Question 1

Rhonda asks Steve, "Do you want to buy me to repair your fishing net?" This is
A) ​a valid offer.
B) ​not a valid offer because the terms are not definite.
C) ​not a valid offer because Rhonda did not express an intent.
D) ​not a valid offer because Steve did not respond.

Accepted Answer

The offer lacks definite terms, as it does not specify the price for the repair.

Question 2

Jon says to Kris, "I would like to sell you my sports memorabilia collection." This is not an offer because it
A) ​does not describe the subject matter sufficiently.
B) ​does not include a price term.
C) ​only expresses an opinion.
D) ​only invites Kris to negotiate.

Accepted Answer

This statement by Jon is not an offer but an invitation to negotiate because it lacks the definiteness and specificity required for an offer and merely expresses a willingness to discuss the possibility of a sale.

Question 3

Rafi offers a tour of Bay Harbor aboard his sailboat, Sea Siren, to Tiara's Travel Group for $500. Referring to the prices for similar tours, Tiara's says, "We'll pay no more than $400." Rafi's offer is
A) ​still open.
B) ​terminated.
C) ​rejected and subject to a counteroffer.
D) ​revoked.

Accepted Answer

The answer of Rafi offers a tour of Bay Harbor...

Question 4

Shelby offers to make digital copies of Relay Company's business conference videotapes, CDs, DVDs, and other media for $500. Under the mailbox rule, Relay's acceptance by e-mail will be considered effective when
A) ​received.
B) ​sent.
C) ​followed up by a confirmation letter sent by regular mail.
D) ​composed on a Relay computer.

Accepted Answer

Under the mailbox rule, acceptance of an offer is generally considered effective when sent, as long as the acceptance is communicated through a medium expressly or impliedly authorized by the offeror. In this case, since Shelby made an offer and Relay's acceptance is via e-mail (a common and likely authorized method of communication), the acceptance is effective when sent.

Question 5

Gayla tells Franco that she will pay him $50 to haul the trimmed tree limbs and other lawn debris from her property. Franco's acceptance is complete
A) ​as soon as he says he will do the job.
B) ​once he starts to work.
C) ​only after he hauls away the debris.
D) ​when he hears the offer.

Accepted Answer

Franco's acceptance is complete only after he hauls away the debris because this is a unilateral contract where acceptance is through performance.

Question 6

Business Properties, Inc. (BPI), offers to sell a cold storage warehouse to Corporate Investments. Corporate says that it will pay BPI $100 to hold the offer open for three business days. This
A) ​creates an illegal contract by adding a clause to BPI's offer.
B) ​makes the offer irrevocable for three days if BPI accepts.
C) ​negates BPI's offer by changing the price term.
D) ​voids BPI's offer by extending the time term.

Accepted Answer

The payment made by Corporate Investments to hold the offer open for three business days creates an option contract, making the offer irrevocable for three days if BPI accepts. This means that BPI cannot revoke the offer during this period, and Corporate has the option to accept or decline the offer within the specified timeframe.

Question 7

Green River Gas Company offers to sell Far East Energy, Ltd., a certain quantity of liquefied natural gas. If Far East sends an acceptance via Green River's authorized mode of communication, it will be effective when it is
A) ​in transit.
B) ​received.
C) ​sent.
D) ​written.

Accepted Answer

According to the mailbox rule in contract law, an acceptance is generally considered effective when it is sent, as long as it is dispatched through a mode of communication expressly or impliedly authorized by the offeror.

Question 8

On May 1 Ralph offers to cure and smoke Sam's pork. On May 3 Ralph mails Sam a letter revoking the offer. Sam receives the letter on May 5 and responds on May 6. Ralph's revocation of the offer
A) ​became effective on May 1.
B) ​became effective on May 3.
C) ​became effective on May 5.
D) ​did not become effective because Sam responded to the offer.

Accepted Answer

Ralph's revocation of the offer became effective on May 5, the day Sam received the letter. In contract law, a revocation is generally effective when it is received by the offeree.

Question 9

Laredo advertises a reward for the return of his lost dog. Miguel, who does not know of the reward, finds and returns the dog, without asking for reward. Miguel cannot recover the reward, because he
A) ​did not confer a benefit on Laredo by returning the dog.
B) ​did not know of the reward when he returned the dog.
C) ​did not ask for the reward when he returned the dog.
D) ​returned the dog.

Accepted Answer

Miguel cannot recover the reward because he did not know of the reward when he returned the dog. Since Miguel did not have knowledge of the reward before returning the dog, he can't be considered to have been motivated by the reward, and therefore he cannot recover it.

