Chapter 11 BUSINESS LAW
What is the Parole Evidence Rule?
A rule that applies to complete and unambiguous contracts, that parties to the contract are not permitted to contradict the contract terms with evidence of previous negotiations.
What is the "Mailbox rule"?
An acceptance of the offer is effective sooner than the offeror's receipt; applies if offer uses the same of another reasonable method of communication as the offeror used
What are the 2 unique exceptions to consideration in the formation of a contract?
Charitable subscriptions (pledges to donate), and Promissory estoppel
"I'll take it, but you must deliver," is a valid acceptance.
False
A contract to solicit subscribers through pop-up Internet ads is considered a good under the UCC because it is a list of names.
False
A merchant's firm offer requires consideration to be valid.
False
An acceptance of a stipulated means offer by a different means is effective upon receipt.
False
An offer is effectively communicated upon mailing or dispatch.
False
Common law does not dictate amounts required for consideration.
False
Contracts for services are governed by the UCC.
False
Contracts for the sale of real property are governed by the Uniform Commercial Code.
False
Implied contracts are unenforceable.
False
The Restatement of Contracts is another name for the UCC.
False
The UCC rules on additional terms in acceptance are the same for merchants and nonmerchants.
False
Under the UCC, offers need price, subject matter, and quantity to be definite enough.
False
Termination of a UCC offer by expiration can be:
On a stated date; on the death of offeror; after a reasonable time has passed
A UCC offer is valid with the subject matter stated even though no price is given.
True
A contract for the sale of a car for $700, under the old UCC, must be in writing to be enforceable.
True
Contracts for the sale of land must be in writing to be enforceable.
True
Options require consideration to be valid.
True
Quasi contracts are implied-in-law contracts.
True
Revocation can be valid any time prior to acceptance.
True
The UCC Battle of the Forms provision allows additional terms in an acceptance without invalidating the acceptance.
True
Under common law, a counteroffer is also a rejection.
True
Types of contracts required to be in writing.
UCC - goods $5,000 or more; real estate; promises to pay the debt of another; contracts that cannot be performed in one year.
Which of the following question(s) on a credit application would be a violation of the Equal Credit Opportunity Act? a. "Do you plan on getting pregnant within the next two years?" b. "Have you ever declared bankruptcy?" c. "Have you ever been convicted of a crime?" d. All of the above are violations.
a. "Do you plan on getting pregnant within the next two years?"
Which of the following contracts would have to have some form or writing or record to be enforced? a. A contract for the sale of a painting for $1,000. b. A contract for employment for nine months. c. A contract for advertising a house for sale for $50. d. All of the above contracts would need to be in writing to be enforceable.
a. A contract for the sale of a painting for $1,000.
Which of the following contracts must be in writing to be enforceable? a. A contract for the sale of an easement for $250. b. A contract for the sale of a bike for $175. c. A six-month marketing consulting contract. d. All of the above must be in writing to be enforceable.
a. A contract for the sale of an easement for $250.
The Equal Credit Opportunity Act prohibits which of the following? a. Basing the credit decision on the receipt of public assistance income. b. Basing the credit decision on a bankruptcy of five years ago. c. Basing the credit decision on the fact that the applicant was in prison for a felony three years ago. d. Basing the credit decision on unemployment.
a. Basing the credit decision on the receipt of public assistance income.
Jerry Montray is negotiating with Pamela Barnes for the purchase of her mountain bike. The following conversation has taken place: Jerry: "I will buy your mountain bike for $375.00." Pamela: "I will sell it to you." Jerry: "Good. The tire pump is included." Which of the following statements is true? a. Jerry and Pamela have a contract for the bike at $375.00. b. Jerry and Pamela do not have a contract for the bike at $375.00. c. Jerry and Pamela have a contract for the bike at $375.00 with the tire pump. d. none of the above
a. Jerry and Pamela have a contract for the bike at $375.00.
