Question 1

[Leaky Tub and Flaming Watercraft] Isaiah finished college, got a good job, and decided to sell some used items and buy newer ones. A used hot tub with a leak in it and a personal watercraft were at the top of the list. Isaiah offered to sell to Yasmeen the hot tub for $500. Yasmeen was interested but not willing to pay $500. She said "I'll give you $400." Isaiah said that he would think about it. Later, the same day, Isaiah offered to sell Donna the hot tub for $500. Donna said "Would you consider $450?" Isaiah said he would think on it. A few minutes later, Paul who had heard that Isaiah wanted to sell the hot tub accepted Isaiah's offer to sell for $500, and they agreed that the transfer would be made the next day. A few minutes later, Yasmeen called saying that she accepted Isaiah's offer to sell the hot tub for $500. A few minutes after that, Donna called and told Isaiah that she accepted his offer to sell the hot tub for $500. Isaiah told Yasmeen and Donna that he had already sold it, and they were angry and threatened to sue. Isaiah offered to sell the personal watercraft to Haley for $800. She said that she would think it over and let him know the next day. Unfortunately, through no fault of anyone, there was a fire at Isaiah's home that night and the personal watercraft burned. Haley called the next day and accepted before Isaiah could tell her the watercraft burned. When she found out about the fire, Haley told Isaiah that he had better come up with another watercraft, or she was going to sue.
-Which of the following is correct regarding the final status of the negotiations between Donna and Isaiah?

Accepted Answer

A)   Donna rejected Isaiah's offer by making a counteroffer.
B)   Donna did not reject Isaiah's offer because she merely made an inquiry.
C)   Donna cannot accept Isaiah's offer because he already sold the hot tub, and that terminated the offer to her.
D)   Donna cannot accept Isaiah's offer because it was revoked when he sold the personal watercraft to Paul.
E)   Donna cannot accept Isaiah's offer because she did not do so in her initial conversation with Isaiah.F) A) and D)
G) B) and D)

Question 2

Kendrick overhears Eric's offer to sell Greg a boat for $1,000. Greg declines the offer, but Kendrick immediately says "I accept." Eric does not want to sell the boat to Kendrick because he is afraid that Kendrick will not immediately pay him. Also, he thinks Kendrick is a complainer and will find something to complain about regarding the sale. Is Eric obligated to sell the boat to Kendrick, and why or why not? Also, discuss what you believe the ethical rule should be on this issue.

Accepted Answer

No, Eric is not required to sell the boa...

Question 3

Explain under which circumstances an offer may not be revoked.

Accepted Answer

An option contract prevents re...

Question 4

Joe's car is for sale and he tells Tom that Tom can buy the car for $9,000 if he lets him know within that week. Joe later changes his mind and writes a letter to Tom, which he mails. Five minutes after Joe mails the letter, he receives a phone call from Joe accepting the offer to buy the car. Does Joe have to sell Tom the car?

Accepted Answer

A)   Yes, because the offer stated it would be open for a period of time and it was accepted before the revocation reached the offeree.
B)   Yes, because an offeror is master of his offer and can revoke it at any time.
C)   No, because an offeror is master of his offer and can revoke it at any time.
D)   No, because Tom only called and did not come with the money for the car.
E)   No, because the mailbox rule says that a revocation becomes valid when it is mailed.F) A) and B)
G) C) and D)

Question 5

The case of Lucy v. Zehmer, involving whether or not there was assent to a contract or whether allegations of joking prevented the formation of the contract, what did the court determine?

Accepted Answer

A)   The court ruled that the contract would not be enforced because one of the parties was subjectively joking and that both the Zehmers testified they were joking.
B)   The court ruled that the contract would not be enforced because one of the parties was joking, and a reasonable person should have known that.
C)   The court ruled that the contract would not be enforced because the parties had been drinking and although they were not intoxicated, there was still no mutual assent.
D)   The court ruled that the agreement would be enforced because under the applicable standard, the words and acts, judged by a reasonable standard, manifested an intention to be bound.
E)   The court ruled that the contract would be enforced because of what the parties verbally said regardless of whether an objective person would have thought joking was involved.F) C) and D)
G) B) and E)

Question 6

Which of the following is true of intent to form a contract?

