AIC 301 FINAL EXAM PAPER 2026
QUESTIONS WITH ALL CORRECT
SOLUTIONS GRADED A+
⩥ For a contract to be legally enforceable. Answer: it must have these
elements: agreement, capacity, mutual assent, consideration, legal
purpose, and the form required by law
⩥ What must an agreement include. Answer: An agreement must include
an offer and its acceptance.
⩥ To create a legally enforceable contract, the offeror (party making the
offer) must use language that. Answer: clearly establishes a desire to
create a binding contract with the offeree.
⩥ what must the offer include. Answer: It must include definite terms,
such as a price, quantity, and/or delivery date of specific goods or
services, so that all parties can easily determine whether agreed-to terms
have been fulfilled. Finally, the offer must be communicated to, and
received by, an offeree.
⩥ Acceptance requires the offeree to. Answer: agree to the offer
unconditionally and unequivocally.
,⩥ what does capacity mean. Answer: For a contract to be legally
binding, all parties who enter into it must be mentally competent
⩥ who would not meet capacity requirement. Answer: minors, insane or
intoxicated individuals, and artificial entities (such as insurers) that are
restricted from entering into certain contracts.
⩥ what is mutual assent. Answer: the act of two or more parties
deliberately negotiating all terms to achieve consensus. The
corresponding agreement forms the basis of the contract.
⩥ what is consideration. Answer: Consideration goes hand in hand with
mutual assent and is something of value that is given in return for a
promise. It can be monetary or a promise to perform or refrain from an
act.
⩥ what is a legal purpose. Answer: a purpose that is not illegal
⩥ can contracts be oral. Answer: Yes
⩥ What contracts have to be in writing. Answer: 1.The sale of real estate
2.Agreements that can't be performed within one year
3.Transactions worth $500 or more involving personal property (under
the Uniform Commercial Code)
,4.Agreements to pay a debt owed by another person
5.Agreements where an executor of an estate promises to pay estate
debts from personal funds
⩥ do states allow oral insurance contacts. Answer: yes some do but most
insurance contracts end up being written because of their complexity.
Writing requirements vary by state.
⩥ types of contracts. Answer: bilateral or unilateral, executed or
executory, express or implied, voidable or void.
⩥ Bilateral contract. Answer: With bilateral contracts, each party
promises to perform an act in exchange for an act by the other party.
Most contracts are bilateral. Ex: Jay's promise to pay Tony $500 in
exchange for Tony's promise to paint Jay's garage creates a bilateral
contract in which each party becomes both a promisor and a promisee.
⩥ Unilateral contract. Answer: In a unilateral contract, one party
promises to pay for an act of the other party. If the act isn't performed,
no payment is required. Ex: Jay promises to pay $500 if Tony paints the
garage, Jay only has a binding requirement to pay Tony after Tony paints
the garage.
⩥ Executed contract. Answer: An executed contract requires nothing
more of either party to be fulfilled. For example, one party has bought
and paid for goods that another party delivered. contract is done
, ⩥ Executory contracts. Answer: An executory contract, on the other
hand, is one that hasn't been fully executed
⩥ Express contracts. Answer: In express contracts, the terms are clearly
stated. This can be done orally or in writing.
⩥ Implied contract. Answer: Implied contracts are created by the
nonverbal, nonwritten conduct of the parties.
⩥ types of implied contracts. Answer: implied-in-fact contracts or
implied-in-law contracts.
⩥ implied-in-fact contract. Answer: an unambiguous offer and
acceptance have been made, such as through an ongoing but informal
arrangement
⩥ Implied-in-law contracts. Answer: not actual contracts and are
sometimes called quasi contracts. These are obligations that do not arise
from the parties' apparent intentions but from courts' notions of justice
and equity in certain cases. In particular, they serve to prevent one party
from being unjustly enriched by the actions of another.
