acc351 exam 2

It is usually advisable to put a contract in writing if the transaction is important, complicated, involves a large amount of money, or will extend over a long period of time

ture

In the eyes of the law, a misrepresentation is a belief that is not in accord with the facts

false

The Statute of Frauds applies to executory contracts only

true

The parol evidence rule states that any spoken or written words that are in conflict with what the written contract states cannot be introduced as evidence in a court of law

true

The person who transfers his or her rights is known as the assignor; the third party to whom the rights are transferred is known as the assignee

true

The promisor may make a promise to pay a sum of money to the promisee for the performance of a certain act

true

To satisfy the Statute of Frauds, a written contract or agreement must contain a description of the consideration promised

true

Under the mailbox rule, an acceptance sent via the postal system or by courier is effective when sent

true

When rights or duties that arise from a contract are legally transferred to a third party, such contracts are an exception to the general rule that only the parties to a contract have rights and duties under it

true

With regard to pledges and subscriptions, some courts have held that the consideration given by a charitable institution is the promise to use the money for the purpose for which it was donated

true

An incidental beneficiary has a legal right to benefits resulting from a contract

false

An incidental beneficiary is one who may benefit as a direct consequence of contract.

false

If an agreement imposes a legal obligation, then it is a(n): A. enforceable contract. B. unenforceable contract. C. a negated concurrence. D. a void contract.

A

. The most common form of valid consideration is: A. the promise of money by one party for the promise of an act by another. B. the promise of an act by one party for the promise of refraining from trade by the other party. C. the promise of money by one party for the promise of restraining oneself from competitive trade by another. D. the promise of an act by one party in exchange for a different act by another.

A. the promise of money by one party for the promise of an act by another

All of the following communications are offers that are obviously not made with the intent of entering into a valid enforceable agreement EXCEPT those made: A. under severe emotional strain. B. in anger. C. through electronic means. D. in jest.

C. through electronic means

If agreement of either party is ¬obtained by fraud, misrepresentation, mistake, undue influence, or duress, or if the contract is one of adhesion, or is unconscionable, a(n): A. executed contract results. B. valid contract results. C. void contract results. D. voidable contract results

D. voidable contract results

A contract that obviously cannot be completed within one year may be oral

false

All contracts are agreements, but not all agreements are contracts. The PRIMARY reason is that: A. certain agreements cannot be enforced by law. B. certain agreements cannot be licensed under law. C. agreements do not fall under any classification of contracts. D. terms of an agreement usually are different from those of a contract.

A

An agreement that may be rejected by one of the parties for a legally acceptable reason is a(n): A. implied contract. B. void contract. C. voidable contract. D. valid contract

C. voidable contract

Oral evidence introduced after a contract is signed is legally accepted if it clarifies some point in the: A. oral agreement. B. verbal agreement. C. written agreement. D. implied agreement

C. written agreement

Contracts can be created for: A. only one specific purpose. B. one or two purposes. C. only for agreements that involve monetary transactions. D. any number of purposes.

D

. A simple contract is not: A. written. B. oral. C. implied. D. formal

D. Formal

The seal on a formal contract may consist of any of the following, EXCEPT: A. the word "Seal.." B. the letters "L.S." C. an impression on the paper. D. a stamped signature.

D. a stamped signature

An indication made by the offeree that he or she agrees to be bound by the terms of the offer is known as: A. an enforceable offer. B. a mutual agreement. C. free consent. D. acceptance.

D. acceptance.

The offer and acceptance issue gets complicated when there is little or no direct contact between the parties, as in the case of all of the following EXCEPT: A. bidding. B. advertising. C. public offers. D. agreement

D. agreement

A promise to pay an existing debt or to obey the law, or a similar promise, is called a: A. pledge. B. gratuitous promise. C. preexisting duty. D. barren promise

D. barren promise

Sometimes a person has the power to control the actions of another because of a special or confidential relationship to that person. Such relationships are found in all of the following, EXCEPT that of a(n): A. employer and an employee. B. physician or nurse and a patient. C. attorney and a client. D. client and vendor

D. client and vendor

The promises exchanged by the parties to a contract, either to give up something of value they have a legal right to keep, such as money or property; to do something they are not otherwise legally required to do, such as performing a service; or to refrain from an action is known as: A. competence of parties. B. offer and acceptance. C. mutual agreement. D. consideration

D. consideration

Contracts that involve parties of unequal bargaining power are often considered: A. unconscionable. B. unforgivable. C. inadequate. D. contracts of adhesion

D. contracts of adhesion

A party to an existing contract may appoint a third person to perform contractual duties by: A. transference. B. recovery. C. assignment. D. delegation

D. delegation

. Rights or duties under a contract may be assigned by a court of law when a contracting party: A. earns profits. B. incurs losses. C. opens new business. D. dies or becomes bankrupt