Accepted Answer

A)   Intent Is not a required element of an offer or acceptance to form a contract.
B)   Intent is determined based on the specific motivations of the offeror or offeree, including hidden motivations.
C)   Intent is assessed by considering proof of an offeree or offeror's internal thought process.
D)   Intent is a required element of an offer or acceptance only if a contract is a contract for the sale of goods.
E)   An offeror must show intent to be bound by the offeree's acceptance.F) A) and C)
G) B) and D)

Question 7

Which of the following is true of an offer made in jest?

Accepted Answer

A)   Even if an offer is clearly a joke, the words are treated as an offer.
B)   A joke is always treated as a serious offer, unless the person specifically states: "I'm joking."
C)   A joke is never treated as a serious offer.
D)   A joke is treated as a serious offer if the outward manifestation of intent would lead a reasonable person to believe it was intended as a serious offer.
E)   The court will look to a person's secret or hidden intent to attempt to discern if a joke was an offer or not.F) C) and D)
G) A) and C)

Question 8

Which of the following is true when an offer authorizes a certain mode of acceptance but does not require it, and an offeree attempts to accept the offer through a method other than the authorized means?

Accepted Answer

A)   The acceptance becomes a counteroffer that the original offeror may or may not accept.
B)   There is no contract, and the attempted acceptance is of no effect.
C)   There is a contract only if the acceptance is received by the time that acceptance through the authorized means would have been received.
D)   The contract is not formed until the acceptance is received by the offeror.
E)   Authorizing but not requiring a certain type of acceptance has no effect, and the mailbox rule applies.F) All of the above
G) D) and E)

Question 9

Emily and Sasha are having pizza and talking about cars. Emily asks Sasha if Sasha would consider selling her car for $2,000. Is this a valid offer?

Accepted Answer

A)   No, there is no valid offer.
B)   Yes, an offer has been made by Emily, but it may be revoked prior to acceptance.
C)   Yes, an offer has been made because Emily and Sasha negotiated.
D)   Yes, there is a valid offer and now a contract has been entered into.
E)   Yes, there is a valid offer because the parties know each other.F) B) and C)
G) A) and E)

Question 10

If the means by which an acceptance can be communicated to the offeror is expressly stated in the offer, it is called an "implied authorization."

Accepted Answer

A) True 
 B)False

Question 11

Regarding unsolicited merchandise received from a seller, what have most states done?

Accepted Answer

A)   Most states have passed laws providing that unsolicited merchandise does not have to be returned and the recipient may keep it as a gift, with no contract being formed.
B)   Most states have passed laws providing that unsolicited merchandise must be returned to the seller within 7 days.
C)   Most states have passed laws providing that unsolicited merchandise must be returned to the seller within 10 days.
D)   Most states have passed laws providing that unsolicited merchandise must be returned to the seller within 30 days.
E)   Most states have passed laws providing that unsolicited merchandise must be returned to the seller within 60 days.F) None of the above
G) A) and E)

Question 12

Jasmine offers $100 to anyone who can return her lost dog, Champ. Kayla returns the dog and requests the money. Jasmine says that there is no binding contract. Which of the following is true regarding Jasmine's statement?

Accepted Answer

A)   Jasmine is incorrect because there is a binding bilateral contract.
B)   Jasmine is incorrect because there is a binding unilateral contract which Kayla accepted by performing.
C)   Jasmine is correct because there is no binding bilateral contract.
D)   Jasmine is correct because there is no binding unilateral contract.
E)   Jasmine is correct because Kayla acted incorrectly by her manner of attempted acceptance.F) B) and E)
G) B) and C)