Question 10

Pacific Charter Company offers to provide an air-conditioned bus to Quincy's tour group for $1,500 plus the cost of the fuel. The mailbox rule applies if Quincy accepts the offer by
A) ​e-mail.
B) ​phone.
C) ​regular mail.
D) ​any of the choices.

Accepted Answer

The mailbox rule, also known as the postal rule, applies to acceptances made by regular mail. This rule states that an acceptance is effective when dispatched, as long as the communication is correctly addressed and the means of communication is expressly or impliedly authorized by the offeror. In this scenario, regular mail is the method that traditionally applies to the mailbox rule.

Question 11

Fix-It-Quik, Inc., offers Gina a job as a plumber. No time for acceptance is specified in the offer. The offer will terminate
A) ​after a reasonable period.
B) ​after a work week (five business days).
C) ​after a month (thirty calendar days).
D) ​never.

Accepted Answer

Since no time for acceptance is specified in the offer, the offer will terminate after a reasonable period of time. The exact length of this period may vary depending on the circumstances, but it is typically considered to be a matter of weeks rather than days or months. Option A is the best choice because it reflects this general understanding of how offers without a specific deadline are typically interpreted. Option B and C provide specific time frames that may not be appropriate in all situations, and option D is incorrect because all offers must terminate at some point, even if it is simply because the position has already been filled.

Question 12

Rico, a user of SmartPhoneApps.com's Web site, can download apps for free if he first clicks on "I accept" after viewing certain terms. This is
A) ​a contract that does not include the terms.
B) ​a contract that includes the terms.
C) ​not a contract but the terms are enforceable.
D) ​unenforceable.

Accepted Answer

By clicking on "I accept" after viewing the terms, Rico has entered into a contract with SmartPhoneApps.com that includes those terms.

Question 13

Wally offers to repair and service a forklift for Valu Lumber Outlet, but Wally dies before Valu accepts. Most likely, Wally's death
A) ​does not affect the offer.
B) ​shortens the time of the offer but does not terminate it.
C) ​extends the time of the offer.
D) ​terminates the offer.

Accepted Answer

Wally's death terminates the offer as a person cannot perform a contract after they have died. Therefore, the offer is no longer valid.

Question 14

Simone offers Thom a dozen piano lessons for a certain price per lesson but conditions the deal on Thom accepting the offer by April 1. Simone may revoke the offer
A) ​before Thom accepts the offer.
B) ​before April 1, whether or not Thom has accepted the offer.
C) ​only after Thom accepts the offer.
D) ​only after April 1.

Accepted Answer

Simone can revoke the offer at any time before Thom accepts it, as acceptance is required to form a binding contract.

Question 15

Pastries, Inc., sends its catalogue to Rollo and includes a "personalized" letter inviting the purchase of any item at the advertised price. This is
A) ​an offer because of the "personalized" letter.
B) ​an offer because there is no room for price negotiation.
C) ​an offer only if Rollo previously bought items from Pastries.
D) ​not an offer.

Accepted Answer

The letter inviting the purchase of any item at the advertised price is not an offer but a mere invitation to make an offer. Rollo can choose to accept or decline the invitation, and Pastries Inc. could accept or reject Rollo's offer depending on its own discretion.

Question 16

Nevin negotiates a deal for the sale of twenty-five acres of farmland to Otis. Nevin promises to hold the offer open in return for a small payment but does not state an exact period of time. With respect to this offer
A) ​the deal is binding except for the promise to hold the offer open.
B) ​a reasonable period of time is implied.
C) ​the offer must be held open for an indefinite period.
D) ​the deal is done.

Accepted Answer

When an exact period of time is not stated for holding an offer open, a reasonable period of time is implied. Nevin's promise to hold the offer open is therefore binding for a reasonable period of time, and Otis can accept the offer within that period.

Question 17

Lauren files a suit against Moving Service for breach of contract, based on what Lauren claims was Moving's offer. For a court to determine if a contract has been breached, under the common law, the offer must include terms that are
A) ​exactly precise.
B) ​reasonably definite.
C) ​unequivocally approximate.
D) ​vague or uncertain.

Accepted Answer

Under the common law, for a court to determine if a contract has been breached, the terms of the offer must be reasonably definite. This means that they must be specific enough to enable the court to identify the subject matter of the contract, the parties, the price, and the quantity of the goods or services to be transferred. If the terms are too vague or uncertain, the court may not be able to enforce the contract.

Question 18

Fabien offers to sell his Graphic Signs, LLC, business to Hanna for $100,000. Hanna replies, "The price is too high. I will buy it for $75,000." Hanna has
A) ​accepted the offer.
B) ​made a counteroffer without rejecting the offer.
C) ​rejected the offer and made a counteroffer.
D) ​rejected the offer without making a counteroffer.

