Chapter 10: Prepare

For purposes of general contract law (common law), an offer must:

• be sufficiently definite and certain.

• be made to only to one person.

• be intended by the offeror to be an offer.

• All of these are correct.

Answer explanation

For an offer to be valid under common law, it must be sufficiently definite and certain. While intention and the recipient can be relevant, the key requirement is the clarity of the offer's terms.

To be effective, an offer must:

• be in a specified format.

• be communicated to the offeree

• always contain the price of a product or service offered.

• be spoken directly to the offeree.

Answer explanation

For an offer to be effective, it must be communicated to the offeree. The offer does not have to be in a specified format, it doesn't always need to contain the price, and it can be communicated in writing, electronically, or verbally (it doesn't need to be spoken directly).

Retail stores typically put advertisements in newspapers describing goods and stating prices. These ads are generally considered to be:

• offers only if they are made by merchants

• offers only if they are not made by merchants.

• invitations to buyers to make an offer to buy the goods described.

• firm offers.

Answer explanation

Retail store ads are not legally binding offers but rather invitations for customers to make an offer to purchase the goods. This means the correct choice is that they are invitations to buyers to make an offer to buy the goods described.

If an offer has no stated time by which it must be accepted, when does the offer terminate?

• Never.

• After one week.

• After one month.

• After a reasonable period of time.

Answer explanation

An offer without a stated acceptance time terminates after a reasonable period, as determined by the circumstances. This ensures that the offer remains valid for a time that allows the offeree to respond.

Which of the following will terminate an offer?

• Rejection by the offeror.

• Subsequent illegality of the purpose but not of the subject matter of the offer.

• Destruction of the subject matter of the offer.

• Death of the offeree but not of the offeror.

Answer explanation

An offer is terminated by the destruction of its subject matter, as it can no longer be fulfilled. Other options do not necessarily terminate the offer.

The mirror image rule relates to which required element of a contract?

• The offer.

• The acceptance.

• Both the offer and the acceptance.

• Only to acceptances in contracts subject to UCC.

Answer explanation

The mirror image rule requires that the acceptance must exactly match the terms of the offer for a contract to be formed under common law. Any variation or additional terms in the acceptance would constitute a counteroffer, not an acceptance. This rule applies to the acceptance, not the offer, and it is a principle of common law, not contracts subject to the UCC (Uniform Commercial Code).

Which is NOT a correct about the UCC's "Battle of the Forms" rule?

• The UCC battle of the forms rule is what common law calls the mirror image rule.

• The UCC battle of the forms rule changes the common law's mirror image rule.

• The UCC battle of the forms rule may result in a contract with terms that are not identical to the terms included in the offer.

• What gets included in the final contract terms may depend upon whether the parties are merchants.

Answer explanation

This statement is incorrect because the UCC's "Battle of the Forms" rule is different from the common law's mirror image rule. Under the UCC, a contract can still be formed even if the acceptance includes terms that differ from the original offer, whereas the mirror image rule requires the acceptance to exactly match the offer. The other options correctly describe aspects of the UCC's Battle of the Forms rule.

According to general (common) contract law, the __________ must be the __________ of the offer.

• counteroffer; acceptance

• acceptance; mirror image

• acceptance; consideration

• contract; revocation

Answer explanation

According to general (common) contract law, the acceptance must be the mirror image of the offer. This means that the terms of the acceptance must exactly match the terms of the offer for a valid contract to be formed. Any deviation from the offer would be considered a counteroffer, not an acceptance.

An offer for the sale of goods under the UCC:

• must include a price.

• must include the quantity.

• must be made by a merchant.

• must include the time and place of delivery.

Answer explanation

Under the UCC (Uniform Commercial Code), for a contract for the sale of goods to be valid, the offer must include the quantity of goods. Other terms like price, time, and place of delivery can be left open and may be filled in by UCC gap-filling provisions, but the quantity must be specified. The offer does not have to be made by a merchant.

Who would likely be considered a merchant under the UCC with respect to the goods in question?

• An authorized Apple computer dealer selling accessories for Apple computers and Apple-related products.

• An authorized Apple computer dealer selling the old shelving in the Apple store that was used to display the Apple products before the store was redecorated.

• An authorized Apple computer dealer selling household goods at a yard sale at his home.

• All of these are correct.

Answer explanation

Under the UCC, a merchant is someone who deals in goods of the kind involved in the transaction or has special knowledge or skills about the goods being sold. In this case, the Apple dealer would be considered a merchant when selling Apple products and accessories, as they are within the dealer's area of expertise. The dealer would not be considered a merchant when selling old shelving or household goods, as those items are not within their normal scope of business.