Question 1

Risks ordinarily assumed in business do not constitute consideration for the modification of a contract.

Accepted Answer

A) True 
 B)False

Question 2

Herm promises to pay Nixie to work as an assistant buyer for his Organic Foods stores.Nixie agrees and quits her job with Pic-U Grocery,but Herm does not hire her.Herm is most likely liable to Nixie under

Accepted Answer

A) the concept of accord and satisfaction. 
B) the doctrine of promissory estoppel. 
C) the preexisting duty rule. 
D) no circumstances. 
A) the concept of accord and satisfaction. 
B) the doctrine of promissory estoppel. 
C) the preexisting duty rule. 
D) no circumstances.

Question 3

Cherry is injured in an accident caused by Bronco.Bronco agrees to pay Cherry $2,500 if she agrees to release him from further liability.Cherry agrees.If Cherry's damages ultimately exceed $2,500,she can

Accepted Answer

A) collect the balance from Bronco in a breach-of-contract suit. 
B) collect the balance from Bronco in a tort suit. 
C) collect the balance from Bronco on the ground of unforeseen events. 
D) not collect the balance from Bronco. 
A) collect the balance from Bronco in a breach-of-contract suit. 
B) collect the balance from Bronco in a tort suit. 
C) collect the balance from Bronco on the ground of unforeseen events. 
D) not collect the balance from Bronco.

Question 4

The doctrine of promissory estoppel does not apply if there is a clear and definite promise.

Accepted Answer

A) True 
 B)False

Question 5

Mary promises to pay her assistant Ned $10,000 in consideration of the ser?vices he provided over the years.Mary never pays Ned.Mary is

Accepted Answer

A) liable for payment of the $10,000. 
B) liable only if Ned still works for Mary. 
C) not liable,because the consideration is in the past. 
D) not liable,because the consideration was unintentional. 
A) liable for payment of the $10,000. 
B) liable only if Ned still works for Mary. 
C) not liable,because the consideration is in the past. 
D) not liable,because the consideration was unintentional.

Question 6

An illusory promise is a promise that is enforceable without consideration.

Accepted Answer

A) True 
 B)False

Question 7

Fact Pattern 12-A2 (Questions A8-A10 apply)
Cut-Rate Construction Company (CCC)begins building a restaurant for Diners Restaurants,Inc.,but after two months demands an extra $100,000.Diners agrees to pay.
-Refer to Fact Pattern 12-A2.If CCC offers no reason for the extra $100,000,but says only that it will otherwise stop construction,the agreement is

Accepted Answer

A) enforceable as an accord and satisfaction. 
B) enforceable because of unforeseen difficulties. 
C) unenforceable as an illusory promise. 
D) unenforceable due to the preexisting duty rule. 
A) enforceable as an accord and satisfaction. 
B) enforceable because of unforeseen difficulties. 
C) unenforceable as an illusory promise. 
D) unenforceable due to the preexisting duty rule.

Question 8

Jen questions whether there is consideration for her contract with Isaac to exchange her catering services for his payment of a certain amount.To constitute consideration,the value of whatever is exchanged must be

Accepted Answer

A) objectively worthy. 
B) grossly inadequate. 
C) legally sufficient. 
D) practically sound. 
A) objectively worthy. 
B) grossly inadequate. 
C) legally sufficient. 
D) practically sound.

Question 9

Flossy promises to pay her cousin Garth,who is dangerously obese,$10,000 if Garth loses 100 pounds within the next two years.Garth agrees,per?forms his part of the bar?gain,and asks for the money.Flossy refuses to pay,say?ing that she forgot about the deal,but that even if she did make such a pledge,there was no valid consideration for it.Garth files a suit against Flossy.In whose favor is the court likely to rule,and why?

Accepted Answer

A court is most likely to rule against F

Question 10

Two parties can mutually agree to rescind a contract unless it is executory.

Accepted Answer

A) True 
 B)False

Question 11

Use of the word consideration in an agreement means that consideration has been given.

Accepted Answer

A) True 
 B)False

Question 12

Panini Vittles,Inc.,contracts with Qino to deliver its sandwiches.Later,the parties decide to cancel their contract.They can

Accepted Answer

A) rescind their entire contract. 
B) rescind their contract to the extent that it is executory. 
C) rescind their contract if they make a new contract at the same time. 
D) not rescind their contract. 
A) rescind their entire contract. 
B) rescind their contract to the extent that it is executory. 
C) rescind their contract if they make a new contract at the same time. 
D) not rescind their contract.

Question 13

Kelsey promises to pay Jon,her son,$15,000 if he obtains his degree at Ivy University,where he is currently in his second year.Jon graduates.Kelsey is

Accepted Answer

A) not required to pay,because Jon was already at Ivy. 
B) not required to pay,because obtaining a degree benefits Jon. 
C) required to pay,because a job can be hard to find after college. 
D) required to pay,because Jon obtained a degree at Ivy. 
A) not required to pay,because Jon was already at Ivy. 
B) not required to pay,because obtaining a degree benefits Jon. 
C) required to pay,because a job can be hard to find after college. 
D) required to pay,because Jon obtained a degree at Ivy.

Question 14

A release does not require consideration to be legally binding.

Accepted Answer

A) True 
 B)False

Question 15

Rescission is the dissolution of a contract that returns the parties to the positions they held before the contract.

