Business Law 15-16

In a bilateral contract, the consideration for each promise is ____.

A return promise

What does the preexisting duty rule mean?

A. Performance of a duty one is obligated to do under the law is not good consideration. B. Performance of an existing contractual duty is not good consideration. D. Both A and B.

Guardians may be appointed for which of the following?

A. Those who are adjudicated insane. B. Those who are adjudicated habitual drunkards. C. Those whose judgment has been impaired because of a condition such as Alzheimer's. D. All of the above.

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

Action

When must a disaffirmance of a contract based on minority occur?

Before or within a reasonable time of the minor's reaching the age of majority.

For a court to enforce a promise, ______ must offer consideration.

Both sides

A person who has legal ______ to contract is one who has the mental ability to understand his or her rights and obligations under a contract and, therefore, will presumably be able to understand how to comply with the terms of the agreement.

Capacity

Which of the following is true regarding the adequacy of consideration?

Courts seldom consider the adequacy of consideration but will do so if fraud is involved.

Which of the following is true if a contract is disaffirmed on the basis of intoxication?

Each party to the contract must return the other to the condition he or she was in at the time the contract was entered into.

Which of the following occurs when a minor's parents or legal guardians give up their right to exercise legal control over the minor, typically when the minor moves out of the parents' house and begins supporting himself or herself?

Emancipation

Which of the following occurs when a person reaches the age of majority and states either orally or in writing that he or she intends to be bound by the contact entered in to as a minor?

Express ratification

Which of the following is true regarding illusory promises?

Illusory promises are not consideration.

A[n] ______ occurs when a former minor does not specifically state that he affirms a contract entered into as a minor but takes some action that is consistent with intent to ratify the contract.

Implied ratification

Which of the following is true of an output contract under the UCC?

It is not valid because of the lack of consideration.

A promise to do something that you are already obligated to do is ____.

Not valid consideration

Which of the following is true regarding the ability of persons suffering from a mental illness to enter into a binding contract?

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

Which of the following occurs when three conditions are met: one party makes a promise knowing the other party will rely on it; the other party does rely on it; the only way to avoid injustice is to enforce the promise?

Promissory estoppel

Because ______ does not favor intoxication, the courts tend to be unsympathetic to intoxicated parties and will fairly liberally interpret behavior that seems like ratification as ratifying the contract.

Public policy

Which of the following are exceptions to the preexisting duty rule?

Unforeseen circumstances and additional work, but not past consideration.

Because their contracts are ____, minors have the right, until a reasonable time after reaching the age of majority, to _____ their contracts.

Voidable, disaffirm