Unit 5 Test

An oral contract is not enforceable by law.

• True
• False

Advertisements in newspapers, price tags, and signs in store windows are treated by the law as invitations to negotiate.

• True
• False

A valid contract must contain at least four of the six elements of a contract.

• True
• False

Consideration is the legal ability to enter into a contract.

• True
• False

When a bilateral mistake is made, neither party may avoid the contract.

• True
• False

Individuals can make a false representation by not saying something that they should say.

• True
• False

A person may win a lawsuit for fraud even if no loss is suffered.

• True
• False

People who cannot read English, but sign a contract written in English, are not bound by that contract.

• True
• False

The purpose of contract law is to fulfill the reasonable expectations of the parties to a contract.

• True
• False

People are bound by contract terms in a written agreement that they have signed, even if they do not understand them.

• True
• False