D. dies or becomes bankrupt

. The Statute of Frauds only specifies that certain contracts must be in writing to be: A. beneficial. B. rewarding. C. indistinct. D. enforceable

D. enforceable

A telephone conversation can result in a(n): A. informal contract. B. statutory contract. C. contingent contract. D. enforceable oral contract

D. enforceable oral contract

A(n) __________________ has legal authority to arrange for the distribution of the assets of a deceased person. A. court-appointed executor B. executor C. administrator D. executor or administrator

D. executor or administrator

All of the following are true of the Statute of Frauds, EXCEPT: A. the name is taken from the English law of 1677. B. the name is a derivative of a law called "An Act for Prevention of Frauds and Perjuries." C. it does not prohibit a person from legally entering into oral contracts. D. it applies to executory and executed contracts

D. it applies to executory and executed contracts

All but one of the following elements is required of an enforceable contract. The exception is: A. offer and acceptance. B. mutual agreement. C. consideration. D. malafide intention

D. malafide intention

A written contract or agreement that is sometimes called a_____ is required to satisfy the Statute of Frauds. A. draft. B. brief. C. synopsis. D. memorandum

D. memorandum

. The unintentional misstatement or nondisclosure of a material fact that results in inducing another to enter into an agreement to his or her loss is known as: A. fraud. B. duress. C. mistake. D. misrepresentation

D. misrepresentation

An executor is a person: A. who inherits property from a deceased person. B. who has drafted the will of the deceased. C. who is named by a court to judge matters of law. D. named in a will who serves as the personal representative of a deceased person

D. named in a will who serves as the personal representative of a deceased person

A party to a contract who assigns his or her rights or delegates his or her duties to a third party is: A. allowed to hold the third party responsible for the contract execution. B. held responsible only until the contract is assigned. C. not responsible for the execution of the contract. D. never free from the contract until it is completely executed

D. never free from the contract until it is completely executed

. When all parties to a contract agree to a significant change in the contract, the change is called a(n): A. assignment. B. delegation. C. execution. D. novation.

D. novation

A promise to repay someone for a benefit after the benefit has been received is known as: A. a pre-ordained contract. B. a pre-meditated contract. C. prior consideration. D. past consideration

D. past consideration

A valid contract does not exist if the contract is a promise of/to: A. payment. B. provide services. C. forbearance. D. perform an illegal act

D. perform an illegal act

Charitable organizations frequently raise money by asking for: A. discounts. B. bribes. C. gifts. D. pledges

D. pledges

An exchange of promises made by persons planning to marry is known as a(n): A. arranged agreement. B. self-arranged agreement. C. mutual agreement. D. prenuptial agreement

D. prenuptial agreement

Offers are terminated for all of the following reasons EXCEPT: A. lapse of time. B. revocation. C. rejection. D. silence.

D. silence.

A valid offer must be all of the following EXCEPT: A. definite and certain. B. communicated to the offeree. C. made with serious intent. D. stated in writing

D. stated in writing

In the case of purchase orders: A. the seller of the goods is the offeror and there is no offeree. B. the buyer of the goods is the offeror and there is no offeree. C. the seller of the goods is the offeror and the buyer is the offeree. D. the buyer of the goods is the offeror and the seller is the offeree.

D. the buyer of the goods is the offeror and the seller is the offeree

. The beneficiary named in the insurance policy is legally a(n): A. substantial beneficiary. B. material beneficiary. C. incidental beneficiary. D. third-party beneficiary

D. third-party beneficiary

. A party's rights in a contract can be assigned to another party; and also a party's duties are transferred to a third party if the duties do not involve: A. charity. B. royalty. C. goodwill. D. unique skills

D. unique skills

A contract resulting from the use of undue influence is: A. considered a mistake. B. .fraudulent C. void. D. voidable.

D. voidable

For the injured party to claim fraud, he or she must prove all of the following of the statements or acts EXCEPT that it: A. was a misstatement or nondisclosure of a material fact. B. was made with knowledge of its falsity or with reckless disregard of its truth. C. was relied on by the injured party. D. was not intended to cause the other party to enter into the agreement

D. was not intended to cause the other party to enter into the agreement

. _______________ is one of the essential elements of a valid contract. A. Legality of purpose B. Parol evidence C. A reasonable claim D. A memorandum of belief

A. Legality of purpose

That certain kinds of contracts should be in writing is a requirement under the: A. Statute of Frauds. B. Statute of Principles. C. Statutes on Employment. D. Statute on Discrimination

A. Statute of Frauds

What states, "No delegation of performance relieves the party delegating of any duty to perform or any liability for breach"? A. The Uniform Commercial Code (UCC) B. The law of each state C. A federal statute D. Common law

A. The Uniform Commercial Code (UCC)

It is stated that the terms of a written contract may not be changed by evidence of any prior agreement but may be explained, or supplemented, by the: A. Uniform Commercial Code (UCC). B. Statute of Frauds. C. Parol Evidence Rule. D. English Law

A. Uniform Commercial Code (UCC)

The Uniform Commercial Code dispenses with the requirement for consideration in contracts that involve: A. a merchant's firm written offer of an irrevocable contract. B. an oral discharge of a claim for an alleged breach of contract. C. modifications on future contracts. D. modifications to executed contracts

A. a merchant's firm written offer of an irrevocable contract

`When no ¬definite time for acceptance is stated in an offer, the offer terminates after the passing of: A. a reasonable time. B. 18 months. C. two months. D. two years.

