Legal Environment of Business Exam 3 - CH 10

Defective Acceptances

A late or defective acceptance does not create a contract. It is a new offer.

Variant Acceptances

A variant acceptance is one that contains terms different from or additional to those in the offer. It receives different treatment by the common law and the Code. - Common Law - Code

Acceptance of Offer

Acceptance is a manifestation of a willingness to enter into a contract on the terms of the offer. - Effective on dispatch, makes contract. Also called 'mailbox rule.' - Communication of Acceptance

To be effective, an offer must a. None of these b. be communicated to the offeree c. manifest an intent to enter into a contract d. be sufficiently definite and certain e. All of these

All of these

Duration of Offers

An offeree's power to accept an offer continues until the offer terminates. - Lapse of time - Revocation - Rejection - Counteroffer - Death or Incompetency - Destruction of Subject Matter - Subsequent Illegality

Death or Incompetency

Death or incompetency of either the offeror or the offeree ordinarily terminates an offer, other than one contained in an option.

Leonard offers to sell his diamond ring to Emily. Diane overhears the offer and says, "I accept the offer." a. Presuming the offeror gets the same benefit as a contract to Emily would have provided, the acceptance will be effective b. Diane cannot accept this is an invitation seeking offers and not an offer c. this is a valid acceptance d. Diane cannot accept the offer, because it wasn't made to her

Diane cannot accept the offer, because it wasn't made to her

A contract exists if either party's actions manifest recognition of a contract's existence.

False

The common law "mirror image" rule applies to an offer and the acceptance of that offer in a contract for the sale of goods. a. True b. False

False

William, who just purchased a new computer which won't work properly, screams, "I'll sell this thing for $10," and thereby makes an offer

False

Which of the following would be an offer? a. Will you buy my computer for $1000? b. I sure would like to sell this computer for $1000. c. I'll sell you this computer for $1000. d. None of the above are offers.

I'll sell you this computer for $1000.

Subsequent Illegality

If the purpose or subject matter of the offer becomes illegal, the offer is terminated.

Destruction of Subject Matter

If the specific subject matter of the offer is destroyed, the offer is terminated.

General Rule

In the case of a bilateral offer, acceptance must be communicated to the offeror. In the case of a unilateral offer, however, notice of acceptance is usually not required.

Which of the following would be subject to Article 2 of the UCC? a. An agreement to clean someone's yard for $25 b. An option to buy a vacant lot c. An agreement to perform at a charity fundraiser d. None of the above is subject to the UCC.

None of the above is subject to the UCC.

Code

The mirror image rule is modified by the UCC. The Code focuses on the intent of the parties and attempts to alleviate the battle of the forms where the buyer uses a standardized form which favors the buyer and the seller uses a standardized form which favors the seller. If the offeree does not expressly make acceptance conditional upon the offeror's assent to the additional or different terms, a contract is formed.

Rejection

The refusal of an offeree to accept an offer is effective when received by the offeror. Express or implied rejection terminates the power of acceptance

Definiteness

The terms must be clear enough to provide a court with a basis for determining the existence of a breach and for giving an appropriate remedy. - Open Terms - Output and Requirements Contracts

James offers to sell four acres of land to Jennifer for $8,000 and further offers to keep the offer open for one month if Jennifer will pay him $100 for the privilege. Jennifer pays James $100. Which statement describes the payment of $100? a. This created an irrevocable option contract under the common law so Jennifer has one month to decide if she wants to buy the land b. This created an option contract under the UCC c. A revocable option contract has been formed so if Brooks refunds thee $100, he can revoke the offer to Jennifer

This created an irrevocable option contract under the common law so Jennifer has one month to decide if she wants to buy the land

A contract for the sale of goods need not specify the price in order to have an effective contract.

