accounting module 2 quiz questions

Which of the following is a definition for consideration? Being cordial in the negotiation of contracts. Refraining from unethical behavior in the negotiation of contracts. Being cordial and refraining from unethical behavior in the negotiation of contracts. The bargained-for exchange. A contract negotiated in person as opposed to by telephone or e-mail.

The bargained-for exchange.

8. When an accord and satisfaction is at issue, the _____ is the new agreement to pay less than the creditor claims is owned. • Compromise • Seal • Accord • Satisfaction • Acknowledgement

accord

In a unilateral contract, the consideration for a promise is a[n] ____.

action

9. Why is it important to distinguish between unilateral and mutual mistake? • Because it determines which contracts are voidable. • Because it determines how much may be awarded in damages under a contract • Because it determines whether punitive damages may be awarded • Because it determines which contracts are considered fraudulent. • Because it determines which contracts lack consideration

because it determines which contracts are voidable

Which of the following is a term for laws that limit the types of business activities in which parties may legally engage on Sundays?

blue laws

Which of the following is an element of a legally binding contract?

capacity

Which of the following is true regarding an agreement to commit a crime or a tort?

An agreement to commit a crime is unenforceable, and an agreement to commit a tort is unenforceable.

Yolanda agrees to bathe and groom Wendy's dog, Fluffy Puff, for $30. Yolanda agreed to the price before seeing Fluffy Puff who is a chubby dog with lots of hair. Yolanda tells Wendy that if she is going to groom Fluffy Puff, the price will be $40. Wendy reluctantly agrees but tells Yolanda that she should not have been surprised that a dog named Fluffy Puff would have lots of hair. Yolanda bathes and grooms Fluffy Puff, but Wendy will only pay $30. Which of the following is correct regarding Yolanda's entitlement to the extra $10?

Assuming the unforeseen circumstances rule does not apply, Yolanda is not entitled to the extra $10 because she had a preexisting duty to bathe and groom Fluffy Puff for $30.

8. In which of the following ways may an offeree accept a unilateral contract? • By making a counteroffer or by a signed writing • By signed writing only. • By either verbal acceptance or a signed writing. • By performance only. • By performance, by a verbal acceptance, or by a signed writing.

by performance only

1. Which of the following is true regarding the rating the World Bank gives China in relation to the ease of doing business there? • China is ranked in the bottom 25. • China is rated in the top 10. • China is ranked last. • China is ranked in the bottom 10. • China is ranked near the middle.

china is rated in the top ten

9. The law of contracts is primarily ________ law. a. Comprehensive b. Statutory c. Common d. Restated e. Modified

common

4. Which of the following occurs when one of the parties to a contract has so much more bargaining power than the other that he or she dictates the term of the agreement? • Disconnection • Unconscionability • Unfairness • Cohesiveness • Unprovable

unconscionability

7. Which of the following contracts are usually voidable? • Contracts entered into as a result of fraud, but not duress or undue influences. • Contracts entered into as a result of duress or undue influence, but not fraud. • Contracts entered into as a result of undue influences or fraud, but not duress. • Contracts entered into as a result of fraud or duress, but not undue influence. • Contracts entered into as a result of fraud, duress, or undue influence.

• Contracts entered into as a result of fraud, duress, or undue influence.

1. Which of the following was the result in the case in the text Adone v. Paletto involving the rejection of a purported acceptance of an offer of compromise because it was not made within the time limit of 10 days specified in the offer? • Rejection of the acceptance was unjustified because offers of compromise may not contain time limits. • Rejection of the acceptance was unjustified because allowing only 10 days for acceptance is unreasonable. • Rejection of the acceptance was unjustified because of the plaintiff's severe injuries. • Rejection of the acceptance was enforceable because a trial had already been held. • Rejection of the acceptance was enforceable because the 10 days in which the other party had to accept had expired.

• Rejection of the acceptance was enforceable because the 10 days in which the other party had to accept had expired.

Under the Uniform Commercial Code, contracts for the sale of goods totaling more than ______ must be in writing.

$500

How many states have statutes requiring that people working in certain professions obtain a license before practicing their craft?

50

Which of the following may represent a lack of genuine assent? Acceptance secured through fraud, duress, or misrepresentation, but not acceptance through undue influence. Acceptance secured through undue influence, misrepresentation, or duress, but not through fraud. Acceptance secured through fraud or duress, but not through misrepresentation or undue influence. Acceptance secured through fraud, dress, or undue influence, but not through misrepresentation. Acceptance secured through fraud, duress, undue influence, or misrepresentation.

Acceptance secured through fraud, duress, undue influence, or misrepresentation.

Which of the following is true regarding writings created at the same time as a written agreement? The parol evidence rule applies to writings created at the same time as the written agreement only if a sale of goods is involved, and in that case the writings are analyzed in the same way as prior or contemporaneous oral evidence. The parol evidence rule applies to writings created at the same time as the written agreement, and these writings are analyzed in the same way as prior or contemporaneous oral evidence. Although the parol evidence rule applies to writings created at the same time as the written agreement, these writings tend to be treated differently than prior or contemporaneous oral agreements in that the writings are more readily admitted as part of the written agreement than is oral evidence. Although the parol evidence rule applies to writings created at the same time as the written agreement, these writings tend to be treated differently than prior or contemporaneous oral agreements in that the writings are less likely to be admitted as part of the written agreement than is oral evidence. The parol evidence rule does not apply to writings created at the same time as the written agreement.

