MULTIPLE CHOICE QUESTIONS

1. Jake receives and accepts an offer to work Grandview, Inc as a marketing director. An element of prime importance in determining whether a contract exists is

a. the price to be paid.

b the duration of the work.

c. the intent of the parties.

d. the subject of the contract.

2 Grandway Markets, Inc. makes an offer to Roz for a sales position in its sales department.Roz accepts the offer. A valid contract requires

a. a price and a subject.

b. a duration and termination provision.

c. an offer and an acceptance.

d. specific quality standards.

3. James tells Mark he will give him a new TV if Mark does James' chores for a month. Mark promises to do the chores. Mark and James have formed a

a. a bilateral contract.

b. a formal contract.

c. a unilateral contract.

d. no contract.

4.Lomberti, Inc., enters into an informal contract with JO Janitorial Company for custodial services for Lomberti's buildings. This means that the parties' contract

a. requires no special form.

b. is freely open to either party's interpretation.

c. is subject to change by either party, within reason.

d. is not yet completely formed

5. Linda's truck breaks down, she asks Low-Tow, Inc. to tow it to Pete's Repair Shop. There is no discussion of a price, and Linda and Low-Tow do not sign any documents. Later, Low-Tow sends Linda a bill. With respect to Linda's obligation to pay the bill, this is

a. an express contract.

b. an implied contract.

c. no contract.

d. a quasi contract.

6.Leo signs a lease agreement for an apartment with Jamo, who owns and manages the Bear Creek Apartments complex. These parties have

a. an express contract.

b. an implied contract.

c. a quasi contract.

d. nocontract.

7.Fran drives into Leo's Auto Service and asks Hank, a Leo's employee, to replace a tire on Fran's car. After Hank replaces the tire, but before Fran pays for it, any contract between Fran and Leo's is

a. executed.

b. executory.

c. void.

d. unenforceable.

8. Casey offers to sell a certain used forklift to DIY Lumber Outlet, but Casey dies before DIY accepts. Most likely, Casey'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. terminated the offer.

9. Jean offers to sell Mel her briefcase for $200. Mel says, "Okay, but only if you include a travel strap and other accessories." Mel 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.

10. Limvo Contracting, Inc., agrees to build a warehouse for PekeWholesale Distributors. When Limvo runs into the types of difficulties that contractors ordinarily confront, Peke agrees to pay extra compensation to overcome them. Regarding the agreement to pay more, a court would likely

a. enforce it.

b. rescind it.

c. order the parties to renegotiate it.

d. not enforce it.

11. Mayload Engineering, Inc., promises to give stock options to Leiona for processes she has already designed for the firm. This promise is enforceable

a. because it is a new contract.

b. because it is an illusory promise.

c. because it is supported by past consideration.

d. under no circumstances.

12. Paul's uncle tells Paul that if "he feels that Paul deserves it," he will give Paul $10,000 when Paul graduates from college. Paul's uncle's promise is

a.illusory.

b. a contract.

c. a forbearance.

d. a preexisting duty.

13. Rejoice Packaging Company promises its employees a 10 percent raise at the end of the year if productivity has increased and management feels the raise is warranted.Rejoice Packaging must

a. do nothing.

b. give the employees a 10 percent raise only at the end of the year.

c. give the employees a 10 percent raise only if productivity increases.

d. give the employees a 10 percent raise under any circumstances.

14. Henry promises not to open his Hank's Lunchbox Caf before 10:00 a.m. if Isis, who owns Isis's Danish & Donuts next door, promises to close by 4:00 p.m. Henry's consideration is

a. the creation of a legal relationship.

b. a nice thing to do

c. a forbearance.

d. an exchange of money.

15. Elle promises to pay Frank $400 because "he does not have as much money as other people." Elle's promise is not enforceable because

a. society does not want gifts cheapened by making them legally enforceable.

b. the redistribution of wealth on a one-to-one basis is not a valid social goal.

c. Elle could have paid more.Raul

d. Frank has not given consideration in return.

16. James questions whether there is consideration for his contract with Rainey to exchange his performance with the Boston Football League for her payment of a certain amount. To constitute consideration, there must be

a. a payment.

b. a performance.

c. a bargained-for exchange.

d. serious thought underlying each party's intent to contract.

17. Vernan Jet Services files a suit against the Wing Gate Flyers Club, Inc., claiming that the consideration for their contract is inadequate. The court will most likely not examine the adequacy of the consideration if

a. there is a large disparity in the amount of consideration exchanged.

b. the consideration involves the performance of services.

c. something of value passed between the parties.

d. the consideration is worth less than $100.

18. Makefield Telephone Company offers Ned an unlimited number of monthly phone minutes for $4.50 per month. Ned accepts. If a dispute arises, a court would likely

a. enforce the deal after questioning the adequacy of the consideration.

b. not question the adequacy of the consideration.

c. rewrite the deal after questioning the adequacy of the consideration.

d. set aside the deal after questioning the adequacy of the consideration.

