Homework #3
Chapter #11
1. An actor, exhausted after his 10-hour workweek, agrees to buy a briefcase full of cocaine
from Lewis for $12,000. Lewis and the actor have a (n) void contract.
Answer: d. void
2. Carol says, “Pam, you’re my best friend in the world. I just inherited a million bucks, and
I want you to have some of it. Come with me to the bank tomorrow, and I’ll give you
$10,000.” “Sweet!” Pam replies. Later that day, Carol has a change of heart. She is
allowed to do so. Examine the list of the elements of a contract and cite the correct
reason.
Answer:
c. Pam did not give consideration.
3. Consider these two events:
[Link] the first day of the baseball season, Victor orders a new Marlins hat online.
II. Two days later, the hat is delivered to Victor’s house.
Answer:
b. Both I and II are executed contracts
4. Linda goes to an electronics store and buys a television. Becca hires a company to clean
her swimming pool once a week.
Answer:
d. Becca’s contract is governed by the common law and Linda’s by the UCC
5. Consider the following scenarios:
I. Madison says to a group of students, “I’ll pay $35 to the first one of you who shows
up at my house and mows my lawn.”
II. Lea posts a flyer around town that reads, “Reward: $500 for information about the
person who keyed my truck last Saturday night in the Wag-a-Bag parking lot. Call
Lea at 555-5309.”
Which of these proposes a unilateral contract?
Answer:
c. Both I and II
Chapter #12
Page 326 Exam Strategy Question
Question: Rick is selling his espresso coffeemaker. He sends Tamara an email, offering to
sell the machine for $350. Tamara promptly emails back, offering to buy the item for
$300. She hears nothing from Rick, so an hour later Tamara stops by his apartment,
where she learns that he just sold the machine to his roommate for $250. She sues Rick.
Outcome?
a. Tamara will win because her offer was higher than the roommate’s.
b. Tamara will win because Rick never responded to her offer.
c. Tamara will win because both parties made clear offers, in writing.
d. Tamara will lose because she rejected Rick’s offer.
e. Tamara will lose because her offer was not definite.
Strategy: A valid contract requires a definite offer and acceptance. Rick made a valid
offer. When Tamara said she would buy the machine for a lower amount, was that
acceptance? If not, what was it?
Answer:
Rick will win Tamara’s suit in this case. The reason behind Rick’s win is he
offered to sell his Coffee maker through email to Tamara, but the offer was not
accepted. Tamara reject Rick’s offer by sending revised amount of $300, because a
counter offer means a rejection in this case. If Tamara accepted the offer, then deal
has been done, but she didn’t accept the offer. Later she found that Rick sold the
Coffee maker to his roommate at a lower price than she expected. So, Tamara was
willing to buy the Coffee maker at a lower price. In this case there was no valid
contract between Rick and Tamara, and he was under no obligation to sell to Tamara
at any price, therefore Rick will win if there is a legal lawsuit brought against him. He
will win Tamara’s suit.
Chapter #13
1. For consideration to exist, there must be:
Answer:
a. a bargained-for exchange.
2. Which of the following requires consideration in order to be binding on the parties?
I. Modification of a contract involving the sale of real estate
II. Modification of a sale of goods contract under the UCC
Answer:
c. Just I
Modification of a contract involving the sale of real estate
3. Ted’s wallet is as empty as his bank account, and he needs $3,500 immediately.
Fortunately, he has three gold coins that he inherited from his grandfather. Each is
worth $2,500, but it is Sunday, and the local rare coins store is closed. When
approached, Ted’s neighbor Andrea agrees to buy the first coin for $2,300. Another
neighbor, Cami, agrees to buy the second for $1,100. A final neighbor, Lorne, offers
“all the money I have on me”—$100—for the last coin. Desperate, Ted agrees to the
proposal. Which of the deals is supported by consideration?
Answer:
c. All three of the agreements
4. Which of these statements is true?
I. Under the UCC, an output contract is acceptable
II. Under the UCC, a requirements contract is acceptable
Answer:
a. Both I and II
5. Non-compete agreements are common features of employment contracts. Currently,
courts ________ enforce these clauses.
Answer:
b. usually