Although the parol evidence rule applies to writings created at the same time as the written agreement, these writings tend to be treated differently than prior or contemporaneous oral agreements in that the writings are more readily admitted as part of the written agreement than is oral evidence.

Assuming no exception applies, which of the following is true regarding the effect of a debtor offering to pay less money than is owed as full payment on a debt for which there is a dispute over the amount of the debt, and the creditor agrees?

An unliquidated debt is involved, and there is an accord and satisfaction.

Sally has a large farm and significant other assets. She agreed to loan her nephew Todd $100,000 with payments of principle and interest to be made yearly. A few years later she and Todd got into a dispute because Sally did not like his new girlfriend, Polly. Soon thereafter Todd got notice that Sally was suing him for not paying interest on the note. Todd defended on the basis that two years after the initial loan agreement was entered into, he and Sally entered into an oral agreement that he would perform services on her farm in lieu of paying interest on the note. If the court follows the reasoning of the court in the Case Opener involving Monroe Bradstad and Jeanne Garland, which of the following is the most likely result of the dispute between Sally and Todd involving whether he owes past interest amounts? Assuming the court credits Todd's account of events, Todd will not be required to pay the interest amounts because the oral agreement will be considered an extension and part of the original written agreement. Assuming the court credits Todd's account of events, based on the parol evidence rule, Todd will be required to pay only 1/2 of the interest amounts. Todd will be required to pay the interest amounts because the parol evidence rule bars evidence of any oral agreement outside the written agreement. Todd will be required to pay the interest amounts because the agreement involving performing services in lieu of paying interest was not in writing. Assuming the court credits Todd's account of events, Todd will not be required to pay the interest amounts because the oral agreement will be considered a separate enforceable agreement.

Assuming the court credits Todd's account of events, Todd will not be required to pay the interest amounts because the oral agreement will be considered a separate enforceable agreement.

Why is it important to distinguish between unilateral and mutual mistakes?

Because it determines which contracts are voidable.

1. An _______ contract is commonly defined as a promise in exchange for a promise. a. Unilateral b. Trilateral c. Complete d. Bilateral e. Classified

Bilateral

A[n] ______________ contract is commonly defined as a promise in exchange for a promise. Unilateral Trilateral Complete Bilateral Classified

Bilateral

Tina, an experienced pool contractor, and Bruce agree on a price for Tina to build a pool in Bruce's backyard. Tina discovers that she did not initially figure in enough of a charge for labor. She tells Bruce that unless she receives an extra $5,000 with which to hire workers, she cannot complete the job. Bruce agrees thinking to himself that he has a way out. When Tina finishes the pool, Bruce refuses to pay the additional $5,000. Which of the following is the most likely result of their dispute?

Bruce will not be required to pay because he provided no additional consideration, and the preexisting duty rule applies.

Which of the following is the reason the Uniform Commercial Code was drafted? Different states had different laws governing contracts which did not result in a smooth flow of interstate commerce. Some states had no law governing contracts. Federal law governing contracts was difficult to apply. The Uniform State Act on laws was not working. The Restatement of the Law Second, Contracts was not being evenly and fairly applied.

Different states had different laws governing contracts which did not result in a smooth flow of interstate commerce.

2. Which of the following is true regarding a signature of a document falling within the statue of frauds? a. There is no requirements of any signature of either party to satisfy the statue of frauds. b. Any party required to sign must sign at the beginning of the document. c. Any party required to sign must sign at the end of the document d. Any party required to sign must both the end and at the beginning of the document e. So long as it meant as a signature, a party required to sign may sign at any place on the document.

E. so long as it meant as a signature, a party required to sign may sign at any place on the document

Which of the following is false regarding international treatment of evidentiary matters? England has significantly increased the number of contracts falling within the statute of frauds since the original act was passed. England requires that promises to pay for the debt of others be in writing. France has a limited parol evidence rule. The parol evidence rule in France does not apply to commercial contracts. German law does not have a parol evidence rule.

England has significantly increased the number of contracts falling within the statute of frauds since the original act was passed.

Which of the following is true under the UCC regarding checks marked "paid-in-full"?

If a business inadvertently cashes such a check, the business has 90 days from the date it cashed that check to offer repayment in the same amount to the debtor and avoid an accord and satisfaction.

Which of the following is true regarding acceptable means of acceptance if no means of communicating an acceptance is specified in an offer? If no means of communicating an acceptance is specified in an offer, acceptance must be done through the U.S. mail system. If no means of communicating an acceptance is specified in an offer, acceptance must be done either in person or through telephone communication. If no means of communicating an acceptance is specified in an offer, acceptance must be done either through the U.S. mail or through fax transmittal. If no means of communicating an acceptance is specified in an offer, acceptance must be done either through U.S. mail or through e-mail. If no means of communicating the acceptance is specified, any reasonable means is generally acceptable.

If no means of communicating the acceptance is specified, any reasonable means is generally acceptable.