Accepted Answer

By stating that the price is too high and making a counteroffer of $75,000, Hanna has rejected the original offer and made a counteroffer, which is a rejection of the original offer and a proposal of new terms.

Question 19

Lou offers to service Millie's heating and air conditioning system for one year for $500. Under the mirror image rule, Millie's response will be considered an acceptance if the terms of the acceptance
A) ​exactly mirror those of the offer.
B) ​change the items offered, but do not change the price.
C) ​change the price, but do not change the items offered.
D) ​change both the price and the items offered.

Accepted Answer

The mirror image rule requires that acceptance must exactly mirror the terms of the offer, including the items offered and the price. Any changes to the offer, regardless of how minor, would constitute a counteroffer, which the offeror may accept or reject. Therefore, in order for Millie's response to be considered an acceptance, it must exactly mirror the terms of the offer.

Question 20

Coffee Brokers, Inc., offers to buy Dining Company's coffee-roasting services for a certain price. Dining responds that the price is too low and thereby rejects the offer. The offer is
A) ​terminated.
B) ​valid for a reasonable time to give Interstate a "second chance."
C) ​valid for the period of time prescribed by a state statute.
D) ​valid until Interstate revokes the offer.

Accepted Answer

Once an offer is rejected, it is terminated and no longer valid. Therefore, Coffee Brokers, Inc.'s offer to buy Dining Company's coffee-roasting services is terminated due to Dining's rejection.

Quiz 8: Agreement in Traditional and E-Contracts

Rhonda asks Steve, "Do you want to buy me to repair your fishing net?" This is

Jon says to Kris, "I would like to sell you my sports memorabilia collection." This is not an offer because it

Rafi offers a tour of Bay Harbor aboard his sailboat, Sea Siren, to Tiara's Travel Group for $500. Referring to the prices for similar tours, Tiara's says, "We'll pay no more than $400." Rafi's offer is

Shelby offers to make digital copies of Relay Company's business conference videotapes, CDs, DVDs, and other media for $500. Under the mailbox rule, Relay's acceptance by e-mail will be considered effective when

Gayla tells Franco that she will pay him $50 to haul the trimmed tree limbs and other lawn debris from her property. Franco's acceptance is complete

Business Properties, Inc. (BPI) , offers to sell a cold storage warehouse to Corporate Investments. Corporate says that it will pay BPI $100 to hold the offer open for three business days. This

Green River Gas Company offers to sell Far East Energy, Ltd., a certain quantity of liquefied natural gas. If Far East sends an acceptance via Green River's authorized mode of communication, it will be effective when it is

On May 1 Ralph offers to cure and smoke Sam's pork. On May 3 Ralph mails Sam a letter revoking the offer. Sam receives the letter on May 5 and responds on May 6. Ralph's revocation of the offer

Laredo advertises a reward for the return of his lost dog. Miguel, who does not know of the reward, finds and returns the dog, without asking for reward. Miguel cannot recover the reward, because he

Pacific Charter Company offers to provide an air-conditioned bus to Quincy's tour group for $1,500 plus the cost of the fuel. The mailbox rule applies if Quincy accepts the offer by

Fix-It-Quik, Inc., offers Gina a job as a plumber. No time for acceptance is specified in the offer. The offer will terminate

Rico, a user of SmartPhoneApps.com's Web site, can download apps for free if he first clicks on "I accept" after viewing certain terms. This is

Wally offers to repair and service a forklift for Valu Lumber Outlet, but Wally dies before Valu accepts. Most likely, Wally's death

Simone offers Thom a dozen piano lessons for a certain price per lesson but conditions the deal on Thom accepting the offer by April 1. Simone may revoke the offer

Pastries, Inc., sends its catalogue to Rollo and includes a "personalized" letter inviting the purchase of any item at the advertised price. This is

Nevin negotiates a deal for the sale of twenty-five acres of farmland to Otis. Nevin promises to hold the offer open in return for a small payment but does not state an exact period of time. With respect to this offer

Lauren files a suit against Moving Service for breach of contract, based on what Lauren claims was Moving's offer. For a court to determine if a contract has been breached, under the common law, the offer must include terms that are

Fabien offers to sell his Graphic Signs, LLC, business to Hanna for $100,000. Hanna replies, "The price is too high. I will buy it for $75,000." Hanna has

Lou offers to service Millie's heating and air conditioning system for one year for $500. Under the mirror image rule, Millie's response will be considered an acceptance if the terms of the acceptance

Coffee Brokers, Inc., offers to buy Dining Company's coffee-roasting services for a certain price. Dining responds that the price is too low and thereby rejects the offer. The offer is