Contracts Law Practice Exam 200 Questions
and Answers Plus Well Explained Rationale
Latest Exam Update 2026
Table of Contents
Part I: The Objective Theory of Assent and Mutual Assent (Questions 1-15)
● Offer and Acceptance Fundamentals
● The Objective Test
● Bilateral vs. Unilateral Contracts
Part II: The Offer (Questions 16-40)
● Defining an Offer
● Advertisements and Solicitations
● Termination of the Power of Acceptance
● Irrevocable Offers
Part III: Acceptance (Questions 41-65)
● The Mirror Image Rule and UCC §2-207
● Acceptance by Performance vs. Promise
● The Mailbox Rule and Its Exceptions
● Acceptance by Silence and Unauthorized Acceptance
Part IV: Consideration and Promissory Estoppel (Questions 66-95)
● The Bargain Element and Detriment/Benefit
, ● Adequacy of Consideration and Unconscionability
● Pre-existing Duty Rule and Its Exceptions
● Past Consideration and Moral Obligation
● Promissory Estoppel
Part V: Defenses to Formation (Questions 96-120)
● Statute of Frauds
● Mistake, Misrepresentation, and Fraud
● Duress, Undue Influence, and Incapacity
Part VI: Third-Party Rights and Obligations (Questions 121-140)
● Assignment and Delegation
● Third-Party Beneficiaries
● Vesting of Rights
Part VII: Performance, Breach, and Excuse (Questions 141-165)
● Conditions
● Substantial Performance and Material Breach
● Anticipatory Repudiation
● Impracticability and Frustration of Purpose
Part VIII: Remedies (Questions 166-200)
● Expectation, Reliance, and Restitution Interests
● Damages for Breach
● Mitigation of Damages
● Specific Performance and Injunctions
● Quasi-Contract and Unjust Enrichment
Part I: The Objective Theory of Assent and Mutual Assent
,1. Question: A famous celebrity posts on social media: "I will pay $10,000
to anyone who can prove they named their pet iguana after me." A fan, B,
sees the post, names her iguana "CelebrityName," and emails a photo as
proof. Is there a valid contract?
A) Yes, because B performed the requested act, creating a unilateral
contract.
B) Yes, because the social media post was a valid offer.
C) No, because the offer was not communicated personally to B.
D) No, because the celebrity's post was made in jest.
Answer: A
Rationale: This is a classic unilateral contract scenario. The offer is for a
promise to pay in exchange for a specific performance (naming the
iguana). The offer is valid because it is definite and communicated to the
public. B's completion of the act constitutes acceptance, creating a binding
contract. The objective test looks at the words used; a reasonable person
would see this as an offer for a unilateral contract, not a joke (D), and offers
can be made to the public (C).
2. Question: A sends B a letter offering to sell B a vintage car for $50,000. B
receives the letter and immediately mails an acceptance. Before A receives
the acceptance, A calls B and says, "I revoke the offer." The acceptance
letter arrives the next day. Is there a contract?
A) Yes, because the mailbox rule applies, and the acceptance was effective
upon dispatch.
B) No, because A revoked the offer before receiving the acceptance.
C) No, because A's revocation was communicated directly to B.
D) Yes, but only if B can prove she mailed the acceptance before the phone
call.
Answer: A
Rationale: Under the mailbox rule, an acceptance is generally effective upon
dispatch, unless the offer provides otherwise. A's revocation is only
effective upon receipt. Since B dispatched the acceptance before receiving
, the revocation, a contract was formed at the moment of dispatch. The fact
that the letter arrived later is irrelevant.
3. Question: A offers to sell B "my car" for $10,000. A owns two cars: a red
sedan and a blue convertible. B accepts, intending to buy the red sedan. A
intended to sell the blue convertible. Is there a contract?
A) Yes, for the blue convertible, based on A's subjective intent.
B) Yes, for the red sedan, based on B's subjective intent.
C) No, because the terms were not reasonably certain, and there was no
meeting of the minds.
D) Yes, a court will split the difference and force a sale of both cars.
Answer: C
Rationale: A contract requires mutual assent, which is judged by the
objective manifestation of intent. If a term is so ambiguous that a
reasonable person cannot determine what was agreed upon, there is no
meeting of the minds. "My car" when the offeror owns two cars is a classic
example of a latent ambiguity that prevents contract formation because the
parties attached different meanings to a material term.
4. Question: A, a homeowner, tells B, a painter, "I'll pay you $5,000 to paint
my house." B replies, "I'll do it for $6,000." A says nothing. B then paints the
house. A refuses to pay. Is A obligated to pay?
A) Yes, for $5,000, because B accepted by performance.
B) Yes, for $6,000, because A remained silent, which is acceptance.
C) No, because B's response was a counteroffer that terminated A's original
offer, and A never accepted the new terms.
D) Yes, for $5,500, as a compromise.