Which of the following is true regarding what is considered an interest in land within the statute of frauds? Interests in land within the statute of frauds include promises to sell crops annually, but not agreements between parties for profit sharing from the sale of real property or boundary disputes that have been settled through the use of land. Interests in land within the statute of frauds include boundary disputes that have been settled through the use of land and promises to sell crops annually, but not agreements between parties for profit sharing from the sale of real property. Interests in land within the statute of frauds include boundary disputes that have been settled through the use of land, but not promises to sell crops annually or agreements between parties for profit sharing from the sale of real property. Interests in land within the statute of frauds include promises to sell crops annually, agreements between parties for profit sharing from the sale of real property, and boundary disputes that have been settled through the use of land. Interests in land within the statute of frauds include promises to sell crops annually and agreements between parties for profit sharing from the sale of real property, but not boundary disputes that have been settled through the use of land.

Interests in land within the statute of frauds include promises to sell crops annually, agreements between parties for profit sharing from the sale of real property, and boundary disputes that have been settled through the use of land.

In return for his oral promise to pay her $100, Penny promises her uncle that she will not violate laws against speeding for one year. Penny abides by her promise, but her uncle refuses to pay. Which of the following is true regarding whether Penny is entitled to the money?

Penny is not entitled to recover because she had a preexisting duty to obey laws against speeding.

A[n] _______________ arises when a person acknowledges in court that he or she will perform some specified act or will pay a price upon failure to do so. Contract under seal Voidable contract Recognizance Implied-in-fact Informal contract

Recognizance

Prudence, a mean business law teacher, offers $50 to any student who will mow her lawn. Sam goes right over and begins mowing. Just before he finishes, Prudence goes over and tells him that she revokes her offer. Which of the following is true regarding Sam's entitlement to payment? Sam is not entitled to payment because a bilateral contract was involved that could only be accepted by full performance prior to revocation. Sam is not entitled to payment because a unilateral contract was involved that could only be accepted by full performance prior to revocation. Sam is entitled to only a proportional recovery based on the amount of work he had done prior to the revocation because Prudence always retained the right to validly revoke. Sam is entitled to recover because a unilateral contract was involved, and he was entitled to a reasonable amount of time to complete the job. Sam is entitled to recover because a bilateral contract was involved, and he was entitled to a reasonable amount of time to complete the job.

Sam is entitled to recover because a unilateral contract was involved, and he was entitled to a reasonable amount of time to complete the job.

Which of the following are contracts that contain multiple parts which can each be performed separately and for which separate consideration is offered?

Severable contracts

Which of the following terms would be considered material terms?

Subject matter, price, parties, quality, and quantity

Which of the following involves overly harsh or lopsided substance in an agreement?

Substantive unconscionability.

Mary and Jason discuss the fact that a new teacher is being hired for business law at their school. Jason mentions that he does not yet have a book, and Mary agreed to sell Jason a used business law book for $30 for the upcoming semester. When the new semester begins, the new business law teacher announces that a new custom business law text will be used that is only available in the campus bookstore. Jason wants a refund. Which of the following is Mary's best defense?

That Jason knew of the change of change of teacher and bore the risk of mistake.

Which of the following was the result in Alexander v. Lafayette Crime Stoppers Inc., the case in the text in which the plaintiffs sued for collection of reward money offered to catch a serial killer by the defending publications, and the publications defended on the basis that the plaintiffs failed to provide notice as required by the reward offers because the plaintiffs provided relevant information to law enforcement, not the defendants? That the plaintiffs accepted the reward offers by performance when they provided information to law enforcement and were, therefore, entitled to recover. That the plaintiffs were entitled to prevail because by law they were required to contact law enforcement, not the defendants. That defendants did not receive acceptance of the reward offer and that, therefore, no contract was formed. That defendants revoked the reward offer before it was accepted and that, therefore, no contract was formed. That reward offers cannot constitute offers and that, therefore, no contract was formed.

That defendants did not receive acceptance of the reward offer and that, therefore, no contract was formed.

Which of the following was the result in the case in the text William Cavanaugh v. Margaret McKenna, the case in which the plaintiff was sued for opening a funeral home after she agreed to refrain from doing so in her divorce as part of a covenant not to compete with her ex-husband?

That the covenant was reasonable and valid and construed liberally because it was most analogous to the sale of a business.

Which of the following was the result on appeal in the Case Opener involving the alleged breach of an oral contract based on the plaintiff lawyer loaning a corporate client funds and the client later reneging on a promise, made in gratitude, to give the lawyer 3 percent of the company's stock?

That the promise was not enforceable because it was a gift

Which of the following is false regarding how the Japanese tend to view contracts?

The Japanese do not desire that any terms be left to be decided later

Which of the following provides that a revocation is effective only when received by the offeree?

The Mailbox Rule

Which of the following is true on appeal regarding the case of Mary W. Scott v. Mid-Carolina Homes Inc., discussed in the "Case Nugget" in which the plaintiff sued to recover damages after a salesperson allegedly mistakenly agreed to sell a mobile home to her for a price that was too low, later told her the mobile home could not be sold because of a bent frame, and then proceeded to sell it for a higher price to other buyers?

The court refused to find that the defendant had the right to rescind the contract based on the alleged unilateral mistake.