A. a reasonable time

Genuineness, or reality, of agreement is said to be present in a contract when there is: A. a true meeting of minds. B. knowledge of falsity. C. puffing. D. duress

A. a true meeting of minds

The meaning of an implied contract is drawn from the: A. actions and conduct of the parties. B. interpretations of a written contract. C. interpretations of an oral contract. D. actions of third parties

A. actions and conduct of the parties.

Most rights are assignable, except in cases in which the obligations of the parties would be significantly: A. altered. B. recorded. C. rejected. D. shared

A. altered

If only one party promises something, such as paying a certain amount of money, and the other party promises nothing, then the agreement lacks: A. consideration. B. competence. C. legality of purpose. D. offer and acceptance.

A. consideration

When parties to a contract include in the contract itself a specific provision forbidding assignment, such a contract is called a: A. contract with assignment restrictions. B. contract with an impeachment clause. C. contract with an arbitration clause. D. contract with an exemption clause

A. contract with assignment restrictions

An offer is a proposal made by one party (offeror) to another (offeree) that indicates willingness to: A. enter into a contract. B. negotiate a service or exchange. C. consider a service or exchange. D. reject an offer.

A. enter into a contract

A contract in which some future act or obligation remains to be performed under its terms is known as a(n): A. executed contract. B. statutory contract. C. contingent contract. D. executory contract

A. executed contract

. In auction sales, in which goods are sold to the highest bidder, the sale is completed at the: A. fall of the hammer. B. signing of an agreement. C. time of delivery of the goods. D. end of the auction

A. fall of the hammer

A memorandum must include all of the following to satisfy the Statute of Frauds, except the: A. family details of the parties. B. names of the parties. C. purpose of the agreement. D. signatures of the parties

A. family details

The promise to refrain from doing something that a party has a legal right to do, or the promise of inaction, is known as: A. forbearance. B. consideration. C. general release. D. pledge or subscription

A. forbearance

When the misstatement is made knowingly or recklessly, it amounts to: A. fraud. B. mistake. C. misrepresentation. D. duress

A. fraud.

The law assumes that, as long as no undue pressure is brought to bear, the parties were: A. free to reject a proposed unfair contract. B. not allowed to enter into another contract. C. required to accept proposed contract terms. D. part of a confidential relationship

A. free to reject a proposed unfair contract

The UCC provides that "any claim or right arising out of an alleged breach can be discharged in whole or in part without consideration by a written waiver or renunciation signed and delivered by the aggrieved party." Such a written agreement is called a: A. general release. B. mutual release. C. barren promise. D. preexisting duty

A. general release

A person who makes a promise without requiring some benefit in return has made a: A. gratuitous promise. B. barren promise. C. pledge or subscription. D. onerous contract

A. gratuitous promise

A(n)______ to pay the debts or settle the wrongdoings of another if he or she does not make settlement personally is not enforceable unless it is written. A. guaranty B. warranty C. memorandum D. statute

A. guaranty

A promise that consists of an indefinite, open-ended statement purporting to be an agreement is known as a(n): A. illusory promise. B. gratuitous promise. C. preexisting duty. D. barren promise

A. illusory promise

Advertising is generally regarded as a(n): A. invitation to trade. B. firm offer. C. commitment to sell. D. executory contract

A. invitation to trade

A legally enforceable contract will not be enforced if it: A. is impossible to fulfill. B. is inconvenient to fulfill. C. is difficult to fulfill. D. poses unforeseen expenses

A. is impossible to fulfill

While courts have long been reluctant to uphold ¬unconscionable contracts, more recently, however, the UCC has: A. made such contracts less likely to be enforced. B. required such contracts to be reduced to writing. C. encouraged the agreement of such contracts. D. made such contracts more likely to be enforced

A. made such contracts less likely to be enforced

. Athletes are hired because of their special personal skills; because of this, their services under a contract: A. may not be delegated. B. may be delegated. C. may not be assigned. D. may be assigned

A. may not be delegated

If the original contract is required to be in writing under the Statute of Frauds, the assignment: A. must also be in writing. B. may be either written or oral. C. is void. D. is valid

A. must also be in writing

To be enforceable, agreements that cannot be completed in less than one year: A. must be in writing. B. can be oral. C. can be oral only if witnessed. D. must be oral if for an amount less than $500

A. must be in writing.

Legality of purposes is the requirement that a contract: A. must not violate the law. B. can be void. C. may contain a malafide intention. D. need not be valid.