True

If no time is stated, an offer will terminate automatically after a reasonable period of time. a. True b. False

True

Pedro receives an unordered three-CD set in the mail accompanied by the statement, "This CD set can be purchased for the special price of $19.95. If the CDs are not returned within two weeks they will be deemed accepted and the payment is due within 30 days of receipt of the CDs." Pedro is under no obligation to either return the CDs or to pay for them; he may use them or give or throw them away. a. True b. False

True

Compare briefly the traditional and modern theories of variant acceptance of an offer as shown by the common law "mirror image rule" and by the rules of the UCC.

Under the common law "mirror image rule," an acceptance must be positive and unequivocal. It may not change any of the terms of the offer, nor add to, subtract from, or otherwise qualify the terms of the offer in any way. Any communication that attempts to do so is not acceptance but rather is a mere counteroffer. In contrast, the Code modifies this rule to account for the realities of modern business practices, the most notable being the extensive use of the standardized business form. The Code focuses on the intent of the parties; if the offeree definitely and seasonably expresses his acceptance of the offer and does not expressly make his acceptance conditional on the buyer's assent to the different or additional terms, then a contract is formed. Here the issue becomes whether the seller's different or additional terms are part of the contract. The Code provides rules to resolve these disputes depending on whether the parties are merchants and on whether the terms are additional or different terms.

An offer can be effectively communicated to an offeree by: a. a writing only. b. spoken words only. c. a writing or by spoken words only. d. a writing, by spoken words, or by conduct from which a reasonable person could infer a promise.

a writing, by spoken words, or by conduct from which a reasonable person could infer a promise.

Under the common law, the _______ must be the mirror image of the _______ a. offer, acceptance b. contract, offer c. acceptance, offer d. contract, consideration

acceptance, offer

An offeree generally may cancel or revoke an offer at any time prior to its acceptance unless the offer: a. is an option contract. b. is a merchant's firm offer under the Code. c. contemplates a unilateral contract and the offeree has begun the invited performance. d. all of the above.

all of the above.

A rejection of an offer by the offeree is effective: a. at the moment that the offeree signs the notice of rejection. b. at the moment that the offeree dispatches the notice of rejection. c. at the moment that the offeror receives the notice of rejection. d. none of the above

at the moment that the offeror receives the notice of rejection.

To be effective, and offer must a. be spoken directly to the offeree b. always contain the place of delivery c. be communicated to the offeree d. always contain the price of the product or service offered

be communicated to the offeree

Carol Customer sees an ad in a newspaper for a clock radio for $8. She goes to the store and wants to buy the item advertised in the newspaper at the price quoted. Carol is: a. making a counteroffer. b. making an offer to buy. c. making an acceptance of the store's offer to sell. d. making an acceptance of the store's firm offer.

making an offer to buy.

Under the Code, if two parties, at least one of whom is not a merchant, intend to enter into a binding contract but the offeree in her acceptance includes additional terms for the contract, those terms are construed as: a. mere surplus and are ignored. b. proposals for addition to the contract. c. terms of the contract provided they do not materially alter the agreement. d. terms of the contract provided they are not material and are not objected to by the offeror within a reasonable time.

proposals for addition to the contract.

Whether or not a person's words or conduct constitutes an offer is determined according to: a. the subjective intent of the offeror. b. the subjective intent of the offeree. c. the objective, reasonable person standard. d. none of the above.

the objective, reasonable person standard.

In order to have the mutual assent requisite to the formation of a contract, the offeror must have communicated the offer and the offeree must have knowledge of the offer.

True

The UCC imposes an obligation of good faith in the performance or enforcement of every contract within its scope.

True

Under the Restatements of Contracts and the Code, unless language in the offer, or the circumstances under which it is made indicate otherwise, an offer shall be construed as inviting acceptance in any reasonable manner.

True

Under the UCC, if both parties are merchants, additional terms contained in the offeree's unconditional acceptance will become part of the contract provided they do not materially alter the agreement and are not objected to either in the offer itself or within a reasonable period of time.