Which of the following was the result in In Re Zappos.com Inc., v. Customer Data Security Breach Litigation, the case in the text in which customers of Zappos claimed that they were not bound to an arbitration agreement contained in a contract with Zappos? The court ruled for the plaintiffs for the following two reasons: (1) there was no contract because plaintiffs did not assent to it, and (2) even if a contract existed, the contract was illusory and unenforceable because Zappos could avoid promises at any time. The court ruled for the plaintiffs only because of its finding that no contract existed based on the plaintiffs lack of assent. The court ruled for the plaintiffs only because of its finding that the contract was illusory and unenforceable because Zappos could avoid promises at any time. The court ruled in favor of Zappos on the basis that even though some provisions of the contract were unenforceable, because of the federal policy favoring arbitration agreements, the arbitration clause itself was enforceable. The court ruled in favor of Zappos on the basis that the contract was properly entered into and was fully enforceable.

The court ruled for the plaintiffs for the following two reasons: (1) there was no contract because plaintiffs did not assent to it, and (2) even if a contract existed, the contract was illusory and unenforceable because Zappos could avoid promises at any time.

Which of the following was the result on appeal in Thelma Agnes Smith v. David Phillip Riley, the case in the text in which the plaintiff who had lived with the defendant out of wedlock for several years sought after they broke up to enforce two agreements regarding the sale and assignment of property to her? The court ruled in favor of the plaintiff on the basis that the plaintiff's previous deposit of funds into a joint checking account was sufficient consideration for the later agreements. The court ordered the parties to divide on a 50/50 basis the assets in question based on their domestic partnership. The court ruled in favor of the defendant on the basis that the plaintiff's previous deposit of funds into a joint checking account was insufficient consideration for the later agreements. The court ruled in favor of the plaintiff on the basis that a recitation of nominal consideration of $1 along with consideration of love and affection was adequate consideration to support the agreements. The court ruled in favor of the defendant on the basis that a recitation of nominal consideration of $1 along with love and affection was insufficient consideration to support a conveyance.

The court ruled in favor of the plaintiff on the basis that a recitation of nominal consideration of $1 along with consideration of love and affection was adequate consideration to support the agreements.

Which of the following was the result on appeal in Eric Lucier and Karen Haley v. Angela and James Williams, Cambridge Associates LTD., and Al Vasys, the case in the text in which, after finding significant problems with their roof, the plaintiffs claimed that provisions in a home inspection contract illegally limited the liability of the defendants?

The court ruled in favor of the plaintiffs on the basis that the limitation of liability provision in the contract was unconscionable and violated the public policy of the state.

Which of the following was the result on appeal in Reisenfeld & Co. v. The Network Group Inc.; Builders Square Inc.; Kmart Corp., the case in the text involving whether the plaintiff could recover from BSI in the situation in which BSI contracted with Network Group to lease property, and Network Group contracted with the plaintiff agreeing to pay a certain commission for his work but then defaulted on the contract?

The court ruled that because a quasi-contract was involved, BSI was required to pay the plaintiff the reasonable value of the services rendered, not necessarily the contractual amount promised for commissions.

What was the result in the case discussed in the text Andrus v. State Department of Transportation, and City of Olympia in which the plaintiff sued because a job offer was allegedly revoked? The plaintiff won because the city had validly offered him a job and had no right to revoke it. The plaintiff won because, while there was no contract, the court ruled that the city was not allowed to mislead him on equitable grounds and also on grounds of unlawful discrimination. The defendant won because it had truly received a bad reference. The defendant won because the plaintiff had not specifically accepted the job. The defendant won because the purported job offer contained insufficient information to be considered reasonably certain in regard to its terms.

The defendant won because the purported job offer contained insufficient information to be considered reasonably certain in regard to its terms.

Which of the following is the most likely measure of recovery when a quasi-contract is involved? The amount set forth in the contract. The fair market value of the matter involved. The wholesale price of any good involved. The amount sought by the plaintiff in the Complaint. Damages will be computed the same way as they are computed for any other contract.

The fair market value of the matter involved.

Sally goes to have her hair trimmed and agrees to pay $40 to the stylist. While there, Sally decides that she would also like highlights. The stylist informs her that highlights will cost an additional $30. Sally agrees to the price, gets the highlights, but refuses to pay the extra amount. What is the likely result in a dispute between Sally and the stylist and why?

The stylist will win because she did additional work in exchange for the extra payment; and, therefore, Sally's promise was supported by valid consideration.

When may a court rule find parol evidence admissible to further the court's understanding of an agreement?

When a court determines that a written agreement does not represent a complete and final version of the agreement.

As a general rule, when is revocation effective?

When it is received by the offeree

15. When must a disaffirmance of a contract based on minority occur? a. Before of within a reasonable time of the minors reaching age of majority. b. Within 30 days of the minors reaching majority age c. Within 60 days of the minors reaching majority age d. Within 90 days of the minors reaching majority age e. Within one year of minors reaching majority age

a. Before of within a reasonable time of the minors reaching age of majority.

11. Sam promises his uncle, Bob, that he will lose 10 pounds and exercise every day during the spring semester in exchange for having his tuition paid for the fall semester. The uncles agrees; but after Sam has lost 10 pounds and exercised all semester, Bob refused to pay saying that no contract existed. Which of the following is true? a. Consideration was present, there was an enforceable contract, and bob has wrongfully refused to pay. b. There was no consideration present, bob has no obligation to pay. c. There was no consideration present, but bob must pay under principles of promissory estoppels. d. There was consideration present, but bob is not required to pay because the contract was illusory. e. There was consideration present, but bob is not required to pay because bob did not receive a benefit personally.

a. Consideration was present, there was an enforceable contract, and bob has wrongfully refused to pay.

