Chapters 9 - 11

 

True/False

Indicate whether the sentence or statement is true or false.

 

____    1.            An express contract must be in writing.

 

____    2.            The doctrine of promissory estoppel requires a clear and definite promise.

 

____    3.            Any breach allows the breaching party to sue for damages.

 

____    4.            A breach of contract entitles the innocent party to sue for damages.

 

____    5.            An offer can be accepted by any reasonable means.

 

____    6.            Under a destination contract, the risk of loss passes to the buyer when the goods are duly delivered to the carrier.

 

Multiple Choice

Identify the letter of the choice that best completes the statement or answers the question.

 

____    7.            Bob claims that Carol breached their contract. Carol responds that she never intended to enter into a contract with Bob. The intent to enter into a contract is determined with reference to

a.

the conscious theory of contracts.

b.

the objective theory of contracts.

c.

the personal theory of contracts.

d.

the subjective theory of contracts.

 

 

____    8.            Sam announces that he plans to sell his business at a price below its market value. Tina gives Sam a check for the stated amount. Sam

a.

is bound to sell his business to Tina.

b.

may refuse to accept the check, because he only expressed an intent to do something in the future.

c.

may refuse to accept the check, because he only expressed an opinion as to the worth of the business.

d.

may refuse to accept the check, because he only expressed a willingness to discuss a possibility of entering into a contract.

 

 

____    9.            Coffee Brokers, Inc., offers to sell Java Roasters, Inc., fifty bags of coffee beans. Java rejects the offer. The offer is

a.

terminated.

b.

valid for a reasonable time to give Java a “second chance.”

c.

valid for the period of time prescribed by a state statute.

d.

valid until Coffee Brokers revokes the offer.

 

 

____    10.            Best Contractors, Inc., agrees to build an office building for Commercial Properties Company. Best substantially performs. Commercial is entitled to

a.

damages.

b.

rescission.

c.

specific performance.

d.

none of the above.

 

 

____    11.            Nora contracts to work for Omega Investments during June for $2,500. On May 31, Omega cancels the contract. Nora refuses to accept a similar job with Peak Sales Corporation, which would pay $2,000. Nora files a suit against Omega. As compensatory damages, Nora can recover

a.

$2,500.

b.

$2,000.

c.

$500.

d.

nothing.

 

 

____    12.            Eve contracts to repair a computer for Digital Distributors, Inc. Eve knows that without the computer, Digital will lose a sale. Eve does not perform as promised. Digital files a suit against Eve. As consequential damages, Digital can recover

a.

the cost of a new computer.

b.

the difference between Eve’s price and the actual cost of repair.

c.

the loss of profit from the lost sale.

d.

nothing.

 

 

____    13.            Best Music, Inc., offers to buy from Sound Products Corporation (SPC) 1,000 blank CDs of a certain brand. Without notifying Best, SPC timely ships CDs of a different brand. This shipment is

a.

an acceptance of Best’s offer.

b.

a breach of the parties’ contract.

c.

an acceptance and a breach.

d.

none of the above.

 

 

____    14.            Air Transport Company contracts to buy goods from Beta Engines, Inc. Beta wrongfully fails to deliver the goods. Air files a suit against Beta. Air can recover damages equal to the difference between the contract price and the market price

a.

at the time and place of tender.

b.

at the time the contract was made.

c.

when Air filed a suit against Beta.

d.

when Air learned of Beta’s wrongful failure to deliver.

 

 

____    15.            A statement by Adam, a salesperson for Best Textiles Company, that Best’s bolts of fabric will match a particular sample is

a.

an express warranty.

b.

an implied warranty.

c.

a warranty of title.

d.

puffing.

 


Chapters 9 - 11

Answer Section

 

TRUE/FALSE

 

           1.           ANS:           F           REF:           198           OBJ:           TYPE: N

 

           2.           ANS:           T           REF:           209           OBJ:           TYPE: N

 

           3.           ANS:           F           REF:           226           OBJ:           TYPE: +

 

           4.           ANS:           T           REF:           232           OBJ:           TYPE: +

 

           5.           ANS:           T           REF:           244           OBJ:           TYPE: +

 

           6.           ANS:           F           REF:           251           OBJ:           TYPE: N

 

MULTIPLE CHOICE

 

           7.           ANS:           B           REF:           197           OBJ:           TYPE: N

 

           8.           ANS:           B           REF:           200           OBJ:           TYPE: N

 

           9.           ANS:           A           REF:           205           OBJ:           TYPE: N

 

           10.           ANS:           A           REF:           226           OBJ:           TYPE: =

 

           11.           ANS:           C           REF:           232           OBJ:           TYPE: =

 

           12.           ANS:           C           REF:           233           OBJ:           TYPE: =

 

           13.           ANS:           C           REF:           246           OBJ:           TYPE: N

 

           14.           ANS:           D           REF:           260           OBJ:           TYPE: +

 

           15.           ANS:           A           REF:           262           OBJ:           TYPE: N