Deck 10: The Formation of Traditional and E-Contracts

Question 1

Any contract that is not in writing is unenforceable.

Answer 1

False

Question 2

Ordinarily,one can agree to a bargain without knowing that it exists.

Answer 2

False

Question 3

Only one party entering into a contract must possess characteristics that qualify him or her as competent for a valid contract to exist.

Answer 3

False

Question 4

Because parties act in their own self-interest,influencing the terms of their contracts,contract law must provide rules to determine which terms to enforce.

Question 5

A preliminary agreement can constitute a binding contract if the parties have agreed on all essential terms.

Question 6

A request to negotiate is an offer.

Question 7

Contracting parties are bound only by terms that can be objectively inferred from promises made.

Question 8

The party to whom a promise is made has the right to expect or demand that something will or will not happen in the future.

Question 9

An offer that can be accepted simply by a promise to perform does not create a binding contract.

Question 10

Under the objective theory of contracts,a contract is not enforceable without a clearly defined objective.

Question 11

One element necessary for an effective offer is the offeror's subjective belief in its reasonableness.

Question 12

An offer can be revoked by the performance of an act that is inconsistent with the existence of an offer and that is made known to the offeree.

Question 13

By supplying procedures for enforcing private agreements,contract law provides an essential condition for the existence of a market economy.

Question 14

An agreement to agree to the material terms of a contract at some future date may be enforceable.

Question 15

Contests and lotteries are unilateral contracts.

Question 16

An invitation to submit bids is an offer.

Question 17

A contract that only one of the parties can enforce in a court is not valid.

Question 18

In effect,a counteroffer converts the original offeror into an offeree with the power of acceptance.

Question 19

One of the requirements of a valid contract is an adequate market for the deal's goods or services.

Question 20

A contract is an implied contract if the conduct of the parties creates and defines some of the terms.

Question 21

A court usually will enforce a covenant not to compete provided its restrictions are reasonable.

Question 22

A minor can ratify a contract and thus make it enforceable.

Question 23

Acceptance is timely if it is effective before the offer is terminated.

Question 24

Painting a garage can constitute "something of legally sufficient value."

Question 25

A click-on agreement can indicate the acceptance of an online offer.

Question 26

To exercise the power of acceptance effectively,an offeree must accept an offer without adding or changing any terms.

Question 27

The lack of a license in certain occupations bars the enforcement of work-related contracts.

Question 28

Howe downloads Instagram's app by clicking on the site's "I agree" link to its terms of service.Later,Howe reverse engineers the software to create a competing app.This is most likely

A) a breach of Howe's agreement to the terms of service.
B) part of the bargain between a social media site and its users.
C) acceptable as long as the code is not shared with third parties.
D) within the promisee's right to expect or demand something of the future.

Question 29

A minor can enter into any contract an adult can,without exception.

Question 30

Field Construction Inc.contracts with Mesa Ranch to build a new horse barn on Mesa's property for which Mesa agrees to pay.If this is a valid contract,it will be partly because it includes the element of

A) capability.
B) legality.
C) necessity.
D) marketability.

Question 31

A contract provision that deprives one party of the benefits of the agreement may seem unfair but a court is not likely to consider it unconscionable.

Question 32

Consideration is the value given in return for a promise or performance in a contractual agreement.

Question 33

Macy offers to sell his fitness watch for $50 to Nona.Nona promises to pay Macy the price.Later,they exchange the watch for the funds.A contract was created when

A) Macy offered to sell the watch.
B) Macy delivered the watch.
C) Nona promised to pay for the watch.
D) Nona paid for the watch.

Question 34

Steel Mill Inc.makes an offer to Tom to enter into a contract to work as a mechanical engineer for a certain salary for one year subject to a five-year renewal based on his performance.Tom accepts the offer.This is a valid contract because it includes

A) a price and a subject.
B) a duration and a termination.
C) an offer and an acceptance.
D) specific quality standards.

Question 35

Acceptance may consist of words or conduct.

Question 36

Mel agrees to work as a freight broker for National Shipping Inc.In determining whether a contract has been formed,an element of prime importance is the parties'

A) intent.
B) character.
C) subjective beliefs.
D) motives.

Question 37

With respect to consideration,a bargained-for exchange distinguishes a contract from a gift.

Question 38

A landlord can avoid liability for injuries that occur on rental property by including an exculpatory clause in the lease.

Question 39

Before the Uniform Electronic Transactions Act applies,each party to a transaction must agree to conduct it by electronic means.

Question 40

Shrink-wrap terms are enforceable even if a buyer does not discover them until after the parties have entered into a contract.

