Question 1

Which of the following is true for an auction with reserve?

Accepted Answer

A) The seller retains the right to refuse the highest bid and withdraw the goods from sale. 
B) An invitation to make an offer is not allowed. 
C) An auctioned item cannot be withdrawn from the auction after an offer has been made. 
D) A bid cannot be withdrawn and is legally binding from the moment it is made. 
A) The seller retains the right to refuse the highest bid and withdraw the goods from sale. 
B) An invitation to make an offer is not allowed. 
C) An auctioned item cannot be withdrawn from the auction after an offer has been made. 
D) A bid cannot be withdrawn and is legally binding from the moment it is made.

Question 2

A rejection of an offer is not effective until it is actually received by the offeror.

Accepted Answer

A) True 
 B)False

Question 3

Alan tells Sherry that he will pay her $5,000 if she runs the Boston Marathon.Once Sherry starts running the marathon,Alan ________.

Accepted Answer

A) can revoke the contract,as an informal verbal agreement is not legally binding 
B) can revoke the contract,provided he does so before she completes the marathon 
C) can reduce the amount of money he offered her,provided he does so before she completes the marathon 
D) cannot revoke the contract 
A) can revoke the contract,as an informal verbal agreement is not legally binding 
B) can revoke the contract,provided he does so before she completes the marathon 
C) can reduce the amount of money he offered her,provided he does so before she completes the marathon 
D) cannot revoke the contract

Question 4

A person who disaffirms a contract based on intoxication is not legally obligated to return the consideration he or she received under the contract to the other party.

Accepted Answer

A) True 
 B)False

Question 5

A counteroffer is considered a rejection of the original offer.

Accepted Answer

A) True 
 B)False

Question 6

A contract is a bilateral contract if the offeror's promise is answered with the offeree's promise of acceptance.

Accepted Answer

A) True 
 B)False

Question 7

A contract is said to have legal value if ________.

Accepted Answer

A) both the promisor and the promisee receive a legal benefit 
B) the promisor suffers a legal detriment 
C) the promisee suffers a legal detriment 
D) the promisee receives a legal benefit 
A) both the promisor and the promisee receive a legal benefit 
B) the promisor suffers a legal detriment 
C) the promisee suffers a legal detriment 
D) the promisee receives a legal benefit

Question 8

A contract need not arise from a bargained-for exchange.

Accepted Answer

A) True 
 B)False

Question 9

The infancy doctrine gives minors the right to disaffirm most contracts they have entered into with adults.

Accepted Answer

A) True 
 B)False

Question 10

Stella is injured in a car accident and is transported to the local hospital by emergency personnel.She subsequently passes into a coma.The doctors and other staff perform the necessary medical procedures to save her life.Stella recovers after two months and is discharged from the hospital.Under the doctrine of ________ contract,Stella must pay the hospital for its services.

Accepted Answer

A) implied-in-fact 
B) express 
C) quasi- 
D) formal 
A) implied-in-fact 
B) express 
C) quasi- 
D) formal

Question 11

The infancy doctrine allows minors to ________ most contracts they have entered into with adults.

Accepted Answer

The answer of The infancy doctrine allows minors to ________...

Question 12

Two brothers,Sam and Jim,were fighting over the division of their ancestral property.After ten years of legal battle,a frustrated Sam contacted a powerful politician who subjected Jim to extreme duress,forcing him to sign a contract in favor of Sam.When Sam takes this contract to court,the contract will be declared ________.

Accepted Answer

A) voidable 
B) void 
C) null 
D) unenforceable 
A) voidable 
B) void 
C) null 
D) unenforceable

Question 13

Compare valid,void,voidable and unenforceable contracts.

Accepted Answer

1.Valid contract.A valid contract meets

Question 14

Which of the following is true of a contract in which one of the parties is insane but not adjudged insane?

Accepted Answer

A) The contract is voidable by the competent party. 
B) The contract is only voidable by the insane person. 
C) Only the court-appointed legal guardian of the insane person can modify the contract. 
D) The sane person must be placed in status quo if the insane person voids the contract. 
A) The contract is voidable by the competent party. 
B) The contract is only voidable by the insane person. 
C) Only the court-appointed legal guardian of the insane person can modify the contract. 
D) The sane person must be placed in status quo if the insane person voids the contract.

Question 15

Under the mailbox rule,an acceptance is effective when ________.

Accepted Answer

The answer of Under the mailbox rule,an acceptance is effective...

Question 16

Which of the following statements is true about a counteroffer?

Accepted Answer

A) An offeree who makes a counteroffer is still considered the offeree. 
B) A counteroffer terminates the existing offer. 
C) A counteroffer can only be made by the original offeror. 
D) A counteroffer is effective even before it has been received by the original offeror. 
A) An offeree who makes a counteroffer is still considered the offeree. 
B) A counteroffer terminates the existing offer. 
C) A counteroffer can only be made by the original offeror. 
D) A counteroffer is effective even before it has been received by the original offeror.

Question 17

A voidable contract is also termed as an unenforceable contract.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following elements must be established to create an implied-in-fact contract?

Accepted Answer

A) The plaintiff provided property or services to the defendant gratuitously. 
B) The defendant accepted the plaintiff's property or services as payment for an illegal activity. 
C) The plaintiff made the defendant sign the contract and then changed its terms,identifying the new terms as "retroactively implied." 
D) The defendant was given an opportunity to reject the plaintiff's property or services but failed to do so. 
A) The plaintiff provided property or services to the defendant gratuitously. 
B) The defendant accepted the plaintiff's property or services as payment for an illegal activity. 
C) The plaintiff made the defendant sign the contract and then changed its terms,identifying the new terms as "retroactively implied." 
D) The defendant was given an opportunity to reject the plaintiff's property or services but failed to do so.

Question 19

In auction without reserve,the seller is the offeree.

Accepted Answer

A) True 
 B)False

Question 20

A contract into which parties enter but in which one or both of the parties can choose not to perform their contractual obligations is said to involve ________ promises.

Accepted Answer

The answer of A contract into which parties enter but...

Exam 9: Formation and Requirements of Contracts

Which of the following is true for an auction with reserve?

A rejection of an offer is not effective until it is actually received by the offeror.

Alan tells Sherry that he will pay her $5,000 if she runs the Boston Marathon.Once Sherry starts running the marathon,Alan ________.

A person who disaffirms a contract based on intoxication is not legally obligated to return the consideration he or she received under the contract to the other party.

A counteroffer is considered a rejection of the original offer.

A contract is a bilateral contract if the offeror's promise is answered with the offeree's promise of acceptance.

A contract is said to have legal value if ________.

A contract need not arise from a bargained-for exchange.

The infancy doctrine gives minors the right to disaffirm most contracts they have entered into with adults.

The infancy doctrine allows minors to ________ most contracts they have entered into with adults.

Compare valid,void,voidable and unenforceable contracts.

Which of the following is true of a contract in which one of the parties is insane but not adjudged insane?

Under the mailbox rule,an acceptance is effective when ________.

Which of the following statements is true about a counteroffer?

A voidable contract is also termed as an unenforceable contract.

Which of the following elements must be established to create an implied-in-fact contract?

In auction without reserve,the seller is the offeree.

A contract into which parties enter but in which one or both of the parties can choose not to perform their contractual obligations is said to involve ________ promises.

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