16. Which of the following is what a person will receive in return for preforming a contract obligation? a. Consideration b. Acknowledgment c. Approval d. Accord e. Accession

a. consideration

9. Within the statue of frauds, "land" encompasses not only the land and soil itself but anything_______ to the land. • Pertinent • Adjacent • Relating • Contracted • Attached

attached

9. A[n] _________ is 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 recognized a duty. • Contract • Offer • Consideration • Acceptance • Legal object

contract

3. The reference to ___________ comes from the days when the contract was literally sealed by a piece of soft wax into which an impression was made. • Implied-in-fact contracts • Implied- in-law contracts • Contracts under was • Contracts under seal • Contracts under pressure

contracts under seal

4. Even if they would normally have to be writing, if applicable criteria are met, oral contracts for _____ goods are enforceable. • Retailed • Wholesale • Consumer • Collateral • Customized

customized

5. Which of the following is true regarding the ability of persons suffering from a mental illness to enter into a binding contract? a. Persons suffering from a mental illness have no capacity to enter into a binding contract. b. Persons suffering from a mental illness have full capacity to enter into a binding contact so long as they do not present danger to themselves or others. c. Persons suffering from a mental illness have full capacity to enter into a binding contract so long as they inform the other party that they are in treatment d. Persons suffering from a mental illness may have full, limited, or no legal capacity to enter into a binding contact depending on the nature and extent of their mental deficiency e. Persons suffer from a mental illness always have full capacity to enter into a binding contract

d. Persons suffering from a mental illness may have full, limited, or no legal capacity to enter into a binding contact depending on the nature and extent of their mental deficiency

An ______ agreement is a clause parties include in written agreement that states that the written agreement accurately reflects the final, complete version of the agreement? a. Adhesion b. Complete c. Parol d. Merger e. Consolidation

d. merger

19. An _______ agreement is an agreement two parties enter into before marriage that clearly states the ownership rights each party enjoys in the other party's property. a. Preliminary b. Planned c. Approved d. Prenuptial e. Arranged

d. prenuptial

2. If a legal contract is formed and the subject of the contract then becomes illegal under a new statue, the contract is____. • Enforced • Discharged • Executory • Executed • Disregarded

discharged

Which of the following is found when one party was forced into an agreement by the wrongful act of another?

duress

Which of the following occurs when a party threatens to file a criminal lawsuit unless consent is given to the terms of a contract? Coercion Criminal influence Durable fraud Duress Undue influence

duress

10. Which of the following occurs in Australia whenever an illegitimate threat is made to hold on to goods unless a payment is made or an agreement is entered into? • Unreasonable duress • Duress of trade • Unconscionable duress • Duress of merchandise • Duress of goods

duress of goods

13. Which of the following is presumed to be reasonable amount of time when considering whether an offer has expired? a. 48 hours b. 7 days c. 10 days d. 45 days e. There is no set amount of time, and what constitutes a reasonable amount of time varies depending upon the subject matter of the offer.

e. There is no set amount of time, and what constitutes a reasonable amount of time varies depending upon the subject matter of the offer.

6. Which of the following would NOT be considered an example of consideration? a. A promise to be on time for class all semester. b. A promise to stop drinking sports drinks c. A promise to walk the neighbor's dog d. A promise to call the police if the neighbor's alarm system should go off while they are on vacation. e. A promise to pay your employees as required by law

e. a promise to pay your employees as required by law

14. Which of the following is FALSE regarding written contracts? a. Disputes are easier to settle when contractual terms are solidified in writing. b. The moment of writing allows both parties to reconsider terms and ensure what they desire. c. In general, written contracts aid in the conduct of smooth business contracts. d. The idea of requiring a writing comes from an English law e. All contracts must be in writing in order to be enforced.

e. all contracts must be in writing in order to be enforced

4. For a court to enforce a promise, _______ must offer consideration. • The acceptor but not the acceptee •The acceptee but nit the acceptor • Each side to the contract • The offeree but not the offeror • The offeror but not the offeree

each side to the contract

3. Which of the following is involved in a situation in which a person refuses to perform according to a contract unless the other person either signs another contract with the one making the threat or pays that person a higher price than was specified in the original agreement? a. Fraudulent duress b. Contractual duress c. Negligent duress d. Economic duress e. Specific duress

economic distress

Which of the following is involved in a situation in which a person refuses to perform according to a contract unless the other person either signs another contract with the one making the threat or pays that person a higher price than was specified in the original agreement? Contractual duress Economic duress Negligent duress Fraudulent duress Specific duress

economic duress

5. Which of the following occurs when a minor's parents or legal guardian gives up the right to exercise legal control over the minor, typically when the minor moves out of the parent's house and begins supporting him or herself? • Legal release • Emancipation • Disaffirmance • Ratification • Reaffirmance

emancipation

A statement releasing one of the parties to an agreement from all liability, regardless of who is at fault or what the injury suffered is, would be referred to as a[n] ______ agreement.

exculpatory

Once all the terms of the contract have been fully performed, the contract is said to be ___________. Executory Executed Anticipatory Ended Stopped

executed

As long as some of the duties under a contract have not yet been performed, the contract is considered ________________. Executory Executed Anticipatory Ended Stopped

executory

22. An _____ is a false of representation of a material fact that is consciously false and intended to mislead the other party. a. Negligent misrepresentation b. Fraudulent misrepresentation c. Scienter misrepresentation d. Acknowledged misrepresentation e. True misrepresentation

fraudulent misrepresentation

If a licensing statute is intended to protect the public's health, safety, and welfare, an agreement with an unlicensed professional is typically deemed _____.

