Business Law Chapter 11
Showing posts with label Business Law Chapter 11. Show all posts
Showing posts with label Business Law Chapter 11. Show all posts

A seller's form clearly states no warranty is included. The buyer's form states that the seller warrants the goods for one year. In this case:

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A seller's form clearly states no warranty is included. The buyer's form states that the seller warrants the goods for one year. In this case:



a. the warranty term is a "different term," which in most states becomes part of the contract unless the seller promptly objects.
b. the warranty term is a "different term," and the majority of states hold that a contract can be formed but the contradictory terms cancel each other out.
c. the warranty term is an "addendum term" that becomes part of the contract in most states.
d. no contract can be formed between the two.







Answer: B

Alex and Scott have a contract wherein Scott agrees to buy sporting goods and equipment. Since the goods are not to be delivered for several months, they left the price open. Under the UCC, which of the following will be true?

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Alex and Scott have a contract wherein Scott agrees to buy sporting goods and equipment. Since the goods are not to be delivered for several months, they left the price open. Under the UCC, which of the following will be true?




a. None of these answers. The contract is not valid because the terms are not definite and certain.
b. Alex has the freedom to set any price he wants considering Scott was foolish enough to enter into a contract without a price established.
c. Scott has the right to establish a price because he is the buyer. Alex should have taken steps to protect his sales interest.
d. The price will be the reasonable price based on fair market value of the goods at the time of delivery.








Answer: D

George owns 200 acres of land. George offers to sell the land to Roland for $1,500 per acre. Roland replies that he does not need 200 acres of land but would like to buy 40 acres at $1,500 per acre. George agrees to sell but does not identify which 40 acres. Later, George refuses to sell any land to Roland. What is the result?

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George owns 200 acres of land. George offers to sell the land to Roland for $1,500 per acre. Roland replies that he does not need 200 acres of land but would like to buy 40 acres at $1,500 per acre. George agrees to sell but does not identify which 40 acres. Later, George refuses to sell any land to Roland. What is the result?




a. George wins; this agreement is too indefinite since it does not identify which 40 acres are to be sold.
b. Roland wins; the UCC will decide which 40 acres are to be sold.
c. George wins; the original offer was not intended to be an offer but merely an invitation to negotiate.
d. Roland wins; this is an enforceable contract with complete and definite terms.





Answer: A

What is a revocation?

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What is a revocation?





a. A letter that summarizes negotiating progress.
b. The withdrawal of an offer by the offeror.
c. An acceptance of an offer.
d. An act or statement that proposes definite terms and permits the other party to create a contract by accepting those terms.







Answer: B

A letter of intent:

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A letter of intent:



a. All of these answers.
b. does not necessarily create a binding contract.
c. do not usually create any legal obligation.
d. summarizes progress made during business negotiations.






Answer: A

Omecron, Inc. sent the following price list to its customers. Dispensers SBC-500J $670.00 True TDD-1 $875.00 True TDD-2 $1,465.00 True TDD-3 $1,515.00 CO2 Tank and Regulator $150.00 Which statement is correct?

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Omecron, Inc. sent the following price list to its customers.
Dispensers
SBC-500J $670.00
True TDD-1 $875.00
True TDD-2 $1,465.00
True TDD-3 $1,515.00
CO2 Tank and Regulator $150.00
Which statement is correct?



a. These price quotes would generally be considered requirements contracts.
b. These price quotes would generally not be considered offers.
c. These price quotes would generally be considered output contracts.
d. These price quotes would generally be considered offers.








Answer: B

LoveTravel offered to sell 10 round-trip tickets to Sally. LoveTravel stated that the acceptance must be in writing by USPS next-day service. Which of the following acceptances will create a contract between LoveTravel and Sally?

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LoveTravel offered to sell 10 round-trip tickets to Sally. LoveTravel stated that the acceptance must be in writing by USPS next-day service. Which of the following acceptances will create a contract between LoveTravel and Sally?




a. All of these answers will create a contract between LoveTravel and Sally since they constitute reasonable means of communication.
b. Sally sends a fax to LoveTravel stating she will buy the tickets.
c. Sally sends a letter by USPS next-day service to LoveTravel stating that she will buy the tickets.
d. Sally calls LoveTravel and states that she will buy the tickets.






Answer: A

Cynthia goes to an auction and sees a rare antique lamp that is an identical match to one she already has. At the proper time she bids on the lamp and is the highest bidder. Even though she is the highest bidder, the auctioneer refuses to accept her bid and withdraws the lamp from the auction. Can the auctioneer do that?

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Cynthia goes to an auction and sees a rare antique lamp that is an identical match to one she already has. At the proper time she bids on the lamp and is the highest bidder. Even though she is the highest bidder, the auctioneer refuses to accept her bid and withdraws the lamp from the auction. Can the auctioneer do that?




a. Most auctions are without reserve and therefore the auctioneer cannot withdraw the lamp.
b. Generally, the auctioneer must sell to the highest bidder. Cynthia will get the lamp.
c. Generally, the auctioneer is the offeror and the bidders are the offerees so there is a contract and Cynthia will get the lamp.
d. Unless otherwise stated, the auctioneer had the right to withdraw the item before the fall of the hammer.