True

Under the common law mirror image rule, an offeree's acceptance will not be effective if it deviates from the exact terms of the offer.

True

When does acceptance of an offer to enter into a unilateral contract generally occur? a. Upon full performance by the offeree b. Upon commencement of performance by the offeree c. Upon full performance by the offeror d. Upon notice of intent to accept by the offeree

Upon full performance by the offeree

CPA: Opal offered, in writing, to sell Larkin a parcel of land for $300,000. If Opal dies, the offer will: a. terminate prior to Larkin's acceptance only if Larkin received notice of Opal's death. b. remain open for a reasonable period of time after Opal's death. c. automatically terminate despite Larkin's prior acceptance. d. automatically terminate prior to Larkin's acceptance.

automatically terminate prior to Larkin's acceptance.

In order for an offer to have legal effect, it must: a. be communicated to the offeree. b. manifest an intent to enter into a contract. c. be sufficiently definite and certain in its terms. d. all of the above.

all of the above.

A rejection is effective at the moment of its dispatch by the offeree.

False

An offeror's manifestation of intent to enter into a contract is judged by a subjective standard.

False

At an auction announced to be "without reserve," the auctioneer is free to withdraw the goods from sale at any time prior to a bid's acceptance.

False

David's question to Albert, "Would you be interested in buying my computer for $800?" is an offer to Albert. a. True b. False

False

If Bill tells Sara that he will give her two days to decide if she wants to buy his car, he cannot sell it to anyone else during that time. a. True b. False

False

In order for an offeror's revocation of the offer to be effective, notice of the revocation must be directly communicated to the offeree before acceptance.

False

Ron offers to sell Pete his stamp collection. Pete gives Ron $10 to induce him to keep his offer open for a week. If Ron decides on day four of the week that he really does not want to sell to Pete, he can revoke his offer without fear of a breach of contract lawsuit being filed against him. a. True b. False

False

With respect to agreements for the sale of goods, the Code provides standards by which omitted terms may be ascertained, provided: a. the parties actually agreed upon the open term but negligently failed to include it in the written contract. b. the parties actually discussed the open term but intentionally failed to include it in the written contract. c. the parties intended to enter into a binding contract regardless of whether they actually discussed the open term or not. d. the parties did not intend to enter into a binding contract regardless of whether they actually discussed the open term or not.

the parties did not intend to enter into a binding contract regardless of whether they actually discussed the open term or not.

List two situations where the Code rule differs from the common law. Give both the Code rule and the common law rule.

(a) The common law follows the "mirror image rule" which states that offers and acceptances must be mirror images of each other. The Code (in §2-207, the battle of the forms section) allows for the acceptance of an offer where the terms of the acceptance vary from those of the offer. (b) The common law required definiteness and certainty in the terms of an offer. The UCC has "gap filler" provisions (in §§ 2-305, 2-308 and 2-309) that allow a contract to exist when certain terms are left open. (c) At common law, an offer which says it will be kept open for a specified period of time can be terminated at any time in the absence of consideration. Under the UCC (§ 2-205), a firm offer in writing by a merchant is binding even without consideration. (d) At common law, an offer must be accepted in the manner specified. Under the UCC, an offer may be accepted in any manner and by any medium reasonable under the circumstances. In general, the Code looks at whether the parties intended to form a contract rather than at technical rules regarding the exact moment of acceptance of an offer.

Advertisements

- Advertisements are generally considered to be invitations to make offers, because they are not sufficiently definite and certain. However, if the advertisement or announcement contains a definite promise of something in exchange for something else and confers a power of acceptance, it may constitute an offer.

Communication of Acceptance

- General Rule - Silence as Acceptance - Effective Moment of Acceptance - Defective Acceptances

Preliminary Negotiations

- Initial communications between the potential parties to a contract in many cases take the form of preliminary negotiations rather than an offer. A statement that may indicate a willingness to make an offer is not itself an offer.

