QUESTION 1 When each party has given and received something of legal value, the

Question

QUESTION 1

When each party has given and received something of legal value, the agreement is supported by __________.

contractual capacity

satisfaction

preexisting obligations

consideration

4 points   

QUESTION 2

The concept of Consideration is important because it

"locks-in" each aspect of the agreement.

makes it possible for one party to negotiate a "better deal" after the contract has been formed.

encourages the practice of "low balling".

makes certain that the bargained for exchanges are of equal value.

4 points   

QUESTION 3

A homeowner, who is having an addition built according to detailed plans, will

have to reimburse the contractor for all unanticipated expenses.

have to increase the amount owed the contractor when there are "unforeseen difficulties".

never be aware of the total cost of the project since unexpected problems can always occur.

always be a party to a "cost plus" contract.

4 points   

QUESTION 4

When one party to a contract provides something of legal value and does not receive anything of legal value in return, that party has, in essence, given a legal __________>

voucher

detriment

gift

remedy

4 points   

QUESTION 5

Which one of the following would probably be considered an "unforeseen difficulty"?

Damage caused by strong winds in Western New York during a storm in February.

Damage caused by a powerful earthquake in Western New York.

The discovery of bedrock just below the surface of the soil that has to be removed.

The departure of a key employee and difficulty in finding a suitable replacement.

4 points   

QUESTION 6

When reasonable and honorable people disagree over the amount owed, the debt is __________.

unliquidated

liquidated

discharged

preexisting

4 points   

QUESTION 7

When one party makes a clear and definite promise, and the other party incurs some expense or loss as a result of a reasonable reliance on that promise, the promisor may be held liable for the consequences as a result of the concept of __________. In this situation, the offerer can not revoke the offer.

preexisting obligation

past consideration

promissory estoppel

accord and satisfaction

4 points   

QUESTION 8

An agreement, within which a promise is so indefinite that it can not be enforced, or whose fulfillment is discretionary, creates a/an __________. contract.

illusory

quasi

voidable

implied

4 points   

QUESTION 9

Which one of the following is NOT a definition, or explanation, of Consideration?

The bargained for exchange.

What each party gives and receives that is of legal value.

The mutual obligations of each party on a contract.

The agreement that results from an offer and an acceptance.

4 points   

QUESTION 10

When the offeree, or promisee, makes a commitment that he/she is not already obligated to fulfill, or agrees not to act in a way that he/she would otherwise be free to act, the offeree, or promisee, has incurred a __________.

legal benefit

unenforceable obligation

legal detriment

promissory estoppel

contractual capacity

satisfaction

preexisting obligations

consideration

Explanation / Answer

A- contractual capacity D- makes certain that the bargained for exchanges are of equal value D- always be a party to a "cost plus" contract. B- detriment C- The discovery of bedrock just below the surface of the soil that has to be removed D- pre-existing C- promissory estoppel C- voidable D- The agreement that results from an offer and an acceptance B- unenforceable obligation

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