Question 1

Kris buys Liz's house for $300,000, which is the fair market value of the house. If the contract is later disputed in court, the court is likely to declare Kris's consideration

Accepted Answer

A)  inadequate. 
B)  past. 
C)  legally sufficient. 
D)  illusory. 
A)  inadequate. 
B)  past. 
C)  legally sufficient. 
D)  illusory. C

Question 2

With respect to consideration, a bargained-for exchange distinguishes a contract from a gift.

Accepted Answer

A) True 
 B)False  True

Question 3

A release enables recovery beyond that specified in its terms.

Accepted Answer

A) True 
 B)False  False

Question 4

Consideration is the value given in return for a promise or in return or a performance.

Accepted Answer

A) True 
 B)False

Question 5

Frank offers to buy a guitar owned by Holly for twice what she paid for it. She accepts and hands the guitar to Frank. Holly's delivery of the guitar is

Accepted Answer

A)  not consideration because its adequacy is unfair. 
B)  not consideration because the exchange is not a bargain. 
C)  consideration. 
D)  not consideration because the value is not legally sufficient. 
A)  not consideration because its adequacy is unfair. 
B)  not consideration because the exchange is not a bargain. 
C)  consideration. 
D)  not consideration because the value is not legally sufficient.

Question 6

In general, courts question the adequacy of consideration.

Accepted Answer

A) True 
 B)False

Question 7

Cindy, a real estate agent, sells her friend Doug's house without charging a commission. In return, Doug promises to give Cindy $1,000. This promise is not an enforceable contract because

Accepted Answer

A)  the house has already been sold-the consideration is past. 
B)  selling the house was the agent's preexisting duty. 
C)  selling the house was a foreseen difficulty. 
D)  the promise of a payment of $1,000 is illusory. 
A)  the house has already been sold-the consideration is past. 
B)  selling the house was the agent's preexisting duty. 
C)  selling the house was a foreseen difficulty. 
D)  the promise of a payment of $1,000 is illusory.

Question 8

Centre City Properties, Inc., owns and manages a warehouse. DIY Home Improvement Stores agrees to lease the warehouse for six years. Under the lease, DIY is obligated to pay all of the utility costs. Two years into the term, DIY asks Centre City to modify the lease to provide that the utility costs will be split equally between them. The landlord agrees, but later decides it does not want to share the costs and refuses to pay. Is Centre City bound to its agreement to share the utility costs? Why or why not?

Accepted Answer

Centre City Properties, Inc., the landlo

Question 9

While sailboarding, Jolie is injured when Kirby carelessly crosses her path. Kirby's insurance company offers Jolie $50,000 to release Kirby from liability, and she accepts. Later, she learns that her injuries are more serious than she realized. The release is

Accepted Answer

A)  enforceable. 
B)  unenforceable because Jolie's injuries are unforeseeably difficult. 
C)  unenforceable because Kirby has a preexisting duty to pay. 
D)  unenforceable because the release is an illusory promise. 
A)  enforceable. 
B)  unenforceable because Jolie's injuries are unforeseeably difficult. 
C)  unenforceable because Kirby has a preexisting duty to pay. 
D)  unenforceable because the release is an illusory promise.

Question 10

Jen promises to pay Kay $500 because "she does not have as much money as other people." Jen's promise is

Accepted Answer

A)  enforceable because society wants people to keep their promises. 
B)  enforceable because the redistribution of wealth is a valid social goal. 
C)  not enforceable because Jen could have paid Kyle more. 
D)  not enforceable because Kay has not given consideration in return. 
A)  enforceable because society wants people to keep their promises. 
B)  enforceable because the redistribution of wealth is a valid social goal. 
C)  not enforceable because Jen could have paid Kyle more. 
D)  not enforceable because Kay has not given consideration in return.

Question 11

For the doctrine of promissory estoppel to be applied, there must be no clear or definite promise.

Accepted Answer

A) True 
 B)False

Question 12

Apps Inc. promises to give stock options to Belden, a creative coder, for processes he has already designed. This promise is

Accepted Answer

A)  enforceable because it is a new contract. 
B)  enforceable because it is an illusory promise. 
C)  enforceable because it is supported by past consideration. 
D)  unenforceable. 
A)  enforceable because it is a new contract. 
B)  enforceable because it is an illusory promise. 
C)  enforceable because it is supported by past consideration. 
D)  unenforceable.

Question 13

Brick and Candy are in an auto accident. Brick offers Candy $20,000 if she promises not to pursue any legal claim against Brick arising out of the accident. Candy agrees. This agreement is

Accepted Answer

A)  past consideration. 
B)  an illusory promise. 
C)  a release. 
D)  promissory estoppel. 
A)  past consideration. 
B)  an illusory promise. 
C)  a release. 
D)  promissory estoppel.

