Business Law - Contracts

1. All agreements made between two consenting adults are legally enforceable.

a. True

b. False

2. The essential elements of contract formation are:

a. mutual assent, consideration, capacity, and fairness

b. consideration, legality, capacity, and enforceability

c. legality, capacity, a written document, signatures by all parties

d. mutual assent, capacity, consideration, legality

e. none of the above

3. Generally speaking, oral contracts are just as legally binding as written contracts.

a. True

b. False

4. Mutual assent will be established as long as at least one party to an agreement manifests a willingness to be bound by his or her promise.

a. True

b. False

5. The contractual theory that requires us to examine whether a reasonable person in the position of an offeree would understand that an offer has been made is called:

a. The Binding Theory of Contracts

b. The Unified Theory of Contracts

c. The Subjective Theory of Contracts

d. The Objective Theory of Contracts

e. None of the above

6. To accept an offer, an offerees acceptance can differ from the terms offered as long as the offeror still gets most of what he or she asked for.

a. True

b. False

7. The only responses to an offer that have a legal effect are rejection, acceptance, and counter offers.

a. True

b. False