Answer: D

If an offer does not specify a type of acceptance:

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If an offer does not specify a type of acceptance:



a. All of these answers.
b. the offer must be accepted with written consent.
c. the offer cannot be accepted legally.
d. the offeree may accept in any reasonable manner and method.







Answer: D

Stephen mails an offer to Julia that states, "I offer to sell you my car for $2000. If I don't hear from you in 10 days, I will assume you are willing to buy the car for the stated price." Stephen hears nothing by the deadline and assumes he has a deal. What is the result?

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Stephen mails an offer to Julia that states, "I offer to sell you my car for $2000. If I don't hear from you in 10 days, I will assume you are willing to buy the car for the stated price." Stephen hears nothing by the deadline and assumes he has a deal. What is the result?




a. Julia is not bound. Ten days is not a reasonable amount of time to consider the offer and accept by mail.
b. Stephen has a deal. Julia should have responded saying she is not interested in the car if she didn't want to be bound to the offer.
c. Julia is not bound. Generally an offeree must say or do something to accept an offer.
d. Stephen has a deal. His offer was intended and contains definite terms.







Answer: C

Chester signed an agreement with Ted under which Chester agreed to purchase all the hay that Ted grew during the coming growing season. This contract will be:

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Chester signed an agreement with Ted under which Chester agreed to purchase all the hay that Ted grew during the coming growing season. This contract will be:



a. unenforceable unless state real estate law makes an exception.
b. unenforceable due to the difficulty of devising an appropriate remedy for a breach.
c. enforceable as long as both parties act in good faith and Chester doesn't suddenly demand more hay than what was reasonably estimated.
d. unenforceable due to its vagueness.








Answer: C

Two parties are said to have a "meeting of the minds" when:

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Two parties are said to have a "meeting of the minds" when:




a. None of these answers.
b. One party proposes an offer with definite terms, and the other party agrees to those terms unconditionally.
c. One party proposes an offer with definite terms, and the other party makes a counter-proposal with different terms.
d. Both parties make a general agreement and decide to work out the details later.







Answer: B

In which case below is the offer still valid at the time the acceptance is made?

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In which case below is the offer still valid at the time the acceptance is made?




a. WasteNot Co. telephones Enviro Co. offering to dispose of Enviro Co.'s chemical waste by a particular method. Enviro says it has another way to dispose of the waste. Then Enviro finds out the method it planned to use violates environmental protection statutes, so it sends a letter of acceptance to WasteNot.
b. In a face-to-face transaction, Carl offers to sell Matt his stereo and Matt accepts.
c. All of these answers.
d. Timmy offers to sell his AT&T stock for a particular price by May 1. On May 2, Katie agrees to buy the stock.
e. Ned offered to sell a book to Brian. Ned died, and Brian sent an acceptance two days later.








Answer: B

Adam owns a thoroughbred horse named Prince Charming that just ran in the Kentucky Derby. Prince Charming came in last, much to Adam's frustration and embarrassment. Adam exclaims in a loud voice, "I'm selling that horse to the first person who hands me $100 bucks!" Adam has:

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Adam owns a thoroughbred horse named Prince Charming that just ran in the Kentucky Derby. Prince Charming came in last, much to Adam's frustration and embarrassment. Adam exclaims in a loud voice, "I'm selling that horse to the first person who hands me $100 bucks!" Adam has:




a. not made an offer because under the circumstances a reasonable person would not conclude that John had intent to make an offer.
b. made a firm offer and will be bound by his offer for a reasonable period of time.
c. made an acceptance to the first person who can produce $100.
d. made an offer to anyone within hearing distance and will be bound by his offer to the first person who produces $100.








Answer: A

Collector Cameron displays his beer can collection at the local swap meet. Jill sees the collection and is interested in buying it. Cameron says he will sell the collection for $1,500. Jill says she really likes the collection but is only willing to pay $1,000. Which of the following is correct?

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Collector Cameron displays his beer can collection at the local swap meet. Jill sees the collection and is interested in buying it. Cameron says he will sell the collection for $1,500. Jill says she really likes the collection but is only willing to pay $1,000. Which of the following is correct?





a. Jill's offer is a firm offer. Cameron has an exclusive right to consider her offer for a reasonable period of time.
b. If Cameron rejects Jill's counteroffer, she can still accept Cameron's offer of $1,500.
c. Neither offer is valid. Who would ever pay $1,000 or $1,500 for a beer can collection?
d. Jill's counteroffer terminates Cameron's offer of $1,500.








Answer: D

MaryBeth mails an offer to Kara that states, "I offer to sell you my sofa for $200. If I don't hear from you in 10 days, I will assume you are willing to buy the sofa for the stated price." MaryBeth hears nothing by the deadline and assumes she has a deal. What is the result?

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MaryBeth mails an offer to Kara that states, "I offer to sell you my sofa for $200. If I don't hear from you in 10 days, I will assume you are willing to buy the sofa for the stated price." MaryBeth hears nothing by the deadline and assumes she has a deal. What is the result?





a. Kara is not bound. Ten days is not a reasonable amount of time to consider the offer and accept by mail.
b. MaryBeth has a deal. Kara should have responded saying she is not interested in the sofa if she didn't want to be bound to the offer.
c. Kara is not bound. Generally an offeree must say or do something to accept an offer.
d. MaryBeth has a deal. Her offer was intended and contains definite terms.







Answer: C
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