Question 1

Hal's True Hardware Stores and Ideal Tools, Inc., sign a written con­tract for a sale of goods. To be enforceable, this written contract must include

Accepted Answer

A)  ​a correct title, such as "Purchase Order" or "Sales Invoice." 
B)  ​a date, such as "October 2014" or "10/2014." 
C)  ​a quantity term, such as "50 hammers" or "100 boxes of assorted nails." 
D)  ​the parties' contact information. 
A)  ​a correct title, such as "Purchase Order" or "Sales Invoice." 
B)  ​a date, such as "October 2014" or "10/2014." 
C)  ​a quantity term, such as "50 hammers" or "100 boxes of assorted nails." 
D)  ​the parties' contact information.

Question 2

All collateral promises must be in writing to be enforceable.

Accepted Answer

A) True 
 B)False

Question 3

An oral contract for the transfer of an interest in land can sometimes be enforced if partial performance has taken place.

Accepted Answer

A) True 
 B)False

Question 4

Donald and Etta orally agree on the sale of Donald's Electrical Supplies Company to Etta and jot down the terms on the back of one of Donald's blank invoices, which they both sign. A written memorandum evidencing an oral contract that would otherwise be unenforceable must contain

Accepted Answer

A)  ​all terms. 
B)  ​the essential terms. 
C)  ​the preliminary terms. 
D)  ​the qualitative terms. 
A)  ​all terms. 
B)  ​the essential terms. 
C)  ​the preliminary terms. 
D)  ​the qualitative terms.

Question 5

To be enforceable, a writing evidencing an oral contract must have been signed by the party who seeks to enforce it.

Accepted Answer

A) True 
 B)False

Question 6

A contract entered into under undue influence is voidable.

Accepted Answer

A) True 
 B)False

Question 7

To be enforceable, a contract for a sale of goods priced at $500 or more should be in writing.

Accepted Answer

A) True 
 B)False

Question 8

Under the Statute of Frauds, all contracts must be in writing to be enforceable.

Accepted Answer

A) True 
 B)False

Question 9

Reliance on a misrepresentation is justified if the misrepresentation is an obviously extravagant statement.

Accepted Answer

A) True 
 B)False

Question 10

Whitewater Canyon Adventures, Inc., and Xtra Overstock Company enter into an oral contract for Xtra's sale to Whitewater of five rafts for $2,000 each. Before Whitewater takes possession of the rafts, this contract is enforceable by

Accepted Answer

A)  ​Xtra only. 
B)  ​Whitewater only. 
C)  ​any interested third party, such as a Whitewater tour guide. 
D)  none of the choices. 
A)  ​Xtra only. 
B)  ​Whitewater only. 
C)  ​any interested third party, such as a Whitewater tour guide. 
D)  none of the choices.

Question 11

When the dominant party in a fiduciary relationship benefits from that relationship, a presumption of undue influence arises.

Accepted Answer

A) True 
 B)False

Question 12

Camille, a tennis pro, convinces Dante, who has no athletic ability, that he has considerable skill and induces him to pay Camille $1,000 for tennis lessons. When Dante realizes the truth, he files a suit against Camille. Dante is most likely to recover on the basis of

Accepted Answer

A)  ​opinion. 
B)  ​fraud. 
C)  ​mistake. 
D)  ​undue influence. 
A)  ​opinion. 
B)  ​fraud. 
C)  ​mistake. 
D)  ​undue influence.

Question 13

Dick's Burgers n' Shakes enters into an oral contract with Restaurant Equipment Warehouse (REW) for REW's sale to Dick's of a single-spindle milkshake mixer for $300. Assuming the terms can be proved, the con­tract is enforceable by​

Accepted Answer

A)  ​Dick's or REW. 
B)  ​the manufacturer of the mixer. 
C)  ​ any third party with a material interest, such as one of Dick's suppliers. 
D)  ​ none of the choices. 
A)  ​Dick's or REW. 
B)  ​the manufacturer of the mixer. 
C)  ​ any third party with a material interest, such as one of Dick's suppliers. 
D)  ​ none of the choices.

Question 14

When both parties to a contract are mistaken about the same material fact, the contract cannot be rescinded.

Accepted Answer

A) True 
 B)False

Question 15

Lewis, an employee of Silos, Inc., makes a substantial mathematical error in totaling the estimated costs for a project for which AgriCo-op is seeking bids. Consequently, Silos’s bid is significantly low. Any contract with AgriCo-op that includes the mistake may be rescinded

Accepted Answer

A) if AgriCo-op knew or should have known of the mistake. 
B) if Lewis’s supervisor did not know of the mistake. 
C) if Silos knew or should have known of the mistake. 
D) under no circumstances. 
A) if AgriCo-op knew or should have known of the mistake. 
B) if Lewis’s supervisor did not know of the mistake. 
C) if Silos knew or should have known of the mistake. 
D) under no circumstances.

Question 16

Ranchland Properties and Prairie State Investments sign a writ­ten contract for a sale of land. In some states, to be enforceable, this con­tract must include​

Accepted Answer

A)  ​a correct title, such as "Land Transfer" or "Real Estate Agreement." 
B)  ​a declaration of the contract's purpose. 
C)  ​a statement of the source of financing 
D)  ​a description of the land. 
A)  ​a correct title, such as "Land Transfer" or "Real Estate Agreement." 
B)  ​a declaration of the contract's purpose. 
C)  ​a statement of the source of financing 
D)  ​a description of the land.