Answer: C
Rationale: B's response ("$6,000") was a counteroffer, which operates as a
rejection of the original offer and terminates it. A's silence is generally not
acceptance. Since A never accepted B's counteroffer, no contract was
formed. B painted the house without a contract and may have a claim for
unjust enrichment, but not breach of contract.
and Answers Plus Well Explained Rationale
Latest Exam Update 2026
Table of Contents
Part I: The Objective Theory of Assent and Mutual Assent (Questions 1-15)
● Offer and Acceptance Fundamentals
● The Objective Test
● Bilateral vs. Unilateral Contracts
Part II: The Offer (Questions 16-40)
● Defining an Offer
● Advertisements and Solicitations
● Termination of the Power of Acceptance
● Irrevocable Offers
Part III: Acceptance (Questions 41-65)
● The Mirror Image Rule and UCC §2-207
● Acceptance by Performance vs. Promise
● The Mailbox Rule and Its Exceptions
● Acceptance by Silence and Unauthorized Acceptance
Part IV: Consideration and Promissory Estoppel (Questions 66-95)
● The Bargain Element and Detriment/Benefit
, ● Adequacy of Consideration and Unconscionability
● Pre-existing Duty Rule and Its Exceptions
● Past Consideration and Moral Obligation
● Promissory Estoppel
Part V: Defenses to Formation (Questions 96-120)
● Statute of Frauds
● Mistake, Misrepresentation, and Fraud
● Duress, Undue Influence, and Incapacity
Part VI: Third-Party Rights and Obligations (Questions 121-140)
● Assignment and Delegation
● Third-Party Beneficiaries
● Vesting of Rights
Part VII: Performance, Breach, and Excuse (Questions 141-165)
● Conditions
● Substantial Performance and Material Breach
● Anticipatory Repudiation
● Impracticability and Frustration of Purpose
Part VIII: Remedies (Questions 166-200)
● Expectation, Reliance, and Restitution Interests
● Damages for Breach
● Mitigation of Damages
● Specific Performance and Injunctions
● Quasi-Contract and Unjust Enrichment
Part I: The Objective Theory of Assent and Mutual Assent
,1. Question: A famous celebrity posts on social media: "I will pay $10,000
to anyone who can prove they named their pet iguana after me." A fan, B,
sees the post, names her iguana "CelebrityName," and emails a photo as
proof. Is there a valid contract?
A) Yes, because B performed the requested act, creating a unilateral
contract.
B) Yes, because the social media post was a valid offer.
C) No, because the offer was not communicated personally to B.
D) No, because the celebrity's post was made in jest.
Answer: A
Rationale: This is a classic unilateral contract scenario. The offer is for a
promise to pay in exchange for a specific performance (naming the
iguana). The offer is valid because it is definite and communicated to the
public. B's completion of the act constitutes acceptance, creating a binding
contract. The objective test looks at the words used; a reasonable person
would see this as an offer for a unilateral contract, not a joke (D), and offers
can be made to the public (C).
2. Question: A sends B a letter offering to sell B a vintage car for $50,000. B
receives the letter and immediately mails an acceptance. Before A receives
the acceptance, A calls B and says, "I revoke the offer." The acceptance
letter arrives the next day. Is there a contract?
A) Yes, because the mailbox rule applies, and the acceptance was effective
upon dispatch.
B) No, because A revoked the offer before receiving the acceptance.
C) No, because A's revocation was communicated directly to B.
D) Yes, but only if B can prove she mailed the acceptance before the phone
call.
Answer: A
Rationale: Under the mailbox rule, an acceptance is generally effective upon
dispatch, unless the offer provides otherwise. A's revocation is only
effective upon receipt. Since B dispatched the acceptance before receiving
, the revocation, a contract was formed at the moment of dispatch. The fact
that the letter arrived later is irrelevant.
3. Question: A offers to sell B "my car" for $10,000. A owns two cars: a red
sedan and a blue convertible. B accepts, intending to buy the red sedan. A
intended to sell the blue convertible. Is there a contract?
A) Yes, for the blue convertible, based on A's subjective intent.
B) Yes, for the red sedan, based on B's subjective intent.
C) No, because the terms were not reasonably certain, and there was no
meeting of the minds.
D) Yes, a court will split the difference and force a sale of both cars.
Answer: C
Rationale: A contract requires mutual assent, which is judged by the
objective manifestation of intent. If a term is so ambiguous that a
reasonable person cannot determine what was agreed upon, there is no
meeting of the minds. "My car" when the offeror owns two cars is a classic
example of a latent ambiguity that prevents contract formation because the
parties attached different meanings to a material term.
4. Question: A, a homeowner, tells B, a painter, "I'll pay you $5,000 to paint
my house." B replies, "I'll do it for $6,000." A says nothing. B then paints the
house. A refuses to pay. Is A obligated to pay?
A) Yes, for $5,000, because B accepted by performance.
B) Yes, for $6,000, because A remained silent, which is acceptance.
C) No, because B's response was a counteroffer that terminated A's original
offer, and A never accepted the new terms.
D) Yes, for $5,500, as a compromise.
Answer: C
Rationale: B's response ("$6,000") was a counteroffer, which operates as a
rejection of the original offer and terminates it. A's silence is generally not
acceptance. Since A never accepted B's counteroffer, no contract was
formed. B painted the house without a contract and may have a claim for
unjust enrichment, but not breach of contract.