Offer

- Must show "willingness to enter into a contract." - An offeror is the person making the offer. An offeree is the person to whom the offer is made.

Output and Requirements Contracts

- Output and requirements contracts are valid under the Code so long as there is an objective standard for their application and the parties act in good faith. - An output contract is an agreement of a buyer to purchase the entire output of a seller's factory for a stated period. - A requirements contract is an agreement of a seller to supply a buyer with all his requirements for certain goods.

Intent

- To have legal effect, an offer must manifest an intent to enter into a contract. - Objective standard - similar to reasonable person standard - was there an intent expressed? - Preliminary Negotiations - Advertisements - Auction Sales

Communication

- To have the mutual assent required to form a contract, the offeree must know about the offer. - The offeror must communicate the offer in an intended manner. The communication must be made or authorized by the offeror. - An offer need not be stated or communicated by words. - Conduct from which a reasonable person may infer a proposal in return for either an act or a promise amounts to an offer. - An offer may be made to the general public, but no person can accept such an offer unless he knows that the offer exists. - EX: reward sign for a lost dog - a unilateral contract - Knowledge is essential in this situation because you cant claim a reward if you returned the dog without knowing about the reward in the first place - actions communicate intension - pulling items out of your cart and getting them scanned at a grocery store

Open Terms

- Under the UCC, an offer for the purchase or sale of goods may leave open particulars of performance. - The Code provides standards to determine open terms and requires such specification be made in good faith and within limits set by commercial reasonableness. - Good faith is defined as honesty in fact in the conduct or transaction concerned. - Commercial reasonableness is a standard measured by the judgment of reasonable persons familiar with the customary practices in the type of transaction involved and with regard to the facts and circumstances of the case.

Auction Sales

-The auctioneer at an auction sale does not make offers to sell the property being auctioned but invites offers to buy. The bid is an offer, and if it is accepted, a contract results. A bidder is free to withdraw his bid at any time prior to its acceptance, and the auctioneer is free to withdraw the goods unless the sale is advertised to be without reserve.

Counteroffer

A counteroffer is a counterproposal from the offeree to the offeror that indicates a willingness to contract but on terms different from the original offer. It operates as a rejection and terminates the original offer upon receipt by the offeror. It also operates as a new offer. A conditional acceptance claims to accept an offer, but it is contingent upon the acceptance of an additional or different term. It is therefore a counteroffer that terminates the original offer.

Which of the following would NOT be a merchant under Article 2 of the UCC? a. A 'crafty' sole proprietor who makes and sells homemade jewelry b. A car mechanic who fixes used cars and then sells them c. The owner of a hardware store which sells paint d. A person who inherits three speedboats and wants to sell them to buy a car

A person who inherits three speedboats and wants to sell them to buy a car

Common Law

An acceptance must be positive and unequivocal. It must be a mirror image of the offer. The mirror image rule provides that an acceptance cannot deviate from the terms of the offer. Any communication by the offeree that attempts to modify the offer is not an acceptance but a counteroffer. - Mirror image rule

An offer confers upon the offeree a power of acceptance that continues until the offer terminates. Identify and discuss briefly seven ways in which an offer may be terminated other than by acceptance.

An offer may lapse either upon the running of the period of time specified in the offer itself, or if no such time is stated, upon the expiration of a reasonable period of time. The offeror may also revoke his offer at any time prior to acceptance unless the offer is held open by an option contract, is a merchant's firm offer under the Code, is statutorily irrevocable, or is for a unilateral contract and the offeree has begun the requested performance. An offeree's power of acceptance may also be terminated by the offeree's communicated rejection. The rejection is effective from the moment that it is received by the offeror. A counteroffer or conditional acceptance both indicate an unwillingness to agree to the terms of an offer and operate as a rejection. They are to be distinguished from mere inquiries about the possibility of obtaining new or different terms for the contract, as these do not terminate the offer. Finally, an offer will be terminated by the death or incompetency of the offeror or offeree, by the destruction of the specific subject matter of a contract, or if performance of a valid offer is later made illegal.

