can rescind the deal. 
C)  is bound to the deal but can charge the intended price. 
D)  can rescind the deal and recover damages for the mistake.

Question 9

Don enters into a contract with Eve, who claims to have access to a stock-trading algorithm that will multiply an investment many times over. When the results do not match this claim, Don learns that Eve does not have access to the algorithm and files a suit, alleging fraud. Don must show harm to

Accepted Answer

A)  recover damages. 
B)  rescind the contract. 
C)  undo Eve's influence. 
D)  punish the defendant. 
A)  recover damages. 
B)  rescind the contract. 
C)  undo Eve's influence. 
D)  punish the defendant.

Question 10

The party on whom duress is exerted can choose to avoid the entire transaction.

Accepted Answer

A) True 
 B)False

Question 11

Exaggeration is an element of fraud.

Accepted Answer

A) True 
 B)False

Question 12

In selling a 300-acre tract to Organic Farm, Peyton tells the buyer that the land "will be worth twice as much by next year." This statement is not likely to support rescission of the contract because it is

Accepted Answer

A)  a material fact. 
B)  a misrepresentation. 
C)  a mistake. 
D)  an opinion. 
A)  a material fact. 
B)  a misrepresentation. 
C)  a mistake. 
D)  an opinion.

Question 13

Misrepresentation of law does not ordinarily entitle a party to avoid a contract.

Accepted Answer

A) True 
 B)False

Exam 14: Voluntary Consent

For purposes of fraudulent misrepresentation, scienter clearly exists if a party asserting a fact knows it is not as stated.

A misunderstanding concerning a basic assumption on which a contract is made will support the rescission of the deal if the mistake is

Orin, an employee of Plumbing LLC, makes a substantial mathematical mistake in totaling the estimated costs for a project for which Quality Built Inc. is seeking bids. Consequently, Plumbing's bid is significantly low. Any contract with Quality Built that includes the mistake may be rescinded

A misrepresentation must be expressly made through the words or writings of another.

Ruth, who is Sal's guardian, convinces him to buy a certain parcel of land from Tyrone at a greatly inflated price. Ruth may be liable for

An otherwise valid contract is enforceable even if the parties have not genuinely agreed to its terms.

An innocent party who does not suffer harm as a result of a misrepresentation can nevertheless collect damages.

Restaurant Food Inc. intends to sell a certain quantity of beef for $1,000. In e-mail, however, the firm's sales representative mistakenly offers to sell the beef to Steak House for $100, Steak's manager immediately accepts. The seller

Don enters into a contract with Eve, who claims to have access to a stock-trading algorithm that will multiply an investment many times over. When the results do not match this claim, Don learns that Eve does not have access to the algorithm and files a suit, alleging fraud. Don must show harm to

The party on whom duress is exerted can choose to avoid the entire transaction.

Exaggeration is an element of fraud.

In selling a 300-acre tract to Organic Farm, Peyton tells the buyer that the land "will be worth twice as much by next year." This statement is not likely to support rescission of the contract because it is

Misrepresentation of law does not ordinarily entitle a party to avoid a contract.

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