Alpha Enterprises sent an offer to Omega Enterprises. The offer read as follows: AVAILABLE FOR IMMEDIATE SHIPMENT: 600 WIRELESS NOKIA PHONES - MODEL HCG5321 (THE PHONE FROM "CHARLIE'S ANGELS"). PRICE IS $10 EACH. 30 DAYS, SAME AS CASH. ALL WARRANTIES IN EFFECT. THIS OFFER EXPIRES ON TUESDAY, MARCH 15, 2016. Omega sent the following letter in response on March 14, 2016, via overnight delivery: HAPPY TO ACCEPT YOUR OFFER ON THE NOKIA PHONES. SHIP IMMEDIATELY. There was a major snowstorm that hit the east coast on March 14, 2016, and Omega's letter did not arrive at Alpha's headquarters until March 18, 2016. Alpha had sold the phones to another company. Omega demanded the 600 phones for $10 each claiming that it had accepted the offer in time. a. Omega is correct; it had valid and timely acceptance and had a contract. b. Omega is incorrect; the acceptance must arrive for it to be effective. c. Omega is incorrect; the offeree assumes the risk of the delivery means chosen. d. Omega is correct, but any damages must be recovered from the overnight shipping company. e. none of the above
a. Omega is correct; it had valid and timely acceptance and had a contract.
An ad in a newspaper reads: "AVAILABLE TODAY ONLY. FRIENDLY'S APPLIANCES. CLEARANCE SALE FOR ALL FLOOR ITEMS. 75% OFF RETAIL PRICES." Joan Ludwig arrived at Friendly's about one hour after it opened and there were no appliances left. The issues in the situation are governed by: a. The Uniform Commercial Code b. UETA c. common law d. restatement of contracts e. none of the above
a. The Uniform Commercial Code
Which of the following contracts would not be governed by the UCC? a. a contract for dentures b. a contract for the purchase of an Arabian horse c. a contract for the purchase of an oil painting for $550 d. a contract for the purchase of an ATR jet e. All of the above are governed by the UCC.
a. a contract for dentures
Which of the following contract subject matters must be evidenced by a writing to be enforceable under the statute of frauds? a. a contract for the sale of an easement for $75 b. a contract for the sale of a computer monitor for $220 c. a contract for consulting for 6 months @ $10,000 per month plus expenses d. All of the above must be in writing.
a. a contract for the sale of an easement for $75
The language "I offer to sell you my 1974 White Ford Torino" is: a. a valid offer. b. not a valid offer because it lacks a definite price. c. not a valid offer because there are no terms for payment. d. not a valid offer because it is oral.
a. a valid offer.
Under the UCC and between merchants, additional terms in acceptance: a. are part of the contract unless they are material. b. are part of the contract unless the offer was limited. c. result in rejection of the original offer. d. none of the above
a. are part of the contract unless they are material.
The following series of events occurred between Bull's Meat Market and The Butcher: May 1 - The Butcher faxes Bull's and offers to buy 200 lbs. of T-bone steak at $3.29 per lb. May 2 - Bull's faxes back: "Price is okay. Payment prior to delivery." Bull's and The Butcher: a. have a contract on May 2 with the payment term. b. have a contract on May 2 without the payment term. c. do not have a contract. d. none of the above
a. have a contract on May 2 with the payment term.
The maximum liability for a credit card holder whose card is lost or stolen is: a. $50. b. $50 if the cardholder notifies the creditor. c. $0. d. none of the above
b. $50 if the cardholder notifies the creditor.
Stan James carelessly left his wallet in the restroom of a gas station while on a business trip. He did not realize his wallet was gone until eight hours later when he went to check into his hotel. Stan called the credit card companies immediately, only to learn that the thief had charged $2000 on his American Express card, $450 on his MasterCard, and $75 on his gas credit card. Stan James' maximum liability on the cards is: a. $0. b. $50 per card. c. $50. d. none of the above
b. $50 per card.
Andy: "This is to confirm our telephone conversation of earlier today. 200 lbs. of T-bone at $2.89 per pound." Barb: "Yes, but that's 100 pounds at $2.99." Andy: "Too late, we already reached agreement by phone." Barb: "Too bad, it wasn't in writing." Which of the following statements is true? a. Barb is incorrect. The phone conversation was a contract. b. Barb is correct. The agreement must be in writing to be enforceable. c. Andy can enforce the agreement with the parol evidence rule. d. none of the above
b. Barb is correct. The agreement must be in writing to be enforceable.