Question 13

[Leaky Tub and Flaming Watercraft] Isaiah finished college, got a good job, and decided to sell some used items and buy newer ones. A used hot tub with a leak in it and a personal watercraft were at the top of the list. Isaiah offered to sell to Yasmeen the hot tub for $500. Yasmeen was interested but not willing to pay $500. She said "I'll give you $400." Isaiah said that he would think about it. Later, the same day, Isaiah offered to sell Donna the hot tub for $500. Donna said "Would you consider $450?" Isaiah said he would think on it. A few minutes later, Paul who had heard that Isaiah wanted to sell the hot tub accepted Isaiah's offer to sell for $500, and they agreed that the transfer would be made the next day. A few minutes later, Yasmeen called saying that she accepted Isaiah's offer to sell the hot tub for $500. A few minutes after that, Donna called and told Isaiah that she accepted his offer to sell the hot tub for $500. Isaiah told Yasmeen and Donna that he had already sold it, and they were angry and threatened to sue. Isaiah offered to sell the personal watercraft to Haley for $800. She said that she would think it over and let him know the next day. Unfortunately, through no fault of anyone, there was a fire at Isaiah's home that night and the personal watercraft burned. Haley called the next day and accepted before Isaiah could tell her the watercraft burned. When she found out about the fire, Haley told Isaiah that he had better come up with another watercraft, or she was going to sue.
-What effect does the accidental destruction of the personal watercraft have on the deal between Isaiah and Haley?

Accepted Answer

A)   Isaiah is in breach of contract and must pay Haley damages because she accepted before he could tell her about the fire.
B)   Isaiah is in breach of contract and must purchase a similar watercraft to transfer to Haley.
C)   Isaiah is not in breach of contract because an insufficient material term involving who would move the watercraft was omitted.
D)   Isaiah is not in breach of contract because the offer was not sufficiently definite.
E)   Isaiah is not in breach of contract because of destruction of the subject matter.F) A) and C)
G) All of the above

Question 14

[Used Car Sales] Edwin sells used cars. He is looking for a way to increase sales and profits so that he can take his girlfriend on a nice diving trip to the Grand Cayman Islands. The first thing that Edwin does is say that during the first week of December, he will give a $500 rebate on used cars that are under two years old. To spice things up, he also offers to sell any car on the lot that is over five years old for $1,000 to the first three customers who can jump rope for ten hours straight on December 7th. Edwin was not very concerned about the jumping rope issue because he thought that no one would be able to jump rope for ten hours straight. Edwin put an advertisement pertaining to the rebate and the jump rope opportunity in the local newspaper. The promotion went over very well. Although Edwin had several cars available, he ran out of cars under two years old within one day. During the rest of the week shoppers were told that cars of that description were no longer available. Josh was very angry at Edwin for not having a car available that was under two years old so that he could get a good deal and a $500 rebate. On December 7th, while Edwin was watching people jump rope, Brandi was shopping for a car. She was in college and did not have much money. She saw one, an older car, a real clunker, that she liked; but wasn't sure if it could be repaired sufficiently to be dependable. Edwin had not even put a price on it because he planned to have it crushed. Brandi was going to talk to her parents about it. Edwin eventually approached her, and Brandi asked him if he would take $450 for the car. Edwin said, "Yes, sold." Brandi tried to explain that she needed to talk to her parents first, but Edwin would not hear of it. While Edwin was still fuming from his encounter with Brandi, Zack walked up and started to criticize the nature of Edwin's inventory. Edwin told him that he had great cars. Zack pointed at a beater that was banged up, had 200,000 miles on it, and a cracked windshield. Zack said, "Sure, I'll pay $100,000 for that car!" Edwin said, "Sold." Zack said, "Wait a minute. I was only kidding." Edwin said, "No way." Meanwhile all the people jumping rope dropped out well prior to ten hours except for Emma. She completed the jumping rope and asked for her car for $1,000. Edwin refused saying that the offer was revoked. Josh and Emma sued Edwin, and Edwin sued Zack and Brandi. Under the applicable law in Edwin's state, common law will be applied, and there are no state statutes impacting the situation.
-What is the most likely result in Edwin's lawsuit against Brandi in which he claims that she must pay $450 for the car at issue?

Accepted Answer

A)   Edwin will win because Brandi made an offer that he properly accepted.
B)   Edwin will win because Brandi agreed to pay a reasonable amount for the vehicle.
C)   Brandi will win because the agreement was not put into written form and signed by both parties.
D)   Brandi will win because she merely expressed interest and did not make an offer.
E)   Brandi will win because she was not provided sufficient time in which to consider the offer.F) B) and E)
G) C) and D)

Question 15

Reasonably definite terms are one of the elements of an offer.

