BUSINESS LAW TEST QUESTIONS AND ANSWERS A+
GRADED
What is the objective theory of contracts?
The objective theory of contracts is how the intent of the contract is determined. It is
determined by the objective theory of contracts rather than by the personal or subjective
intent or belief of one of the parties.
What are the four requirements/elements of a valid contract?
1) Agreement
2) Consideration
3) Contractual Capacity
4) Legality
What distinguishes a bilateral contract from a unilateral contract?
In a bilateral contract the offeree is able to accept the contract by promising to perform,
simply put it is a "promise for a promise". In contrast, a unilateral contract is phrased in
a way that requires the offeree can only accept the offer by completing the contract
performance, a "promise for an act".
What is the difference between express and implied contracts?
In an express contract the terms of the agreement are fully stated in words, oral or
written. An implied contract is a contract that is implied from the conduct of the parties.
What are the requirements of an implied contract?
The three requirements for an implied contract are: the plaintiff furnished some service
or property, the plaintiff expected to be paid for that service or property, and the
defendant knew or should have known that there was an expected payment, and the
defendant had a chance to reject the services or property and did not.
How does a quasi contract differ from an express or an implied-in-fact contract?
Quasi, or implied-in-law, contracts are not actual contracts, whereas express, or
implied-in-fact, contracts are actual/true contracts formed by the words or actions of the
parties. Quasi contracts do not arise from any agreement, express or implied, between
the parties themselves.
What is the difference between a formal contract and an informal contract?
Formal contracts require a special form or method of creation in order to be
enforceable. Informal contracts have no such requirement so they include all other
contracts.
How does a party distinguish between an executed and an executory contract?
If a contracted has been fully performed it is considered executed, but if it has not it will
be considered executory. If one party has fully performed their part of the contract, but
the other party didn't then that side of the contracted is considered executed, however
the contract will still be considered executory.
What is the plain meaning rule?
If a contract's writing is clear and unequivocal a court will enforce it according to its
obvious terms.
What are some of the other rules regarding the interpretation of contracts?
GRADED
What is the objective theory of contracts?
The objective theory of contracts is how the intent of the contract is determined. It is
determined by the objective theory of contracts rather than by the personal or subjective
intent or belief of one of the parties.
What are the four requirements/elements of a valid contract?
1) Agreement
2) Consideration
3) Contractual Capacity
4) Legality
What distinguishes a bilateral contract from a unilateral contract?
In a bilateral contract the offeree is able to accept the contract by promising to perform,
simply put it is a "promise for a promise". In contrast, a unilateral contract is phrased in
a way that requires the offeree can only accept the offer by completing the contract
performance, a "promise for an act".
What is the difference between express and implied contracts?
In an express contract the terms of the agreement are fully stated in words, oral or
written. An implied contract is a contract that is implied from the conduct of the parties.
What are the requirements of an implied contract?
The three requirements for an implied contract are: the plaintiff furnished some service
or property, the plaintiff expected to be paid for that service or property, and the
defendant knew or should have known that there was an expected payment, and the
defendant had a chance to reject the services or property and did not.
How does a quasi contract differ from an express or an implied-in-fact contract?
Quasi, or implied-in-law, contracts are not actual contracts, whereas express, or
implied-in-fact, contracts are actual/true contracts formed by the words or actions of the
parties. Quasi contracts do not arise from any agreement, express or implied, between
the parties themselves.
What is the difference between a formal contract and an informal contract?
Formal contracts require a special form or method of creation in order to be
enforceable. Informal contracts have no such requirement so they include all other
contracts.
How does a party distinguish between an executed and an executory contract?
If a contracted has been fully performed it is considered executed, but if it has not it will
be considered executory. If one party has fully performed their part of the contract, but
the other party didn't then that side of the contracted is considered executed, however
the contract will still be considered executory.
What is the plain meaning rule?
If a contract's writing is clear and unequivocal a court will enforce it according to its
obvious terms.
What are some of the other rules regarding the interpretation of contracts?
