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Q:
Courtney, who does not keep up with the price of current technology, agrees to buy a used computer from Jake for $2,500. Later, Brice tells Courtney that she made a really bad deal and that she could get an even better new computer for no more than $1,000. Courtney tells Jake that she is not giving him any money because he was not fair with her. Which of the following is the most likely result if Jake sues Courtney alleging breach of contract?
A. Brice will win only if he can establish that Brice is wrong and that the deal was actually reasonable.
B. Brice will win because the court would not weigh whether a good bargain was made.
C. Courtney will win if she can establish that she paid at least 75% more than the computer was actually worth.
D. Courtney will win if she can establish that she paid at least 50% more than the computer was actually worth.
E. Courtney will win if she can establish that she made a bad deal and that truly she was not aware of current prices of computers.
Q:
In the case of Smith v. Riley, referenced in the text, what did the court rule in regard to whether a purchase in the amount of "the sum of One Dollar ($1.00) and other good and valuable consideration" was sufficient consideration to support an agreement?
A. The Court ruled that the purchase amount was sufficient consideration.
B. The Court ruled that the purchase amount was insufficient consideration only because the sale of an interest in a lease was involved.
C. The Court ruled that the purchase amount was insufficient consideration only because a sale of goods was involved.
D. The Court ruled that the purchase amount was insufficient consideration only because a domestic partnership was involved.
E. The Court ruled that the purchase amount was insufficient consideration because over $50,000 was at issue.
Q:
Sam offers Betty his bicycle for $75. Which of the following is an example of an illusory promise on the part of Betty?
A. "I'll take it."
B. "I'll take it if I decide to do so."
C. "I won't pay $75, but I will pay $50."
D. "I'll take it if you will let me try it out first and the brakes work well."
E. "I'll take it if you will buy new tires."
Q:
Which of the following is true regarding illusory promises?
A. Illusory promises are not consideration.
B. Illusory promises are consideration.
C. Illusory promises qualify as consideration when past consideration is at issue.
D. Illusory promises qualify as consideration when promissory estoppel is at issue.
E. Illusory promises are consideration only when a sale of goods is involved.
Q:
Which of the following is true regarding the adequacy of consideration?
A. Courts generally consider the adequacy of consideration in determining whether to enforce a contract.
B. Courts consider the adequacy of consideration only if something is sold for less than 90% of its market value.
C. Courts consider the adequacy of consideration only if something is sold for less than 80% of its market value.
D. Courts consider the adequacy of consideration only if something is sold for less than 70% of its market value.
E. Courts seldom consider the adequacy of consideration but will do so if an item was sold for a low sum in order to avoid claims of creditors.
Q:
When would a court consider the adequacy of consideration?
A. To verify property was sold at the fair market value.
B. To verify that the sale of assets was not done to avoid payment to creditors.
C. To verify that one party gave a promise for an act of another party.
D. To verify that each party gave a valid promise to the other party.
E. The court never considers the adequacy of consideration.
Q:
Which of the following would not be considered an example of consideration?
A. A promise to stay in a job until a particular project is completed.
B. A promise to your football coach to refrain from riding your motorcycle during football season even though you love riding it.
C. A promise to cook dinner for your roommate for the next six months.
D. A promise to stop drinking alcohol during exam week.
E. A promise to pay your employees as required by law.
Q:
In a unilateral contract, the consideration for a promise is ______.
A. an act
B. a return promise
C. an acknowledgement
D. consideration
E. an agreement
Q:
Which of the following is an exception to the rule requiring consideration?
A. Promissory agreement.
B. Promissory estoppel.
C. Quasi estoppel.
D. Quasi agreement.
E. Promissory performance.
Q:
What is the legal enforcement of an otherwise unenforceable contract due to a party's detrimental reliance on the contract?
A. Promissory agreement.
B. Promissory estoppel.
C. Quasi estoppel.
D. Quasi agreement.
E. Promissory performance.
Q:
Forbearance is _______________.
A. the promise to pay a debt on time
B. the promise to enter into a bilateral contract
C. the promise to waive consideration for a valid agreement
D. the promise to not engage in particular activities
E. an element of a valid contract
Q:
An example of forbearance is _________________.
A. selling assess to avoid payment to creditors
B. one party making a promise knowing the other party will rely on it
C. refraining from the use of liquor and tobacco
D. a promise to do something that you are already obligated to do
E. past consideration
Q:
In Hamer v. Sidway, the New York Court of Appeals found that forbearance:
A. Negates the enforceability of a contract.
B. Is not mandatory for a contract to be binding.
C. Is unconstitutional.
D. Is sufficient consideration for a valid contract.
E. Is insufficient consideration for a valid contract.
Q:
Without the exchange of consideration by the parties, the courts will ____________________.
