Question 1

A counteroffer does not terminate the original offer.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following is true regarding the effect of death and incapacitation on an offer?

Accepted Answer

A)  Death or incapacitation of either party terminates an offer. 
B)  Death of either party terminates an offer,and incapacitation on the part of the offeror terminates an offer,but incapacitation on the part of an offeree does not terminate an offer. 
C)  Death of either party terminates an offer,and incapacitation on the part of an offeree terminates an offer,but incapacitation on the part of the offeror does not terminate an offer. 
D)  Neither death nor incapacitation on either the part of the offeror or offeree terminates an offer. 
A)  Death or incapacitation of either party terminates an offer. 
B)  Death of either party terminates an offer,and incapacitation on the part of the offeror terminates an offer,but incapacitation on the part of an offeree does not terminate an offer. 
C)  Death of either party terminates an offer,and incapacitation on the part of an offeree terminates an offer,but incapacitation on the part of the offeror does not terminate an offer. 
D)  Neither death nor incapacitation on either the part of the offeror or offeree terminates an offer.

Question 3

Generally,if Taye's factory unforeseeably burns down through no fault of Taye's own,then Taye is discharged from contractual obligation to manufacture widgets for Jordan.

Accepted Answer

A) True 
 B)False

Question 4

Reliance damages are awarded in addition to expectation damages.

Accepted Answer

A) True 
 B)False

Question 5

Jean is an accountant who works for the firm of Readum & Weep.Jean was approached by Henley,who represents one of Readum's competitors,Numbers R Us.Jean was offered a substantial raise to leave Readum and work for Numbers.Jean's boss heard this and called Jean in and said,"If you agree to stay with us for at least five years,I promise that next year you will receive a promotion with a 50 percent raise,and a five-year contract." Jean turned down the offer from Numbers and stayed with Readum.Nine months later Jean was dismissed due to corporate downsizing.Can Jean legally enforce the promise the boss made? What theory or theories would Jean use? Discuss fully.

Accepted Answer

Jean would say a valid offer was made an

Question 6

An agreement between two parties that provides that the seller will sell all of a product that he produces to the buyer is called a(n)

Accepted Answer

A)  illusory promise. 
B)  requirements contract. 
C)  output contract. 
D)  fulfillment contract. 
A)  illusory promise. 
B)  requirements contract. 
C)  output contract. 
D)  fulfillment contract.

Question 7

As a birthday gift,Bryce's uncle promised Bryce that he would pay Bryce's business school tuition for the next semester.In reliance on that promise,Bryce quit a part-time job at a fast food restaurant.When the tuition bill became due,Bryce's uncle told Bryce that he was sorry but that he would not be able to pay the tuition because he just built a new swimming pool at his house,and funds were running short.Bryce asks you if there is any basis upon which Bryce could win in litigation against this uncle.Which of the following would be the best advice?

Accepted Answer

A)  Bryce should sue for breach of contract because an offer,acceptance,and consideration are all present. 
B)  Bryce should sue for breach of contract because an offer and acceptance are present,and Bryce's reliance would substitute for consideration. 
C)  Bryce should sue based on promissory estoppel. 
D)  Bryce should hurry and try to get the former restaurant job back because there is no basis upon which Bryce would have a viable case. 
A)  Bryce should sue for breach of contract because an offer,acceptance,and consideration are all present. 
B)  Bryce should sue for breach of contract because an offer and acceptance are present,and Bryce's reliance would substitute for consideration. 
C)  Bryce should sue based on promissory estoppel. 
D)  Bryce should hurry and try to get the former restaurant job back because there is no basis upon which Bryce would have a viable case.

Question 8

Generally,prior to upholding a contract,a court will carefully scrutinize the value of consideration to be sure that the contract is a fair one.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following is a type of conditional promise?

Accepted Answer

A)  Condition concurrent 
B)  Condition subsequent 
C)  Condition illusory 
D)  Both a condition concurrent and a condition subsequent 
A)  Condition concurrent 
B)  Condition subsequent 
C)  Condition illusory 
D)  Both a condition concurrent and a condition subsequent

Question 10

Azariah promises to give Carey $50 if Carey promises to sell Azariah a business law book.This is an example of a(n)_____ contract.

Accepted Answer

A)  unilateral 
B)  bilateral 
C)  void 
D)  conditional 
A)  unilateral 
B)  bilateral 
C)  void 
D)  conditional

Question 11

A third-party beneficiary is someone who is NOT:

Accepted Answer

A)  a legal and recognized type of beneficiary. 
B)  intended to benefit from the contract. 
C)  a party to the original contract. 
D)  intended to enforce the contract. 
A)  a legal and recognized type of beneficiary. 
B)  intended to benefit from the contract. 
C)  a party to the original contract. 
D)  intended to enforce the contract.