Bethany Schmidt wrote to her friend Alan Gregson, "I will sell you my Apple iPhone for $375." Alan wrote back, "I accept. Please include the original packaging for the phone." Suppose that Bethany and Alan are both in the business of buying and selling used iPhones. Which of the following is correct? a. Bethany and Alan have an option. b. Bethany and Alan have a contract with the original packaging being included. c. Bethany and Alan have a contract without the packaging being included. d. Bethany and Alan do not have a contract.
b. Bethany and Alan have a contract with the original packaging being included.
Grace Williams purchased plates and cups from China Wholesalers for sale to retail customers at her store. Grace and China had little paperwork, just the invoices from the shipments. Otherwise, they operated by phone and shipments in response to the phone call requests. Grace's orders range from $2000-$10,000. China decided to clean up its internal controls and documentation and asked Grace to sign a form agreement. Grace is not sure that she wants to sign a contract. Which of the following is correct, given Grace's circumstances? a. There need not be a written contract because the parties have a longstanding relationship. b. If China simply confirms each order from Grace, there is sufficient record of a contract. c. There must be a written contract for any part of this relationship to be enforceable. d. Pattern or practice is sufficient writing to establish a contract.
b. If China simply confirms each order from Grace, there is sufficient record of a contract.
Jane Linden is negotiating with James Paul to buy his 2012 Mini-Cooper. The following excerpts from letters have occurred so far: Jane: "I would be interested in purchasing your Mini-Cooper." James: "I am thinking of selling my Mini-Cooper." Jane: "I am considering selling my diamond tennis bracelet to buy your Mini-Cooper." Which of the following statements is true? a. James and Jane have a contract to sell the Mini-Cooper. b. James and Jane do not have a contract to sell the Mini-Cooper.
b. James and Jane do not have a contract to sell the Mini-Cooper.
Stephen has a lawn service and Jennifer asked him to come by and cut her grass while she was out of town. Jennifer paid him when she got back into town and asked him to mow the grass "whenever it needs it" so Stephen has been cutting her grass every few weeks all summer. She has always paid him the following day. In late August Stephen mowed the grass again but this time Jennifer refused to pay him stating that they didn't have a contract so he should have asked her first. Which of the following is true? a. Stephen and Jennifer had an unenforceable contract. b. Stephen and Jennifer had a quasi contract. c. Stephen and Jennifer had an executory contract. d. Stephen and Jennifer did not have any type of contract.
b. Stephen and Jennifer had a quasi contract.
James Reston offered, via letter, to sell his mountain cabin to Jennifer Olsen for $375,000. Before Jennifer could respond, Reston died suddenly. What happens with the offer? a. The offer remains open until Reston's estate revokes it. b. The offer terminated with Reston's death. c. Jennifer still has the power of acceptance for a reasonable period of time after Reston's death. d. The offer is enforceable against the estate of Reston.
b. The offer terminated with Reston's death.
Stamps.com offers at-home postage and mailing for a monthly fee. Customers are able to carry a balance on their accounts that allows them to mail packages and letters as long as there is a balance in their account. Stamps.com has a button on its program that carries this logo, "To purchase postage, click here." Following that click, another window pops up that reads, "You are about to purchase postage. Once you click 'Okay' below, you cannot change this transaction." Why does Stamps.com have the second pop-up button? a. The pop-up button is simply a courtesy for its customers. b. The pop-up button is necessary to show acceptance of the terms. c. The pop-up button is required under the UCC. d. The pop-up button is required under common law.
b. The pop-up button is necessary to show acceptance of the terms.
Day 1 - School teacher sends superintendent letter of resignation. Day 4 - Superintendent mails letter accepting resignation. Day 5 - School teacher hand delivers letter withdrawing resignation. Day 6 - Teacher receives superintendent's letter. a. The above negotiations are governed by the UCC. b. The resignation was accepted and the withdrawal is too late. c. both a and b d. The resignation offer was revoked.
b. The resignation was accepted and the withdrawal is too late.
An ad in a newspaper reads: "AVAILABLE TODAY ONLY. FRIENDLY'S APPLIANCES. CLEARANCE SALE FOR ALL FLOOR ITEMS. 75% OFF RETAIL PRICES." Joan Ludwig arrived at Friendly's about one hour after it opened and there were no appliances left. Which of the following is true? a. Friendly's has breached a contract and owes damages to Joan. b. There is no breach of contract. c. Joan has no rights of recovery because the contract was required to be in writing. d. There was no contract, but Joan can recover on the basis of quasi contract. e. none of the above
b. There is no breach of contract.