A. automatically find in favor of the offeree
B. automatically find in favor of the offeror
C. not enforce the parties' agreement
D. only award nominal damages
E. seek a determination by a jury
Q:
A promise to your mother to refrain from going to bed later than 11:00 p.m. on a school night is what type of consideration?
A. A benefit to the promisor.
B. A promise to refrain from doing something.
C. A promise to do something.
D. A detriment to the promisor.
E. A detriment to the promisee.
Q:
In a bilateral contract, the consideration for each promise is ______.
A. a completed act
B. the beginning of action in acceptance, even if it is not complete
C. an acknowledgement
D. a return promise
E. an agreement
Q:
An accord and satisfaction is a court ordered proceeding to determine the amount of money owed in an unliquidated debt.
Q:
When a party to a contract performs a contractual obligation, that party will receive _______________________.
A. consideration
B. acknowledgement
C. approval
D. accord
E. accession
Q:
What is something of value given to another party in exchange for something else of value?
A. Consideration.
B. Acknowledgement.
C. Approval.
D. Discharge.
E. Accession.
Q:
Which of the following are examples of consideration?
A. A benefit to the promisor but not a detriment to the promisee.
B. A detriment to the promisee but not a benefit to the promisor.
C. A promise to do something, a benefit to the promisor, or a detriment to the promisee.
D. An accepted offer.
E. A valid counteroffer.
Q:
The debt must be unliquidated for the parties to enter into an accord and satisfaction.
Q:
In a liquidated debt, the parties dispute the amount of money owed.
Q:
Partial payment of a debt is usually valid consideration, for a liquidated debt.
Q:
For a court to enforce a promise, only the offeror must give consideration.
Q:
A preexisting duty is generally valid consideration.
Q:
If additional work is needed for an existing contractual duty due to unforeseen circumstances, the promise for the additional work may be valid consideration for a new agreement.
Q:
The rule of promissory estoppel requires consideration for all bilateral contracts to be enforceable.
Q:
The court never considers the adequacy of consideration.
Q:
An illusory promise is not an actual promise.
Q:
Consideration that was provided before the promise was made, known as past consideration, qualifies as consideration.
Q:
Forbearance is the promise to refrain from entering into a unilateral contract.
Q:
Forbearance is sufficient consideration for a valid and enforceable contract.
Q:
Promissory estoppel is the legal enforcement of an otherwise unenforceable contract due to a party's detrimental reliance on the contract.
Q:
Consideration is what a person will give in return for performing a contract obligation.
Q:
Consideration is optional in every contract.
Q:
In a bilateral contract, the consideration for a promise is a completed act.
Q:
In a unilateral contract, one party's consideration is a promise and the other party's consideration is an act.
Q:
The part of the Uniform Commercial Code that governs contracts for the sale of goods is Article _____.
A. 2
B. 3
C. 4
D. 5
E. 6
Q:
All contracts can be categorized as either _____ or _____ contracts.
A. unilateral; complete
B. unilateral; trilateral
C. bilateral; trilateral
D. unilateral; bilateral
E. bilateral; complete
Q:
A _____ contract is commonly defined as a promise in exchange for a promise.
A. unilateral
B. trilateral
C. complete
D. bilateral
E. classified
Q:
Which of the following was propounded by prominent legal scholars, recruited by the American Law Institute?
A. The Restatement Second of the Law of Contracts.
B. The Convention on Contracts for International Sales of Goods.
C. Common law.
D. Both common law and the Convention on Contracts for International Sales of Goods.
E. Both the Convention on Contracts for International Sales of Goods and the Restatement Second of the Law of Contracts.
Q:
Which of the following is the reason the Uniform Commercial Code was drafted?
A. Different states had different laws governing contracts that did not result in a smooth flow of interstate commerce.
B. Some states had no law governing contracts.
C. Federal law governing contracts was difficult to apply.
D. The Uniform State Act on laws was not working.
E. The Restatement of the Law Second, Contracts was not being evenly and fairly applied.
Q:
Which of the following is true regarding the Uniform Commercial Code?
A. It has been adopted federally and is therefore applicable in all states.
B. It has been individually adopted by all states completely and in the same manner.
C. It became the law in each state that adopted it in whole or in part and state laws differ somewhat.
D. It was defeated and voted down by an act of Congress.
E. It was replaced by the Restatement of the Law Second, Contracts.
Q:
Which of the following represents a lack of genuine assent?