A. must not violate the law

The parties to a contract must have a clear understanding of what they are undertaking; that is, the contract must show: A. mutual agreement. B. legality of purpose. C. consideration. D. competency of the parties

A. mutual agreement

. Randolf, a wealthy connoisseur of arts, was invited to an art exhibition. He became very interested in one of the showcased art exhibits, and approached the manager to buy the piece. While he was interested in the painting of the catalogue number 1201, the art gallery's manager mistakenly assumed he was interested in another piece. When it was the time to complete the transaction, the manager realized that he had instead sold and delivered the wrong painting, and immediately clarified this with Randolf. In this instance, the contract can be canceled by either party for: A. mutual mistake. B. unilateral mistake. C. negligence. D. misrepresentation.

A. mutual mistake

If the mistake in the contract is made by both parties then it amounts to: A. mutual mistake. B. unilateral mistake. C. intentional mistake. D. conditional mistake

A. mutual mistake

For a contract to be dissolved because of a mistake, the law usually requires that the mistake be: A. mutual. B. unilateral. C. intentional. D. a belief about what might happen in the future

A. mutual.

A call for a bid or estimate for materials to be furnished or work to be done is not considered a(n): A. offer. B. acceptance. C. request for proposal. D. invitation to acceptance

A. offer.

The offer, once rejected by the offeree, cannot be revived or made into a counteroffer once the communication of the rejection has been received by the: A. offeror. B. offeree. C. courier authority. D. offeree's agent.

A. offeror

Most important contracts are printed and signed by hand by the: A. parties to the agreement. B. notary who is present. C. attorney of the parties. D. judges deciding on the contract

A. parties to the agreement

. The words, "first come, first served" in advertisements create a language of: A. promise. B. offer. C. acceptance. D. request.

A. promise

In a private-service contract, the party who hires the specific person to perform certain duties has a(n) ____________interest in having only the hired person perform. A. substantial B. implied C. explicit D. reasonable

A. substantial

When threats are used to force someone to enter into a contract, the agreement may be dissolved by: A. the ¬injured party. B. the person using undue influence. C. a third party. D. the mistaken party

A. the ¬injured party

A person, who is not a party to a contract but is intended by the contracting parties to benefit as a consequence of a contract, is termed a(n): A. third party beneficiary. B. incidental beneficiary. C. official receiver. D. arbitrator

A. third party beneficiary

A barren promise is one that involves a promise: A. to do something one is already required to do. B. to perform an illegal act. C. to perform an act that involves an unreasonable period of time. D. that cannot be performed

A. to do something one is already required to do

. Contracts that are shockingly unfair and unjust are known as: A. unconscionable contracts. B. unrequited contracts. C. inadequate contracts. D. contracts of adhesion

A. unconscionable contracts

The general rule regarding the effective date and time an acceptance becomes binding is: A. when the parties intend. B. three days after receipt of the acceptance. C. three days after acceptance is sent. D. upon receipt by the offeree

A. when the parties intend

Statutes in many states have permitted a person who has a claim against another to give up, or release, his or her claim without an exchange of consideration by making a: A. written statement to that effect. B. soliloquy to that effect. C. modification. D. complaint to that effect

A. written statement to that effect

To be enforceable, UCC agreements for the sale of personal property must be in writing if they are for at least: A. $100. B. $200. C. $500. D. $1,000.

C. $500

. Which of the following contracts can be assigned? A. Contracts that include assignment restrictions. B. Assignments prohibited by law. C. Contracts that cannot be performed within one year. D. Contracts that require personal service

C. Contracts that cannot be performed within one year

In divisible contracts, the law of sales provides that, "where the circumstances give either party to a contract for sale the right to make or demand delivery in lots, the price, if it can be apportioned, may be demanded for each lot." This is stated under which of the following provisions of the Uniform Commercial Code? A. UCC 2-305. B. UCC 2-306. C. UCC 2-307. D. UCC 2-308.

C. UCC 2-307

When an offer of sale does not specify a price, it is assumed that the parties intended: A. an implied contract. B. not to enter a contract C. a reasonable price. D. a minimal price

C. a reasonable price

When a contracting party dies, contract rights are assigned to the: A. parents of the deceased person. B. heirs of the deceased person. C. administrator or executor of the estate. D. spouse of the deceased person

C. administrator or executor of the estate.

When a customer asks a merchant to deliver an article to his home with no mention of payment, the buyer implies that he or she will pay the market price of the article when it is delivered or when the bill is presented. This is an illustration of: A. a simple contract. B. consideration. C. an implied contract. D. a formal contract.

