MBA 650, Business Law (Ch. 7, Contracts Review) || with Complete Solutions.
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MBA 650, Business Law (Ch. 7, Contracts
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MBA 650, Business Law (Ch. 7, Contracts
An offeree's response to an offer in which the offeree rejects the original offer and at the same time makes a new offer is a:
a. cancellation.
b. revocation.
c. withdrawal.
d. counteroffer. correct answers d. counteroffer.
Termination of an offer by operation of law can occur due to which...
MBA 650, Business Law (Ch. 7, Contracts Review) || with
Complete Solutions.
An offeree's response to an offer in which the offeree rejects the original offer and at the same
time makes a new offer is a:
a. cancellation.
b. revocation.
c. withdrawal.
d. counteroffer. correct answers d. counteroffer.
Termination of an offer by operation of law can occur due to which of the following?
a. Frustration of purpose
b. Bankruptcy proceedings
c. Lapse of time
d. All of these answers are correct. correct answers d. All of these answers are correct.
In contract law, consideration is defined as:
a. the value given in return for a promise.
b. the promises broken in a contract.
c. the end result of any transaction. correct answers a. the value given in return for a promise.
Under most circumstances, a promise to do what one already has a legal duty to do does not
constitute:
a. a preexisting duty.
b. a contract.
c. legally sufficient consideration.
d. a legally binding promise. correct answers c. legally sufficient consideration.
True or false: If a court has previously determined that a person is mentally incompetent and has
appointed a guardian to represent the individual, any contract made by the mentally incompetent
person is void. correct answers True
A contractual promise of one party to refrain from conducting business similar to that of another
party for a certain period of time and within a specified geographic area is:
a. a contract not to compete.
b. an illegal contract.
c. a promise not to compete.
d. a covenant not to compete. correct answers d. a covenant not to compete.
Which of the following describes promissory estoppel?
, a. It is a legal doctrine that allows a person who has reasonably and substantially relied on the
promise of another to obtain some measure of recovery.
b. It is a legal doctrine that allows courts to recreate contracts that have been broken and force
the performance of either the buyer or seller.
c. None of these answers are correct.
d. It is a legal doctrine that requires judges to consider the promises made by the parties to the
court that a reformed contract will not be broken again. correct answers a. It is a legal doctrine
that allows a person who has reasonably and substantially relied on the promise of another to
obtain some measure of recovery.
The most common way to discharge, or terminate, contractual duties is:
a. by novation.
b. by rescission.
c. by performance.
d. by breach. correct answers c. by performance.
A third-party beneficiary who may receive rights under a contract is known as:
a. an actual third-party beneficiary.
b. a donee beneficiary.
c. a creditor beneficiary.
d. an intended third-party beneficiary. correct answers d. an intended third-party beneficiary.
If Valerie contracts with Bill to build a stone wall on his property and Valerie breaches the
contract, Bill is under a legal obligation to:
a. mitigate his damages.
b. absorb all of the costs associated with Valerie's breach.
c. do nothing, because he is the innocent party and thus has no legal duties.
d. wait until Valerie is ready to build the stone wall. correct answers a. mitigate his damages.
Liquidated damages may be defined as:
a. a punishment for a default on a contractual term.
b. a specific dollar amount to be paid in the event of a future default or breach of contract.
c. an unspecified dollar amount payable in case of breach of contract.
d. damages to compensate a small technical harm. correct answers b. a specific dollar amount to
be paid in the event of a future default or breach of contract.
The intent required for an effective contract offer:
a. is based on the subjective intent of the parties.
b. must be measured on a reasonable person standard.
c. must be absolute. correct answers c. must be measured on a reasonable person standard.
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