Question 1

Which of the following offers are considered to be irrevocable for a given period?

Accepted Answer

All three options - firm offers, option contracts, and merchant's written offer to hold open an offer for the sale of goods for a stated period - are considered irrevocable for a given period. A firm offer is an offer by a merchant to sell goods in writing and signed, which gives assurance that the offer will not be revoked for a specific time. An option contract is a contract where the option holder has the right, but not the obligation, to buy or sell an underlying asset at a predetermined price, and the option writer must hold it open for the stated period. A merchant's written offer to hold open an offer for the sale of goods is also irrevocable for the period stated in the offer.

Question 2

Dick offers to sell Jane his 1955 Thunderbird convertible.Before Jane can accept the offer,lightning strikes the car and it is totally destroyed.Which of the following is true?

Accepted Answer

The offer is terminated by law due to the destruction of the subject matter of the contract (the 1955 Thunderbird convertible). Once the car is destroyed, the offer is no longer valid and cannot be accepted. The loss of the car was not the fault of either party, and therefore, neither party can be held liable for the destruction of the car.

Question 3

Travel Lines offered to sell 10 round-trip tickets to Elaine.Travel Lines stated that the acceptance must be in writing by USPS next-day service.Which of the following acceptances will create a contract between Travel Lines and Elaine?

Accepted Answer

The offer stated that acceptance must be in writing by USPS next-day service, so the only option that meets this requirement is option C, where Elaine sends a letter through USPS next-day service stating that she will buy the tickets. The other options do not meet the specific requirements of the offer.

Question 4

Collector Carl displays his beer can collection at the local swap meet.Mary sees the collection and is interested in buying it.Carl says he will sell the collection for $1,500.Mary says she really likes the collection but is only willing to pay $1,000.Which of the following is correct?

Accepted Answer

Mary's counteroffer terminates Carl's original offer of $1,500. When Mary made a counteroffer for $1,000, it created a new offer to sell the collection at that price. Carl can either accept Mary's counteroffer or reject it and make a new offer. If Carl rejects Mary's counteroffer, he cannot later accept her original offer of $1,500.

Question 5

Spangel Fashions sends out its spring and summer catalog to Cindy.Cindy falls in love with the cute dress featured on the front cover of the catalog.When Cindy calls to order the dress,she is informed that the company has sold out of the dress.Cindy is upset and claims that the store is in breach of contract.She argues that the catalog presented an offer,which she accepted when she called to order the dress.Is Cindy correct? Why/why not?

Accepted Answer

The answer of Spangel Fashions sends out its spring and...

Question 6

David and George have a contract wherein George agrees to buy sporting goods and equipment.Since the goods are not to be delivered for several months,they left the price open.Under the UCC,which of the following will be true?

Accepted Answer

Under the UCC, if the price is not specified, it will be determined by the reasonable price based on the market value at the time of delivery or a price established by a neutral party. This is to ensure fairness to both parties and to prevent one party from taking advantage of the other. Therefore, option A is the correct choice. Options B and C are incorrect because they do not follow the UCC rules, and option D is incorrect because the contract is still valid, despite the open price term.

Question 7

Hensley and Boyer have been negotiating for several months over issues related to the purchase and sale of some real estate.They draft a letter of intent that

Accepted Answer

A letter of intent may or may not be an offer, depending on the exact language and whether the document indicates that the parties have reached an agreement. It is typically considered a preliminary agreement that outlines the key terms and conditions of a potential transaction, but is not always legally binding.

Question 8

Acme Co.offers to buy 1000 widgets from Widget World Co.The written offer provides for 1000 at $10 per widget,to be delivered May 1.The offer has no other provisions.Widget World sends a written acceptance.However,the acceptance also states that if any claim arises under this contract,Widget World must be notified within 10 days.Acme does not object to this provision.Both parties are merchants.Which of the following best describes this situation?

Accepted Answer

The original offer from Acme Co. was clear and specific - to buy 1000 widgets at $10 per widget and to be delivered on May 1. Widget World Co's acceptance, although containing an additional provision, did not materially alter the terms of the offer. This provision is called a "minority" term, which does not significantly affect the agreement. The Uniform Commercial Code (UCC) allows for the addition of such terms in the acceptance, making it a valid contract. Since Widget World is a merchant, they are presumed to know the trade practices in the industry and the standard terms. Therefore, Acme does not need to object to the additional provision to make the contract enforceable.

Question 9

Bob signed an agreement with Joe under which Bob agreed to purchase all the hay that Joe grew during the coming growing season.This contract will be

Accepted Answer

The agreement is enforceable as long as both parties act in good faith and there is no sudden demand for more hay than what was reasonably estimated. An agreement to purchase all the hay that Joe grows during the coming growing season is reasonably definite and certain as it specifies the subject matter, price, and time of performance. However, it is subject to the duty of good faith and fair dealing. If either party acts in bad faith or Bob suddenly demands more hay than what was reasonably estimated, the agreement may not be enforceable. State real estate law is not relevant to this contract as it does not involve real estate. The contract is not unenforceable due to its vagueness or difficulty of devising an appropriate remedy for a breach.

Question 10

Jaime offered to buy Kevin's bike.Jamie is the

Accepted Answer

Jamie is the offeror because he is the one making the offer to buy Kevin's bike.

