Chapters 8, 9, 10, 11
Sandy owns a sandwich shop and offers a free sandwich to any customer who shows receipts for the purchase of ten sandwiches. Ben shows the required receipts and requests a free sandwich. Sandy agrees and provides him with a sandwich. This is an example of what type of contract, if any?
A. A bilateral, executed contract B. A bilateral, executory contract C. This type of transaction does not involve a contract. D. A unilateral, executed contract Correct Answer: D
Amy owns "We Mow Yards". One of her employees, Sam, mistakenly mows the yard of Alice instead of the yard of customer Will, who was Alice's neighbor. Alice was home at the time, saw what was going on, but said nothing. Does Alice owe anything to Amy, and if so, why?
A. Alice owes Amy an amount set by the court representing the reasonable value of the benefit received under the theory of promissory estoppel. B. Alice owes Amy whatever the contract amount was that Amy had with Will under a quasi contract theory. C. Alice owes Amy whatever the contract amount was that Amy had with Will under the theory of promissory estoppel. D. Alice owes Amy an amount set by the court representing the reasonable value of the benefit received under a quasi contract theory. Correct Answer: D
Which of the following is true regarding the Uniform Commercial Code (UCC)?
A. It expressly recognizes the concept of an unconscionable contract. B. It recognizes the enforceability of all oral and written contracts. C. It only applies to business-to-business (B2B) transactions. D. It classifies everyone covered by the UCC as a merchant. Correct Answer: A
Which of the following is true regarding the Uniform Commercial Code and merchants?
A. It imposes a higher standard of behavior on nonmerchants than on merchants. B. If a person sporadically deals in the kind of goods being sold, that person is a merchant for the purposes of the contract in question. C. It defines merchant on a case-by-case basis. D. If a consumer buys a refrigerator from a used-car dealer, the dealer is a merchant for the purposes of the contract in question. Correct Answer: C
Which of the following is true of the Uniform Commercial Code (UCC) regarding acceptance by shipment?
A. It specifically says that an order requesting "current" shipment of goods impliedly refuses acceptance. B. It says that a seller who ships "nonconforming goods" has failed to breach a contract. C. It says that a seller who ships "nonconforming goods" has accepted the contract if the seller reasonably notifies the buyer that such a shipment is intended as an "accommodation" to the buyer. D. It forces the seller to give the buyer timely notice of his inability to fill an order. Correct Answer: D
Dan is looking for a new large-screen television for his entertainment room. Over the weekend, while surfing the internet for deals, Dan sees a 70-inch, "state-of-the-art" Sonyo television advertised for sale by Preferable Purchase Electonics. The price indicated is a jaw-dropping $199, and the advertisement states that the price is good for in-store purchases only. On Monday morning, Dan drives to his local Preferable Purchase store and as soon as the doors are opened for business, Dan finds Pete, one of the Preferable Purchase sales representatives. Dan informs Pete that he wants to buy one of the 70-inch Sonyo TVs for the advertised price of $199, and that he will pay cash for it. Pete immediately locates the manager, Mike, who informs Dan that the price listed in the advertisement was unfortunately a mistake (the price was supposed to be $1,999 not $199). Mike refuses to sell the television at the advertised price but tells Dan that he will sell it to him for the store's cost, $1,600. Dan responds by saying, "See you in small claims court, Mike, if you do not sell me this TV for $199". Is Preferable Purchase legally obligated to sell Dan the television for $199? (Assume that the price listed in the advertisement was in fact a mistake, and not an intentional misrepresentation).
A. No, since advertisements for the sale of goods are not supported by mutual consideration. B. Yes, since Preferable Purchase's advertisement constituted a firm offer. C. No, since advertisements for the sale of goods at a specified price are not offers. D. Yes, since Preferable Purchase's advertisement constituted an offer, and Dan accepted the offer based on its terms. Correct Answer: C
Paul sends Kristy an order for 200 china plates for his restaurant. Since her supplier is late and her stock is low, Kristy sends 100 china plates and 100 china bowls with no explanation. Which of the following is true regarding the status of the parties?
A. Paul must accept the shipment, but he may sue in order to recover the remaining goods due under the contract. B. Paul must accept the shipment and has no rights to sue Kristy because the deficiency was unavoidable. C. Paul must accept the shipment, but Kristy must give him a discount. D. Kristy has both accepted and breached the contract, and the shipment is considered a counteroffer. Correct Answer: D
Preston, who makes a living doing remodeling, put his car up for $5,000 on March 1. Betty wanted to buy the car but was not sure whether or not she could get a loan. On March 3, she paid Preston $100 to hold the car for her for one week. Preston took the money but sold the car one day later, on March 4, and told Betty that he had revoked the contract. Which of the following is true regarding the position of the parties?
A. Preston and Betty had a quasi contract, but Preston was entitled to disregard it so long as he returned Betty's $100 to her. B. Preston made a firm offer which Betty was entitled to enforce, and Preston breached the contract. C. Preston and Betty had an option contract which Preston breached by selling the car. D. Preston and Betty did not have an enforceable contract, and Preston was entitled to sell the car. Correct Answer: C
Any attempt by the offeree to materially alter the terms of the offeror's offer results in a(n):
A. Rejection B. Counteroffer C. Bilateral contract D. Acceptance Correct Answer: B
Which of the following is false regarding the CISG?
A. The CISG generally requires that acceptance be a mirror image of the offer. B. The CISG applies in all countries. C. The CISG applies only to commercial sales of goods. D. All parties must be merchants under the CISG. Correct Answer: B
Which of the following creates a temporary monopoly to encourage the development of new technologies?
A. Trademark B. Copyright C. Trade Secret D. Patent Correct Answer: D
In a contract involving elements of both goods and services, a court will determine whether Article 2 of the Uniform Commercial Code (UCC) applies by:
A. asking if the contract is barred by public policy. B. asking which element predominates in the contract. C. applying the strict scrutiny test to the contract. D. applying the intermediate scrutiny test to the contract. Correct Answer: B
A counteroffer:
A. impliedly rejects an offer. B. does not affect the material terms of the contract. C. is a mirror-image of the offer. D. is an inquiry into the terms of the offer. Correct Answer: A
Mike D'Arruda, the owner of Preferable Purchase Electronics, Inc., orders 100 stereo receivers from Sandy Talley, a salesperson for Dulcet Sound Manufacturing Company. Mike has made a promise to pay for the receivers in exchange for Dulcet Sound's promise to deliver them. This is a(n) __________ contract.
A. quasi B. unilateral C. bilateral D. implied Correct Answer: C
Suppose that Jeff and Patricia are negotiating a contract and Jeff prepares a written draft of the agreement for both of them to sign. The two parties have a dispute before the contract is signed by either of them. Jeff would like to go through with the agreement, but Patricia refuses to do so. To determine if there is an enforceable contract between Jeff and Patricia, a court would determine the intent of the parties by applying a(n) _________ test of what a reasonable _________ familiar with the circumstances would be justified in believing the parties intended.
A. subjective; judge B. objective; person C. objective; juror D. subjective; juror Correct Answer: B
A person who advertises for bids, such as a general contractor who wants to provide a portion of a job to a subcontractor, is generally not held to have made an invitation to offer.
True False Correct Answer: True
For most of its history, the United States based its patent laws on a "first-to-invent" system.
True False Correct Answer: True
The Restatement (Second) of Contracts does not have the force of law.
True False Correct Answer: True
Any incremental patent changes used by a business will not increase the time of protection awarded by a patent.
True False Correct Answer: True
Bidders at auctions are generally held to be the offerees.
True False Correct Answer: True