Business Law Chapter 6

Both parties sign a document agreeing to the time-frame of the offer. Their arrangement is best described as a....

firm offer

Capacity to contract means that the person....

has the ability, according to law, to understand the contract and the consequences

List the three tests that an offer must pass to be considered valid.

1. Is contractual intent present in the offer? 2. Are the essential terms of the contract complete and definite? 3. Was the offer communicated to the offeree?

Which of the following is a test that a valid offer must pass?

All of the above are tests that a valid offer must pass

Which of the following statements about a firm offer is not true?

All of the above statements are true

An unaccepted offer may be terminated by....

All of the above; a counteroffer reasonable length of time rejection of the offeree

If an offeree alters a term in the original offer and sends it back to the original offeror, the result is a....

Counteroffer

A failure to respond at all to an offer can be construed as an acceptance

False

A store display of a MP3 player marked $121 would be an offer.

False

All contracts have to be in writing to be enforceable.

False

If a person finds and returns a watch for which a reward is offered but does not know of the reward offer, the person is still entitled to the reward.

False

If the offeree gives the offeror something of value in return for a promise to keep the offer open, this agreement is itself a binding contract and is called a counteroffer.

False

The person to whom an offer is made is termed the offeror.

False

The requirement that the acceptance must exactly match the offer for an agreement to be legally effective is known as the reverse image rule.

False

The right to withdraw an offer before it is accepted is known as the right of redemption

False

Unlike other methods of acceptance, a mailed acceptance is effective only when received by the offeror

False

Individuals who regularly deal in the goods, or tangible personal property, being bought or sold are labeled....

Merchants

Generally, when nothing is said in the offer about how long it will remain open, it will end after...

a reasonable length of time

A clear rejection terminates an offer.

True

While an implied-in-fact contract does not have its term expressly stated the terms can be inferred from the parties' acts or conduct

True

what the promiser demands and generally must receive in order to make his or her promise legally enforceable against him or her is called....

consideration

Generally defined _____ are agreements between two or more parties that create obligations.

contracts

Alfredo thinks about the offer and proposes to pay $600 now and then $200 payments on the 30th of the next three months. Alfredo's proposal to Victor is considered a....

counteroffer

When current market price is not specified in a contract between merchants for the sale of goods, but the current market price is understood to be the basis of the contract, the price term is said to be.....

implied

Advertisements in newspapers, radio, television, and direct mailings are considered to be....

invitations to negotiate

If the court requires that the terms of the acceptance exactly match the terms contained in the offer in order for the contract to be legally enforceable, the court is imposing the....

mirror image rule

Which of the following is not one of the major requirements for a contract?

offer and accommodation

After an offer is rejected, unless renewed by the original ___, the offeree can no longer accept the original offer.

offeror

A contract between the offeree and the offeror where the offeree gives something of value in return for a promise to keep the offer open is known as an....

option

Miquel agrees to take $2,000 from Ricardo and promises to keep open the offer to purchase the motorcycle to Ricardo only. This agreement would be legally described as an....

option

A ____ contract is not really a contract but a legal fiction created by the law to allow the enforcement of a contractual remedy where justice alone warrants such a remedy.

quasi or implied-in-law

Shawna calls Philip and withdraws her offer before Philip accepts it. She is able to do this because she has the right of....

revocation

The withdrawal of an offer before it is accepted is known as a...

revocation

When the specific subject matter of an offer is destroyed before the offer can be accepted, the offer is automatically......

terminated

Which of the following circumstances might render an acceptance invalid?

the acceptance does not match the offer

Nearly all offer must, at a minimum, identify....

the price, subject matter, and quantity

The Uniform Commercial Code makes firm offers binding for the stated period of time in the offer but not to exceed...

three months

Rhonda gladly paid her neighbor the agreed upon sum. This is a good example of an ____ contract.

unilateral

A contract is which performance alone is acceptance is termed an....

unilateral contract

In an ____ the offeror promises something in return for the offeree's performance and indicates that this performance is the way acceptance is to be made.

unilateral contract

Reward offers are always the basis for an....

unilateral contract