A. Acceptance secured through fraud.
B. Acceptance secured through undue influence.
C. Acceptance secured through misrepresentation.
D. Acceptance secured through fraud or undue influence, but not through misrepresentation.
E. Acceptance secured through fraud, undue influence, or misrepresentation.
Q:
Which of the following are the two most important primary sources of contract law?
A. Case law and the Restatement of Law.
B. Case law and the Uniform Commercial Code.
C. The Uniform Commercial Code and the Convention on Contracts for International Sales of Goods.
D. Case law and the Convention on Contracts for International Sales of Goods.
E. The Convention on Contracts for International Sales of Goods and the Restatement of the Law Second, Contracts.
Q:
Today's law of contracts originated from judicial decisions in _____.
A. France
B. Italy
C. Spain
D. England
E. Switzerland
Q:
The law of contracts is primarily _____ law.
A. civil
B. statutory
C. common
D. restated
E. modified
Q:
The legal ability to enter into a binding agreement is known as _____.
A. majority
B. emancipation
C. contractual knowledge
D. contractual capacity
E. informed consent
Q:
Which of the following are examples of people who do not have the capacity to enter into legally binding contracts?
A. Those under the age of majority and suffering from a mental illness.
B. People suffering from mental illness and intoxicated persons.
C. Intoxicated persons and those under the age of majority.
D. Only people suffering from mental illness.
E. People under the age of majority, people suffering from mental illness, and intoxicated persons.
Q:
Which element of a contract requirements that a contract not be either illegal or against public policy?
A. Consideration.
B. Capacity.
C. Legal object.
D. Illegal prohibition.
E. Ethical requirement.
Q:
The person who makes an offer is called the _____________.
A. offeree
B. offeror
C. agreeor
D. agree
E. inquirer
Q:
The person who agrees to the terms of an offer by another party is called the _____.
A. offeree
B. offeror
C. agreeor
D. agree
E. inquirer
Q:
Consideration is defined as _____.
A. being cordial in the negotiation of contracts
B. refraining from unethical behavior in the negotiation of contracts
C. being both cordial and refraining from unethical behavior in the negotiation of contracts
D. a bargained-for exchange
E. a contract negotiated in person as opposed to by telephone or e-mail
Q:
The requirements of a valid acceptance parallel the requirements for a valid offer.
Q:
A promise or set of promises for the breach of which the law gives a remedy or the performance of which the law in some way recognizes a duty is known as a(n) _____.
A. contract
B. offer
C. consideration
D. acceptance
E. legal object
Q:
What are the elements of a binding contract?
A. Offer, acceptance, consideration, and assent
B. Acceptance, consideration, assent, and legal object
C. Agreement, offer, acceptance, and consideration
D. Agreement, consideration, contractual capacity, and assent
E. Agreement, consideration, contractual capacity, and legal object
Q:
An offer made by one party and accepted by another party is called a(n) _____.
A. legal object
B. agreement
C. coherence
D. alliance
E. concurrence
Q:
An acceptance, which is received after the offer was rejection, is still a valid acceptance.
Q:
Silence can be an acceptance when the offeree receives the benefits of the offered services with reasonable opportunity to reject them and knowledge that some form of compensation is expected, yet remains silent.
Q:
An offeror can revoke the offer at any time.
Q:
An offer by a retailer to purchase seasonal goods from a wholesaler would not lapse before an offer to purchase goods that could easily be sold all year long.
Q:
Silence may constitute acceptance of an offer.
Q:
The mirror-image rule is applicable when a unilateral contract is involved.
Q:
Under the UCC, the agreement begins when the offeror makes an offer to the offeree.
Q:
An offer has two elements, intent and definite and certain terms.
Q:
Courts interpret contracts using an objective standard.
Q:
An offer may be accepted by the offeree to whom an offer is directed or the offeree's agent.
Q:
All contracts are either formal contracts or informal contracts, which are also called simple contracts.
Q:
States still require that formal contracts be under seal.
Q:
All contracts deemed valid by the court are enforceable.
Q:
Quasi-contracts are legally the same as implied-in-law contracts.
Q:
Under a quasi-contract is imposed the amount of damages for a breach which may be awarded is based upon the fair market value of any service provided to the defendant.
Q:
A quasi contract is an agreement by the parties to prevent unjust enrichment.
Q:
A bilateral contract is a promise exchanged for an act.
Q:
In an express contract, all terms of the agreement must be clearly set forth in writing.
Q:
A contract that arises from the conduct of the parties is an implied contract.
Q:
The two primary sources of contract law are the Uniform Commercial Code and Restatement of Contracts.
Q:
The Restatement (Second) of the Law of Contracts is not actually the law itself.
Q:
The Uniform Commercial Code is federal law that was created by Congress.
Q:
All contracts can be classified as either bilateral or unilateral.