illegal and unenforceable

20. Which of the following in some sort of mental or physical defect that prevents a person from being able to enter into a legally binding contract? a. immajority b. Capacity c. Chronic illness d. Incapacity e. Terminal illness

incapacity

4. An _____ misrepresentation results from a false statement about a fact material to an agreement that the person making the statement believed to be true. a. Wrongful b. Innocent c. False d. Misleading e. Illegal

innocent

Which of the following are written contracts intended to be the complete and final representation of the parties' agreement? • Complete contracts • Adhesion contracts • Integrated contracts • Acknowledged contracts • Bilateral contracts

integrated contracts

7. Which of the following is the maximum interest rate? • 15% • 12% • It varies depending on the state involved. • 20% • 10%

it varies depending on the state involved

8. Which of the following involves a promise to buy or sell that the courts will require the parties to obey? • Contractual affirmance • A special agreement • Bilateral assent • Legal assent • Legal affirmance

legal assent

When a mistake of fact occurs, ______ is absent.

legal assent

8. Which of the following references the requirement that a contract not be either illegal or against public policy? • Consideration • Capacity • Legal object • Illegal prohibition • Ethical requirement

legal object

terms of a contract that are correct for entering or not entering contract

material contract

A[n] ______ agreement is a clause parties include in a written agreement that states that the written agreement accurately reflects the final, complete version of the agreement.

merger

7. If a _________ misunderstanding between parties exists, and as a result of that misunderstanding the parties do not really come to a meeting of the minds, there is no contract. a. Mutual b. Unilateral c. Comprehensive d. Subjective e. Reasonable

mutual

Which of the following refers to an intentional failure to provide pertinent information about a projected contract? Negligence Secretion Entombment Concealment Nondisclosure

nondisclosure

Which of the following refers to an intentional failure to provide pertinent information about a projected contract? Negligence Secretion Entombment Concealment Nondisclosure

nondisclosure

24. If a ________ contact exists, the administrator of an offeror's estate must hold the offer open until it expires in accordance with the contract. a. Bilaterial b. Unilaterial c. Complete d. Option e. Controlled

option

7. If a person wishes to ensure that an offer will in fact be held open for a set period of time, the person may do so by entering into a[n] _______ contract with the offeror. • Clear • Explicit • Irrevocable • Option • Adhesion

option

If a[n] __________ contract exists, the administrator of an offeror's estate must hold the offer open until it expires in accordance with the contract.

option

Under ____, if the buyer in an alleged contract for the sale of land has paid any portion of the sale price, has begun to permanently improve the land, or has taken possession of the land, the courts will consider the contract partially performed, and this partial performance will amount to proof of the contract.

partial performance

5. Which of the following occurs when three conditions are met: one party makes a promise knowing the other party will rely on it; way to avoid injustice is to enforce the promise? • Promissory performance • Quasi agreement • Promissory agreement • Quasi estoppel • Promissory estoppel

promissory estoppel

9. Which of the following is an exception to the rule requiring consideration? • Promissory estoppel • Quasi agreement • Promissory performance • Quasi estoppel • Promissory agreement

promissory estoppel

As discussed in the case of Double AA Builders Ltd., v. Grand State Construction L.L.C., which of the following may be used to necessitate that a subcontractor perform according to the terms of its bid because the contractor has relied on the subcontractor's bid?

promissory estoppel

2. Christen graduates from college, receives a job offer across the county, and moves there giving up her apartment and cancelling all the other job interviews. After she gets there, she is told that there is no job. What may she recover in most states? • Approved damages • Reliance damages • Nothing • Acknowledged damages • Liquidated damages

reliance damages

7. When a person who makes a misrepresentation has no knowledge about the falsity of the claim, it is said that the person lacked_______. • Premeditation • Planning • Information • Scienter • Plotting

scienter

When a person who makes a misrepresentation has no knowledge about the falsity of the claim, it is said that the person lacked ____.

scienter

23. As a general rule, the ______ intent of the parties is not relevant when degerming whether a contract exists, rather, what is relevant is how they represented their intent through their actions and words. a. Objective b. Subjective c. Unilateral d. Comprehensive e. Considered

subjective

4. As a general rule, the ________ intent of the parties is not relevant when determining whether a contract exists; rather what is relevant is how that represented their intended actions and words.

subjective

Which of the following is an exception as to when a secondary obligation needs to be in writing?

the main purpose rule

9. Which of the following sets forth the common law rule that the terms if an acceptance must mirror the terms of an offer? • The Matching Rule • The Complete Rule • The Mirror Image Rule • The Exact Rule • The Parallel Rule

the mirror image rule

6. Which if the following refers to the right of an offeror to revoke an offer? • The offeror is the "controller of his offer." • The offeror is the "master of his offer." • The offeror is the "proponent of his offer." • The offeror is the "adjudicator of his offer" • The offeror is the "arbiter of his offer"

the offeror is the "master of his offer"

Which of the following is false regarding the parol evidence rule? The purpose of the rule is to prevent evidence that substantially contradicts an agreement in its written form. The rule is an amalgamation of different rules and conditions. The rule relates to substantive legal issues. The rule is a rule of evidence. The rule is not a unitary concept or rule.