Jane: "I'll pay you $50 if you will clean my windows." Al: "I'll do it for $75." Jane: "$65 and it's a deal." Al: "No way." Jane: "Too late. We have a contract." Which of the following statements is true? a. Jane is correct, there is a contract. b. There is no contract. c. There is a contract to clean the windows for $65. d. There is a contract to clean the windows for $75.
b. There is no contract.
Melanie: "I'll buy that armoire for $775." Judith: "It's not for sale." Melanie: "How about $875?" Judith: "I don't know. It's been in my family for 130 years." Melanie: "How about $1000?" Judith: "I'll think about it." a. There is an option contract. b. There is no contract. c. There is a reliance case. d. There is a quasi contract.
b. There is no contract.
Which of the following contracts would not have to be in writing under the old UCC? a. a contract for the sale of an easement for $450 b. a contract for consulting services for $10,000 over the next 90 days c. a three-year advertising contract d. a contract for the sale of furniture for $700 e. All of the above must be in writing.
b. a contract for consulting services for $10,000 over the next 90 days
Which of the following contracts must be in writing to be enforceable? a. a contract for $550 for binding books b. a contract for the sale of an easement for $375 c. a contract for services from April 1, 2015 through December 15, 2016 d. a contract for the sale of a horse for $425
b. a contract for the sale of an easement for $375
The mailbox rule applies to: a. all acceptances. b. acceptances communicated through the offer's stipulated means. c. acceptances under UCC only. d. revocations and acceptances. e. none of the above
b. acceptances communicated through the offer's stipulated means.
An ad in a newspaper reads: "AVAILABLE TODAY ONLY. FRIENDLY'S APPLIANCES. CLEARANCE SALE FOR ALL FLOOR ITEMS. 75% OFF RETAIL PRICES." Joan Ludwig arrived at Friendly's about one hour after it opened and there were no appliances left. The newspaper ad: a. is an offer. b. is not an offer. c. is a merchant's firm offer. d. cannot be revoked. e. none of the above
b. is not an offer.
To be valid, a UCC merchant's firm offer: a. must be supported by consideration. b. must be evidenced by a record. c. must be signed by both parties. d. all of the above
b. must be evidenced by a record.
Which of the following is not required for a valid UCC offer? a. quantity b. payment terms c. subject matter d. both b and c e. a, b, and c
b. payment terms
Which is not a requirement for a merchant's confirmation memorandum? a. evidenced by a record b. signed by both parties c. underlying oral agreement d. none of the above
b. signed by both parties
"Point and click" refers to: a. the right of the FBI to search web sites. b. the formation of contracts via the Internet. c. the registration of domain names under ICANN. d. pornographic web sites. e. none of the above
b. the formation of contracts via the Internet.
Which of the following is not required to be disclosed in the solicitation of a credit card customer? a. fees for issuing the card b. what your credit limit will be c. APR for the card d. All of the above must be disclosed.
b. what your credit limit will be
Which of the following eliminates the effect of the mailbox rule? a. The UCC eliminates the mailbox rule. b. Common law eliminates the mailbox rule. c. An offer that includes, "Acceptance is effective upon receipt only." d. Any attempt to eliminate the mailbox rule is void. e. none of the above
c. An offer that includes, "Acceptance is effective upon receipt only."
Barry hired Anglin Engineering to produce engineering drawings for work Barry was doing at a brewery. Anglin said it would charge "street" rates for the work, which meant $35 an hour for regular work, $40 an hour for overtime work, and $45 an hour for its time. Barry gave Anglin a "purchase order" for the work, but no rate was specified. Anglin sent bi-weekly invoices to Barry, and Barry paid the invoices for two months. Barry continued to insist that the work be done, but constantly complained about the rates and did not pay invoices for the next four months. Anglin sued for $98,618, the amount it was due for work at the "street" rate. Barry claimed there was no contract, because there was no meeting of the minds about the rate to be paid. Who should prevail in this case? a. Anglin, because there was a purchase order that outlined all of the terms and conditions between Barry and Anglin. b. Barry, because there was no meeting of the minds as to the rate of compensation for Anglin's work because there was no contract, only a purchase order. c. Anglin, because there was an agreement in that Barry accepted the rates when it paid the invoices for two months. d. Barry, because there was no contract as the rates identified by Anglin were too vague and indefinite to enforce.
c. Anglin, because there was an agreement in that Barry accepted the rates when it paid the invoices for two months.
