Bus3310 Exam 2

Question 1

Manny Manufacturer sent an e-mail to its widget supplier with this message: “Please confirm by return e-mail if you will be able to send me an additional ten dozen red widgets for the usual price by the thirtieth of this month.” Supplier e-mailed back: “Yes, the additional widgets will be part of our delivery to you on the morning of the thirtieth.” This exchange created what type of contract?Unilateral
Bilateral
Adhesionary
Implied in law

Answer 1

Bilateral

Question 2

when there is a time is of the essence clause in a contract, the parties will normally also include in the contract a dollar amount that will be paid the innocent party each day it takes to complete the work after the contract date. This is an example of?
Liquidated 
  Nominal 
  Consequential 
  Compensatory

Answer 2

liquidated damages clause

Question 3

Another term for punitive damages?
Liquidated 
  Nominal 
  Exemplary 
  Criminal

Answer 3

Exemplary

Question 4

The award of a very small amount of money, such as 1, acknowledges that a wrong has been done, even though there were no monetary losses, This award represents what type of damages?
Punitive 
  Liquidated 
  Special 
  Nominal

Answer 4

Nominal

Question 5

Bill Builder entered into a contract with Carl's Carpets to supply him with the carpeting he needed to complete the renovation of Famous Restaurant. When Carl did not deliver the carpeting on the contract dare, Bill had to find similar carpeting from a different vendor for 5 a yard more than he would have paid to Carl. The difference between the cost of the carpet in the contract with Carl and the cost Bill had to pay the new vendor can be recovered from Carl as? 
Consequential 
  Compensatory 
  Nominal 
  Punitive

Answer 5

Compensatory damages

Question 6

Contracts in which both sides have completely performed their duties are executory.
True or False

Answer 6

False

Question 7

Rescission is the remedy that cancels the contract and returns each party to his pre-contract position.
True or false

Answer 7

True

Question 8

Cal Contractor did extensive work renovating Hailey Homeowner’s kitchen. The construction work has been completely finished, but Hailey has not yet paid Cal. This is an example of a partially executed contract.
True or False

Answer 8

True

Question 9

Excessive punitive damage awards may violate the constitutional protection of due process.
True or False

Answer 9

True

Question 10

A party who seeks to rescind a contract must notify the other party in a timely fashion.
True or false

Answer 10

True

Question 11

Which of the following is not a legal detriment?

• A 22 year old who lives in a state where the drinking age is 21 promises not to drink alcohol.
• A 20 year old who lives in a state where the drinking age is 21 promises not to drink alcohol.
• An 85 year old with a valid driver’s license promises that she will not drive on superhighways anymore.
• The victim of libel promises not to sue.

Answer 11

A 20 year old who lives in a state where the drinking age is 21 promises not to drink alcohol

Question 12

Plaintiff sued a National Football League team, alleging that she had been sexually assaulted by several team members in a hotel room after a game. Team offered the plaintiff a cash settlement in exchange for two promises: 1) plaintiff would never discuss publically the suit or the terms of the settlement; and (2) plaintiff would never again sue the team or the individual players on any claim connected with the incident. Agreeing not to exercise these legal rights constitutes ?
Contract modification 
  Revocation 
  Forbearance 
  Accord and satisfaction

Answer 12

Forbearance

Question 13

An illusory promise is created when?

• The promise cannot be performed within 1 year of the contract date.
  
  • The promise is conditional on any other event happening first.
• The promise is conditional on an event happening first that is outside the promissor’s control.
• The promise is conditional on an event happening first that is totally within the promissor’s control.

Answer 13

the promise is conditional on an event happening first that is totally within the promisor’s control

Question 14

Which of the following statements is true about an accord and satisfaction?

• It can be used for unliquidated debts based on contract or tort claims.
• It can only be used in liquidated debt contracts.
• It is only used in labor contracts
• It is only used in construction contracts

Answer 14

It can be used for unliquidated debts based on contracts or tort claims

Question 15

Benny bought shares in Big Chip Maker BCM when the shares were trading for 37 a share. For the past 9 years BCM shares have not traded above 21. Can Benny rescind his purchase based on failure of consideration?
Yes, he suffered an economic detriment
Yes, there is a difference in value sufficient to trigger the adequacy of consideration rule.
Yes, he clearly gave more value than he received.
No, unless he was induced into buying the shares through fraud or other wrongdoing.

