Question 1

Deb buys a song through eSongs,an online music vendor.Before completing the purchase and downloading the song,Deb must agree to a provision stating that she will not make and sell copies of the song.This provision is
A)a browse-wrap term.
B)a click-on agreement.
C)a shrink-wrap agreement.
D)a wrap-on agreement.

Accepted Answer

The provision that Deb must agree to before downloading the song is a type of click-on agreement, which requires the user to click a button indicating agreement to the terms and conditions before proceeding with the download.

Question 2

Hi-Lite Manufacturing,Inc.,orders supplies online from Indigo Parts Company. To complete the order,the buyer is required to click on a button that says,in reference to certain terms,"I agree." This is
A)a click-on agreement.
B)a default agreement.
C)an attribution agreement.
D)a shrink-wrap agreement.

Accepted Answer

This is a click-on agreement, where the user agrees to certain terms by clicking a button.

Question 3

Ali offers to sell Ben a new car for $10,000.Ben accepts the offer and sells his old car so that he will have money for the new one.Ali's offer is probably
A)revocable because the terms of the offer were not definite.
B)irrevocable because Ben sold his old car because of justifiable reliance on Ali's offer to sell him a new car.
C)revocable because any offer is revocable.
D)irrevocable because Ali's offer represents an opinion contract.

Accepted Answer

Ben's sale of his old car in reliance on Ali's offer creates a binding contract, making Ali's offer irrevocable. This is known as promissory estoppel, which prevents a party from revoking an offer when the other party has relied on it to their detriment.

Question 4

Lovett County Bank offers to lend money to Kino,the owner of Java Stop,at 15 percent interest.Before Kino accepts,a state statute is enacted prohibiting loans at rates greater than 12 percent.Kino and the bank have
A)have a contract for a loan at 15 percent interest.
B)have a contract for a loan at 12 percent interest.
C)have a contract for a loan at 0 percent interest.
D)no contract for a loan.

Accepted Answer

Since the state statute prohibits loans at rates greater than 12 percent, the previously offered 15 percent interest loan is no longer valid. Without a new agreement between Kino and the bank for a loan at 12 percent interest or less, there is no valid contract for a loan, making option D the correct answer.

Question 5

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

According to the mailbox rule, an acceptance is considered effective upon dispatch, which means when it is sent, not when it is received. Therefore, Shelby's offer will be deemed accepted when Relay sends their acceptance by e-mail. There is no requirement for a confirmation letter or for the use of a specific device or computer.

Question 6

Crafted Iron Works,Inc.,offers to design,make,and sell City Transit Agency fourteen streetcars.Crafted authorizes a particular mode of communication,but City Transit sends an acceptance via a substituted means.This acceptance is effective when it is
A)in transit.
B)received.
C)sent.
D)written.

Accepted Answer

According to the Mailbox Rule, an acceptance is effective upon receipt, regardless of the mode of communication authorized by the offeror. Therefore, City Transit's acceptance via a substituted means is effective when it is received by Crafted Iron Works.

Question 7

Digital Products Company includes a shrink-wrap agreement in a transac-tion with Eagle Engineering Corporation. A shrink-wrap agreement is an agreement whose terms are expressed
A)in code at the end of a computer program .
B)inside a box in which goods are packaged.
C)in small print at the end of a paper contract signed by both parties.
D)on a computer screen.

Accepted Answer

The answer of Digital Products Company includes a shrink-wrap agreement...

Question 8

Mark is creating a Web site through which he will enter into contracts over the Internet.Important terms to include in his offers include
A)provisions specifying the remedies if the contract is breached.
B)a detailed history of his business.
C)glowing reviews from former customers.
D)his educational background.

Accepted Answer

Provisions specifying remedies if the contract is breached are important terms to include in offers made over the Internet to ensure that both parties understand the consequences of a breach of contract. Providing a detailed history of the business, glowing customer reviews, and educational background may be relevant information to include on a website, but they do not necessarily pertain directly to the terms of the contract.

Question 9

Pastry Dough,Inc.,sends its catalogue to Octavio and includes a "per-son-alized" letter inviting him to buy any item in it at the ad-vertised price.This is
A)an offer because of the "person-alized" letter.
B)an offer because there is no room for price negotiation.
C)an offer only if Octavio previously bought items from Pastry Dough.
D)not an offer.