Accepted Answer

A) True 
 B)False

Question 16

If a debt is liquidated,an accord and satisfaction cannot take place.

Accepted Answer

A) True 
 B)False

Question 17

A transaction that lacks a bargained-for exchange lacks an element of consideration.

Accepted Answer

A) True 
 B)False

Question 18

Parties are not generally free to bargain as they wish.

Accepted Answer

A) True 
 B)False

Question 19

Betty pledges to donate $1,000 to the Children's Hospital.On the basis of the pledge,the hospital orders additional equipment.Betty reneges on the pledge.The hospital sues Betty.If the court enforces the pledge,it will be

Accepted Answer

A) because Betty's performance is uncertain. 
B) because of the unforeseen difficulties. 
C) because the pledge is a gift. 
D) under the doctrine of promissory estoppel. 
A) because Betty's performance is uncertain. 
B) because of the unforeseen difficulties. 
C) because the pledge is a gift. 
D) under the doctrine of promissory estoppel.

Question 20

A promise to do what one already has a legal duty to do is legally suf?ficient consideration.

Accepted Answer

A) True 
 B)False

Exam 12: Consideration

Risks ordinarily assumed in business do not constitute consideration for the modification of a contract.

Herm promises to pay Nixie to work as an assistant buyer for his Organic Foods stores.Nixie agrees and quits her job with Pic-U Grocery,but Herm does not hire her.Herm is most likely liable to Nixie under

Cherry is injured in an accident caused by Bronco.Bronco agrees to pay Cherry $2,500 if she agrees to release him from further liability.Cherry agrees.If Cherry's damages ultimately exceed $2,500,she can

The doctrine of promissory estoppel does not apply if there is a clear and definite promise.

Mary promises to pay her assistant Ned $10,000 in consideration of the ser?vices he provided over the years.Mary never pays Ned.Mary is

An illusory promise is a promise that is enforceable without consideration.

Jen questions whether there is consideration for her contract with Isaac to exchange her catering services for his payment of a certain amount.To constitute consideration,the value of whatever is exchanged must be

Two parties can mutually agree to rescind a contract unless it is executory.

Use of the word consideration in an agreement means that consideration has been given.

Panini Vittles,Inc.,contracts with Qino to deliver its sandwiches.Later,the parties decide to cancel their contract.They can

Kelsey promises to pay Jon,her son,$15,000 if he obtains his degree at Ivy University,where he is currently in his second year.Jon graduates.Kelsey is

A release does not require consideration to be legally binding.

Rescission is the dissolution of a contract that returns the parties to the positions they held before the contract.

If a debt is liquidated,an accord and satisfaction cannot take place.

A transaction that lacks a bargained-for exchange lacks an element of consideration.

Parties are not generally free to bargain as they wish.

Betty pledges to donate $1,000 to the Children's Hospital.On the basis of the pledge,the hospital orders additional equipment.Betty reneges on the pledge.The hospital sues Betty.If the court enforces the pledge,it will be

A promise to do what one already has a legal duty to do is legally suf?ficient consideration.

Introduction to Law and Legal Reasoning

Courts and Alternative Dispute Resolution

Court Procedures

Constitutional Authority to Regulate Business

Ethics and Business Decision Making

Intentional Torts and Privacy

Negligence and Strict Liability

Intellectual Property and Internet Law

Criminal Law and Cyber Crime

Nature and Terminology

Agreement in Traditional and E-Contracts

Capacity and Legality

Mistakes, fraud, and Voluntary Consent

The Statute of Frauds

Third Party Rights

Performance and Discharge

Breach of Contract and Remedies

The Formation of Sales and Lease Contracts

Title, risk, and Insurable Interest

Performance Breach of Sales Lease Contracts

Warranties and Product Liability

International Law in a Global Economy

The Function Creation of Negotiable Instruments

Transferability and Holder in Due Course

Liability,defenses,and Discharge

Checks and Banking in the Digital Age

Creditors Rights and Remedies

Secured Transactions

Bankruptcy Law

Mortgages Foreclosures After the Recession

Agency Formation and Duties

Agency Liability and Termination

Employment,immigration,and Labor Law

Employment Discrimination

Sole Proprietorships and Franchises

Partnerships and Limited Liability Partnerships

Limited Liability Companies Special Business Forms

Corporate Formation and Financing

Corporate Directors,officers, Shareholders

Corporate Merger, consolidation, Termination

Securities Law Corporate Governance

Law for Small Business

Administrative Law

Consumer Law

Environmental Law

Antitrust Law

Professional Liaility and Accountability

Personal Property and Bailments

Real Property Landlord-Tenant Relationships

Insurance

Wills and Trusts

Legal and Ethical Considerations in Sustainability, Discovery, and Corporate Behavior

Legal and Ethical Issues in Contemporary Society

Contracts and Agreements

Legal Issues in Iowa's Video Game Labeling Statute, National Export Initiative, and Contract Law

Banking and Loan Liability

Bankruptcy and Agricultural Credit: Debts, Reporting, and Risk

Legal and Ethical Issues in Employment and Agency Relationships

Legal Issues in Business Franchising, LLC Management, Tax Collection, Director Liability, and Securities Regulations

Compliance and Ethics Issues in Business Operations

Risk Assessment, Virtual Property, Property Rights, and Building Moratoriums