Question 14

Legal sufficiency of consideration is distinct from adequacy of consideration.

Accepted Answer

A) True 
 B)False

Question 15

The elements of consideration, in a bilateral contract for a sale of goods, are the sale and the goods.

Accepted Answer

A) True 
 B)False

Question 16

A preexisting duty may arise out of a previous contract.

Accepted Answer

A) True 
 B)False

Question 17

Dale's Uncle Ed tells Dale, "If I feel you deserve it at the time, I will give you a new car when you graduate from college." Ed's promise is

Accepted Answer

A)  illusory. 
B)  enforceable. 
C)  a forbearance. 
D)  a preexisting duty. 
A)  illusory. 
B)  enforceable. 
C)  a forbearance. 
D)  a preexisting duty.

Question 18

Essentially, adequacy of consideration concerns the fairness of the bargain.

Accepted Answer

A) True 
 B)False

Question 19

Adequacy of consideration refers to

Accepted Answer

A)  "how much" consideration is given. 
B)  legally sufficient value in the eyes of the law. 
C)  the intangible value to a contracting party of a thing exchanged. 
D)  the substantiality of the consideration exchanged. 
A)  "how much" consideration is given. 
B)  legally sufficient value in the eyes of the law. 
C)  the intangible value to a contracting party of a thing exchanged. 
D)  the substantiality of the consideration exchanged.

Question 20

Parties are not usually free to bargain as they wish.

Accepted Answer

A) True 
 B)False

Exam 12: Consideration

Kris buys Liz's house for $300,000, which is the fair market value of the house. If the contract is later disputed in court, the court is likely to declare Kris's consideration

With respect to consideration, a bargained-for exchange distinguishes a contract from a gift.

A release enables recovery beyond that specified in its terms.

Consideration is the value given in return for a promise or in return or a performance.

Frank offers to buy a guitar owned by Holly for twice what she paid for it. She accepts and hands the guitar to Frank. Holly's delivery of the guitar is

In general, courts question the adequacy of consideration.

Cindy, a real estate agent, sells her friend Doug's house without charging a commission. In return, Doug promises to give Cindy $1,000. This promise is not an enforceable contract because

While sailboarding, Jolie is injured when Kirby carelessly crosses her path. Kirby's insurance company offers Jolie $50,000 to release Kirby from liability, and she accepts. Later, she learns that her injuries are more serious than she realized. The release is

Jen promises to pay Kay $500 because "she does not have as much money as other people." Jen's promise is

For the doctrine of promissory estoppel to be applied, there must be no clear or definite promise.

Apps Inc. promises to give stock options to Belden, a creative coder, for processes he has already designed. This promise is

Brick and Candy are in an auto accident. Brick offers Candy $20,000 if she promises not to pursue any legal claim against Brick arising out of the accident. Candy agrees. This agreement is

Legal sufficiency of consideration is distinct from adequacy of consideration.

The elements of consideration, in a bilateral contract for a sale of goods, are the sale and the goods.

A preexisting duty may arise out of a previous contract.

Dale's Uncle Ed tells Dale, "If I feel you deserve it at the time, I will give you a new car when you graduate from college." Ed's promise is

Essentially, adequacy of consideration concerns the fairness of the bargain.

Adequacy of consideration refers to

Parties are not usually free to bargain as they wish.

Law and Legal Reasoning

Constitutional Law

Ethics in Business

Courts and Alternative Dispute Resolution

Tort Law

Product Liability

Intellectual Property Rights

Internet Law, Social Media, and Privacy

Criminal Law and Cyber Crime

Nature and Classification

Agreement

Capacity and Legality

Voluntary Consent

The Statute of Fraudswriting Requirement

Performance and Discharge

Breach and Remedies

Third Party Rights

The Formation of Sales and Lease Contracts

Title and Risk of Loss

Performance and Breach of Sales and Lease Contracts

Negotiable Instruments

International and Space Law

Banking in the Digital Age

Security Interests and Creditors Rights

Bankruptcy

Agency Relationships in Business

Employment, Immigration, and Labor Law

Employment Discrimination

Sole Proprietorships and Franchises

All Forms of Partnership

Limited Liability Companies and Special Business Forms

Corporate Formation and Financing

Corporate Directors, Officers, and Shareholders

Corporate Mergers, Takeovers, and Termination

Investor Protection, Insider Trading, and Corporate Governance

Administrative Law

Antitrust Law and Promoting Competition

Consumer and Environmental Law

Liability of Accountants and Other Professionals

Personal Property and Bailments

Real Property and Landlord-Tenant Law

Insurance, Wills, and Trusts

Filters