Essentials of an Offer

An offer must be communicated to the offeree, must manifest an intent to enter into a contract, and must be sufficiently definite and certain. - Communication - Intent

Distinguish between an offer and a preliminary negotiation by indicating the necessary elements of a valid offer.

An offer need not take any particular form to have legal effect but it must (1) be communicated to the offeree; (2) manifest an intent to enter into a contract; and (3) be sufficiently definite and certain. Those being present, if a communication creates in the mind of a reasonable person in the position of the offeree an expectation that his acceptance will conclude a contract, then the communication is an offer.

Lapse of time

An offer remains open for the specified time period. If no time is stated, the offer will terminate after a reasonable period of time

Effective Moment of Acceptance

An offer, revocation, rejection, and counteroffer are effective when received. An acceptance is generally effective upon dispatch unless the offer specifically provides otherwise, the offeree uses an unauthorized means of communication, or the acceptance follows a prior rejection. a. Stipulated Provisions in the Offer-If the offer specifically stipulates the means of communication to be used by the offeree, the acceptance must conform to that specification. Moreover, the rule that an acceptance is effective when dispatched or sent does not apply where the offer provides that the acceptance must be received by the offeror. b. Authorized Means-Historically, an authorized means of communication was the means expressly authorized by the offeror, or if none was authorized, it was the means used by the offeror. The Restatement and the Code both now provide that where the language in the offer or the circumstances do not otherwise indicate, an offer to make a contract shall be construed to authorize acceptance in any reasonable manner. Under this rule, an authorized means is any reasonable means of communication. c. Unauthorized Means-When the means used by the offeree is unauthorized, the traditional rule is that acceptance is effective when and if received by the offeror, provided it is received within the time the authorized means would have arrived. Under the Restatement, if these conditions are met, then the effective time for the acceptance is the moment of dispatch. d. Acceptance Following a Prior Rejection-When an acceptance follows a prior rejection, the first communication received by the offeror is the effective one.

Distinguish between an option contract and a firm offer under the Code.

Both an option contract and a firm offer under the Code have the result of holding an offer to be irrevocable for a period of time. The main distinctions between the two are that an option contract is a common law agreement which requires consideration be valid, whereas a firm offer under the UCC is a Code provision and when in writing from a merchant needs no consideration to be enforceable.

The UCC provides missing contract terms in which of the following instances? a. The UCC cannot provide missing contract terms, only the parties can provide terms b. The contract fails to specify the place of delivery c. Both failure to specify the price and failure to specify the place of deliver. d. The contract fails to specify the price

Both failure to specify the price and failure to specify the place of deliver.

Revocation

Cancellation of an offer by an offeror brings an offer to an end. The offeror may revoke the offer by giving notice to the offeree. The notice effectively terminates the offer when the notice is received by the offeree. An offer made to the general public is revoked only by giving equivalent publicity to the revocation as was given to the offer. Certain limitations have been imposed on the offeror's power to revoke. - Option Contracts - Firm Offers under the Code - Statutory Irrevocability (irrevocable by law; ex: some bids to municipalities.) - Irrevocable Offers of Unilateral Contracts - Promissory Estopple (non contractual promise, binds the promisor because she should reasonably expect that the promise will induce the promisee (offeree) to take action in reliance on it. Ex: make offer that will pay for charity building project and they rely on it. a-Contract for services; Goods over $500 (UCC); Etc.)