⩥ voidable contract. Answer: a valid contract that can continue in force,
and the parties can execute it completely unless an innocent or injured
QUESTIONS WITH ALL CORRECT
SOLUTIONS GRADED A+
⩥ For a contract to be legally enforceable. Answer: it must have these
elements: agreement, capacity, mutual assent, consideration, legal
purpose, and the form required by law
⩥ What must an agreement include. Answer: An agreement must include
an offer and its acceptance.
⩥ To create a legally enforceable contract, the offeror (party making the
offer) must use language that. Answer: clearly establishes a desire to
create a binding contract with the offeree.
⩥ what must the offer include. Answer: It must include definite terms,
such as a price, quantity, and/or delivery date of specific goods or
services, so that all parties can easily determine whether agreed-to terms
have been fulfilled. Finally, the offer must be communicated to, and
received by, an offeree.
⩥ Acceptance requires the offeree to. Answer: agree to the offer
unconditionally and unequivocally.
,⩥ what does capacity mean. Answer: For a contract to be legally
binding, all parties who enter into it must be mentally competent
⩥ who would not meet capacity requirement. Answer: minors, insane or
intoxicated individuals, and artificial entities (such as insurers) that are
restricted from entering into certain contracts.
⩥ what is mutual assent. Answer: the act of two or more parties
deliberately negotiating all terms to achieve consensus. The
corresponding agreement forms the basis of the contract.
⩥ what is consideration. Answer: Consideration goes hand in hand with
mutual assent and is something of value that is given in return for a
promise. It can be monetary or a promise to perform or refrain from an
act.
⩥ what is a legal purpose. Answer: a purpose that is not illegal
⩥ can contracts be oral. Answer: Yes
⩥ What contracts have to be in writing. Answer: 1.The sale of real estate
2.Agreements that can't be performed within one year
3.Transactions worth $500 or more involving personal property (under
the Uniform Commercial Code)
,4.Agreements to pay a debt owed by another person
5.Agreements where an executor of an estate promises to pay estate
debts from personal funds
⩥ do states allow oral insurance contacts. Answer: yes some do but most
insurance contracts end up being written because of their complexity.
Writing requirements vary by state.
⩥ types of contracts. Answer: bilateral or unilateral, executed or
executory, express or implied, voidable or void.
⩥ Bilateral contract. Answer: With bilateral contracts, each party
promises to perform an act in exchange for an act by the other party.
Most contracts are bilateral. Ex: Jay's promise to pay Tony $500 in
exchange for Tony's promise to paint Jay's garage creates a bilateral
contract in which each party becomes both a promisor and a promisee.
⩥ Unilateral contract. Answer: In a unilateral contract, one party
promises to pay for an act of the other party. If the act isn't performed,
no payment is required. Ex: Jay promises to pay $500 if Tony paints the
garage, Jay only has a binding requirement to pay Tony after Tony paints
the garage.
⩥ Executed contract. Answer: An executed contract requires nothing
more of either party to be fulfilled. For example, one party has bought
and paid for goods that another party delivered. contract is done
, ⩥ Executory contracts. Answer: An executory contract, on the other
hand, is one that hasn't been fully executed
⩥ Express contracts. Answer: In express contracts, the terms are clearly
stated. This can be done orally or in writing.
⩥ Implied contract. Answer: Implied contracts are created by the
nonverbal, nonwritten conduct of the parties.
⩥ types of implied contracts. Answer: implied-in-fact contracts or
implied-in-law contracts.
⩥ implied-in-fact contract. Answer: an unambiguous offer and
acceptance have been made, such as through an ongoing but informal
arrangement
⩥ Implied-in-law contracts. Answer: not actual contracts and are
sometimes called quasi contracts. These are obligations that do not arise
from the parties' apparent intentions but from courts' notions of justice
and equity in certain cases. In particular, they serve to prevent one party
from being unjustly enriched by the actions of another.
⩥ voidable contract. Answer: a valid contract that can continue in force,
and the parties can execute it completely unless an innocent or injured
