Question 1

Exclusive dealing contracts are binding because the implied obligations are sufficient consideration.

Accepted Answer

A) True 
 B)False

Question 2

Marilyn contracted with Bravo Builders to build an addition to her house for $15,000.After digging the foundation, Bravo decides that it will take more work and more concrete than it had originally thought and that it will need to charge an additional $5,000 for the job.Assuming Marilyn agrees, which of the following is correct?

Accepted Answer

A) Marilyn will have to pay $20,000. 
B) This is a contract under seal which is enforceable. 
C) This is a modification of a preexisting contract, which under common law must be supported by additional consideration on the part of Bravo Builders. 
D) This is the settlement of a disputed debt that requires no additional consideration on the part of Bravo Builders. 
A) Marilyn will have to pay $20,000. 
B) This is a contract under seal which is enforceable. 
C) This is a modification of a preexisting contract, which under common law must be supported by additional consideration on the part of Bravo Builders. 
D) This is the settlement of a disputed debt that requires no additional consideration on the part of Bravo Builders.

Question 3

Bob promises to sell to Candy an automobile for $20,000, for which Candy promises $20,000.A unilateral contract exists.

Accepted Answer

A) True 
 B)False

Question 4

Aunt Ellie promises her 21-year-old nephew, Robbie, that she will pay him $100 if he quits smoking for a month.If Robbie does, is there a binding contract?

Accepted Answer

A) No, because Robbie gave no benefit to Aunt Ellie. 
B) No, because Robbie did not suffer any detriment. 
C) Yes, because stopping smoking will benefit Robbie's health. 
D) Yes, because Robbie gave up a legal right. 
A) No, because Robbie gave no benefit to Aunt Ellie. 
B) No, because Robbie did not suffer any detriment. 
C) Yes, because stopping smoking will benefit Robbie's health. 
D) Yes, because Robbie gave up a legal right.

Question 5

Breton owes Parkerson $750, which is due on June 1.Discuss the sufficiency of consideration if Breton offers Parkerson: (a) $600 in full settlement on June 1 if the debt is undisputed; (b) $600 in full settlement on April 10 if the debt is undisputed; and (c) $500 on June 1 to settle the debt if the amount of the debt is validly disputed.

Accepted Answer

The sufficiency of consideration is affe

Question 6

Ron owes Matt an unsecured deposit of $3,000.Ron has a discharge of all his unsecured debts by a bankruptcy court.Can the contract between Matt and Ron be reinstated?

Accepted Answer

Yes, the contract may be reinstated if R

Question 7

Nathan's father promises to give him a car for his twenty-first birthday.Nathan can legally enforce this promise because it created a moral obligation.

Accepted Answer

A) True 
 B)False

Question 8

Under the common law, payment of a lesser sum of money than is owed in consideration of a promise to discharge a fully matured, undisputed debt is legally sufficient to support the promise of discharge.

Accepted Answer

A) True 
 B)False

Question 9

Jason's mother would like him to go to college, so in June he enrolls at the local university.He also quits his job and tells his mother his plans to take classes.His mother says, "I'm so happy that you are going to college that I want to pay for your books." Jason then sends her a bill for $485.Which of the following is true regarding his mother's promise?

Accepted Answer

A) It is enforceable, because Jason returned to college. 
B) It is enforceable, because Jason is giving up the right to do something else. 
C) It is unenforceable, because it is a unilateral contract. 
D) It is unenforceable, because Jason had already enrolled in school when she made the statement that she wanted to pay for his books, and there is no consideration. 
A) It is enforceable, because Jason returned to college. 
B) It is enforceable, because Jason is giving up the right to do something else. 
C) It is unenforceable, because it is a unilateral contract. 
D) It is unenforceable, because Jason had already enrolled in school when she made the statement that she wanted to pay for his books, and there is no consideration.

Question 10

A modification of a preexisting contract occurs when the parties agree to change one or more of its terms.

Accepted Answer

A) True 
 B)False

Question 11

Andrew agreed to exchange something clearly without value to enter a contract with Milt.The contract will not fail for lack of consideration because, if the parties agree to the exchange, the courts will not be concerned about whether the consideration is "adequate."

Accepted Answer

A) True 
 B)False

Question 12

Contracts binding without consideration include promises to pay debts barred by a statute of limitations and debts discharged in bankruptcy.

Accepted Answer

A) True 
 B)False

Question 13

In a unilateral contract a promise is exchanged for an act or forbearance to act.

Accepted Answer

A) True 
 B)False

Question 14

Although such a gratuitous promise would be otherwise unenforceable, under the UCC, any claim arising out of an alleged breach of contract can be discharged by a written renunciation signed and delivered by the aggrieved party.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following is enforceable without consideration?

Accepted Answer

A) A new promise to pay a debt barred by the statute of limitations. 
B) An illusory promise. 
C) A promise to supply all of the materials a manufacturer will need for the production of a certain item for a specified period of time. 
D) In the majority of states, a promise by a father to pay someone who rendered emergency services to his injured son before the father had arrived at the accident scene. 
A) A new promise to pay a debt barred by the statute of limitations. 
B) An illusory promise. 
C) A promise to supply all of the materials a manufacturer will need for the production of a certain item for a specified period of time. 
D) In the majority of states, a promise by a father to pay someone who rendered emergency services to his injured son before the father had arrived at the accident scene.