Marge, a sports collector, puts an ad in her company's newsletter saying she would pay $400 for a specific Kobe Bryant rookie basketball trading card. She said she would pay the first person who accepted her offer by bringing her the card. Marge then decides she would rather buy some new shoes, and changes her mind about investing in the card. Marge posts a sign at the executive water fountain saying the offer is no longer valid. A foreman from a branch plant takes a flight to the Chicago main office to see Martha and accept her offer. When he walked in the office and said "I've brought you the card!" she replied, "But I don't want it anymore." What is the result? a. Since the contract was executory, she has no legal obligation to the foreman b. Marge must pay him the $400 because he accepted the offer c. Marge does not owe him any money because she had already revoked the offer d. Based on promissory estopple, Marge will have to pay the reasonable value of the card.

Marge must pay him the $400 because he accepted the offer

Maxine offered to sell her video camera to Tom for $200 and also stated to Tom, "I will give you two weeks to accept my offer." One week later Tom learned that Maxine had sold the video camera to Cindy. In this case: a. Maxine has revoked her offer to Tom. b. Maxine's offer is a firm offer and she must sell Tom a video camera for $200 c. Maxine has revoked her offer to Tom d. Maxine must get the camera back from Cindy if Tom accepts within two weeks.

Maxine has revoked her offer to Tom

Pat mails Trish an offer to buy Blackacre. Trish receives the offer on May 1. On May 2, Trish delivers a letter of acceptance to National Express, but due to their error the letter is not sent by the company until May 3. Pat receives the acceptance on May 4. A contract is formed on: a. May 1 b. May 2 c. May 3 d. May 4

May 2

UCC Battle of the forms

Merchants frequently use forms to conduct business, such as Purchase Order Form and Confirmation. Parties will have a contract based on terms in agreement that match up, unless agreement limited to only offeror's terms. Conflicting terms cancel each other out. If additional terms, for merchants: additional terms not part of contract if they materially alter the agreement or the other party objects to them. If not a merchant: additional terms are only proposals.

Marilyn read an ad in the school newspaper offering a thousand dollar swimming scholarship to anyone who could swim 500 laps in the school pool. Marilyn called the advertiser and began swimming. She has reached lap number 460; she feels great and is sure she can make it all the way. The advertiser a. May revoke the offer since there has not yet been acceptance b. Must permit Marilyn the opportunity to finish her attempt to swim the 500 laps, or pay damages if he interferes with the completion of the laps. c. must pay Marilyn $920, because she has performed 92% of the offer d. may not revoke the offer since Marilyn has already accepted it

Must permit Marilyn the opportunity to finish her attempt to swim the 500 laps, or pay damages if he interferes with the completion of the laps.

CPA: On April 1, Fine Corp. faxed Moss an offer to purchase Moss' warehouse for $500,000. The offer stated that it would remain open only until April 4 and that acceptance must be received to be effective. Moss sent an acceptance on April 4 by overnight mail and Fine received it on April 5. Which of the following statements is correct? a. No contract was formed because Moss sent the acceptance by an unauthorized method. b. No contract was formed because Fine received Moss' acceptance after April 4. c. A contract was formed when Moss sent the acceptance. d. A contract was formed when Fine received Moss' acceptance.

No contract was formed because Fine received Moss' acceptance after April 4.

George offered to paint Catherine's barn for $4,000. Catherine said she would accept the offer if George would paint the woodshed, too. a. At this point, they have made a valid, enforceable contract because a gap-filler provision can provide a reasonable price for the additional work b. Presuming George receives Catherine's response and then starts painting, based on his conduct he has accepted her offer which includes painting the woodshed c. Since the acceptance is not the mirror image of the order, the contract will be made but only based on the terms of the original offer

Presuming George receives Catherine's response and then starts painting, based on his conduct he has accepted her offer which includes painting the woodshed

Silence as Acceptance

Silence is usually not an acceptance unless it becomes one by custom, usage, or course of dealing. There is no legal duty to reply to an offer.