C. an implied contract

Third parties to a contract are affected by the contract if they: A. are witnesses to the contract. B. sign the contract. C. arethird-party beneficiaries or incidental beneficiaries. D. have rights under the contract

C. arethird-party beneficiaries or incidental beneficiaries

. In most states, the law permits parties to a contract to transfer their rights to another by: A. variance. B. recovery. C. assignment. D. delegation

C. assignment

A person cannot be compelled to speak or to write in order to avoid a(n): A. void agreement. B. voidable agreement. C. binding agreement. D. illegal agreement

C. binding agreement

The assignor of a contract right becomes a(n): A. assignee. B. grantor. C. guarantor. D. transferee

C. guarantor

The element of proper form requires that certain contracts must be: A. court-ordered. B. stamped. C. in writing. D. notarized

C. in writing

Randy and Donald were property developers, and they decided to construct a condominium in a certain neighborhood. Jim, who owned a chain of restaurants, heard of this agreement and opened a new restaurant in the same neighborhood even before the condominium construction began. However, the plan for the condominium was not approved by the state authorities, and the project was cancelled. Jim suffered losses as a result, but he had no rights in the contract because he was a(n): A. material beneficiary. B. substantial beneficiary. C. incidental beneficiary. D. third-party beneficiary

C. incidental beneficiary

The omission of one or more essential terms does not necessarily make the offer: A. voidable. B. valid. C. invalid. D. void.

C. invalid

The three essential characteristics of valid consideration are: A. accuracy, brevity, and clarity. B. fulfillment of social, moral and ethical obligations. C. legality, adequacy, and the possibility of performance. D. intention, practices, and policies

C. legality, adequacy, and the possibility of performance

The unintentional misstatement or nondisclosure of a material fact made by one party with the hope of influencing the other party amounts to: A. fraud. B. duress. C. misrepresentation. D. mistake

C. misrepresentation

A promise to do something that one is already required to do either by law or by contract represents no additional sacrifice and is: A. a general release. B. an illegal act. C. not valid consideration. D. fraudulent

C. not valid consideration

A party to a contract will not be obligated by an assignment made by the other party without his or her knowledge until A. recorded. B. stamped. C. notified. D. rejected

C. notified

The element of consideration in a contract refers to the: A. competence of the parties. B. purpose of the contract. C. parties' exchange of promises. D. form of the contract

C. parties' exchange of promises

The requirement that the form of a contract be correct for the terms of the contract to enforceable is the element of: A. written form. B. legal wording. C. proper form. D. consideration.

C. proper form

If an advertisement offers a reward for information that might lead to the arrest of a criminal or to the return of a lost article, it is regarded as a: A. request for an offer. B. reward offer. C. public offer. D. call for a bid

C. public offer

To be legally enforceable, a contract must contain the six elements. If one of these elements is missing, the court will usually: A. enforce the contract. B. refer the matter to the superior courts. C. refuse to enforce the contract. D. validate the contract

C. refuse to enforce the contract.

A contracting party intending to authenticate a written agreement may use any symbol as their: A. acceptance. B. seal. C. signature. D. revocation

C. signature

. If the offeror acknowledges the rejection but restates the offer, the offeree: A. loses the opportunity to accept but retains the authority to make a counteroffer. B. does not have any opportunity to accept, reject, or make a counteroffer. C. still has the opportunity to accept, reject, or make a counteroffer. D. cannot revive the offer or make a counteroffer

C. still has the opportunity to accept, reject, or make a counteroffer

. When the UCC was written, it was intended that an unconscionable clause would apply only to: A. written contracts. B. leasing an apartment. C. the sale of goods. D. opening a checking account

C. the sale of goods

In a bankruptcy, the assets and contracts of a bankrupt person or business will be assigned to: A. the party to the contract. B. the court. C. the trustee. D. the creditors.

C. the trustee

. Sometimes a person has the power to control the actions of another because of a special or confidential relationship to that person. If this power is improperly used to his or her personal advantage, then it amounts to: A. mistake. B. misrepresentation. C. undue influence. D. duress.

C. undue influence

If the mistake in the contract is made by only one party, then it amounts to: A. mutual mistake. B. intentional mistake. C. unilateral mistake. D. conditional mistake

C. unilateral mistake

Court decisions involving mistakes in contracts are often complex and the courts attempt to determine whether the mistake was: A. intentional. B. unintentional. C. unilateral or mutual. D. unilateral and misrepresented

C. unilateral or mutual

A proposal that is both offered by the offeror and accepted by the offeree is a _____contract. A. void B. invalid C. valid D. voidable

C. valid

A promise of an act by one party in exchange for the promise of an act by another is an example of: A. a void contract. B. a valid offer and acceptance. C. valid consideration. D. a voidable contract