the rule is a rule of evidence

8. Which of the following is the age of majority in regard to the right to contract in Great Britain? • 21 • 16 • 19 • 18 • There is not a set age of majority

there is not a set age of majority

6. Which of the following refers to special relationships in which one person has taken advantage of his or her dominant position in a relationship to unduly persuade the other person? • Pressing dominance • Relationships dominance • Fraudulent misrepresentation • Pressing persuasion • Undue influence

undue influence

6. In a[n] _______ contract, the offeror wants a performance to form the contract.

unilateral

8. A __________ mistake is the result of an error by one party about a material fact. a. Unclear b. Mutual c. Unilateral d. Clear e. Single

unilateral

Although there are some exceptions, a[n] ______ mistake does not generally void a contract.

unilateral

2. All contracts can be categorized as either ______ or_____

unilateral or bilateral

1. A[n] ________ contract is one that contains all the legal elements of a contract.

valid

18. In an auction ________, the seller is treated as making an offer to accept the highest bid. a. Without controls b. With controls c. Without reserve d. With reserve e. Without qualifications

without reserve

In an auction _________, the seller is treated as making an offer to accept the highest bid.

without reserve

3. In most states, which of the following are exceptions to when the statue of frauds would apply? • Promissory estoppel and partial performance, but not admissions • Admissions, partial performance, and promissory estoppel • Partial performance and admissions, but not promissory estoppel • Admissions but not partial performance or promissory estoppel • Promissory estoppel but not admissions or partial performance

• Admissions, partial performance, and promissory estoppel

2. Sally has a large farm and significant other assets. She agreed to loan her nephew Todd $100,000 with payments of principle and interest to be made yearly. A few years later she and Todd got into a dispute because Sally did not like his new girlfriend, Polly. Soon thereafter Todd got notice that Sally was suing him for not paying interest on the note. Todd defended on the basis that two years, after the initial loan agreement was entered into, he and sally entered into an oral agreement that he would perform services on her farm in lieu of paying interest on the note. If the court follows the reasoning of the court in the Case Opener involving Monroe Bradstand and Jeanne Garland, which of the following is the most likely result of the dispute between Sally and Todd involving whether he owes past interest amounts? • Assuming the court credits Todd's account of events. Todd will not be required to pay the interest amounts because the oral agreement will be considered an extension and part of the original written agreement. • Assuming the court credits Todd's account of events, based on the parol evidence rule, Todd will be required to pay inly ½ of the interest amounts. • Todd will be required to pay the interest amounts because the parol evidence bars evidence of any oral agreement outside the written agreement. • Todd will be required to pay the interest amounts because the agreement involving performing services in, lieu of paying interest was not in writing. • Assuming the court credits Todd's account of events, Todd will not be required to pay the interest amounts because the oral agreement will be considered a separate enforceable agreement.

• Assuming the court credits Todd's account of events, Todd will not be required to pay the interest amounts because the oral agreement will be considered a separate enforceable agreement.

5. Gretchen offers $100 to anyone who can return her lost dog, Sparky, Haley returns the dog and requests the money. Gretchen says that there is no binding contract. Which if the following is true regarding Gretchen's statement? • Gretchen is incorrect because there is a binding bilateral contract. • Gretchen is incorrect because there is binding unilateral contract which Haley accepted by performing. • Gretchen is correct because there is no binding bilateral contract. • Gretchen is correct because there is no binding unilateral contract. • Gretchen is correct because Haley acted incorrectly by her manner of attempted acceptance.

• Gretchen is incorrect because there is binding unilateral contract which Haley accepted by performing.

3. Which of the following is true once a guardian has been appointed for a person who has been adjudicated insane? • If a person has been adjudicated insane and has been a guardian appointed, that person reaction capacity to enter into a contract so long as the other party to the contract is aware of the insanity issue. • If a person has been adjudicated insane and has a guardian appointed, that person retains capacity to enter into contracts so long as the other party to the contract is aware of the guardian's status. • If a person has been adjudicated insane and has a guardian appointed, that person retains capacity to enter into contracts so long as the other [party to the contract is aware of the guardian's status and also the insanity issue. • If a person has been adjudicated insane and has a guardian appointed, that person has no capacity to enter into contracts and any contract he does attempt to enter into is void. • If a person has been adjudicated insane and has a guardian appointed, that person has no capacity to enter into contracts and any contract he does attempt to enter into is voidable

• If a person has been adjudicated insane and has a guardian appointed, that person has no capacity to enter into contracts and any contract he does attempt to enter into is void.

6. As a general rule, most states will not allow a minor to disaffirm contracts for which of the following? • Education loan contracts and psychological counseling, but not life insurance or health insurance. • Health insurance and psychological counseling, but not life insurance • Health insurance, but not life insurance or psychological counseling • Life insurance, health insurance and psychological counseling • Psychological counseling, but not health insurance or life insurance

• Life insurance, health insurance and psychological counseling

Which of the following is false regarding the statue of frauds and promise made in consideration of marriage? • A prenuptial agreement is not automatically enforceable just because is it in writing. • Prenuptial agreements fall within the statue of frauds. • Agreements regarding marriage in which on party is gaining something other than a return on his or her promise to marry are within the statue of frauds and must be in writing. • Mutual promises to marry fall within the statue of frauds. • When one party promises something to the other as part of an offer of marriages, the contract must be writing to be enforceable

• Mutual promises to marry fall within the statue of frauds.