Accepted Answer

A) True 
 B)False

Question 16

In the absence of a time condition in either offer, an offer by a retailer to purchase seasonal goods from a wholesaler would lapse later than an offer to purchase goods that could easily be sold all year long.

Accepted Answer

A) True 
 B)False

Question 17

[Used Car Sales] Edwin sells used cars. He is looking for a way to increase sales and profits so that he can take his girlfriend on a nice diving trip to the Grand Cayman Islands. The first thing that Edwin does is say that during the first week of December, he will give a $500 rebate on used cars that are under two years old. To spice things up, he also offers to sell any car on the lot that is over five years old for $1,000 to the first three customers who can jump rope for ten hours straight on December 7th. Edwin was not very concerned about the jumping rope issue because he thought that no one would be able to jump rope for ten hours straight. Edwin put an advertisement pertaining to the rebate and the jump rope opportunity in the local newspaper. The promotion went over very well. Although Edwin had several cars available, he ran out of cars under two years old within one day. During the rest of the week shoppers were told that cars of that description were no longer available. Josh was very angry at Edwin for not having a car available that was under two years old so that he could get a good deal and a $500 rebate. On December 7th, while Edwin was watching people jump rope, Brandi was shopping for a car. She was in college and did not have much money. She saw one, an older car, a real clunker, that she liked; but wasn't sure if it could be repaired sufficiently to be dependable. Edwin had not even put a price on it because he planned to have it crushed. Brandi was going to talk to her parents about it. Edwin eventually approached her, and Brandi asked him if he would take $450 for the car. Edwin said, "Yes, sold." Brandi tried to explain that she needed to talk to her parents first, but Edwin would not hear of it. While Edwin was still fuming from his encounter with Brandi, Zack walked up and started to criticize the nature of Edwin's inventory. Edwin told him that he had great cars. Zack pointed at a beater that was banged up, had 200,000 miles on it, and a cracked windshield. Zack said, "Sure, I'll pay $100,000 for that car!" Edwin said, "Sold." Zack said, "Wait a minute. I was only kidding." Edwin said, "No way." Meanwhile all the people jumping rope dropped out well prior to ten hours except for Emma. She completed the jumping rope and asked for her car for $1,000. Edwin refused saying that the offer was revoked. Josh and Emma sued Edwin, and Edwin sued Zack and Brandi. Under the applicable law in Edwin's state, common law will be applied, and there are no state statutes impacting the situation.
-What is the most likely result in the lawsuit brought by Edwin against Zack?

Accepted Answer

A)   Edwin will win because Zack properly made an offer that Edwin accepted.
B)   Zack will win because he was merely expressing possible interest.
C)   Zack will win because Edwin did not properly accept.
D)   Zack will win because under a subjective standard he was joking.
E)   Zack will win because under an objective standard, it appears he was joking.F) A) and C)
G) A) and B)

Question 18

Belinda sends an email to Equador offering to sell her entire entertainment set to him for $2,500. Equador responds that the price seems a bit high and offers to buy the entertainment set for $2,000. Equador's response is considered a(n)  ________?

Accepted Answer

A)   illegal response
B)   acceptance
C)   revocation
D)   counteroffer
E)   bilateral offerF) B) and D)
G) None of the above

Question 19

Tonya runs a bakery and she wants to attract new customers. She publishes an ad in a community newspaper indicating that the first 200 people who come in on Monday the 24th of August can buy a muffin for just $1 if they arrive between 9:00 AM and 4:00 PM and bring in a dollar bill. Is Tonya's ad an offer?

Accepted Answer

A)   No, it is an offer to make an offer.
B)   No, because advertisements can never be offers.
C)   No, because it does not reflect Tonya's specific intent to make an offer.
D)   Yes, because all advertisements are offers.
E)   Yes, because it specified a limited quantity and provided a specific means by which the offer could be accepted.F) A) and B)
G) A) and C)

Question 20

Dameon offers to sell his camper trailer to Wanette. Before Wanette can decide if she wants to buy the camper, a storm destroys the camper. The offer ________.

