Q. An offer can be revoked before acceptance unless it is:
-
A.
A unilateral contract
-
B.
Supported by consideration
-
C.
Made in writing
-
D.
Communicated verbally
Solution
An offer can be revoked before acceptance unless it is supported by consideration, which can create an option contract.
Correct Answer:
B
— Supported by consideration
Learn More →
Q. If a party fails to perform their obligations under a contract, this is known as:
-
A.
Breach of contract
-
B.
Performance
-
C.
Acceptance
-
D.
Revocation
Solution
A failure to perform obligations under a contract is termed a breach of contract.
Correct Answer:
A
— Breach of contract
Learn More →
Q. In contract law, 'capacity' refers to:
-
A.
The ability to perform the contract
-
B.
The legal ability to enter into a contract
-
C.
The financial ability to fulfill obligations
-
D.
The ability to negotiate terms
Solution
Capacity refers to the legal ability of a party to enter into a contract, which can be affected by age, mental state, and other factors.
Correct Answer:
B
— The legal ability to enter into a contract
Learn More →
Q. What is the effect of a counteroffer?
-
A.
It accepts the original offer
-
B.
It creates a new offer
-
C.
It has no effect
-
D.
It automatically breaches the contract
Solution
A counteroffer creates a new offer and effectively rejects the original offer.
Correct Answer:
B
— It creates a new offer
Learn More →
Q. What is the first element required for a valid contract?
-
A.
Offer
-
B.
Acceptance
-
C.
Consideration
-
D.
Capacity
Solution
The first element required for a valid contract is an offer, which is a proposal to enter into a legally binding agreement.
Correct Answer:
A
— Offer
Learn More →
Q. What is the purpose of consideration in a contract?
-
A.
To ensure the contract is in writing
-
B.
To provide a legal basis for enforcement
-
C.
To outline the terms of the agreement
-
D.
To establish the parties' intentions
Solution
The purpose of consideration is to provide a legal basis for enforcement of the contract by ensuring that something of value is exchanged.
Correct Answer:
B
— To provide a legal basis for enforcement
Learn More →
Q. Which of the following is NOT a valid form of acceptance?
-
A.
Silence
-
B.
Verbal agreement
-
C.
Written agreement
-
D.
Conduct indicating acceptance
Solution
Silence is generally not considered a valid form of acceptance unless there is a prior agreement stating otherwise.
Correct Answer:
A
— Silence
Learn More →
Showing 1 to 7 of 7 (1 Pages)