Michelle's Boutique places an ad in the Sunday paper for beautiful, top-of-the-line designer suits for $3.00. Irene sees the ad in the paper and goes to the store to stock up on business suits for her new job. Michelle apologizes for the misprint. Irene has just finished a class in contract law and insists that the store sell her 5 suits for $15.00. Irene threatens to sue Michelle for breach of contract. a. This is a valid contract based on commercial reasonableness b. The ad in the newspaper is an offer to sell. Irene accepted the offer, is an enforceable contract c. The ad in the newspaper is a solicitation seeking offers, but is not an offer to sell; therefore, Irene will not be able to successfully sue for breach of contract d. Michelle must sell Irene a suit for $3.00, but is only obligated to sell her one suit, not five

The ad in the newspaper is a solicitation seeking offers, but is not an offer to sell; therefore, Irene will not be able to successfully sue for breach of contract

On January 1st, Mask Manufacturing Inc. makes an agreement to sell to Helping Hands Hospital all of the protective masks that Helping Hands needs for a period of 3 months. Helping Hands normally uses about 1,000 month although the number varies a little. On March 1st, Helping submitted an order for 5,000 masks. Mask Manufacturing only provides 1,000. Which statement is true? a. This is a requirements contract and Mask is not in breach of contract for failing to provide 5,000 b. This would be an unenforceable common law contract c. The agreement was an output contract and Mask is in breach of contract since they are not providing the number (5,000) requested.

This is a requirements contract and Mask is not in breach of contract for failing to provide 5,000

Although an offeree is generally under no duty to reply to an offer, by custom, usage, or course of dealing, silence or inaction by the offeree may operate as an acceptance.

True

An offer is a proposal, expressed either in words or by conduct, by one person to another indicating a willingness to enter into a contract.

True

If an offer does not state the time within which the offeree may accept, the offer will terminate upon the expiration of a reasonable time.

True

Gary mails an offer to Brian on June 15. Brian receives the offer on June 16. Gary mails a revocation of the offer on June 17. Brian mails a letter of acceptance on June 18. Gary receives the revocation on June 19. Brian receives the letter of acceptance on June 20. Was a contract formed? a. No, the offer was revoked before acceptance b. Yes, on June 18th c. Yes, on June 16th d. Yes, on March 20

Yes, on June 18th

Lynn offers to sell his house to Dennis for $95,000. Dennis responds, "I will pay you $95,000 if you will paint the second floor." This response could best be described as: a. an acceptance b. a counteroffer c. an invitation d. a rejection

a counteroffer

The Cameron Park Zoo offered to rent its facilities to Kids Kamp, a local organization, to hold an Easter Egg hunt for all children in the community on April 1st. However, before Kids Kamp can accept, the City of Waco passed a law making it illegal for groups of 10 or more to gather until April 7th. The City's new law a. acts as a rejection of the offer by the offeree b. acts as a condition on the offer c. automatically terminates the offer d. has no effect on the offer

acts as a condition on the offer

Advertisements, circulars, quotation sheets, and other similar business communications usually do not constitute offers because: a. they do not contain a promise. b. they leave unexpressed many terms which would be necessary to the making of a contract. c. both (a) and (b). d. none of the above.

both (a) and (b).

Ezekiel wrote a letter to his friend offering to sell Fernando an 75-acre farm for $150,000. After mailing the letter, Ezekiel learns that the farm is actually worth $200,000 and changes his mind about selling. In this case, Ezekiel: a. can revoke his offer at any time before Fernando accepts it, because there is no consideration to keep it open b. has made a firm offer to Fernando which cannot be revoked c. cannot, because of promissory estopple, revoke his offer to Fernando d. must keep the offer open, because this is an option contract

can revoke his offer at any time before Fernando accepts it, because there is no consideration to keep it open

A leading manufacturer of electronic equipment writes a letter to its wholesale distributors offering to sell its most popular VCR for $100 and stating that it will accept orders at that price for 30 days. This is a(n): a. option to sell. b. auction without reserve. c. firm offer. d. requirements contract.

firm offer.