Prep for Midterm BUS 110 Exam 2026
Questions and Answers
With mutual assent between the parties, there is no contract. - Correct answer-False
The offeree has the power to create a contract by accepting the offer. - Correct
answer-True
An offer made in anger, where a reasonable person would not have known that it
was made in anger, cannot result in a contract. - Correct answer-False
The communication of an offer can be made by the offeror or the offeror's agent. -
Correct answer-True
In an auction without reserve, the seller is the offeror. - Correct answer-True
A rejection of an offer is generally not effective until it is received by the offeror. -
Correct answer-True
Death of the offeror terminates an offer even if the offer could still be carried out
by the estate of the offeror, such as the sale of property of the offeror. - Correct
answer-True
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,In certain circumstances, silence can operate as acceptance. - Correct answer-True
Offers made to the public may be revoked by communicating the revocation by the
same means used to make the offer. - Correct answer-True
If an offeree rejects an offer and then attempts to accept that same offer, the offer is
now construed as a new offer that the original offeror is free to accept or reject. -
Correct answer-True
The basic concept that both parties to a contract should have agreed to the same
terms is referred to as: - Correct answer-mutual assent
Which of the following are necessary to meet the requirements of a definite offer? -
Correct answer-identification of the parties, subject matter, and quantity,
consideration to be paid, and time of performance
Advertisements are usually considered to be: - Correct answer-invitations to deal
In an auction when the highest bid has been made and no higher bids are
forthcoming, the highest bid is treated as an acceptance in: - Correct answer-
auctions without reserve, but not in auctions with reserve
The rejection of an offer: - Correct answer-is effective when received by the
offeror, and prevents the offeree from later accepting that offer
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, Which of the following would terminate an offer? - Correct answer-revocation by
the offeror, rejection by the offeree, and counteroffer by the offeree
Which of the following will not generally automatically terminate an open offer? -
Correct answer-changed economic circumstances
An offer lapses upon the following except: - Correct answer-detrimental reliance
Which of the following would be a valid offer? - Correct answer-John tells Rhoda,
"I'll give you $500 for your motorcycle."
Sally owns a very expensive fur coat that Mary would like to buy. During the
course of conversation, Mary asks how much Sally would take for the coat. Sally
replies, "I am not sure I want to sell the coat, but I think it is worth about $3,000."
Mary says, "That is a little more than I wanted to spend." Several days later, Mary
calls Sally on the telephone and says, "I'll bring over the $3,000 today." Sally
refuses to sell the coat, and Mary sues. What results? - Correct answer-Sally wins;
there was never any offer for Mary to accept.
The person who makes an offer to enter into a contract is the "offeree." - Correct
answer-False
Two of the four basic contract requirements are agreement and signatures of the
parties. - Correct answer-False
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Questions and Answers
With mutual assent between the parties, there is no contract. - Correct answer-False
The offeree has the power to create a contract by accepting the offer. - Correct
answer-True
An offer made in anger, where a reasonable person would not have known that it
was made in anger, cannot result in a contract. - Correct answer-False
The communication of an offer can be made by the offeror or the offeror's agent. -
Correct answer-True
In an auction without reserve, the seller is the offeror. - Correct answer-True
A rejection of an offer is generally not effective until it is received by the offeror. -
Correct answer-True
Death of the offeror terminates an offer even if the offer could still be carried out
by the estate of the offeror, such as the sale of property of the offeror. - Correct
answer-True
©COPYRIGHT 2025, ALL RIGHTS RESERVED 1
,In certain circumstances, silence can operate as acceptance. - Correct answer-True
Offers made to the public may be revoked by communicating the revocation by the
same means used to make the offer. - Correct answer-True
If an offeree rejects an offer and then attempts to accept that same offer, the offer is
now construed as a new offer that the original offeror is free to accept or reject. -
Correct answer-True
The basic concept that both parties to a contract should have agreed to the same
terms is referred to as: - Correct answer-mutual assent
Which of the following are necessary to meet the requirements of a definite offer? -
Correct answer-identification of the parties, subject matter, and quantity,
consideration to be paid, and time of performance
Advertisements are usually considered to be: - Correct answer-invitations to deal
In an auction when the highest bid has been made and no higher bids are
forthcoming, the highest bid is treated as an acceptance in: - Correct answer-
auctions without reserve, but not in auctions with reserve
The rejection of an offer: - Correct answer-is effective when received by the
offeror, and prevents the offeree from later accepting that offer
©COPYRIGHT 2025, ALL RIGHTS RESERVED 2
, Which of the following would terminate an offer? - Correct answer-revocation by
the offeror, rejection by the offeree, and counteroffer by the offeree
Which of the following will not generally automatically terminate an open offer? -
Correct answer-changed economic circumstances
An offer lapses upon the following except: - Correct answer-detrimental reliance
Which of the following would be a valid offer? - Correct answer-John tells Rhoda,
"I'll give you $500 for your motorcycle."
Sally owns a very expensive fur coat that Mary would like to buy. During the
course of conversation, Mary asks how much Sally would take for the coat. Sally
replies, "I am not sure I want to sell the coat, but I think it is worth about $3,000."
Mary says, "That is a little more than I wanted to spend." Several days later, Mary
calls Sally on the telephone and says, "I'll bring over the $3,000 today." Sally
refuses to sell the coat, and Mary sues. What results? - Correct answer-Sally wins;
there was never any offer for Mary to accept.
The person who makes an offer to enter into a contract is the "offeree." - Correct
answer-False
Two of the four basic contract requirements are agreement and signatures of the
parties. - Correct answer-False
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