QUESTION 1

Susan took out a life insurance policy on herself, paying all of the premium payments. She named her daughter, Jessica, as the beneficiary under the policy. Jessica has not given anything in consideration for the policy. Jessica is a(n)

a.donee beneficiary who has rights to enforce the policy once Susan dies.

b.creditor beneficiary who has rights to enforce the policy once Susan dies.

c.incidental beneficiary because Jessica did not give any consideration for the policy and therefore cannot enforce the policy even when Susan dies.

d.promisor in the contract with no enforcement rights.

QUESTION 2

Two parties are debating whether or not to put their contract into writing. In making their determination, which of the following factors would normally NOT be considered?

a.the relationship between the two parties

b.the length of time covered by the agreement

c.the complexity of the agreement

d.whether or not the agreement falls within the Statute of Frauds

QUESTION 3

Standard provisions in a contract that are often listed under the heading "Miscellaneous" are called

a.boilerroom.

b.boilerplate.

c.boilerpot.

d.boilertape.

QUESTION 4

The UCC is federal legislation enacted by Congress.

True

False

QUESTION 5

In which case would true impossibility NOT apply?

a.Nelson contracted with a local restaurant to supply 10,000 pounds of potatoes, but a tornado tore through his field, completely destroying it.

b.A record company contracted with Darlene to produce a CD of traditional folk ballads; unfortunately, Darlene died before recording began.

c.Reed agrees to purchase an expensive piece of jewelry for $25,000; a week later, he tells the jeweler that he simply does not have that kind of money.

d.None of these are correct.

QUESTION 6

The status of a third party is determined by

a.the reasonable expectations of the third party.

b.whether the third party gave consideration.

c.the type of contract.

d.the intent of the contracting parties.

QUESTION 7

Lian contracted for financial services from E-wise. This contract is governed by Article 2 of the UCC.

True

False

QUESTION 8

To win expectation damages, the injured party must prove the breach of contract caused damages that can be quantified with reasonable certainty.

True

False

QUESTION 9

The concept that expectation interest is designed to put the injured party in the position he or she would have been in had both sides fully performed their obligations is found in

a.Bi-Economy Market, Inc.v.Harleysville Ins. Co. of New York.

b.Hadleyv.Baxendale.

c.Hawkinsv.McGee.

d.None of these are correct.

QUESTION 10

Bob, a house painter, contracts with Ollie to paint a rental house that Ollie owns. Bob hires Rob to take his place as the painter on this contract. What has Bob done?

a.delegated his duties

b.made a scrivener's error

c.severed the contract

d.assigned his rights