Bethany Schmidt wrote to her friend Alan Gregson, "I will sell you my Apple iPhone for $375." Alan wrote back, "I accept. Please include the original packaging for the phone." Which of the following statements is correct? a. Bethany and Alan have an option. b. Bethany and Alan have a contract with the original packaging being included. c. Bethany and Alan have a contract without the packaging being included. d. Bethany and Alan do not have a contract.
c. Bethany and Alan have a contract without the packaging being included.
John Freeden is negotiating with Bill Murray to buy Bill's mountain bicycle. The following conversation has taken place: John: "I will buy your mountain bike for $325.00." Bill: "I couldn't sell it for less than $375.00." John: "I'll take it for $375.00." Which of the following statements is true? a. Bill and John have a contract for the sale of the bike at $375.00. b. Bill and John have a contract for the sale of the bike at $325.00. c. Bill and John do not have a contract. d. none of the above
c. Bill and John do not have a contract.
Carolina Curtis offered to clean the windows at Rebate Retailer's brick-and-mortar outlet. Carolina said she would get the windows cleaned within 48 hours. Carolina also told Rebate, "We can work on the price later." Which of the following statements is correct? a. Carolina and Rebate have formed a valid contract. b. Carolina and Rebate will have formed a contract once she cleans the windows. c. Carolina and Rebate do not have a contract. d. The absence of a price does not affect the validity of an offer.
c. Carolina and Rebate do not have a contract.
Julia Pitt runs a boutique that specializes in luggage and travel items. Julia contacts Tumi Luggage about carrying its line of messenger satchels. The Tumi representative tells Julia that Tumi would be happy to sell her 100 Tumi Black Messenger bags for $318 each. Julia is happy with the price and asks Tumi to send the bags. The Tumi representative then faxes a confirmation of the shipment of the 100 bags at $318 each. Julia receives the fax. When the bags arrive, Julia contacts Tumi and says there is a business downturn and that she does not want the bags and that there was no contract anyway. a. Julia is correct; the contract requires some type of authentication from Julia to be enforceable. b. Julia is correct; the contract required more than a fax to have a sufficient record. c. Julia is incorrect; she and Tumi have a valid and enforceable contract. d. both a and b
c. Julia is incorrect; she and Tumi have a valid and enforceable contract.
Which of these is an example of a bank's commitment to pay? a. Bill of lading b. Fee arbitration agreement c. Letter of credit d. A warrant
c. Letter of credit
Fred Twain sends the following e-mail to Ralph Barnes: "Will sell you my 2010 Audi A4 for $23,500, will carry or take cash. This offer to remain open until November 11, 2016." Ralph responds, "I know how much you love that car. I'll think about it." On November 12, 2016, Ralph e-mails Fred and writes, "Fred, I am ready to buy your car." Fred responds, "Ralph, I sold the car this morning because I didn't hear from you." a. Fred has breached a contract because Ralph accepted. b. Fred was required to notify Ralph before he sold the car to someone else. c. Ralph no longer had the power of acceptance. d. both a and b
c. Ralph no longer had the power of acceptance.
Refurbished, Inc. sent an offer to The Phone Warehouse. The offer read as follows: "Available for immediate shipment: 1,000 iPhone 4. Price is $49 each. 30 days, same as cash. All warranties in effect. This offer expires on Tuesday, December 31, 2013." The Phone Warehouse sent the following letter in response on December 30, 2013, via overnight delivery: "Happy to accept your offer on the iPhone 4's. Ship immediately." There was a major snowstorm that hit the east coast on December 30, 2013, and The Phone Warehouse's letter did not arrive at Refurbished's headquarters until January 3, 2014. Refurbished had sold the iPhones to another company. The Phone Warehouse demanded the 1,000 phones for $49 each, claiming that it had accepted the offer in time. a. The Phone Warehouse is incorrect; the offeree assumes the risk of the delivery means chosen. b. The Phone Warehouse is correct, but any damages must be recovered from the overnight shipping company. c. The Phone Warehouse is correct; it had valid and timely acceptance and had a contract. d. The Phone Warehouse is incorrect; the acceptance must arrive for it to be effective.
c. The Phone Warehouse is correct; it had valid and timely acceptance and had a contract.
