LSB Exam 2.docx

Illegal contracts are - correct answer void In general, contracts for the sale of goods are governed by: - correct answer state statutory law based on the Uniform Commercial Code Will and Kendrick live in a state that requires that contracts involving transactions over $500 be in writing. If they enter a verbal agreement to buy a car for $1,500, this contract is - correct answer unenforceable In general, contracts for services are governed by - correct answer state common law Caleb contracts with Eliza to beat up Mickey for $50.00. Is that agreement enforceable? - correct answer No it is illegal Aimee and Claire both own their own bakeries in Edwardsville. They both agree with each other to sell their cupcakes for $5.00. Is this contract enforceable? - correct answer No as it is a restraint on trade which is against public policy Karen offers to sing five songs at Meyer's wedding for $500.00. Meyer responds that he will pay her $500.00, but he needs her to sing six songs. Meyer's actions constitute - correct answer A counter offer According to the mailbox rule, an acceptance if effective - correct answer when dispatched by the offeree in a commercially reasonable manner A meeting of the mind requires - correct answer a true understanding, and acceptance, of the terms of the offer The requirement that both the subject matter and performance of a contract must be legal is called - correct answer legality Fraud requires - correct answer actual knowledge of a lie The age when an individual becomes an adult is an example of - correct answer a bright-line rule Hannah shops at a high-end doggy boutique and purchases a designer dog collar for $3500.00. As soon as she got home, she put it on her dog who wore it for a couple of days. After a few days, she realized that she could not afford the collar and did not really like it. She attempted to return it to the store and they refused. Hannah filed suit against the store stating that they charged way too much for their products and made an unfair and unreasonable profit. What would most likely be the outcome of the case? - correct answer The court will rule that as long as Hannah understood her actions there was consideration as two things of legal value were exchanged Josh sells t-shirts at an amusement park. When selling t-shirts, he often tells people that the shirts are the softest shirts ever created. If he did not truly believe that and it was a lie, would this be an example of misrepresentation? - correct answer No because it is a lie about an opinion If a person unintentionally engages in innocent misrepresentation, the other party may - correct answer Avoid the contract Custom Candy Creations, a candy shop, has on its sign "The Finest Candy in the World." This is an example of - correct answer Puffing ABC Land Co. is negotiating the sale of an office building to Mega Co. Which laws will govern the contract for the sale of the building? - correct answer State common law Nancy sees an advertisement on the internet which reads, "Tropical Tan interested in hiring five models to model our newest spray tan method. Please contact me regarding pay." Nancy contacts Tropical Tan to accept the job. Which of the following is true? - correct answer This advertisement is simply an offer to negotiate or discuss, but not an offer An agreement to buy cocaine from a drug dealer is - correct answer a void contract Herb offers to sell Ron a cow that both parties believe is newly pregnant. A few months later they both realize that the cow is not pregnant. Can either party avoid the contract? - correct answer Yes because it was a mutual mistake At this moment, your contract with your university or college is - correct answer express, bilateral, and valid When one party fails to perform his or her duties under a contract, that party is said to be in - correct answer breach Gigi Hilonder, an up and coming tennis star on the tennis circuit, travels to Atlanta to compete in a tournament. Officer Grant, an Atlanta police officer on duty during her tournament, offers to give Gigi "added" security for an additional $100 a day, by standing outside her door and promising to aid her before anyone else should she need it. Gigi readily agrees as her popularity is sky-rocketing and her fans are intrusive. Is this a contract? - correct answer No because a public officer cannot accept greater pay other than what is fixed by law as it is against public policy Fred's Flooring (FF) contracted with Harry homeowner to install wood flooring throughout Harry's home. Harry was to purchase the flooring, and the contract was solely for installation. Payment was to be 20 percent at the time that the work commenced and 80 percent once the flooring was installed. Harry purchased the flooring materials and paid the 20 percent, so FF began work. When FF's work was halfway completed, Harry realized that he didn't have the money to pay FF on completion, so he bolted the doors and refused access. If FF wants to rescind the contract and be paid for work completed, FF would sue for - correct answer restitution Tom is late for a class and tells his friend Shameem that he will pay her $100.00 to drive 20 miles over the speed limit so that he can make it to class on time. Is there a contract? - correct answer No as an agreement to violate a statue is illegal and void Retail Outlets, Inc., contracts with Smooth Paving Inc. to grade and pave a parking lot. Smooth assigns the contract to Tough Road Company, which has a poor record of completing projects. Retail could most successfully argue that the contract cannot be assigned because - correct answer the assignment will materially increase the risk of nonperformance In an exchange of e-mails, Rob, a landlord, and Sam agree to a lease of a certain apartment for one year. Under the Statute of Frauds, this lease is enforceable provided - correct answer the e-mail is signed by the party against whom enforcement is sought Idina admires Jules's collection of guitars. July says, "I plan to sell the collection when I get tired of it." Jules's statement is - correct answer not an offer because July expressed only an intent to enter into a future contract On May 1 Ralph offers to cure and smoke Sam's pork. On May 3 Ralph mails Sam a letter revoking the offer. Sam receives the letter on May 5 and responds on May 6. Ralph's revocation of the offer - correct answer became effective on May 5 Mona is induced by her guardian Newt to sign a contract to invest her student loan funds in OptiBank through Newt's investment firm. Unknown to Mona, Newt realizes a commission from the investment. Most likely, Mona may rescind the contract on the basis of - correct answer undue influence Wally offers to repair and service a forklift for Valu Lumber Outlet, but Wally dies before Valu accepts. Most likely, Wally's death - correct answer terminates the offer Ready Repair Service enters into a contract to fix washers and dryers in Scrub n' Dry Company's coin-operated laundries. If Ready Repair breaches by only partially performing the contract, Scrub n' Dry can - correct answer sue Ready Repair for compensatory and consequential damages A valid contract requires - correct answer an offer and an acceptance Flora enters into a contract with Global Shipping, Ltd., to insure and ship a painting from France to the United States for a certain price. Global makes a mistake in adding the costs, which results in a contract price that is $1,000 less than the true cost. Most likely, a court would - correct answer allow the parties to rescind the contract