Chapter 16

Can there be a contract between Wizard Internet and the seller without an agreement on the price? A. Yes, under UCC contracts. B. Yes, under common law contracts. C. Yes, under both UCC and common law contracts. D. No, under both UCC and common law contracts.

A. Yes, under UCC contracts.

If the contract called for the computer equipment and the installation between Wizard Internet and the seller, would the Article 2 of the UCC cover this agreement? A. Yes, since there is a sale of a good in the contract. B. No, since there is a service (installation of the equipment) in the sale, the UCC would not cover. C. A court would look to the "predominant factor" test to determine if the contract was covered. D. Only if they stated in the contract the UCC would cover this contract.

C. A court would look to the predominant factor test to determine if the contract was covered

Would there be a valid contract if the quantity of the computer equipment was left open? A. Yes, the UCC allows on open quantity term to be closed as long as there is evidence of intent of the parties to enter into a contract. B. Yes, the contract would allow for a reasonable amount of equipment to be delivered. C. No, the contract would fail for indefiniteness. D. Yes, the UCC allows on open quantity term to be closed as long as there is evidence of intent of the parties to enter into a contract & Yes, the contract would allow for a reasonable amount of equipment to be delivered. Both of these are correct. Feedback

C. No, the contract would fail for indefiniteness.

Arnold owned 30 helmeted guinea fowls at his poultry farm. He made a contract to sell 10 of them to Richard. This is an example of a contract for _____ goods. a. future b. promotional c. existing d. liquidated

C. existing

Waldo wanted to remodel his kitchen. He went to Ashwood Cabinetry to pick out some new cabinets for the kitchen. He told the salesperson exactly which type of cabinets he needed for his kitchen and what wood and finish they were to be. The salesperson told him the cabinets had to be ordered but could be expected to be delivered to Ashwood in three weeks. Waldo made a down payment of 50% with the promise to pay the rest when the cabinets were delivered to him. What kind of transaction did Waldo engage in? a. A contract to sell b. A contract for services c. A sale d. A pending sale

a. A contract to sell

When does the United Nations Convention on Contracts for the International Sale of Goods (CISG) govern sales contracts? a. CISG governs only when the parties have business places in different countries that have adopted the convention. b. CISG governs international contracts even when the parties indicate they will not be governed by it. c. CISG governs only personal consumer transactions of parties from different countries. d. CISG governs all sales contracts when the parties are from different countries.

a. CISG governs only when the parties have business places in different countries that have adopted the convention.

Nick's Wholesale was a supplier of Gatorade. It had a stock of 30 cartons of G series Fit, 40 cartons of G series Pro, and 50 cartons of G series Natural. A university contracted with Nick's to buy 10 cartons each of G series Fit and G series Natural for its upcoming basketball competition. Nick's separated the stock ordered by the university from the rest of the stock. The goods in this case are an example of _____ goods. a. identified b. promotional c. future d. liquidated

a. Identified

_____ goods refer to goods that the seller and buyer have agreed are to be received by the buyer or have been picked out by the seller. a. Identified b. Promotional c. Future d. Liquidated

a. Identified

Allison raised cattle on her farm in Texas. She normally fed the cattle hay, but wanted to supplement their food over the winter, so she ordered a load of grain. She did not discuss the price of the grain at the time she made the order. Is there a binding contract and if so, what will the price of the grain be? a. There is a binding contract with the price of the grain the reasonable price for grain in the market. b. There is a binding contract with the price to be fixed later by the parties. c. There is not a binding contract since the contract was illegal. d. There is not a binding contract since no price was fixed in the contract

a. There is a binding contract with the price of the grain the reasonable price for grain in the market.

James planned to buy a guitar from Kevin after seeing Kevin's advertisement on a website. James met with Kevin to make the exchange. But upon inspecting the guitar, James suspected that the guitar was stolen property. Which of the following documents should Kevin produce to prove that he is the original owner of the guitar? a. A grant deed b. A bill of sale c. A letter of credit d. A codicil

b. A bill of sale

Article 2 of the Uniform Commercial Code (UCC), effective in all states except Louisiana, governs: a. transfers of money between banks. b. sales of movable personal property. c. transactions involving letters of credit. d. auctions and liquidations of assets.

b. sales of movable personal property.

How do courts treat a fully executed, illegal sale? a. Courts will normally restore the parties to their status prior to the sale. b. Courts will restore only the complaining party to the party's prior status. c. Courts will not normally aid either party. d. Courts will find both parties guilty of a crime.

c. Courts will not normally aid either party.

Which of the following is true about a sale of goods? a. It does not require any consideration to become enforceable. b. It consists of a promise between individuals to buy and sell in the future. c. It changes ownership from the seller to the buyer at the moment the bargain is made. d. It retains the ownership of the goods with the seller.

c. It changes ownership from the seller to the buyer at the moment the bargain is made.

Jackson visited Speed Zone, a used car dealer. He test drove a few cars and then contracted with the dealer to buy a Chevy for a good price. This Chevy was a stolen car being sold illegally by Speed Zone. However, unaware of this fact, Jackson made full payment to Speed Zone for the car. If Jackson finds out that the car was stolen and sues Speed Zone what will happen? a. The court will find the contract valid since it was wholly executed. b. The court will find in Speed Zone's favor since Jackson willingly paid for the car. c. The court will order Speed Zone to return Jackson's payment to him. d. The court will enforce the legal part of this sale.

c. The court will order Speed Zone to return Jackson's payment to him.

Which of the following is an example of movable personal property? a. Land b. Certificates of stock c. Vehicles d. Notes receivable

c. Vehicles

Wendy had a problem with the battery in her car. She asked Peter, a mechanic, to look at the car. Peter serviced the car and installed a new battery. Peter's contract with Wendy to fix the car is not covered by Article 2 of the UCC because it is: a. a void contract. b. an express contract. c. predominantly a service contract. d. predominantly a sales contract.

c. predominantly a service contract.

The consideration in a sales contract, generally expressed in terms of money or money's worth, is called: a. promissory note. b. loan. c. price. d. penalty.

c. price.

Hi-Tech, an automobile manufacturing company in Maryland sells over 10,000 cars in a month. Which of the following articles of the UCC governs this sale? a. Article 3 b. Article 2A c. Article 6 d. Article 2

d. Article 2

Which of the following is a sale under Article 2? a. Myrtle registering a copyright on her new book b. Ben buying a new house c. William buying a farm d. Gary buying a tuxedo from a fashion house

d. Gary buying a tuxedo from a fashion house

Newton paid Star Lumber Co. to saw some special chestnut trees Star owned into lumber for him. Star told Newton it would probably take three weeks before the trees could be cut for the lumber. After the trees were cut and sawed into lumber, Star place the lumber out to cure. While it was curing Star got into financial difficulty. Newton really wanted the lumber so he drove his truck over and started loading it onto his truck. A Star employee told him to stop. Newton claimed he had title to the lumber. Decide. a. Newton had title to the lumber because he had paid for it. b. Newton had title to the lumber because Star had cut the trees and sawed it into lumber. c. Newton did not have title to the lumber because Star's creditors had title to it. d. Newton did not have title to the lumber because Star first had to take some further action.

d. Newton did not have title to the lumber because Star first had to take some further action.