C. valid consideration

. Contracts in which the parties have unequal bargaining power are known as unconscionable contracts

false

A counteroffer, that is, a conditional, or qualified, acceptance of an offer, is generally interpreted as an acceptance and is not binding on the parties

false

A fraud charge can be proven only if it is available in writing, but not if it is spoken or by acts or conduc

false

A misdemeanor is the intentional misstatement or nondisclosure of a material fact made by one party with the hope of influencing the other party

false

A person who agrees in a contract to perform a particular task may generally delegate this task to someone else and can transfer responsibility for getting it done

false

A person who discusses the terms of a purchase with a salesperson, pays cash for the purchase, and takes the item with him, is making an unenforceable written contract

false

A person who has power and abuses it to control the actions of another person on the basis of a special or confidential relationship commits fraud

false

A pledge or a subscription, which is a promise to donate money, is unenforceable

false

A simple contract is defined as an informal contract made under seal

false

A third-party beneficiary to a contract rarely has a legal right to the benefits resulting from the contract

false

Acceptance of a public offer by anyone, as indicated by the performance of the act, does not result in an enforceable contract

false

An assignment must always be in writing

false

An entire or indivisible contract can contain only two parts, and each is required to be independent of the other

false

An executed contract is one in which all terms of the agreement have been fully performed by at least one party

false

An express contract must be in writing and specifically state the agreement of the parties

false

An offer is terminated as a result of the death or legal incapacity of either the offeror or the offeree under an option contract

false

Competency of parties is not a mandatory requirement to make a contract valid

false

Competent parties can be of any age as long as they understand the terms of a contract

false

Contracts based on moral consideration are generally enforceable

false

Courts have long been reluctant to uphold unconscionable contracts, but recently the UCC has made such contracts more likely to be enforced

false

Even after an offer is rejected by the offeree, it can be revived or made into a counteroffer once the communication of the rejection has been received by the offeror

false

For a contract to be dissolved because of a mistake, the law usually requires that only one of the parties has to be part of the mistake

false

If an injured party in a lawsuit can prove only misrepresentation, the contract can be canceled and the injured party can also sue for additional damages

false

It is not required for a formal contract to be written under seal

false

Members of the armed services are permitted to assign their pay

false

Past consideration is a promise to repay someone for a benefit before it has been received

false

Personal service contracts are automatically assigned at the time of death

false

Sales of personal property in the amount of $5,000 or more must be in writing

false

Silence does not indicate assent to an offer, even if both parties agree beforehand that this is to be the means of acceptance

false

The "take-it-or-leave-it" contracts, known as contracts of adhesion, are quite common and are normally unenforceable.

false

The Statute of Frauds prohibits a person from legally entering into oral contracts for certain kinds of agreements

false

The exchange of money is a mandatory requirement for a consideration

false

The pressure under duress only takes the form of a threat of bodily harm to an individual or to his family, but not the threat of serious loss or damage to his property

false

Undue influence is the act of applying unlawful or improper pressure or influence to a -person in order to gain his agreement to a contract

false

Valid consideration must be either the performance of an act or the payment of money

false

When an offer specifies all the terms and conditions of a contract, it is not considered as definite and certain

false

valid contract may exist even if the consideration is a promise to perform an illegal act, or to avoid performing an act that is legally required to be performed

false

Even employment contracts may be assigned if there is no relationship of trust or confidence, or any other circumstance that would create a materially greater burden on the party whose services are being assigned

true

If a third party enters the contract as a result of a novation, the party whose rights or duties are assumed is completely relieved of obligations

true

If goods are advertised in a newspaper at an incorrect price, and the fault is that of the newspaper, the merchant may be able recoup his or her losses from the publication

true

If the life of an agreement is indefinite and there is a possibility of it being completed within a year, the agreement need not be in writing to be enforceable

true

If there is full performance of an oral agreement to sell real property, the contract does not need to be in writing

true

Intentional concealment or intentional nondisclosure of material facts is just as fraudulent as making false statements

true

Many consumer protection statutes have been passed that recognize some of the problems associated with unconscionable contracts and contracts of adhesion

true

Many contracts, in which part of the consideration is forbearance, involve agreements not to compete

true

Mistakes relating to contracts may be concerned with the nature of the subject matter or the quality of the subject matter

true

Offer and acceptance are essential elements of a contract

true

One reason for creating a contract is for employment

true

Oral evidence introduced after a contract is signed may be legally accepted if it clarifies some point in a written agreement

true

Personal-service contracts may not be assigned because the party who hires the specific person has a substantial interest in having only the hired person perform

true

Proper form is the requirement that the form of a contract be correct for the terms of the contract to be enforceable

true

Puffing is considered a mere expression of opinion that refers to generalities

true

Sometimes the unequal bargaining power of parties to a contract gives one party an unfair advantage when dealing with those who lack the economic power to enter into a contract on an equal footing