Accepted Answer

The personalized letter inviting Octavio to buy any item in the catalogue at the advertised price is merely an invitation to treat, not an offer. An invitation to treat is an invitation to others to make an offer, while an offer is an expression of willingness to enter into a contract on certain terms, made with the intention that it shall become binding as soon as it is accepted by the person to whom it is addressed. In this case, Pastry Dough is inviting Octavio to make an offer by purchasing an item from the catalogue.

Question 10

Wally offers to sell a certain used forklift to Valu Lumber Outlet,but Wally dies before Valu ac-cepts.Most likely,Wally's death
A)did not affect the offer.
B)shortened the time of the offer but did not terminate it.
C)extended the time of the offer.
D)termi-nated the offer.

Accepted Answer

Wally's death terminates the offer because an offer can only be accepted by the offeree during the offeror's lifetime. Once the offeror dies, the offer dies with them.

Question 11

Shasta offers to sell a used hay baler to Roberto,but receives a letter of accep-tance from Quito,who has no relation to Roberto.A valid contract exists between
A)Shasta and Roberto.
B)Shasta and Quito.
C)Roberto and Quito.
D)none of the choices.

Accepted Answer

A valid contract requires an offer, acceptance, and mutual agreement, or meeting of the minds, between the parties involved. In this scenario, there was an offer made by Shasta to sell the hay baler, but the acceptance came from a third party who had no relation to Roberto. Therefore, there is no valid contract between Shasta and Roberto or Shasta and Quito, and since there is no agreement between the parties involved, none of the given choices are correct.

Question 12

Liz offers to sell Jock her iPad for $500 without any accessories.Under the mirror image rule,Jock's response will be considered an acceptance ifthe 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

According to the mirror image rule, the terms of acceptance must exactly mirror those of the offer. Any changes in the terms results in a counteroffer rather than an acceptance. Therefore, choice A is the best answer.

Question 13

Quality Sales Corporation enters into contracts over the Internet.Quality can protect itself against disputes involving these contracts by making im-portant terms
A)reasonably clear.
B)difficult to notice.
C)impossible to find.
D)standardized.

Accepted Answer

Making important terms reasonably clear ensures that the parties to the contract have a mutual understanding of the terms involved, which reduces the likelihood of disputes. Making terms difficult to notice or impossible to find would be unethical and could lead to legal problems for Quality Sales Corporation. Standardizing terms may be helpful in some circumstances but may not be sufficient to protect against disputes.

Question 14

Laredo advertises a reward for the return of his lost dog.Mikayla,who does not know of the reward,finds and returns the dog.Mikayla cannot recover the re-ward,because she
A)did not confer a benefit on Laredo by returning the dog.
B)did not know of the reward when she found and returned the dog.
C)does not need the money.
D)returned the dog.

Accepted Answer

Mikayla did not know about the reward at the time she found and returned the dog, so she cannot recover the reward. The fact that she did not confer a benefit or does not need the money is not relevant in this scenario. The key factor is that she was not aware of the reward.

Question 15

Jon says to Kristy,"I would like to sell you my sports memorabilia collec-tion." 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 Kristy to negotiate.

Accepted Answer

The answer of Jon says to Kristy,"I would like to...

Question 16

On May 1 Jill offers to sell Andrea a herd of sheep.On May 3 Jill mails Andrea a letter revoking the offer.Andrea receives the letter on May 5.Jill's revocation of the offer to sell the sheep became effective on
A)May 1.
B)May 3.
C)May 4.
D)May 5.

Accepted Answer

A revocation of an offer is effective when it is received by the offeree. In this case, Andrea received the revocation letter on May 5, making the revocation effective on that date.

Question 17

Jared downloads some video games from the Internet.There is a page indicating the terms of use,but nothing that requires Jared to affirmatively indicate his consent before downloading the games.These terms are
A)a click-on agreement.
B)browse-wrap terms.
C)an attribution agreement.
D)a shrink-wrap agreement.

Accepted Answer

Browse-wrap terms are terms and conditions that are presented on a webpage but do not require the user's affirmative consent before using the service or downloading content. Therefore, the fact that Jared downloaded the games without explicitly indicating his consent implies that he did so under browse-wrap terms.

Question 18

Beth goes to Dr.Carlton for surgery.Carlton says that Beth should be fully healed within a week.Beth is not healed within a week.With respect to breach of contract,Carlton is
A)liable.
B)not liable,because surgery is not a proper sub-ject for a contract.
C)not liable,because the statement was an opinion.
D)not liable,but Beth is excused from paying Carlton.