Question 12

_____of a contract occurs when one party knows ahead of time that the other party will _____.

Accepted Answer

A)  Anticipatory repudiation; breach the contract 
B)  Anticipatory repudiation; perform the contract 
C)  Mutual performance repudiation; breach the contract 
D)  Conditional performance; breach the contract 
A)  Anticipatory repudiation; breach the contract 
B)  Anticipatory repudiation; perform the contract 
C)  Mutual performance repudiation; breach the contract 
D)  Conditional performance; breach the contract

Question 13

An agreement between two parties that provides that the buyer will buy all of a particular product from a particular seller is called a(n)

Accepted Answer

A)  illusory promise. 
B)  requirements contract. 
C)  output contract. 
D)  fulfillment contract. 
A)  illusory promise. 
B)  requirements contract. 
C)  output contract. 
D)  fulfillment contract.

Question 14

Void means the same thing as voidable in contract law.

Accepted Answer

A) True 
 B)False

Question 15

Two neighbors have lovely landscaped yards.One yard is cared for solely by the homeowner,Hollis.The other neighbor pays ABC Landscaping Service for the gardening work done on the yard.Hollis notices one day that an apparently new employee of ABC is working in Hollis's yard by mistake.Hollis says nothing.When the employee asks for payment,Hollis refuses on the basis that the gardening work was a mistake and that Hollis has no contract with ABC.Which of the following is true regarding whether ABC could recover against Hollis?

Accepted Answer

A)  ABC likely has no rights against Hollis. 
B)  ABC could recover against Hollis based on breach of contract. 
C)  ABC could likely recover on a theory of quantum meruit. 
D)  ABC could likely recover based on a negligence theory. 
A)  ABC likely has no rights against Hollis. 
B)  ABC could recover against Hollis based on breach of contract. 
C)  ABC could likely recover on a theory of quantum meruit. 
D)  ABC could likely recover based on a negligence theory.

Question 16

Which of the following would NOT be among the main reasons contracts are critical to business?

Accepted Answer

A)  They prevent illegal business activity. 
B)  They enhance predictability. 
C)  They allocate risk and reward. 
D)  They provide a basis for enforceability. 
A)  They prevent illegal business activity. 
B)  They enhance predictability. 
C)  They allocate risk and reward. 
D)  They provide a basis for enforceability.

Question 17

A minor may ratify a contract after reaching the age of majority.

Accepted Answer

A) True 
 B)False

Question 18

When the sale of goods is the basis of the contract,it is a unilateral contract.

Accepted Answer

A) True 
 B)False

Question 19

Identify and discuss the two factors central to procedural unconscionability.

Accepted Answer

The procedural element of unconscionabil

Question 20

Fraud in the _______ occurs when a party is persuaded to sign one document thinking that it is another.

Accepted Answer

A)  acceptance 
B)  obligation 
C)  factum 
D)  inducement 
A)  acceptance 
B)  obligation 
C)  factum 
D)  inducement

Exam 7: Contracts

A counteroffer does not terminate the original offer.

Which of the following is true regarding the effect of death and incapacitation on an offer?

Generally,if Taye's factory unforeseeably burns down through no fault of Taye's own,then Taye is discharged from contractual obligation to manufacture widgets for Jordan.

Reliance damages are awarded in addition to expectation damages.

An agreement between two parties that provides that the seller will sell all of a product that he produces to the buyer is called a(n)

Generally,prior to upholding a contract,a court will carefully scrutinize the value of consideration to be sure that the contract is a fair one.

Which of the following is a type of conditional promise?

Azariah promises to give Carey $50 if Carey promises to sell Azariah a business law book.This is an example of a(n)_____ contract.

A third-party beneficiary is someone who is NOT:

_____of a contract occurs when one party knows ahead of time that the other party will _____.

An agreement between two parties that provides that the buyer will buy all of a particular product from a particular seller is called a(n)

Void means the same thing as voidable in contract law.

Which of the following would NOT be among the main reasons contracts are critical to business?

A minor may ratify a contract after reaching the age of majority.

When the sale of goods is the basis of the contract,it is a unilateral contract.

Identify and discuss the two factors central to procedural unconscionability.

Fraud in the _______ occurs when a party is persuaded to sign one document thinking that it is another.

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