Janet Kennedy has received a letter in the mail from BISA International, a credit card firm. The letter describes the card as follows: "This card is yours for only a small annual fee that is billed to your account. There is an annual percentage rate finance charge of 16.5%. There may be other charges for some transactions. There are no late fees, but there will be a charge for going over your credit limit." Which of the following statements is true? a. The letter includes all the necessary disclosures for credit card solicitation under Regulation Z. b. The finance charge is usurious. c. The letter is missing several items of disclosure required under Regulation Z for credit card solicitation. d. none of the above
c. The letter is missing several items of disclosure required under Regulation Z for credit card solicitation.
On June 13, 2016, Brock Adams wrote to Julie Beckham: "I offer to sell you my home (legal description appeared here) for $425,000. Sale to close by September 15, 2016. Offer must be accepted by fax no later than 4:00 PM on June 15, 2016." Julie sent a fax accepting the offer at 3:36 PM on June 15, 2016. Because Brock's fax machine was not working, the fax did not come through until 8:00 PM on June 15, 2016, after Brock had the fax repaired. Which of the following statements is true? a. There is no contract because the acceptance was too late. b. There is no contract because you cannot accept an offer for real estate via fax. c. There is a valid contract that has been formed. d. The mailbox rule does not apply when the acceptance is specified.
c. There is a valid contract that has been formed.
John: "I will sell you my laptop computer for $330." Mary: "Will you include the carrying case"? John: "Sold." a. There is a contract for the sale of the computer with the carrying case. b. There is a contract for the sale of the computer but the carrying case is not included. c. There is no contract for the sale of the laptop computer. d. There is a contract but it is unenforceable because it must be in writing. e. none of the above
c. There is no contract for the sale of the laptop computer.
Buyer on fax: "Will take house for $587,500 if front lawn is fixed." Seller on fax in response: "Price is $589,000 and no front lawn." Buyer on fax in response: "$588,000 plus the front lawn." Seller on fax in response: $589,000 plus the front lawn." a. There is a contract for the sale of the house at $588,000 plus the lawn. b. There is a contract for the sale of the house at $589,000 plus the lawn. c. There is no contract. d. none of the above
c. There is no contract.
Mr. Anderson sold his car to his daughter Amanda for $1,000 even though the car is valued at $20,000. The next day, her brother Richard claimed the car belonged to him. Richard claims their dad promised to give him the car last year. Which of the following is true? a. Even though there is minimal consideration, the sale does not constitute a valid contract. b. Because the car was worth more than the sale price, there is no consideration. c. There is valid consideration, despite the price. d. The car belongs to Richard because it was promised to him first.
c. There is valid consideration, despite the price.
Dakota and Katie have been life-long friends. When Dakota decided to move, Katie made her an offer of $350,000 for her house and Dakota accepted the offer with a hand-shake. A few days later, Dakota was killed in a car accident and her brother informed Katie that Dakota had left him as the sole beneficiary and he would be selling the house for $500,000 if she still wanted to buy it. Which of the following is true? a. Katie still purchase the house for the original $350,000. b. Dakota's brother has to sell the house to Katie for $350,000. c. There was not a valid contract between Katie & Dakota so she will have to pay the new price. d. The house belongs to Katie because she and Dakota had a valid contract.
c. There was not a valid contract between Katie & Dakota so she will have to pay the new price.
