Deck 25: Obligations and Performance

Question 1

The statement, "I doubt that I can perform the contract," is a repudiation of the contract.

Answer 1

False

Question 2

The person on whom a demand for assurance is made, must reply in writing for the assurance to be deemed "adequate."

Answer 2

False

Question 3

A buyer has the right to accept some commercial units of a shipment and reject other commercial units.

Answer 3

True

Question 4

If adequate assurance of performance is not given within five (5) business days from the time of the demand for assurance, the demanding party may treat the contract as repudiated.

Question 5

The UCC requires assurances to be in writing and signed by the company President.

Question 6

The standard for rejection requires that any defect in the good be material.

Question 7

Good faith essentially means that neither party can do anything to impair the other party's expectation of performance.

Question 8

Unless otherwise specified, the place of delivery is the seller's place of business.

Question 9

A non-repudiating party has the right to require a guarantee of performance or a pledge of security.

Question 10

The UCC does not specify the form that the assurance of performance is to take.

Question 11

A seller's duty to deliver goods requires the seller to transport the goods to the place designated by the buyer.

Question 12

A buyer always has a right to examine the goods to determine if, in fact, the goods conform to the contract.

Question 13

When a contract to sell identified goods does not specify a place of delivery, the goods are considered delivered at the seller's place of business.

Question 14

A buyer has a right to insist that all the goods be delivered at one time.

Question 15

If a party refuses to perform a contract when the time for performance arises, the other party has the right to seek assurances.

Question 16

When a method of transportation called for by a contract becomes unavailable for any reason, the contract is automatically voided.

Question 17

Under Revised Article 2, a repudiation occurs when the repudiating party furnishes a record with express language of repudiation.

Question 18

A delivery is sufficient if it is made in accordance with the terms of the sales contract.

Question 19

A party who has demanded adequate assurances must wait 90 days before she can treat the contract as repudiated.

Question 20

The UCC imposes a higher standard of good faith on merchants than on nonmerchants.

Question 21

Substantial impairment requires proof that goods are worthless.

Question 22

The right to ___________ is a second chance for a seller to make a proper tender of conforming goods.

A) rehabilitate
B) repair
C) heal
D) cure

Question 23

Upon a seller's tender of nonconforming goods and the buyer's rejection of them, the transaction has ended.

Question 24

In a cash sale that does not require the physical moving of the goods, the:

A) parties are required to perform concurrently.
B) seller is required to tender the goods before the buyer must pay for them.
C) buyer must pay for the goods in advance.
D) buyer must actually receive the goods before he or she is required to pay for them.

Question 25

If a buyer accepts goods but later claims the goods suffered from a substantial impairment, he is:

A) only required to prove the goods do not conform to the contract.
B) only required to prove the goods are shown to be worthless.
C) only required to prove the use to the buyer is materially different than the contract promised.
D) automatically canceling the contract.

Question 26

To be adequate, after a proper demand an assurance of performance must:

A) include consideration.
B) allow for the additional examination of the goods.
C) be sufficient to assure a reasonable person that the contract will be performed.
D) be written.

Question 27

Unless otherwise agreed, the proper place for the delivery of goods is:

A) the buyer's place of business.
B) the seller's home.
C) a delivery service selected by the seller.
D) the seller's place of business.

Question 28

The obligations of the parties to a sales contract include:

A) the seller's duty to deliver the goods to the buyer's place of business.
B) the buyer's duty to always accept the goods.
C) the seller's duty to arrange for appropriate transport.
D) the buyer's duty to pay for the goods.

Question 29

If the buyer has paid for the goods in advance but revokes his acceptance when the goods arrive, he:

A) can resell the goods.
B) must prove the nonconforming defect was known at the time of the original acceptance.
C) return them within ten (10) days and wait for the refund.
D) may retain possession of the goods as security until the refund has been paid.

Question 30

The standard for determining commercial impracticability is objective, not subjective.

Question 31

When goods are shipped COD:

A) the buyer always has the right to examine them before making payment.
B) the underlying contract must specify when the buyer may inspect the goods.
C) the buyer has no right to examine the goods until payment is made.
D) the buyer gives up all rights to inspection of the goods.

Question 32

Which method of payment gives the buyer credit by postponing the time for payment?

A) a promissory note
B) a check
C) a draft
D) a certified check

Question 33

All of the following can be considered an acceptance by the buyer except:

A) An express statement of approval by the buyer.
B) The buyer's examination of the goods.
C) The buyer's retention of goods for an unreasonable period of time.
D) The buyer's modification of the goods.

Question 34

If a contractually-specified mode of transportation is not available, the:

A) contract is automatically voided.
B) seller must make delivery by a commercially-reasonable substitute.
C) buyer must arrange to pick up the goods.
D) seller must make personal delivery.

Question 35

An acceptance of goods can be done either expressly or by implication.

Question 36

The seller's right to cure a defective tender means that the seller will be given a second chance to make a proper tender of conforming goods.

Question 37

Unless otherwise agreed by the parties, payment by a buyer requires payment either in cash or by certified check.

Question 38

If appropriate assurance is not given in response to a demand for assurance of performance, the demanding party may:

A) treat the contract as repudiated.
B) sue for libel.
C) file for an insurance payment.
D) not replace the repudiated contract.

Question 39

When a buyer demonstrates in some way that the goods conform to the contract, the buyer has made a(n):

A) acceptance of the goods.
B) assignment of the goods.
C) substitution of the goods.
D) avoidance of the contract.

Question 40

A party to a sales contract who is afraid that the other party will not perform may seek some form of:

A) bailment.
B) security.
C) assurances.
D) assignment.

Question 41

In January, a buyer and a seller agreed on the sale of 10,000 pounds of tomatoes to be delivered on July 1. The contract stated that the seller would set the price on June 15 and that the buyer would pay the price on delivery. On June 15, the market price of tomatoes was approximately 75 cents per pound. The seller set the price at $1.50 per pound and the buyer demanded that the price be lowered.
When the parties could not agree, a lawsuit developed. The key issue was whether the seller had the right to set the $1.50 price. Decide.

Question 42

The standard for commercial impracticability is:

A) hypothetical.
B) conjectural.
C) objective.
D) subjective.

Question 43

Jared agrees to purchase twelve computers from Zack Enterprises, Inc. for sale in Jared's department store. Twelve boxes from Zack Enterprises have just arrived at the department store. What are Jared's rights and responsibilities?