Accepted Answer

The answer of Beth goes to Dr.Carlton for surgery.Carlton says...

Question 19

Signe offers to sell Thomas her textbook but conditions the sale on Thomas ac-cepting the offer by March 1.Signe may revoke the offer
A)beforeThomas accepts the offer.
B)before March 1,whether or not Thomas has accepted the offer.
C)only after Thomas accepts the offer.
D)only after March 1.

Accepted Answer

The answer of Signe offers to sell Thomas her textbook...

Question 20

Over the Internet,Red & White Contractors,Inc.,arranges to lease storage space from Blue Services Company. To complete the deal,Red & White clicks on a but-ton that says,in reference to certain terms,"I agree." Most likely,the par-ties have
A)a binding contract that includes the terms.
B)a binding contract that does not include the terms.
C)an unenforceable contract that includes the terms.
D)an unenforceable contract that does not include the terms.

Accepted Answer

By clicking on the button that says "I agree" in reference to certain terms, both parties have entered into a binding contract that includes those terms. The act of clicking on the button signifies that Red & White Contractors, Inc. has agreed to the terms and therefore are bound by them.

Quiz 9: Agreement in Traditional and E-Contracts

Deb buys a song through eSongs,an online music vendor.Before completing the purchase and downloading the song,Deb must agree to a provision stating that she will not make and sell copies of the song.This provision is

Hi-Lite Manufacturing,Inc.,orders supplies online from Indigo Parts Company. To complete the order,the buyer is required to click on a button that says,in reference to certain terms,"I agree." This is

Ali offers to sell Ben a new car for $10,000.Ben accepts the offer and sells his old car so that he will have money for the new one.Ali's offer is probably

Lovett County Bank offers to lend money to Kino,the owner of Java Stop,at 15 percent interest.Before Kino accepts,a state statute is enacted prohibiting loans at rates greater than 12 percent.Kino and the bank have

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

Crafted Iron Works,Inc.,offers to design,make,and sell City Transit Agency fourteen streetcars.Crafted authorizes a particular mode of communication,but City Transit sends an acceptance via a substituted means.This acceptance is effective when it is

Digital Products Company includes a shrink-wrap agreement in a transac-tion with Eagle Engineering Corporation. A shrink-wrap agreement is an agreement whose terms are expressed

Mark is creating a Web site through which he will enter into contracts over the Internet.Important terms to include in his offers include

Pastry Dough,Inc.,sends its catalogue to Octavio and includes a "per-son-alized" letter inviting him to buy any item in it at the ad-vertised price.This is

Wally offers to sell a certain used forklift to Valu Lumber Outlet,but Wally dies before Valu ac-cepts.Most likely,Wally's death

Shasta offers to sell a used hay baler to Roberto,but receives a letter of accep-tance from Quito,who has no relation to Roberto.A valid contract exists between

Liz offers to sell Jock her iPad for $500 without any accessories.Under the mirror image rule,Jock's response will be considered an acceptance ifthe terms of the acceptance

Quality Sales Corporation enters into contracts over the Internet.Quality can protect itself against disputes involving these contracts by making im-portant terms

Laredo advertises a reward for the return of his lost dog.Mikayla,who does not know of the reward,finds and returns the dog.Mikayla cannot recover the re-ward,because she

Jon says to Kristy,"I would like to sell you my sports memorabilia collec-tion." This is not an offer because it

On May 1 Jill offers to sell Andrea a herd of sheep.On May 3 Jill mails Andrea a letter revoking the offer.Andrea receives the letter on May 5.Jill's revocation of the offer to sell the sheep became effective on

Jared downloads some video games from the Internet.There is a page indicating the terms of use,but nothing that requires Jared to affirmatively indicate his consent before downloading the games.These terms are

Beth goes to Dr.Carlton for surgery.Carlton says that Beth should be fully healed within a week.Beth is not healed within a week.With respect to breach of contract,Carlton is

Signe offers to sell Thomas her textbook but conditions the sale on Thomas ac-cepting the offer by March 1.Signe may revoke the offer

Over the Internet,Red & White Contractors,Inc.,arranges to lease storage space from Blue Services Company. To complete the deal,Red & White clicks on a but-ton that says,in reference to certain terms,"I agree." Most likely,the par-ties have