true

Statutes, in some states, have permitted a person who has a claim against another to give up, or release, his or her claim without an exchange of consideration by making a written statement to that effect

true

The Uniform Commercial Code (UCC) provides that additional (or different) terms are to be construed as proposals for addition to the contract, and between merchants, become part of the contract

true

The Uniform Commercial Code dispenses with the requirement of consideration in certain contracts that involve a merchant's written firm offer that provides that the contract is irrevocable

true

The general rule of contract law provides that the acceptance of an offer must be the same as the offer

true

The most common form of valid consideration is the promise of money by one party for the promise of an act by another

true

The parol evidence rule refers to the addition of supplementary evidence or conditions that a party wants added to a written contract

true

In a contract, the term ________means tasks and performances, but not responsibilities. A. rights B. duties C. role D. errands

B. duties

With respect to pledges and subscriptions, courts have generally held that these promises are: A. unenforceable. B. enforceable. C. enforceable only in cases involving amounts greater than $500. D. unenforceable if they are not made for a reasonable period of time

B. enforceable

The Statute of Frauds applies only to: A. administrative contracts. B. executory contracts. C. business contracts. D. notarized contracts

B. executory contracts

. The law makes it clear that the mistaken belief must ¬concern a(n): A. precedent. B. existing fact. C. belief. D. overruled law

B. existing fact

. Jack promised to pay his nineteen year-old nephew $300 on the nephew's twenty-second birthday if the nephew refrained from smoking cigarettes until he graduated from Western State College. This contract is legal and illustrates the promise of: A. pledge or subscription. B. forbearance as consideration. C. general release. D. implied contract

B. forbearance as consideration

Any agreements to sell an interest in real property must be: A. approved by a court-appointed judge. B. in writing unless there has been partial performance. C. signed in the presence of an administrator. D. oral or in writing to be enforceable

B. in writing unless there has been partial performance

An entire contract is also known as a(n): A. simple contract. B. indivisible contract. C. specialty contract. D. executed contract

B. indivisible contract

The ____________ states that an acceptance sent via the postal system or by courier is effective when sent. A. mirror image rule B. mailbox rule C. acceptance rule D. good faith rule

B. mailbox rule

Courts may justify the enforcement of some contracts, even though there is no consideration, by stating that there was: A. monetary consideration. B. moral consideration. C. pecuniary consideration. D. fiscal consideration

B. moral consideration

To be enforceable, agreements in contemplation of marriage: A. must be in writing and signed after the marriage. B. must be in writing and signed before the marriage. C. can be oral if the parties are both over the age of 21 years. D. should be signed in the presence of witnesses

B. must be in writing and signed before the marriage

Certain contracts, such as those involving the sale of personal property for $500 or more,: A. must be orally accepted to be enforceable. B. must be written to be ¬enforceable. C. need not be signed to be enforceable. D. must be divisible in nature

B. must be written to be ¬enforceable

. If a contract requires a person to do something he or she is already required to do, such as obey all traffic laws, the contract is: A. enforceable B. not enforceable. C. illegal. D. impossible.

B. not enforceable

Some agreements that lack consideration are: A. enforceable. B. not enforceable. C. valid. D. unlawful

B. not enforceable

. A(n) __________ transfers all rights and obligations in a contract. A. assignment B. novation C. exemption D. execution

B. novation

If an advertisement contains a positive promise and a positive statement of what the advertiser expects in return, the court will usually hold that the advertisement is a(n): A. proposal. B. offer. C. request. D. informal invitation

B. offer.

The web page or e-mail is generally regarded as the writing that satisfies the Statute of Frauds in the case of: A. auction sales. B. online sales. C. implied sales. D. telephone sales

B. online sales

The obligation to perform acts already required is known as a: A. pious obligation. B. preexisting duty. C. social obligation. D. contractual duty

B. preexisting duty

All of the following are fraudulent except: A. false statements. B. puffing. C. intentional concealment. D. intentional nondisclosure

B. puffing

The parol evidence rule: A. states that any spoken or written words that are in conflict with what the written contract states should be introduced as evidence in a court of law. B. refers to supplementary evidence or conditions that a party wants to be added to an existing written contract. C. specifies that certain kinds of agreements must be in writing to be enforceable. D. does not prohibit a person from legally entering into oral contracts for certain kinds of agreements

B. refers to supplementary evidence or conditions that a party wants to be added to an existing written contract

When communicating an offer, the communication may be implied by: A. custom and tradition. B. the actions of the parties. C. the actions of third parties in similar situations. D. the Uniform Commercial Code.

B. the actions of the parties

When communicating an offer, the communication may be implied by: A. custom and tradition. B. the actions of the parties. C. the actions of third parties in similar situations. D. the Uniform Commercial Code.