Accepted Answer

A)   must be upheld
B)   is extended until Dameon can replace the camper
C)   is extended for twenty-one days
D)   is automatically terminated
E)   would be left to a court to decide whether or not to be upheld.F) A) and E)
G) All of the above

Exam 14: Agreement

Correct Answer
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Which of the following is true of an offer made in jest?

Correct Answer
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Correct Answer
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No, Eric is not required to sell the boa...
View Answer

Reasonably definite terms are one of the elements of an offer.

Correct Answer
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Dameon offers to sell his camper trailer to Wanette. Before Wanette can decide if she wants to buy the camper, a storm destroys the camper. The offer ________.

Correct Answer
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Jasmine offers $100 to anyone who can return her lost dog, Champ. Kayla returns the dog and requests the money. Jasmine says that there is no binding contract. Which of the following is true regarding Jasmine's statement?

Correct Answer
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In the absence of a time condition in either offer, an offer by a retailer to purchase seasonal goods from a wholesaler would lapse later than an offer to purchase goods that could easily be sold all year long.

Correct Answer
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Which of the following is true when an offer authorizes a certain mode of acceptance but does not require it, and an offeree attempts to accept the offer through a method other than the authorized means?

Correct Answer
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The case of Lucy v. Zehmer, involving whether or not there was assent to a contract or whether allegations of joking prevented the formation of the contract, what did the court determine?

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Which of the following is true of intent to form a contract?

Correct Answer
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Explain under which circumstances an offer may not be revoked.

Correct Answer
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An option contract prevents re...
View Answer

Belinda sends an email to Equador offering to sell her entire entertainment set to him for $2,500. Equador responds that the price seems a bit high and offers to buy the entertainment set for $2,000. Equador's response is considered a(n) ________?

Correct Answer
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Emily and Sasha are having pizza and talking about cars. Emily asks Sasha if Sasha would consider selling her car for $2,000. Is this a valid offer?

Correct Answer
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Correct Answer
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If the means by which an acceptance can be communicated to the offeror is expressly stated in the offer, it is called an "implied authorization."

Correct Answer
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Regarding unsolicited merchandise received from a seller, what have most states done?

Correct Answer
verified

Exam 14: Agreement

Correct AnswerverifiedShow Answer

Which of the following is true of an offer made in jest?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedNo, Eric is not required to sell the boa...View AnswerShow Answer

Reasonably definite terms are one of the elements of an offer.

Correct AnswerverifiedShow Answer

Dameon offers to sell his camper trailer to Wanette. Before Wanette can decide if she wants to buy the camper, a storm destroys the camper. The offer ________.

Correct AnswerverifiedShow Answer

Jasmine offers $100 to anyone who can return her lost dog, Champ. Kayla returns the dog and requests the money. Jasmine says that there is no binding contract. Which of the following is true regarding Jasmine's statement?

Correct AnswerverifiedShow Answer

In the absence of a time condition in either offer, an offer by a retailer to purchase seasonal goods from a wholesaler would lapse later than an offer to purchase goods that could easily be sold all year long.

Correct AnswerverifiedShow Answer

Which of the following is true when an offer authorizes a certain mode of acceptance but does not require it, and an offeree attempts to accept the offer through a method other than the authorized means?

Correct AnswerverifiedShow Answer

The case of Lucy v. Zehmer, involving whether or not there was assent to a contract or whether allegations of joking prevented the formation of the contract, what did the court determine?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following is true of intent to form a contract?

Correct AnswerverifiedShow Answer

Explain under which circumstances an offer may not be revoked.

Correct AnswerverifiedAn option contract prevents re...View AnswerShow Answer

Belinda sends an email to Equador offering to sell her entire entertainment set to him for $2,500. Equador responds that the price seems a bit high and offers to buy the entertainment set for $2,000. Equador's response is considered a(n) ________?

Correct AnswerverifiedShow Answer

Emily and Sasha are having pizza and talking about cars. Emily asks Sasha if Sasha would consider selling her car for $2,000. Is this a valid offer?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If the means by which an acceptance can be communicated to the offeror is expressly stated in the offer, it is called an "implied authorization."

Correct AnswerverifiedShow Answer

Regarding unsolicited merchandise received from a seller, what have most states done?

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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No, Eric is not required to sell the boa...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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An option contract prevents re...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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