Contract Law

What are the four basic elements necessary for the formation of a valid contract?

• Offer, acceptance, consideration, and legality

• Agreement, promise, enforceability, and fairness

• Offer, promise, fairness, and legality

• Offer, acceptance, morality, and consideration

Which of the following is necessary for an effective acceptance?

• The acceptance must include additional terms.

• The acceptance must be communicated to the offeror.

• The acceptance must be made by a third party.

• The acceptance must be conditional.

What is required for consideration to be legally sufficient?

• It must be a promise of moral obligation.

• It must involve a promise to take someone to lunch.

• It must have legal value and be bargained for.

• It must always involve money or goods.

Does a minor have the capacity to enter into a contract?

• Yes, but only for contracts involving employment.

• No, minors are always prohibited from entering contracts.

• Yes, but contracts made by minors are generally voidable.

• Yes, and their contracts are always enforceable.

Under what circumstances will courts enforce a covenant not to compete?

• If it is fair, reasonable, and necessary to protect legitimate business interests

• If it completely prevents someone from working in their field

• If it is created verbally during an agreement

• If it lasts indefinitely

How do shrink-wrap and click-on agreements differ from other contracts?

• They are not legally binding.

• They involve electronic or packaged terms agreed to after purchase.

• They do not require the consent of the user.

• They are only applicable to minors.

What is the primary function of contract law?

• To impose moral obligations on individuals

• To determine how promises can be legally enforced

• To ensure that all promises are fulfilled

• To create fairness in every personal relationship

What is an example of a promise that is morally binding but not legally enforceable?

• Agreeing to take a friend to lunch

• Paying for purchased goods

• Fulfilling the terms of a licensing agreement

• Hiring someone for a service

What law governs contracts for the sale and lease of goods?

• Common law

• Uniform Commercial Code (UCC)

• Real Estate Law

• Licensing Agreement Act

What is a contract?

• An informal promise between two friends

• An enforceable agreement between parties to perform or refrain from certain acts

• A written document that guarantees fairness

• A set of rules enforced by public policy