SMC Business Law Sec 1059 Week 2 Ch 5 Quiz (2015)

Week 2 Chp. 5 Quiz

Grading Summary

Grade Details – All Questions

Question 1. Question : Under the very liberal rules of the Uniform Commercial Code the courts are inclined to rule that a contract was formed even if it does not appear from the evidence that the parties intended to create a contract.

Student Answer: True

False

Question 2. Question : Austen Construction, a general contractor, advertised for bids from subcontractors on the electrical work for the renovation of one of SMC’s parking structures. The advertisement announced that the contract will be awarded to the lowest responsible bidder. Assume, for the purpose of answering this question, that Austen’s bid was an offer. Bronte, a responsible electrical subcontractor, submitted the lowest bid to Austen for the electrical portion of the work. Austen informed Bronte that she should begin work immediately. Bronte then stated that she is “withdrawing” her bid from Austen. Assume that Austen is considered responsible within the industry. Which of the following statements is most accurate?

Student Answer: Austen should not rely on Bronte’s offer to do the electrical work

Austen has accepted Bronte’s offer, thereby forming a contract

Austen is not bound by Bronte’s bid until he informs her of his intent to accept

Bronte has accepted Austen’s offer by submitting the lowest bid

Question 3. Question : An advertisement offering a reward for the return of specifically described lost property is treated as an offer for a unilateral contract.

Student Answer: True

False

Question 4. Question : Which of the underlying facts is a required element of an offer?

Student Answer: A writing

A conscious subjective intent to contract on the offeror’s part

Facts and circumstances that outwardly indicate to a reasonabe person that the offeror intended to form a contract

None of the above

Question 5. Question : Which of the following offers terminates earliest? Assume that there is no time limitation unless the below choice says otherwise

Student Answer: An offer for the sale of land

An offer to purchase stock on a stock exchange

An offer that states it will remain open for one week

An offer with a valid five-day option attached to it

Question 6. Question : Worldwide Widget (WW) proposed, in writing, an offer to sell a 250 of its XL Turbo Widgets to Howell Hardware (HH) for 1,000 each and included an assurance to keep the offer open for 180 days. WW was in the business of manufacturing and selling this product. The written offer/assurance was signed by WW’s CEO.

Student Answer: This ‘firm’ offer became irrevocable for 180 days

This ‘firm’ offer was irrevocable for 90 days

This was not a ‘firm’ offer because WW was not a merchant and the deal was not covered by the UCC

None of the above

Question 7. Question : Assume that Seller and Buyer enter into a valid option contract that gives Buyer until November 1, 2012 to purchase the Seller’s home (at an agreed price and terms). Assume that Seller died on October 24, 2012. The option:

Student Answer: Is still valid and passes to the seller’s estate

Is terminated when Seller died

Was revoked by operation of law when Seller died

Both B & C

None of the above

Question 8. Question : Indefiniteness of the terms in an offer bears on intent because it can indicate that the parties are still in the process of negotiation. Indefiniteness can also leave the court with insufficient information to calculate a remedy if a later agreement based on an indefinite offer is breached.

Student Answer: True

False

Question 9. Question : Identify which, if any, of the below statements is correct.

Student Answer: Offerors who promise not to revoke in exchange for the payment of some bargained for consideration cannot revoke for the period of the option.

A signed writing, by a merchant, which contains “assurances” that the offer will be held open will prohibit the merchant from revoking his offer

Promissory estoppel recognizes another limitation on an offeror’s power of revocation

All of the above

Question 10. Question : The offeror is the ‘Master of the Offer’ and accordingly, he can:

Student Answer: Dictate the manner in which acceptance must occur

Determine the precise length of time that the offer will remain open

Both of the above statements are correct

Revoke the offer under any and all circumstances

None of the above

Question 11. Question : In general, when are offerees bound by fine-print terms stated in offers?

Student Answer: Always

Only when they had actual or reasonable notice of the term

Only when they actually read them

None of the above

Question 12. Question : An offer that fails to provide a specific time for acceptance is invalid because it is deemed to be indefinite.

Student Answer: True

False

Question 13. Question : The so-called “firm offer”:

Student Answer: Requires consideration

Arises under Article 2 of the UCC

Can be made orally

Cannot be made by a merchant

None of the above

Question 14. Question : Advertisements are usually treated as ‘invitations’ to make an offer.

Student Answer: True

False

Question 15. Question : A says to B: “I promise to pay you a fair price if you’ll promise to mow my lawn.” B makes the requested return promise to mow the lawn. An enforceable bilateral contract was formed between A and B.

Student Answer: True

False

Question 16. Question : Bob promises Ron that the offer to sell to Ron the home that Bob owns will remain open for five days. Two days later, Bob revoked the offer. According to the facts in this question, Bob had the legal power and right to revoke his offer. (Don’t assume any additional facts).

Student Answer: True

False

Question 17. Question : By applying the rules under the Uniform Commercial Code:

Student Answer: The court will become more involved (take a hands on approach) instead of the laissez faire approach followed in times past

The court will fill in terms such as price, quantity, payment terms and delivery when such are not included by the parties

The courts hope to further the reasonable expectations of people and as a result, often rule that a contract was formed where no contract would have resulted at common law

All of the above

Question 18. Question : Under Article 2 of the UCC, some promises to hold an offer open will be enforced despite the absence of consideration.

Student Answer: True

False

Question 19. Question : Kyle sent Tara a letter offering to sell Tara his car. Tara left the letter on her desk, where her roommate, Maggie, saw it. After reading the letter, Maggie wrote to Kyle and stated that she (Maggie) wanted to accept Kyle’s offer. Which of the following is true?

Student Answer: Kyle must sell Maggie his car unless Kyle is a merchant under the UCC

There is no contract between Kyle and Maggie because Kyle did not communicate the offer to Maggie

Kyle and Tara have a contract for the purchase of Kyle’s car

Maggie’s letter is a valid acceptance of Kyle’s offer

Question 20. Question : Chica, a women’s fashion retailer, sends catalogs to its customers, who can then order from the catalog via phone or online. Donna decides to order a black dress priced at $99.00. Donna calls to accept the offer by placing her order. The sales representative who answers the phone tells Donna that the black dress is no longer in stock. Under these facts:

Student Answer: Chica is not liable for breach of contract

Chica is liable for breach of contract

Chica is liable for “bait and switch.”

Chica is liable under a quasi-contract theory

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