Answer 15

No, unless he was induced into buying the shares through fraud or other wrongdoing

Question 16

Promissory estoppel is the contract doctrine that requires that accords be in writing.
True or False

Answer 16

False

Question 17

Another term for consideration is a bargained for exchange.

true or false

Answer 17

True

Question 18

$1 is never legally adequate consideration in a contract because no one will willingly incur a legal detriment for $1
true or false

Answer 18

False

Question 19

Courts may look into the adequacy of consideration if there is evidence of fraud or undue influence by one of the parties
True or false

Answer 19

True

Question 20

A firm offer that is in writing and signed by a merchant cannot be revoked even though the other party gave no consideration

Answer 20

True

Question 21

If the seller of a parcel of real property breaches and refuses to sell, the best legal remedy for the buyer who wants this particular piece of property is?

• Restitution
• Consequential damages
• Specific performance
• Compensatory damages

Answer 21

Special performance

Question 22

Which of the following is a requirement for a valid contract?

(select all answer options that are correct)

Consideration
Mutuality of signatures
Offer and acceptance
Legal capacity of the parties

Answer 22

Consideration
Offer and acceptance
Legal capacity of the parties

Question 23

Betty Buyer discovers that the pin she bought from Sally Seller is not a ruby as Sally had claimed. She believes that Sally's misrepresentation was innocent, but she wants to get her money back. In order to get her money back, Betty will have to return the pin to Sally. This is the duty of
  Compensation 
  Replevin 
  Restitution 
  Reformation

Answer 23

Restitution

Question 24

Under which of the following is a contract voidable?
Consideration is missing.
Agreement is missing.
The contract was not executed under seal.
One of the parties has the option to set aside the contract.

Answer 24

One of the parties has the option to set aside the contract

Question 25

A contract entered into by a minor is voidable at the options of the minor True of false

Answer 25

True

Question 26

Contracts formed by the conduct of the parties, rather than expressed in words, are implied-in-law contracts. True False

Answer 26

False

Question 27

Tamara left her car in a line of other cars waiting to be washed. Tamara expects to pay for the service and the car wash expects to be paid. The contract that exists between Tamara and the car wash is an implied in fact contract. True False

Answer 27

True

Question 28

Detrimental reliance is another term for Forbearance Renunciation Good faith Promissory estoppel

Answer 28

Promissory estoppel

Question 29

Which of the following statements about the Uniform Commercial Code is false? (select all answer options that are correct) The Code provides for a reasonable price if price is not included in the contract The Code is only concerned that a contract reflect a freely bargained for exchange; it does not look to see if the contract provisions are one-sided or unconscionable. The Code allows the parties to a contract to require that any modifications to the contract be in writing. The Code allows only merchants to be bound by firm offers not supported by consideration.

Answer 29

The Code is only concerned that a contract reflects a freely bargained for exchange; it does not look to see if the contract provisions are one-sided or unconscionable.

Question 30

``` Allison, who raises horses, promised to give her friend Gil a pony for his daughter. She advised Gil that he would need to enclose a section of his property and recommended a specific type of fencing. Gil bought the recommended materials and had the fence built on his property. Allison now refuses to give Gil the pony. Allison will be liable to Gil for the cost of fencing his property based on the theory of Promissory estoppel Contract modification Restitution Contract rescission ```

Answer 30

Promissory estoppel

Question 31

Which of the following is false about a renunciation? The right that is waived in a renunciation is a contract right. Renunciations are valid in common law but not under the Code An oral renunciation does require consideration. A written renunciation does not require consideration.

Answer 31

Renunciations are valid in common law but not under the Code

Question 32

During a violent storm, Nelson saved Reggie's boat from being destroyed. Reggie was so grateful that he promised to give Nelson $100. Reggie's promise is unenforceable because it is based on moral obligation. True False

Answer 32

False

Question 33

In a liquidated debt, the parties agree on the exact amount that is due. True or false

Answer 33

True

Question 34

To meet the element of consideration, each party to a contract must gain a legal benefit and incur a legal detriment true or false

Answer 34

True

Question 35

Parties to a contract may not offer as consideration promises to do what they are already legally required to do. True or false

Answer 35

true