Question 41

Rex contracts with Spicy Pizza to deliver its products.After the deal has been partially performed,both parties inform each other that they would like to cancel the contract.Rex and Spicy may rescind

A) their entire contract.
B) their contract to the extent that it is executory.
C) none of their contract.
D) their contract to the extent that it has been executed.

Question 42

Allen promises to pay Barb,his niece,$5,000 if she obtains her degree at City University,where she is in her third year.Barb graduates.Allen must pay Barb because

A) Barb was already at City.
B) obtaining a degree benefits Barb.
C) a job can be hard to find after college.
D) Barb obtained a degree at City.

Question 43

If a contract between two parties is avoided

A) both parties are released from it.
B) both parties must fully perform their obligations under it.
C) the parties' contractual obligations are postponed.
D) the parties are bound to negotiate another contract on the same subject.

Question 44

On May 1 Raj offers to staff Sam's Sandwich Shop with food preparers and servers for a certain price,and promises to keep the offer open until June 1.On May 3 Raj mails Sam a letter revoking the offer.Sam receives the letter on May 5 and responds on May 6.Raj's revocation of the offer became effective on

A) May 3.
B) May 5.
C) May 6.
D) no date because the offer is irrevocable.

Question 45

Owen decides to sell his ranch,Pine Ridge,in a live auction.When the auctioneer puts the property up for bids,it will be

A) an offer.
B) an invitation to submit offers,not an offer itself.
C) a preliminary negotiation,not an offer.
D) an agreement to agree,not an offer.

Question 46

Luke puts his motorcycle up for sale via a post on an online auction site.This is

A) an offer.
B) an invitation to negotiate,not an offer.
C) a statement of future intent,not an offer.
D) a preliminary negotiation,not an offer.

Question 47

Alyssa hires Bret to mow Alyssa's lawn every Friday.Although they do not discuss the terms of payment,after each of the first three Friday mows,Alyssa pays Bret on Saturday.The payment term is

A) express.
B) implied.
C) illusory.
D) void.

Question 48

Pastries Inc.sends Rollo its catalogue showcasing a variety of baked goods for certain prices.This is

A) an offer.
B) an invitation to negotiate,not an offer.
C) an advertisement,not an offer.
D) a request,not an offer.

Question 49

Oceans Inc. ,a seafood distributor,agrees to buy from Paul,a commercial fisherman,any "overstock" of fish that Paul catches in excess of his legal limit.This agreement is most likely

A) enforceable.
B) illusory.
C) void.
D) voidable.

Question 50

For a contact to be considered valid and enforceable,the parties to a deal must

A) necessarily have it in writing.
B) manifest their voluntary consent to the same bargain.
C) know with certainty what kinds of promises will be enforced.
D) subjectively intend to agree to the terms.

Question 51

Fresh Agro Inc.offers to deliver produce to Growers' Market for a certain price.Fresh's intent to extend an offer is determined by reference to Fresh's

A) market assumptions.
B) all of the choices.
C) subjective,unexpressed intentions.
D) words and actions.

Question 52

Under a contract with Valley View Villas,a residential development,Weng begins grading a terraced hillside.Halfway through the project,Weng asks for $5,000 over the contract price,claiming an increase in the "cost of doing business." Valley View agrees.This agreement to pay more is

A) unenforceable because Weng's performance was a preexisting duty.
B) unenforceable because Valley View's promise was illusory.
C) enforceable.
D) unenforceable because Weng's request modified the contract.

Question 53

Kent tries to start his car with no success.He yells that he will sell the car to anyone for $10.Livy,a passerby,hears Kent's yell.This is not an effective offer because it lacks

A) communication.
B) definite terms.
C) serious intent.
D) practicality.

Question 54

Kim promises to pay Leo $500 to install a sump pump in Kim's warehouse.Leo completes the installation.The act of installing the pump

A) imposes a moral obligation on Kim to pay Leo.
B) imposes no obligation on Kim unless she is satisfied with the job.
C) is not sufficient consideration because it is not goods or money.
D) is the consideration that creates Kim's obligation to pay Leo.

Question 55

Fay offers to pay Grey $50 for a tennis lesson for Hetty.They agree to meet the day after tomorrow to exchange the cash for the lesson.These parties have

A) a bilateral contract.
B) a third-party contract.
C) a unilateral contract.
D) no contract.

Question 56

Rue offers to pay Sari to deliver certain documents within thirty minutes.Sari can accept the offer only by completing the task within the deadline.If she does,Rue and Sari will have

A) a bilateral contract.
B) a unilateral contract.
C) a void contract.
D) an executive contract.

Question 57

Corner Store posts on its website an offer of a reward for information leading to the apprehension of a certain criminal.This offer could normally be terminated by

A) a post on the website.
B) a notice in the local newspaper.
C) a sign in the store.
D) apprehension of the criminal.

