Deck 8: Consideration

Question 1

Which of the following constitutes valid consideration?

A)A promise to refrain from doing an illegal act
B)Past performance
C)A promise to refrain from doing an act that can be lawfully done
D)A promise to do what one is already obligated to do

Answer 1

C

Question 2

Performing or promising to perform what one is already obligated to do is a valid consideration.

Answer 2

False

Question 3

Blake has subscribed to a local charitable association where he needs to make a monthly payment of $100. However, a few months later, Blake stops paying this amount. Which of the following exceptions to the requirement of consideration will enforce that Blake pays the amount?

A)Composition of creditors
B)Voluntary subscriptions
C)Forbearance to cancel monthly subscriptions
D)Modification of sales contracts

Answer 3

B

Question 4

Only financial items can constitute consideration.

Question 5

When charitable enterprises are financed by voluntary subscriptions of many people, the promise of each person is generally not held to be enforceable.

Question 6

Which of the following is true of the doctrine of promissory estoppel? ​

A)It requires that promises made should be supported by consideration.
B)It permits the promisor to claim lack of consideration when the promisee acts in reliance on his promise.
C)It requires the promisor to reasonably expect the promise to induce action by the promisee.
D)It holds enforcement to be proper if the promisee would not be harmed if the promise were not enforced.

Question 7

A promise to steal a valuable piece of art is valid consideration to support a contract.

Question 8

When one refrains or promises to refrain from doing something, this conduct is known as .

A)duress
B)forbearance
C)negligence
D)disaffirmation

Question 9

For a promise to constitute consideration, the promise must not impose an obligation on the person making it.

Question 10

As a general rule, a promise must be supported by consideration. Which of the following is an exception to the rule?

A)A non-charitable enterprise financed by the subscriptions of individuals
B)A promise to refrain from doing what one has no right to do
C)An act performed prior to the promise made by the promisor
D)An obligation of record such as a judgment

Question 11

Mark owes $2000 each to his business partners, Ryan, Bryan, and Clark. Since Mark is facing financial difficulties, his business partners agree to accept a total amount of $4800 from Mark as a cancellation of the unpaid balance due to them. This type of an agreement is known as a .

A)composition of creditors
B)writ of certiorari
C)forbearance
D)promissory estoppel

Question 12

Consideration is not necessary to support an obligation of record.

Question 13

Consideration distinguishes mere agreements from legally enforceable obligations. ​

Question 14

As a general rule, the adequacy of the consideration is irrelevant because the law allows bargains.

Question 15

When parties to a contract mutually agree to cancel an old contract and replace it with a new one, which of the following is true?

A)To be enforceable, there must be added features in the new contract benefiting both parties.
B)One party's past performance under the original contract is sufficient consideration for the new contract.
C)The new contract is void.
D)Neither party has a right to make changes to the original contract.

Question 16

As a general rule, a promise must be supported by consideration. Describe any two exceptions to this rule. ​

Question 17

The Uniform Commercial Code states that when a contract for the sale of goods is modified by agreement of the parties, consideration is necessary to make it enforceable.

Question 18

Generally, a part payment of a past-due debt is not consideration to support the creditor's promise to cancel the balance of the debt.

Question 19

If the supposed consideration consists merely of a promise to do what one is already legally obligated to do, consideration is invalid.

Question 20

Which of the following best describes the term "consideration"? ​

A)It refers to the record of a case sent for review to a higher court.
B)It indicates what the promisor demands and receives as the price for a promise.
C)It signifies a promissory note given by the promisor as a token of the transaction.
D)It refers to the promisor refraining from meeting a promise.