7. As discussed in the text, a main purpose of the statue of frauds is to prevent unreliable_____ evidence from interfering with a contractual relationship. • Oral • Hearsay • Immaterial • Inconclusive • Irrelevant

• Oral

5. In China which of the following is true regarding the treatment of fraudulent misrepresentations by outsiders? • Outsiders are jailed for at least 20 years by law. • Outsiders have been fined but by law are allowed to continue operation in the country's concern with joint ventures. • Outsiders are jailed for at least 10 years, fined heavily, and have all property confiscated. • Outsiders have been prohibited from doing further business with Chinese firms but not fined because of the country's concerns with its reputation with foreign investors. • Outsiders have been fined heavily and refused permission to enter into more agreements with Chinese firms.

• Outsiders have been fined heavily and refused permission to enter into more agreements with Chinese firms.

1. Which of the following was the result on appeal in the case in the text, Gary W. Cruse v. Coldwell Banker/Graben Real Estate Inc. in which the court considered whether the plaintiffs could prevail based on alleged misrepresentations by a sales man that a house was new when it was actually not new leading the plaintiffs to forego a home inspection? • That the plaintiffs were barred from proceeding because they signed an "as is" disclaimer. • That as a matter of law the plaintiffs were allowed to recover. • That the realtor had merely engaged in sales talk when marketing the home as new which could not be relied upon by the purchasers. • That a jury questions was presented on whether the plaintiffs, could have justifiably relied on the defendants' misrepresentation. • That the plaintiffs were barred from proceeding because they knew that the home builder had occupied the house.

• That a jury questions was presented on whether the plaintiffs, could have justifiably relied on the defendants' misrepresentation.

4. Which of the following was the result on appeal in Eric Lucier and Karen Haley v. Angela and James Williams, Cambridge Associates LTD and Al Vasys, the case in the text in which, after finding significant problems with their roof, the plaintiffs claimed that provisions in a home inspection contracts illegally limited the liability of the defendants? • The court ruled in favor of the plaintiffs on the basis that the limitation of liability provision in the contract was unconscionable and violated the public policy of the state. • The court ruled in favor of the defendants on the basis that the plaintiffs freely entered into the contract and should, therefore, be bound to its terms. • The court ruled in favor of the plaintiffs on the basis that although the contract was not unconscionable, public policy was violated • The court ruled in favor of the defendants on the basis that while the could would intervene in appropriate cases, a presumption against a finding of unconscionability exists in home inspections contracts, and the plaintiffs failed to rebut that presumption. • The court ruled in favor of the defendants on the basis that no contract of adhesion was involved and that, therefore by definition the contract satisfied public policy.

• The court ruled in favor of the plaintiffs on the basis that the limitation of liability provision in the contract was unconscionable and violated the public policy of the state.

10. What was the result in the case in the text Lucy v. Zehmer involving whether allegations of joking prevented the formation of the contract involved? • The court ruled that the contract would not be enforced because one of the parties was subjectively joking. • The court ruled that the contract would not be enforced because one of the parties was joking, and a reasonable person should have known that. • The court ruled that the contract would be enforced because the parties had been deinking although they were not intoxicated. • The court ruled that the agreement would be enforced because under the applicable standard, it was not apparent that joking was involved. • The court ruled that the contract would be enforced because of what the parties verbally said regardless of whether an objective person would have through joking was involved.

• The court ruled that the agreement would be enforced because under the applicable standard, it was not apparent that joking was involved.

5. Which of the following is the most likely measure of recovery when a quasi- contract is involved? • The amount set forth in the contract. • The fair market value of the matter involved. • The wholesale price of any good involved. • The amount sought by the plaintiff in the Complaint. • Damages will be computed the same way as they are computed for any other

• The fair market value of the matter involved.

2. What was the result in the Opening Case in which the plaintiff attempted to buy a jet from Pepsi points and some additional funds? • The plaintiff prevailed, and Pepsi had to sell the jet as offered because Pepsi failed to specifically reserve details of the offer to a separate writing. • The plaintiff prevailed, and Pepsi had to sell the jet as offered because Pepsi's advertisement was considered an offer which the plaintiff validly accepted. • The plaintiff prevailed, and Pepsi had to provide the jet as offered because Pepsi did not revoke the offer soon enough. • The plaintiff did not prevail because the jet was unobtainable as a military aircraft. • The plaintiff did not prevail because Pepsi reserved the details of the offer to a separate writing, and Pepsi had the authority to reject the plaintiff's offer to purchase.

• The plaintiff did not prevail because Pepsi reserved the details of the offer to a separate writing, and Pepsi had the authority to reject the plaintiff's offer to purchase.

6. Which of the following is true regarding the preexisting duty rule? • Unforeseen circumstances is an exception, but additional work and past consideration are not exceptions. • Unforeseen circumstances and additional work are exceptions, but past consideration is not an exception. • Additional work is an exception, but unforeseen circumstances and past consideration are not exception. • Unforeseen circumstances and past consideration are expectations, but additional work is not an exception. • Past consideration is an exception, but unforeseen circumstances and additional work are not exceptions.

• Unforeseen circumstances and additional work are exceptions, but past consideration is not an exception.