Question 58

Rona asks Steve,"Do you want to pay me to provide your business with a marketing campaign?" This is

A) an offer.
B) not an offer because the terms are not definite.
C) not an offer because Rona did not express an intent.
D) not an offer because Steve did not respond.

Question 59

Vin admires Will's collection of vinyl records.Vin asks,"Will you sell it?" This statement is

A) an offer.
B) an invitation to negotiate,not an offer.
C) an expression of intent,not an offer.
D) a request,not an offer.

Question 60

Sports Bar and Tasty Bakery are adjacent businesses with adjoining parking lots.Sports Bar offers Tasty a discount on purchases if the bakery will not tow the cars of Sports Bar's patrons who park in the bakery's lot.The discount is legally sufficient consideration

A) because it is a promise of something of value.
B) only if Sports Bar adds a cash rebate.
C) only if Tasty uses it.
D) under no circumstances.

Question 61

A lease between Mia and Niles for residential property contains an exculpatory clause.This clause is most likely

A) enforceable as a matter of public policy.
B) enforceable if either party is in a business important to the public.
C) enforceable if an event occurs to which the clause applies.
D) unenforceable.

Question 62

Reid agrees to sell his Sports Equipment store to Taylor.As part of the sale,Reid promises not to open a similar,competing store anywhere.This promise is most likely

A) invalid because it is part of a sale of an ongoing business.
B) invalid because of the unreasonable terms of area and time.
C) valid because it is part of a sale of an ongoing business.
D) valid if both parties are justifiably ignorant of the facts.

Question 63

Cindy,a real estate agent,sells her friend Doug's house without charging a commission.In return,Doug promises to give Cindy $1,000.This promise is not an enforceable contract because

A) the house has already been sold-the consideration is past.
B) selling the house was the agent's preexisting duty.
C) selling the house was a foreseen difficulty.
D) the promise of a payment of $1,000 is illusory.

Question 64

Intoxicated,Efron enters a contract for the sale of his business,Freight Dispatch,to Gretel for less than its market value.This contract is enforceable if,at the time,

A) Efron's intoxication was purely voluntary.
B) Gretel fraudulently induced Efron to become intoxicated.
C) Gretel was also intoxicated.
D) Efron understood the legal consequences.

Question 65

Business Software Corporation (BSC)sells business apps-wage,price,and inventory coordinating programs,for example-downloadable online.To complete a deal,a purchaser clicks on a button that,with reference to certain terms,states,"I agree." What is this agreement called? Do the parties have a binding,enforceable contract that includes the terms? Explain.

Question 66

Donald is a minor.He can enter into any contract an adult can,provided

A) the adult is willing to enter into contracts with minors.
B) Donald is willing to disaffirm the contract.
C) the contract is not one prohibited by law for minors.
D) an adult is willing to ratify the contract.

Question 67

Dale's Uncle Ed tells Dale,"If I feel you deserve it at the time,I will give you a new car when you graduate from college." Ed's promise is

A) illusory.
B) enforceable.
C) a forbearance.
D) a preexisting duty.

Question 68

Best Products,Inc. ,hires Cole to develop and implement an e-commerce strategy for marketing Best's products.Cole signs a contract that includes a clause prohibiting him from competing with Best during and after the employment.Before the strategy is implemented,Cole resigns from Best's employ and opens a business to compete with Best.In Best's suit against Cole,to determine whether Cole may compete with Best,what is the most important factor the court should consider?

Question 69

Cathy agrees to sell her Daily Donut shop to Ernie.In the agreement,there is a covenant not to compete that prohibits Cathy from operating a donut shop within a certain distance.If the restriction is unreasonable,a court will most likely

A) award Cathy damages.
B) order Ernie to stop doing business.
C) reform the covenant.
D) prohibit both parties from operating donut shops.

Question 70

At Mattress Store,Nate signs a contract to buy bedroom furniture.The contract sets a schedule of $500 monthly payments,subject to a late fee of 150 percent.Nate finds the language of the contract difficult to understand.This is most likely

A) an exculpatory contract.
B) procedural unconscionability.
C) substantive unconscionability.
D) an enforceable contract.

Question 71

Shipping Corporation enters into contracts with distributors and other buyers in e-commerce and in traditional commerce.Between Shipping and its customers,the Uniform Electronic Transactions Act applies if the parties agree to conduct transactions by

A) electronic means.
B) paper documents.
C) any of the choices.
D) verbal communication.

Question 72

Brie buys a subscription to music provided by Concerto,an online streaming service.Before gaining access,Brie must agree to a provision stating that she will not make and sell copies of the music.This provision is

A) a partnering agreement.
B) a click-on agreement.
C) a shrink-wrap agreement.
D) a browse-wrap term.