Which of the following contract subject matters would not be covered under the UCC? a. a contract for the sale of a mobile home from the manufacturer b. a contract for the sale of a mobile home from a previous owner c. a contract for the sale of a mobile home plus its lot d. All of the above are under the UCC.
c. a contract for the sale of a mobile home plus its lot
Which of the following questions on a credit application would be a violation of ECOA? a. asking about felony convictions b. asking address and length of residence c. asking whether the applicant is pregnant d. All of the above are violations.
c. asking whether the applicant is pregnant
Walt's Pool World's fax to Pat's Pumps: "I'll take 10 4 hp pool pumps @ $175 each." Pat's Pumps' return fax: "Ok. Will deliver tomorrow AM." Pat and Walt: a. do not have a contract because the faxes will not satisfy the statute of frauds. b. do not have a contract because of the mirror image rule. c. had a contract when Pat's fax was sent. d. had a contract when Pat's fax was received.
c. had a contract when Pat's fax was sent.
Under both UCC and common law, a counteroffer: a. must be accepted by the original offeror. b. is effective upon mailing or dispatch. c. is also a rejection. d. none of the above
c. is also a rejection.
Which of the following is not a violation of the ECOA? a. requiring a husband's signature when his wife applies for a credit card b. requiring disclosure of pregnancy c. requiring disclosure of length of time at current job d. requiring disclosure of marital status e. All of the above are violations of the ECOA.
c. requiring disclosure of length of time at current job
Ann Frazer has just purchased a new Maserati. Ann will be borrowing the money from her bank. Ann signed the contract at 8:00 PM at the dealership and her bank will not be open until 10:00 AM the following day. Ann: a. has a contract regardless of whether her bank approves her loan. b. has made a conditional acceptance and has no contract. c. will be excused from her contract if the bank does not approve her loan. d. none of the above
c. will be excused from her contract if the bank does not approve her loan.
Abe and Gabriel entered into a contract for Abe to furnish landscaping services for Gabriel's office complex. The contract provides the fee will be $75 per month. At the time Gabriel signs the agreement, the two discuss the fact that the services required in the winter will be less and the fee will be reduced to $50 per month. Abe adds as Gabriel is signing, "I just forgot to put that sliding scale in this contract. Don't worry - I'll take care of it because we understand each other." Gabriel: a. will be permitted to introduce evidence about the winter fee reduction. b. will only need to pay $50 during the winter months. c. will pay $75 per month every month because of parol evidence. d. none of the above
c. will pay $75 per month every month because of parol evidence.
Which of the following questions on a credit application violates the ECOA? a. "List your place of employment." b. "Other sources of income - if you wish to have them considered in your credit evaluation." c. "Length of time in current residence." d. "Monthly child support income."
d. "Monthly child support income."
Which of these can be a valid contract agreement under ESIGN? a. A fax b. A PDF file c. An online click or check on an "I accept" button d. All of the above
d. All of the above
Which of the following questions is prohibited under the ECOA? a. "Will your husband approve of you getting this credit card?" b. "Are you now pregnant or are you planning to be?" c. "We don't count public assistance income." d. All of the above are ECOA violations.
d. All of the above are ECOA violations.
Which of the following is/are governed by the UCC? a. a contract for the sale of water b. a contract for the sale of extracted oil c. a contract for the sale of barges d. All of the above are governed by the UCC.
d. All of the above are governed by the UCC.
Mitchell: I am looking at the Trek bike advertised on your website for $650.00. Would you take $600.00? Leslie: I would take $600 if there were no delivery required. Mitchell: Well, I have to have it delivered because you are two states away. Leslie: Well, then if there has to be delivery, I could do it for $630.00. Mitchell: Is that cash? Leslie: Yes. a. Mitchell and Leslie have a contract for the sale and purchase of the bike for $630.00 with delivery. b. Mitchell and Leslie have a contract for the sale and purchase of the bike for $630.00 without delivery. c. Mitchell and Leslie have an offer on the table of $600 with no delivery. d. Mitchell and Leslie do not have a contract.
d. Mitchell and Leslie do not have a contract.
Which of the following is not a risk associated with international contracting? a. Currency exchange rates b. Transportation costs c. Fee collection d. None of the above
d. None of the above
Which of the following is not part of the CARD provisions on transfer of credit card balances? a. Limits on how quickly credit terms can be changed following the transfer. b. Additional disclosures on transfer fees. c. Limits on transfer fees. d. Prohibitions on additional transfers by the card holder.
d. Prohibitions on additional transfers by the card holder.
