Question 1

A computer program or an electronic or other automated means used independently to initiate an action or respond to electronic records or performances in whole or in part,without review or action by an individual,is known as ________.

Accepted Answer

The definition provided in the question is of an electronic agent. An electronic agent refers to a computer program, electronic or automated means that is capable of initiating an action or responding to electronic records or performances without the need for human intervention. Therefore, the best answer is A) electronic agent.

Question 2

The battle of the forms occurs when the offeror receives an acceptance drafted from the offeree's own form contract.

Accepted Answer

In the battle of the forms, the offeror's form contract and the offeree's form contract compete with each other. This occurs when the offeree's acceptance includes additional or different terms than those originally offered by the offeror. In this scenario, the parties' standard form contracts are said to be in conflict or at war with each other.

Question 3

As per the Statute of Frauds provisions,all contracts for the sale of goods costing $500 or more must be in writing.

Accepted Answer

This is a correct statement under the Statute of Frauds provisions under the Uniform Commercial Code (UCC). Any sale of goods costing $500 or more must be in writing to be enforceable in court.

Question 4

What are the methods and manners of acceptance as defined by the Uniform Commercial Code (UCC)?

Accepted Answer

The answer of What are the methods and manners of...

Question 5

The battle of the forms takes place between a merchant and a nonmerchant.

Accepted Answer

The battle of the forms refers to a situation in contract law where two parties, typically both merchants, exchange documents (like purchase orders and invoices) with differing terms, leading to a conflict over which terms control the agreement.

Question 6

Miranda Airways,a commercial air carrier,has a contract with Wurtherton Inc.,an airplane manufacturer,to purchase a new plane.Due to a sudden shortage of cash,Miranda Airways goes to MetrosBank.MetrosBank issues a document to Wurtherton that if Miranda does not pay for the transaction,MetrosBank would.Wurtherton considers the offer and then sends an acceptance with additional terms.The additional terms stipulate that Miranda Airways could have the new airplane for a period of 10 years and then return it to Wurtherton.Miranda Airways agrees to the acceptance,and Wurtherton hands over the new airplane to them.Which of the following documents did MetrosBank issue to Wurtherton to help Miranda Airways secure the airplane?

Accepted Answer

A letter of credit is a document issued by a bank that guarantees payment to a seller or supplier on behalf of a buyer. In this case, MetrosBank issued a letter of credit to Wurtherton, which guaranteed that if Miranda Airways can't pay for the transaction, MetrosBank will pay for it. This helps Miranda Airways secure the airplane because Wurtherton knows they will receive payment, even if Miranda Airways can't pay for it. The other options, such as a bill of exchange, proforma invoice, or remittance advice, do not provide the same level of payment guarantee as a letter of credit.

Question 7

Option contracts are examples of irrevocable offers.

Accepted Answer

Option contracts create a binding agreement between the two parties involved and cannot be revoked or canceled unless both parties agree to do so. Therefore, option contracts are irrevocable offers.

Question 8

Under common law's mirror image rule,an offeree's acceptance must be on the same terms as the offer.

Accepted Answer

The statement is true, under the mirror image rule, the acceptance must be identical to the offer. Any changes to the terms of the offer may constitute a counteroffer, which the original offeror may accept or reject.

Question 9

Under common law,the inclusion of additional terms in the acceptance of an offer is considered a counteroffer rather than an acceptance.

Accepted Answer

Under common law, the inclusion of additional terms in the acceptance of an offer is considered a counteroffer, as it changes the terms of the original offer and creates a new proposal rather than accepting the original offer as is.

Question 10

Under the common law,a written contract must be signed by the party against whom enforcement is sought.

Accepted Answer

Under the common law, specifically the Statute of Frauds, certain types of contracts must be in writing and signed by the party against whom enforcement is sought to be legally enforceable. This includes contracts for the sale of goods over a certain value, real estate transactions, and contracts that cannot be performed within one year.

Question 11

As per the UCC law of sales,contract modifications do not require considerations.

Accepted Answer

According to UCC 2-209(1), contract modifications can be made without consideration as long as they are made in good faith.

Question 12

The written confirmation rule requires that both parties to an oral agreement send written confirmation of the sale or lease.

Accepted Answer

The written confirmation rule only applies to agreements for the sale of goods over $500, as specified in the Statute of Frauds. It does not apply to leases or all types of agreements. Additionally, the rule only requires one party to send the written confirmation, not both.

Question 13

Shipment of the original offer to a buyer is called accommodation.

Accepted Answer

Shipment of the original offer to a buyer is not called accommodation. Accommodation refers to a seller's willingness to make adjustments or concessions to a transaction in order to satisfy a customer's needs or demands.

Question 14

Course of performance between the parties is taken into account when the express terms of their written contract are not clear.

Accepted Answer

When the written contract is not clear, courts may look to the parties' course of performance to determine their intent and understand how the contract has been performed.

Question 15

A ________ is a document that is issued by a bank on behalf of a buyer who purchases goods on credit from a seller that guarantees that if the buyer does not pay for the goods,then the bank will pay the seller.

Accepted Answer

A letter of credit is a legal document that a buyer's bank issues to the seller, guaranteeing that the payment for goods will be made on time and in the correct amount. If the buyer doesn't pay, the bank will have to pay the seller. This provides security for both the buyer and the seller in international trade. A remittance advice is a notification of payment made, a certified check is a check that has been certified by a bank, and a cashier's check is a check that is issued by a bank on its own behalf. None of these options provide the same type of guarantee as a letter of credit.

Question 16

A contract is created only when the offeror receives the offeree's acceptance.

Accepted Answer

A contract is created when the offeree's acceptance is properly dispatched, not necessarily when it is received by the offeror, according to the mailbox rule in contract law.

Question 17

A sales contract evidenced by writing cannot be contradicted by a prior oral or written agreement.

Accepted Answer

This is the parol evidence rule, which provides that a written contract intended to be a complete and final statement of the parties' agreement cannot be contradicted by any prior or contemporaneous oral or written agreement.

Question 18

Mirror image rule is more liberal than UCC 2-207(1).

Accepted Answer

The mirror image rule is stricter than UCC 2-207(1). The mirror image rule requires that the acceptance must exactly match the offer, with any changes considered a counteroffer. On the other hand, UCC 2-207(1) allows for a contract to be formed even if the acceptance contains additional or different terms from the original offer, as long as the acceptance does not expressly make acceptance conditional on the additional or different terms.

Question 19

Article 5 of the Uniform Commercial Code governs ________.

Accepted Answer

Article 5 of the Uniform Commercial Code (UCC) specifically governs letters of credit, which are used in commercial transactions to assure payment.

Question 20

If one or both parties to a sales contract are merchants,any additional terms are considered proposed additions to the contract.

Accepted Answer

The answer of If one or both parties to a...

Quiz 18: Formation of Sales and Lease Contracts