19. Genovese Contracting, Inc., agrees to build a three story home for John and Sue Smith. When Genovese runs into the types of difficulties that contractors ordinarily confront, the Smiths agree to pay extra compensation to overcome them. Regarding the agreement to pay more, a court would likely

a. enforce it.

b. rescind it.

c. order the parties to renegotiate it.

d. not enforce it.

20. Todos, Ltd., agrees to market the products of United Sales, Inc., in Venezuela. When the government is unexpectedly overthrown in a revolution, Todos can continue to fulfill its contract but only for a much higher price. United agrees to pay but later files a suit to recover the difference. The court will most likely rule that

a. a change in government is a risk ordinarily assumed in business.

b. an unforeseen difficulty supported the contract modification here.

c. Todos engaged in extortion or the so-called holdup game.

d. Todos had a preexisting duty to supply the goods at the initial price.

Fact Pattern 13-B1 (Questions 21-22 apply)

Quik Downtown Delivery contracts with Rico's Tacos to deliver its products. Both parties change their minds, however, and inform each other that they would like to cancel the contract.

21. Refer to Fact Pattern 13-B1. The next day, Quik again offers to deliver Rico's products. Rico's is willing to deal, but for a new price. Quik and Rico's

a. may agree to a new contract, but it cannot include a new price.

b. may agree to a new contract that includes the new price.

c. must perform their original contract.

d. must perform the part of their original contract that is executory.

22. Refer to Fact Pattern 13-B1. Quik and Rico's

a. may rescind their entire contract.

b. may rescind their contract to the extent that it is executory.

c. must perform their entire contract.

d. must perform the part of their contract that is executory.

23. Industrial Engineering, Inc., promises to give stock options to Jasmine for processes she has already designed for the firm. This promise is enforceable

a. because it is a new contract.

b. because it is an illusory promise.

c. because it is supported by past consideration.

d. under no circumstances.

24. Kate writes a check to Paylee, Inc. in an amount that represents half of her debt to the lender. On the back of the check, Kate includes the words "payment in full." Paylee, Inc. agrees to accept the lesser sum and cashes the check. This discharges the entire debt

a. if the debt is liquidated.

b. if the debt is past due.

c. if the debt is unliquidated.

d. under no circumstances.

25. Marnie, a minor, disaffirms a contract for necessaries without returning the goods. To Leon's Food Mart, the seller, Marnie is required to pay

a. nothing.

b. the reasonable value of the goods.

c. the sales price of the goods.

d. the ultimate worth of the goods.

26. Warren enters into a contract to sell his laptop to Roberta. Roberta takes possession of the laptop as a minor and continues to use it well after reaching the age of majority. Roberta has

a. expressly ratified the contract.

b. impliedly ratified the contract.

c. disaffirmed the contract.

d. none of the choices.

27. Intoxicated but still capable of comprehending the consequences of her actions, Celia signs a contract to sell her phone app design to Uploads, Inc. This contract is

a. unenforceable because Celia was intoxicated.

b. enforceable.

c. unenforceable if Celia disaffirms it.

d. unenforceable if Uploads disaffirms it.

28. A court adjudicates Leo mentally incompetent and appoints Kelly to be his guardian. Later, without Kelly's knowledge, Leo signs a contract to sell his lake cabin to Larry for its real market value. The contract is

a. enforceable if Leo comprehended the consequences.

b. enforceable if Leo knew the market value of the farm.

c. enforceable if Leo has been recorded to be the owner of the cabin.

d. void.

29. Barbara, a real estate broker licensed only in Maine, concludes a land sale in New Jersey. She can

a. collect the commission if it has not been paid.

b. keep the commission if it has already been paid.

c. foreclose on the property to obtain any unpaid amount.

d. not collect the commission, keep it, or foreclose on the property.

30.Franklin Manufacturing Company promises its employees a 10 percent raise at the end of the year if productivity has increased and management feels the raise is warranted.Franklin must

a.do nothing.

b.give the employees a 10 percent raise only at the end of the year.

c.give the employees a 10 percent raise only if productivity increases.

d.give the employees a 10 percent raise under any circumstances.

31.Maya writes a check to ABC Loans, Inc., in an amount that represents half of her debt to the lender. On the back of the check, Maya includes the words "payment in full." ABC agrees to accept the lesser sum and cashes the check. This discharges the entire debt

a.if the debt is liquidated.

b.if the debt is past due.

c.if the debt is unliquidated.

d.under no circumstances.

32.Lou and H and H Sportwear, Inc disagree as to the exact amount H and H owes Lou for his landscaping work. They form a new agreement that, on fulfillment, will discharge the prior obligation. This is

a.a covenant not to sue.

b.an accord and satisfaction.

c.a release.

d.promissory estoppel.

33.Jake files a suit against Seldom Late Message Company, Inc., under the doctrine of promissory estoppel. Jake must show that

a.he justifiably refused to fulfill a promise to Seldom Late.

b.he justifiably relied on Seldom Late promise to his detriment.

c.Seldom Late justifiably refused to fulfill a promise to him.

d.Seldom Late justifiably relied on his promise to its detriment.