FAU BUL 4421 Final Exam Study Guide
UPDATED ACTUAL Exam Questions and
CORRECT Answers
Contract - CORRECT ANSWER - A promise or set of promises for the breach of which
the law gives a remedy or the performance of which the law in some way recognizes a duty.
Agreement - CORRECT ANSWER - Consists of an offer by one party, called the offeror,
to enter into a contract and an acceptance of the terms of the offer by the other party, called the
offeree.
Consideration - CORRECT ANSWER - The bargained-for exchange; what each party gets
in exchange for his or her promise under a contract.
What a legal entity receives in return for performing a contract obligation.
Contractual Capacity - CORRECT ANSWER - The legal ability to enter into a binding
agreement.
Who does not have Contractual Capacity? - CORRECT ANSWER - Those under the age
of majority, people suffering from a mental illness, and sufficiently intoxicated persons
Objective Theory of Contracts - CORRECT ANSWER - We base the existence of a
contract on the parties' outward manifestations of intent and we base its interpretation on how a
reasonable person would interpret it. Subjective intent is not relevant.
Bilateral Contract - CORRECT ANSWER - A promise in exchange for a promise. As soon
as the promises exchanged, a contract is formed and the parties' legal obligations arise.
, Unilateral Contract - CORRECT ANSWER - Requires performance in order to form a
contract (i.e. a promise + a requested action). The offeror wants the offeree to do something, not
promise to do something.
Express Contract - CORRECT ANSWER - The terms of the contract are all clearly set
forth in either written or spoken words.
Implied Contract - CORRECT ANSWER - Arise not from words but from the conduct of
the parties.
Void Contract - CORRECT ANSWER - Not a contract at all. Either its object is illegal or
it has some defect so serious it is not a contract.
Voidable Contract - CORRECT ANSWER - One or both of the parties had the ability to
either withdraw from the contract or enforce it.
Option Contract - CORRECT ANSWER - The offeree gives the offeror consideration in
exchange for holding the offer open for a specified period of time.
Revocation - CORRECT ANSWER - The offeror can revoke the offer at any time unless
the offeree entered into an option contract with the offeror. Revocation is effective when the
offeree receives it.
Rejection - CORRECT ANSWER - Another way to terminate the offer, effectuated by the
offeree. Regardless of how long the offer was stated to be open, once the offeree rejects it, it is
termintated.
Counteroffer - CORRECT ANSWER - an offer made by an offeree to his offeror relating
to the same matter as the original offer and proposing a substituted bargain differing from that
proposed by the original offer. Terminates the original offer.
UPDATED ACTUAL Exam Questions and
CORRECT Answers
Contract - CORRECT ANSWER - A promise or set of promises for the breach of which
the law gives a remedy or the performance of which the law in some way recognizes a duty.
Agreement - CORRECT ANSWER - Consists of an offer by one party, called the offeror,
to enter into a contract and an acceptance of the terms of the offer by the other party, called the
offeree.
Consideration - CORRECT ANSWER - The bargained-for exchange; what each party gets
in exchange for his or her promise under a contract.
What a legal entity receives in return for performing a contract obligation.
Contractual Capacity - CORRECT ANSWER - The legal ability to enter into a binding
agreement.
Who does not have Contractual Capacity? - CORRECT ANSWER - Those under the age
of majority, people suffering from a mental illness, and sufficiently intoxicated persons
Objective Theory of Contracts - CORRECT ANSWER - We base the existence of a
contract on the parties' outward manifestations of intent and we base its interpretation on how a
reasonable person would interpret it. Subjective intent is not relevant.
Bilateral Contract - CORRECT ANSWER - A promise in exchange for a promise. As soon
as the promises exchanged, a contract is formed and the parties' legal obligations arise.
, Unilateral Contract - CORRECT ANSWER - Requires performance in order to form a
contract (i.e. a promise + a requested action). The offeror wants the offeree to do something, not
promise to do something.
Express Contract - CORRECT ANSWER - The terms of the contract are all clearly set
forth in either written or spoken words.
Implied Contract - CORRECT ANSWER - Arise not from words but from the conduct of
the parties.
Void Contract - CORRECT ANSWER - Not a contract at all. Either its object is illegal or
it has some defect so serious it is not a contract.
Voidable Contract - CORRECT ANSWER - One or both of the parties had the ability to
either withdraw from the contract or enforce it.
Option Contract - CORRECT ANSWER - The offeree gives the offeror consideration in
exchange for holding the offer open for a specified period of time.
Revocation - CORRECT ANSWER - The offeror can revoke the offer at any time unless
the offeree entered into an option contract with the offeror. Revocation is effective when the
offeree receives it.
Rejection - CORRECT ANSWER - Another way to terminate the offer, effectuated by the
offeree. Regardless of how long the offer was stated to be open, once the offeree rejects it, it is
termintated.
Counteroffer - CORRECT ANSWER - an offer made by an offeree to his offeror relating
to the same matter as the original offer and proposing a substituted bargain differing from that
proposed by the original offer. Terminates the original offer.
