1. Which of the following could be consideration to meet this important contracting requirement in exchange for a concert ticket worth $50?
a) A mere peppercorn will do!
b) $50 cash
c) a video game originally purchased for $35
d) All of the above
2. The U.S. business, ABC Corp. hired Jill to bribe a foreign government official into awarding a $3 million contract to ABC Corp. ABC Corp. gave Jill $10,000 in cash to make the bribe payment and $2,000 for Jill’s efforts. Instead of paying the bribe, Jill just pocketed all of the money. If ABC Corp sues Jill, ABC Corp. will
a) be able to recover the $12,000
b) be able to recover the $3 million lost on the contract
c) be able to recover the $2,000 but not the $10,000
d) not be able to recover the $12,000
3. What is not required to establish promissory estoppel?
a) A contract, written or verbal
b) A promise made by the plaintiff in response to the defendant's promise
c) Reliance on the defendant's promise
d) Enforcing the promise is the only way to avoid injustice
4. You've been shoveling snow from your neighbor's driveway every year for the past five years for $25 each time. This year, when you shoveled, your neighbor refursed to pay after. A court would likely find you and your neighbor had a(n) ___________.
a) implied contract.
b) express contract.
c) quasi contract.
5. Johann, a well-known musician, agrees to give ten guitar lessons to Elton for $2,000. Nothing in the contract itself prohibits a delegation. If Johann delegates his obligation to Eugene, a second-year musical student and enthusiastic guitar player, then the delegation will probably be:
a) permitted because contracts may be freely delegated
b) permitted because the contract is just for music lessons
c) prohibited because the contract is for service from a specific person
d) prohibited by the UCC because this is a sale of services
6. Lily, a merchant, has received a signed, written confirmation from Merchants, Inc. referring to goods she had not ordered. Lily should:
a) Ignore the confirmation
b) Call the seller and object to the confirmation as soon as she gets back from her month long vacation
c) Object to the confirmation in writing within 10 days
d) Return the goods within two weeks of their delivery with a note attached saying she will not pay for them
7. Bob decides to sell his home as termites are ruining its foundation. Jill purchases the property and does not know about the termite damage, which the inspector also does not find before purchase. After purchase, Jill finds out there is over $50,000 in termite damage. As Bob was aware of this issue and remained silent, he must pay $50,000 to Jill or fix the termite damage, even though the home is no longer his. TRUE/FALSE
8. True/False: Roger parked his car at a garage that has a large sign at the entrance saying, "This garage is not liable for items stolen from a car." This type of notice is referred to as an exculpatory clause.
9. Robert, a minor, buys a stereo from Jane for $200. State law allows a minor to disaffirm contracts within a reasonable time after turning 18. Robert disaffirms the contract the day after turning 18 and returns the stereo
a) This contract was a valid contract, Robert cannot disaffirm
b) This contract was a voidable contract, Robert can disaffirm
c) This contract was a void contract.
d) This contract was unenforceable because it needed to be in writing to be enforceable
10. Which of the following are generally considered to be legal offers?
a) Placing an item up for auction.
b) Catalog advertisements.
c) Price lists.
d) A note scribbled on a restaurant napkin that includes the details of the offer.
11. Miles purchased a lawnmower with an attached warning that said, "The manufacturer is not responsible in the case of an injury caused by the lawnmower." If Miles is injured because of a defect in the mower and sues the lawnmower manufacturer, he will most likely
a) Lose, as he agreed to not hold the lawnmower manufacturer liable
b) Lose, as he assumed the risk
c) Win, as this warning would be unenforceable
d) None of the above
12. On January 8, ABC, Inc. sent 123 Company a letter offering to sell $10,000 in restaurant supplies. On January 18, 123 Co. mailed a letter to ABC, Inc. accepting the offer. ABC, Inc. received the acceptance letter on January 20. On January 17, ABC, Inc. sent a letter revoking the offer. 123 Co. received this letter on January 21. According to the mailbox rule, a contract between ABC, Inc. and 123 Co.
a) was not formed because the revocation was effective before the acceptance was sent
b) was not formed because the revocation was effective before the acceptance was received
c) was formed on January 18
d) was formed on January 20
13. The Johnsons decided to sell their summer cabin on Beech Lake. They sent flyers out to all who previously had expressed an interest in buying the cabin stating that they were planning on selling their cabin. The flyer described the location of the property, the size of the lot, and the price. If one of the recipients responds by sending a letter accepting, an agreement
a) Will not be formed because the flyer was sent out as an invitation to make an offer
b) Will be formed because the first to respond gets the property
c) Will be formed because the price is included
d) Will not be formed because of the parol evidence rule
14. In order to satisfy the statute of frauds, a writing must:
a) be a formal written document drafted by an attorney
b) be signed by the defendant and contain the name of each party, the subject matter of the agreement, and the essential terms and promises
c) be notarized
d) All of the above
15. Ned has one alcoholic beverage. In this state, he buys his girlfriend a necklack for $300. When Ned wakes up the next morning with the necklace, he decides he made a big mistake and wants to return the necklace to the vendor. Must the vendor give Ned the $300 back?
a) Yes – he must return the $300 when he receives the necklace. Ned lacked capacity to contract and can therefore cancel the agreement
b) Yes – he must return the $300 because Ned returned the guitar
c) No – Ned entered into a valid contract and is stuck with the necklace whether he likes it or not
d) None of the above