Question 17

Phoebe enters into a contract with Everest for a guided tour of Whitewater Canyon. Everest represents that he is an experienced, knowledgeable guide, when in reality he has never been in the canyon. Phoebe is most likely a victim of

Accepted Answer

A)  ​undue influence. 
B)  ​fraud. 
C)  ​mistake. 
D)  ​nothing 
A)  ​undue influence. 
B)  ​fraud. 
C)  ​mistake. 
D)  ​nothing

Question 18

Because fraud actions necessarily involve wrongful conduct, courts may award punitive damages.

Accepted Answer

A) True 
 B)False

Question 19

Creighton applies to BigData Corporation for a position as a software engineer. Creighton has no training in computers or programming and no background as an engineer. After Creighton is hired, BigData learns the truth. BigData can​

Accepted Answer

A)  ​not rescind the contract. 
B)  ​rescind the contract on the basis of fraud. 
C)  ​rescind the contract on the basis of mistake. 
D)  ​rescind the contract on the basis of undue influence. 
A)  ​not rescind the contract. 
B)  ​rescind the contract on the basis of fraud. 
C)  ​rescind the contract on the basis of mistake. 
D)  ​rescind the contract on the basis of undue influence.

Question 20

Gene, an accountant, convinces his client Hazel to sign a contract to invest her savings in 2Gether, a nonexistent social-networking Web site. There is clear and convincing evidence that Hazel did not act out of her free will. This is​

Accepted Answer

A)  ​duress. 
B)  ​fraud 
C)  ​mistake. 
D)  ​undue influence. 
A)  ​duress. 
B)  ​fraud 
C)  ​mistake. 
D)  ​undue influence.

Exam 13: Defenses to Contract Enforceability

Hal's True Hardware Stores and Ideal Tools, Inc., sign a written con­tract for a sale of goods. To be enforceable, this written contract must include

All collateral promises must be in writing to be enforceable.

An oral contract for the transfer of an interest in land can sometimes be enforced if partial performance has taken place.

Donald and Etta orally agree on the sale of Donald's Electrical Supplies Company to Etta and jot down the terms on the back of one of Donald's blank invoices, which they both sign. A written memorandum evidencing an oral contract that would otherwise be unenforceable must contain

To be enforceable, a writing evidencing an oral contract must have been signed by the party who seeks to enforce it.

A contract entered into under undue influence is voidable.

To be enforceable, a contract for a sale of goods priced at $500 or more should be in writing.

Under the Statute of Frauds, all contracts must be in writing to be enforceable.

Reliance on a misrepresentation is justified if the misrepresentation is an obviously extravagant statement.

Whitewater Canyon Adventures, Inc., and Xtra Overstock Company enter into an oral contract for Xtra's sale to Whitewater of five rafts for $2,000 each. Before Whitewater takes possession of the rafts, this contract is enforceable by

When the dominant party in a fiduciary relationship benefits from that relationship, a presumption of undue influence arises.

Camille, a tennis pro, convinces Dante, who has no athletic ability, that he has considerable skill and induces him to pay Camille $1,000 for tennis lessons. When Dante realizes the truth, he files a suit against Camille. Dante is most likely to recover on the basis of

Dick's Burgers n' Shakes enters into an oral contract with Restaurant Equipment Warehouse (REW) for REW's sale to Dick's of a single-spindle milkshake mixer for $300. Assuming the terms can be proved, the con­tract is enforceable by​

When both parties to a contract are mistaken about the same material fact, the contract cannot be rescinded.

Lewis, an employee of Silos, Inc., makes a substantial mathematical error in totaling the estimated costs for a project for which AgriCo-op is seeking bids. Consequently, Silos’s bid is significantly low. Any contract with AgriCo-op that includes the mistake may be rescinded

Ranchland Properties and Prairie State Investments sign a writ­ten contract for a sale of land. In some states, to be enforceable, this con­tract must include​

Phoebe enters into a contract with Everest for a guided tour of Whitewater Canyon. Everest represents that he is an experienced, knowledgeable guide, when in reality he has never been in the canyon. Phoebe is most likely a victim of

Because fraud actions necessarily involve wrongful conduct, courts may award punitive damages.

Creighton applies to BigData Corporation for a position as a software engineer. Creighton has no training in computers or programming and no background as an engineer. After Creighton is hired, BigData learns the truth. BigData can​

Gene, an accountant, convinces his client Hazel to sign a contract to invest her savings in 2Gether, a nonexistent social-networking Web site. There is clear and convincing evidence that Hazel did not act out of her free will. This is​

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Hal's True Hardware Stores and Ideal Tools, Inc., sign a written contract for a sale of goods. To be enforceable, this written contract must include

Dick's Burgers n' Shakes enters into an oral contract with Restaurant Equipment Warehouse (REW) for REW's sale to Dick's of a single-spindle milkshake mixer for $300. Assuming the terms can be proved, the contract is enforceable by

Ranchland Properties and Prairie State Investments sign a written contract for a sale of land. In some states, to be enforceable, this contract must include

Creighton applies to BigData Corporation for a position as a software engineer. Creighton has no training in computers or programming and no background as an engineer. After Creighton is hired, BigData learns the truth. BigData can

Gene, an accountant, convinces his client Hazel to sign a contract to invest her savings in 2Gether, a nonexistent social-networking Web site. There is clear and convincing evidence that Hazel did not act out of her free will. This is