The Hoffmans were having their home remodeled by All-Right Contractors. The roof had to be removed in order to build the second story the Hoffmans had contracted and designed to build. After All-Right had removed the roof, but before a covering was placed over the exposed half of the home, All-Right's foreman said the job would cost an additional $12,500. The Hoffmans refused to agree to the additional fees and All-Right's foreman said, "Suit yourselves. Looks like rain for the next day or two," and left. The Hoffmans called All-Right and agreed to pay the $12,500 extra and went in to sign the paperwork. Which of the following statements is true? a. The contract for the additional $12,500 is invalid because of duress. b. The contract was not valid because of duress, but the Hoffmans signed anyway—so there is a valid and enforceable agreement. c. The contract is valid because there was substantial performance. d. The contract for the additional $12,500 is valid and binding.
d. The contract for the additional $12,500 is valid and binding.
Tanner is moving from Cleveland to New Orleans. He will be driving a rental truck with his belongings but he needs to get his car to New Orleans also. He tells his friend Skylar, if you will drive my car to New Orleans this weekend, I will pay you $200. Skylar then drove the car to New Orleans, but Tanner refuses to pay and claims they do not have a contract. Which of the following is true? a. They have an executory contract. b. They do not have a contract. c. They have a bilateral contract. d. They have a unilateral contract.
d. They have a unilateral contract.
Margaret Jameson has had enough. Last week she saw the drug dealers who live next door selling drugs to a 12-year-old from the neighborhood. Deciding to take things into her own hands, she paid John $100 to set fire to their house while they were gone. What type of contract is this? a. Unenforceable contract. b. Voidable contract. c. Quasi contract. d. Void contract.
d. Void contract.
Under CARD, the terms of the credit card must be: a. sent to the customers. b. printed on paper. c. posted on the Internet. d. all of the above.
d. all of the above.
E-Sign: a. applies only to interstate transactions. b. must still be adopted by the states to be effective. c. does not apply to contracts for the sale of goods. d. applies in all 50 states. e. none of the above
d. applies in all 50 states.
Under CARD, colleges and universities must: a. disclose financial relationships with the credit card companies. b. provide debt counseling for students. c. limit locations for student solicitation for credit cards. d. do all of these.
d. do all of these.
Day 1: Mike sends Tina a letter offer to sell his fish tank to her for $125. Day 2: Tina faxes Mike an acceptance. Day 2: Mike receives Tina's fax. Day 3: Mike calls Tina to revoke his offer. Mike and Tina: a. do not have a contract since Tina used the wrong means of acceptance. b. do not have a contract because Mike revoked his offer before Tina accepted properly. c. have a contract as of the receipt of the fax. d. have a contract as of when the fax was sent.
d. have a contract as of when the fax was sent.
Day 1: A wires an offer to B Day 2: B receives the offer Day 3: B phones an acceptance A states, "Too late. I changed my mind." Which of the following statements is true? a. A and B do not have a contract b. A and B have a contract under common law only c. A and B have a contract d. none of the above
d. none of the above
The Uniform Electronic Transaction Act (UETA): a. has been adopted in all 50 states. b. has been declared unconstitutional. c. is the same as E-sign. d. none of the above
d. none of the above
Under the UCC and between nonmerchants, additional terms in acceptance: a. constitute a counteroffer. b. are part of the contract. c. result in rejection or the original offer. d. none of the above
d. none of the above
Christiansen Motors ran an ad in the Saturday newspaper with the following language, "The first 10 customers who come to the dealership and purchase a car will get 0% financing for 4 years on any car." Greta Jones went to Christiansen's show room to buy a car with 0% financing, but Christiansen refused to sell a car at 0% financing because it had already sold 10 cars before Greta arrived. Which of the following is correct? a. Christiansen must sell a car to Greta at 0% financing because it ran an ad promising to do so. b. Christiansen needed to be more careful in its language and put a time limit on the offer or sell a car to Greta for the promised rate. c. Christiansen made an offer with its newspaper ad. d. Christiansen did not make an offer and was not obligated to sell the first 10 cars. e. Christiansen need not sell a car to Greta for the rate in the ad.
e. Christiansen need not sell a car to Greta for the rate in the ad.
Which of the following is effective upon mailing or dispatch? a. offers b. rejections c. counteroffers d. revocation e. none of the above
e. none of the above