Question 11

If an offer specifies no time limit in which to accept,

Accepted Answer

When an offer specifies no time limit in which to accept, the offeree has a reasonable period during which to accept. This period varies depending on the circumstances, such as the subject matter of the contract, the relations of the parties, and the mode of communication used to make the offer. It is up to the court to decide what constitutes a reasonable period of time.

Question 12

Jack mails an offer to Joan that states,"I offer to sell you my car for $2000.If I don't hear from you in 10 days,I will assume you are willing to buy the car for the stated price." Jack hears nothing by the deadline and assumes he has a deal.What is the result?

Accepted Answer

Joan is not bound because acceptance of an offer in contract law typically requires the offeree to communicate their acceptance to the offeror. Silence or inaction does not constitute acceptance of an offer.

Question 13

Seth told the salesperson at Outdoor Times that he wanted the sleeping bag that was advertised in the Sunday paper;one that would keep him comfortable if the temperature drops to 10 degrees Fahrenheit.The salesperson told Seth they were sold out of that bag,but there were two other styles that would meet his needs and were the same price.Seth insisted he wanted the advertised bag and threatened to sue for breach of contract.Which is true?

Accepted Answer

Advertisements are generally considered as requests for offers, not binding contracts. Therefore, Outdoor Times is not obligated to provide the exact sleeping bag advertised if they are out of stock. Seth cannot sue for breach of contract in this case.

Question 14

Floyd offers to sell his 1967 Ford Mustang convertible to Tim.Before they conclude their negotiations,Floyd dies.Which of the following is true?

Accepted Answer

The offer terminates automatically upon Floyd's death. This is because a contract requires mutual agreement and consideration between the parties involved, and since Floyd is no longer alive, there is no longer a party to enter into the agreement.

Question 15

Vivian goes to an auction and sees a rare antique lamp that is an identical match to one she already has.At the proper time she bids on the lamp and is the highest bidder.Even though she is the highest bidder,the auctioneer refuses to accept her bid and withdraws the lamp from the auction.Can the auctioneer do that?

Accepted Answer

Unless there is a condition or special term in the auction agreement, the auctioneer has the right to withdraw an item before the fall of the hammer. In this case, the auctioneer exercised that right and therefore Vivian cannot force them to sell the lamp to her.

Question 16

A seller's form clearly states no warranty is included.The buyer's form states that the seller warrants the goods for one year.In this case

Accepted Answer

The warranty term is considered a "different term" because it directly contradicts the seller's terms. In the majority of states, when there are contradictory terms like this, a contract can still be formed, but the contradictory terms cancel each other out, leading to a default position that typically excludes the warranty.

Question 17

If Morales and Rolfes Supply negotiate for the purchase and sale of a supply of fuel for a three-year period for Morales' business,

Accepted Answer

Under the UCC, a contract for the sale of goods may indicate a method for determining the price, such as referencing published market prices, without stating a definite price. This is known as an open price term and is allowed as long as the method for determining the price is objectively determinable. This allows for flexibility in the price of the supply of fuel over the three-year period based on market fluctuations.

Question 18

Wally owns 200 acres of land.Wally offers to sell the land to Robert for $1,500 per acre.Robert replies that he does not need 200 acres of land but would like to buy 40 acres at $1,500 per acre.Wally agrees to sell but does not identify which 40 acres.Later,Wally refuses to sell any land to Robert.What is the result?

Accepted Answer

The agreement between Wally and Robert is too indefinite to be enforceable because it did not identify which specific 40 acres would be sold. Therefore, Wally can refuse to sell the land to Robert without consequence.

Question 19

Oxtron,Inc.sent the following price list to its customers.
Dispensers:	 
SBC-500J	$\quad$$\quad$$\quad$$\quad$$\quad$  $670.00
True TDD-1	$\quad$$\quad$$\quad$$\quad$$\quad$$875.00
True TDD-2	$\quad$$\quad$$\quad$$\quad$$\quad$$1,465.00
True TDD-3	$\quad$$\quad$$\quad$$\quad$$\quad$$1,515.00 
CO2 Tank and Regulator	 $\quad$$150.00
Which statement is correct?

Accepted Answer

The price list sent by Oxtron, Inc. cannot be considered as offers because it lacks the specificity required for a valid offer under contract law. The list does not include important terms and conditions such as quantity, delivery time, payment terms, etc. Therefore, the customers cannot accept the prices and create a binding contract by mere acceptance. Thus, these price quotes would generally not be considered offers.

Question 20

On January 8,Quastrar,Inc.sent Hylavian Company a letter offering to sell $10,000 in restaurant supplies.On January 18,Hylavian mailed a letter to Quastrar accepting the offer.Quastrar received the acceptance letter on January 20.On January 17,Quastrar sent a letter revoking the offer.Hylavian received this letter on January 21.A contract between Quastrar and Hylavian

Accepted Answer

A contract between Quastrar and Hylavian was formed on January 18 when Hylavian mailed the acceptance letter. At this point, Quastrar was still unaware of Hylavian's acceptance, so their earlier revocation letter is irrelevant. Once an offer is accepted, it becomes a legally binding contract. Therefore, the contract was formed before Quastrar received Hylavian's acceptance letter on January 20.

Quiz 12: Agreement