B. the actions of the parties.

. A(n) _____ contract is an agreement that results in an obligation that is legally enforceable. A. void B. valid C. voidable D. invalid

B. valid

An agreement that lacks one or more of the essential elements of a contract from the very beginning is a: A. voidable and unenforceable contract. B. void and unenforceable contract. C. valid and enforceable contract. D. void, but enforceable contract

B. void and unenforceable contract

All of the following are exceptions that apply to the parol evidence rule except: A. incomplete contracts. B. void contracts. C. contracts that are partly written and partly oral. D. subsequent oral modifications

B. void contracts

Consideration required in an enforceable contract can take various forms such as exchange of promises, forbearance, and pledges or subscriptions

true

The part of the Uniform Commercial Code (UCC) that is relevant to contract law is Article number: A. 1 B. 2 C. 3 D. 4

B. 2

. ______ is a promise that is generally not valid consideration and is considered a gratuitous promise, except in cases of moral consideration. A. Present consideration B. Past consideration C. A barren promise D. An onerous contract

B. Past consideration

. Insurance policies may be classified as contracts of: A. service. B. adhesion. C. duress. D. undue influence

B. adhesion

A(n) _____________ is a personal representative named by the court to perform as the executor would, in instances in which the deceased person has not left a will. A. judge B. administrator C. attorney D. agent

B. administrator

. The laws dealing with bankruptcy provide that the assets and contracts of a bankrupt person or business be: A. sold to the highest bidder. B. assigned to the trustee in bankruptcy. C. held by the court pursuant to a decree. D. transferred to the largest creditor

B. assigned to the trustee in bankruptcy

. An injured party who can successfully prove misrepresentation only has the remedy to: A. claim specific performance. B. cancel the contract. C. accept the contract. D. bring suit for damages

B. cancel the contract

Under the UCC, any written offer by a merchant to buy or sell goods that states that the offer will be held open for a specified time period: A. can be revoked during that time period, but only in writing. B. cannot be revoked during that time period. C. cannot be revoked by spoken word. D. can always be revoked

B. cannot be revoked during that time period

The determination of what is considered a reasonable time in the case of termination of a contract by lapse of time can vary according to the: A. assessment of a court-appointed judge. B. circumstances. C. opinion of the parties. D. opinion of the witnesses

B. circumstances

Entering into a contract with persons of legal age and normal mentality is considered within the element of: A. legality of purpose. B. competency of the parties. C. mutual agreement. D. proper form.

B. competency of the parties

An incidental beneficiary is one who may benefit as an indirect consequence of a contract, although that was not the intent of the: A. administrator. B. contracting parties. C. assignor. D. deceased party

B. contracting parties

Checkroom and luggage receipts are examples of: A. simple contracts. B. contracts of adhesion. C. unconscionable contracts. D. expressed contracts

B. contracts of adhesion

Puffing is also considered: A. a mistake. B. dealer's talk. C. misrepresentation. D. fraud

B. dealer's talk

The act of applying unlawful or improper pressure or influence to a person in order to gain his or her agreement to a contract is known as: A. fraud. B. duress. C. undue influence. D. mistake

B. duress.

All of the following are considered to be forms of oral communications in making an offer EXCEPT: A. telephone. B. television. C. e-mail. D. in person

c. e-mail

. Consideration in a contract may be more than just the promises exchanged by the parties; it may include the actual benefit gained and the detriment suffered by them

true

. Genuineness, or reality of an agreement, is said to be present in a contract when there is a true meeting of the minds

true

A contract may be extended and revised as needed to reflect the wishes of the parties

true

A contract may prohibit either just one party or both parties from assigning or delegating

true

A contract must show mutual agreement, which is also referred to as "a meeting of the minds"

true

A divisible contract is made up of two or more parts, each part being independent of the others

true

A guaranty, or promise, to pay the debts or settle the wrongdoings of another if he or she does not make settlement personally is not enforceable unless it is written

true

A life insurance policy is an example of a third-party contract

true

A physician may have the power to control the actions of his patients because of a special or confidential relationship

true

A promise to give up something of value that a person has a legal right to keep or to agree to do something that a person is not legally required to do is known as consideration

true

A transaction that is neither oral nor written but is still legally binding is considered an implied contract

true

A written contract can be a handwritten note

true

Agreements by an executor or administrator to pay debts of a deceased person must be in writing to be enforceable

true

All contracts to sell real property, or any interest in it, must be in writing to be enforceable

true

An enforceable contract results from an agreement that imposes a legal obligation

true

An example of a party to a personal-service contract is a musician

true

An executory contract is one in which the terms of the agreement have not yet been fully performed

true

An offer made in anger or jest is not made with the intent of entering into a valid enforceable agreement

true

An offer may be terminated by a lapse of time

true

Antenuptial agreements often include a provision whereby they do not expire over an extended period of time

true

As a general rule, if an offer is to be definite and certain, it should cover the same points as a good newspaper story: who, what, when, where, and how much

true