Question 16

Barbara, a wealthy widow, promises the pastor of her church that she will donate $10,000 to the church to help pay off its mortgage if the stewardship committee can obtain enough pledges for the balance of the $30,000 mortgage.Other pledges are obtained to pay off the mortgage, but now Barbara has changed her mind and plans to take an around-the-world cruise instead.Barbara's promise to pay $10,000:

Accepted Answer

A) is enforceable because it is a new promise to perform a voidable obligation. 
B) is a promise to give a gift and is therefore not enforceable. 
C) is enforceable under the Restatement of Contracts. 
D) was made to satisfy a preexisting moral obligation and is therefore enforceable. 
A) is enforceable because it is a new promise to perform a voidable obligation. 
B) is a promise to give a gift and is therefore not enforceable. 
C) is enforceable under the Restatement of Contracts. 
D) was made to satisfy a preexisting moral obligation and is therefore enforceable.

Question 17

Obligations contingent upon the happening or nonhappening of an event not certain to occur are known as conditional promises.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following are the two basic elements to consideration?

Accepted Answer

A) Bargained-for exchange and legal sufficiency. 
B) Legal detriment and legal benefit. 
C) Legal sufficiency and legal adequacy. 
D) Promise and forbearance. 
A) Bargained-for exchange and legal sufficiency. 
B) Legal detriment and legal benefit. 
C) Legal sufficiency and legal adequacy. 
D) Promise and forbearance.

Question 19

In the Pearsall v.Alexander case, the court found that by exchanging mutual promises to share in proceeds of lottery tickets, the parties entered into a valid, enforceable contract.

Accepted Answer

A) True 
 B)False

Question 20

Consideration the inducement to make a promise enforceable.

Accepted Answer

A) True 
 B)False

Exam 12: Consideration

Exclusive dealing contracts are binding because the implied obligations are sufficient consideration.

Bob promises to sell to Candy an automobile for $20,000, for which Candy promises $20,000.A unilateral contract exists.

Aunt Ellie promises her 21-year-old nephew, Robbie, that she will pay him $100 if he quits smoking for a month.If Robbie does, is there a binding contract?

Ron owes Matt an unsecured deposit of $3,000.Ron has a discharge of all his unsecured debts by a bankruptcy court.Can the contract between Matt and Ron be reinstated?

Nathan's father promises to give him a car for his twenty-first birthday.Nathan can legally enforce this promise because it created a moral obligation.

Under the common law, payment of a lesser sum of money than is owed in consideration of a promise to discharge a fully matured, undisputed debt is legally sufficient to support the promise of discharge.

A modification of a preexisting contract occurs when the parties agree to change one or more of its terms.

Andrew agreed to exchange something clearly without value to enter a contract with Milt.The contract will not fail for lack of consideration because, if the parties agree to the exchange, the courts will not be concerned about whether the consideration is "adequate."

Contracts binding without consideration include promises to pay debts barred by a statute of limitations and debts discharged in bankruptcy.

In a unilateral contract a promise is exchanged for an act or forbearance to act.

Although such a gratuitous promise would be otherwise unenforceable, under the UCC, any claim arising out of an alleged breach of contract can be discharged by a written renunciation signed and delivered by the aggrieved party.

Which of the following is enforceable without consideration?

Obligations contingent upon the happening or nonhappening of an event not certain to occur are known as conditional promises.

Which of the following are the two basic elements to consideration?

In the Pearsall v.Alexander case, the court found that by exchanging mutual promises to share in proceeds of lottery tickets, the parties entered into a valid, enforceable contract.

Consideration the inducement to make a promise enforceable.

Introduction to Law

Business Ethics

Civil Dispute Resolution

Constitutional Law

Administrative Law

Criminal Law

Intentional Torts

Negligence and Strict Liability

Introduction to Contracts

Mutual Assent

Conduct Invalidating Assent

Illegal Bargains

Contractual Capacity

Contracts in Writing

Third Parties to Contracts

Performance, Breach, and Discharge

Contract Remedies

Introduction to Sales and Leases

Performance

Transfer of Title and Risk of Loss

Product Liability: Warranties and Strict Liability

Sales Remedies

Form and Content

Transfer

Holder in Due Course

Liability of Parties

Bank Deposits, Collections, and Funds Transfers

Relationship of Principal and Agent

Relationship With Third Parties

Formation and Internal Relations of General Partnerships

Operation and Dissolution of General Partnerships

Limited Partnerships and Limited Liability Companies

Nature and Formation of Corporations

Financial Structure of Corporations

Management Structure of Corporations

Fundamental Changes of Corporations

Secured Transactions and Suretyship

Bankruptcy

Securities Regulation

Intellectual Property

Employment Law

Antitrust

Accountants Legal Liability

Consumer Protection

Environmental Law

International Business Law

Introduction to Property, Property Insurance, Bailments, and Documents of Title

Interests in Real Property

Transfer and Control of Real Property

Trusts and Wills

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