COMMERCIAL LAW EXAM 1 QUESTIONS WITH
100% ACCURATE ANSWERS
Executed contract - Accurate answers A contract that has been completely performed by
both parties.
Executory contract - Accurate answers A contract that has not yet been fully performed.
Bilateral contract - Accurate answers A contract involving a two way agreement. You are
bound by what you say to the other party.
Unilateral contract - Accurate answers A contract which involves a promise for an act.
outward expressions - Accurate answers Contracts involve _____________ ___________
of intent.
True - Accurate answers Concerning a merchant, in general, an advertisement is not an
offer, rather it's an invitation to offer.
Statutory law - Accurate answers The law of the state in question.
Mailbox rule - Accurate answers When you place a letter in a mailbox, that is the
acceptance of a contract. DEALS WITH ACCEPTANCE.
Void - Accurate answers A contract with no legal effect.
Voidable - Accurate answers A contract that can be rescinded for many reasons.
1) Legal intent
2) Communicated
3) Reasonably definite - Accurate answers The elements of an offer:
True - Accurate answers A person can revoke an offer anytime they want even if they
have extended the time to accept.
Not legally binding - Accurate answers "My offer will be held open until Jan 31st, 20XX at
noon...." Is this legally binding?
1) Time stated by offeror
2) Death of offeror or offeree
3) Revocation of offer by offeror - Accurate answers When is a valid offer terminated?
, unequivocal; communicated - Accurate answers The acceptance of an offer must by
________ and _________.
Duress - Accurate answers An illegal threat that overcomes the free will of another party
(courts use a subjective test).
Yes - Accurate answers Is a threat to bring criminal charges an example of duress?
No, if in good faith. - Accurate answers Is a threat to bring a civil lawsuit duress?
Undue influence - Accurate answers Take advantage of a position of trust - not duress
(e.g. family or business relationship).
Fraud - Accurate answers The intentional misstatement of a material fact relied upon by
the other party to his or her detriment.
- Factual
- False
- Reliance by other party
- Damages occur - Accurate answers Elements of fraud in the inducement
False, there is no duty to speak. - Accurate answers Concerning fraud, there is generally a
duty to speak.
Fraud in the execution - Accurate answers Having someone sign a document without
giving them a reasonable chance to review it.
Misrepresentation - Accurate answers Same as fraud but it is unintentional and rescission
only (no damages).
1) Must be mutual
2) Must be a clerical error concerning bids - Accurate answers Elements of a mistake:
With reserve - Accurate answers An auction where the auctioneer can take the bid back.
Without reserve - Accurate answers An auction where the auctioneer cannot take the bid
back.
Consideration - Accurate answers The price which a person charges for a promise.
Forbearance - Accurate answers ___________ can constitute adequate consideration
sufficient to form a valid and enforceable contract.
100% ACCURATE ANSWERS
Executed contract - Accurate answers A contract that has been completely performed by
both parties.
Executory contract - Accurate answers A contract that has not yet been fully performed.
Bilateral contract - Accurate answers A contract involving a two way agreement. You are
bound by what you say to the other party.
Unilateral contract - Accurate answers A contract which involves a promise for an act.
outward expressions - Accurate answers Contracts involve _____________ ___________
of intent.
True - Accurate answers Concerning a merchant, in general, an advertisement is not an
offer, rather it's an invitation to offer.
Statutory law - Accurate answers The law of the state in question.
Mailbox rule - Accurate answers When you place a letter in a mailbox, that is the
acceptance of a contract. DEALS WITH ACCEPTANCE.
Void - Accurate answers A contract with no legal effect.
Voidable - Accurate answers A contract that can be rescinded for many reasons.
1) Legal intent
2) Communicated
3) Reasonably definite - Accurate answers The elements of an offer:
True - Accurate answers A person can revoke an offer anytime they want even if they
have extended the time to accept.
Not legally binding - Accurate answers "My offer will be held open until Jan 31st, 20XX at
noon...." Is this legally binding?
1) Time stated by offeror
2) Death of offeror or offeree
3) Revocation of offer by offeror - Accurate answers When is a valid offer terminated?
, unequivocal; communicated - Accurate answers The acceptance of an offer must by
________ and _________.
Duress - Accurate answers An illegal threat that overcomes the free will of another party
(courts use a subjective test).
Yes - Accurate answers Is a threat to bring criminal charges an example of duress?
No, if in good faith. - Accurate answers Is a threat to bring a civil lawsuit duress?
Undue influence - Accurate answers Take advantage of a position of trust - not duress
(e.g. family or business relationship).
Fraud - Accurate answers The intentional misstatement of a material fact relied upon by
the other party to his or her detriment.
- Factual
- False
- Reliance by other party
- Damages occur - Accurate answers Elements of fraud in the inducement
False, there is no duty to speak. - Accurate answers Concerning fraud, there is generally a
duty to speak.
Fraud in the execution - Accurate answers Having someone sign a document without
giving them a reasonable chance to review it.
Misrepresentation - Accurate answers Same as fraud but it is unintentional and rescission
only (no damages).
1) Must be mutual
2) Must be a clerical error concerning bids - Accurate answers Elements of a mistake:
With reserve - Accurate answers An auction where the auctioneer can take the bid back.
Without reserve - Accurate answers An auction where the auctioneer cannot take the bid
back.
Consideration - Accurate answers The price which a person charges for a promise.
Forbearance - Accurate answers ___________ can constitute adequate consideration
sufficient to form a valid and enforceable contract.
