Bus Law Chapter 13 Multiple Choice

1. 1Chicken & Egg Farms promises to pay Dex $500 to install a sump pump in its warehouse. Dex completes the installation. The act of installing the pump
   

   1. Aimposes a moral obligation on Chicken & Egg to pay Dex
   2. Bimposes no obligation on Chicken & Egg unless it is satisfied with the job
   3. Cis not sufficient consideration because it is not goods or money
   4. Dis the consideration that creates Chicken & Egg’s obligation to pay Dex.
2. 2Henry promises not to open his Hank’s Lunchbox Café before 10:00 a.m. if Isis, who owns Isis’s Danish & Donuts next door, promises to close by 4:00 p.m. Henry’s consideration is
   

   1. Athe destruction of a legal relationship.
   2. Bthe creation of a legal relationship.
   3. Ca forbearance.
   4. Dan exchange of money.
3. 3Esmeralda promises to pay Fiorello $400 because “he does not have as much money as other people.” Esmeralda’s promise is not enforceable because
   

   1. Asociety does not want gifts cheapened by making them legally enforceable
   2. Bthe redistribution of wealth on a one-to-one basis is not a valid social goal.
   3. CEsmeralda could have paid more
   4. DFiorello has not given consideration in return.
4. 4Quentin questions whether there is consideration for his contract with Rainey to exchange his performance with the Symphonic Saxophone Sextet for her payment of a certain amount. To constitute consideration, there must be
   

   1. Aa payment.
   2. Ba performance
   3. Ca bargained-for exchange
   4. Dserious thought underlying each party’s intent to contract.
5. 5Valley Paragliders Association files a suit against Wing Designers, Inc., claiming that the consideration for their contract is inadequate. The court will most likely not examine the adequacy of the consideration if
   

   1. Athere is a large disparity in the amount of consideration exchanged.
   2. Bthe consideration involves the performance of services
   3. Csomething of value passed between the parties.
   4. Dthe consideration is worth less than $100.
6. 6Mobile Minutes Company offers Nate an unlimited number of monthly phone minutes for $4.50 per month. Nate accepts. If a dispute arises, a court would likely
   

   1. Aenforce the deal after questioning the adequacy of the consideration.
   2. Bnot question the adequacy of the consideration.
   3. Crewrite the deal after questioning the adequacy of the consideration.
   4. Dset aside the deal after questioning the adequacy of the consideration.
7. 7Genovese Contracting, Inc., agrees to build a warehouse for Hawthorne Wholesale Distributors. When Genovese runs into the types of difficulties that contractors ordinarily confront, Hawthorne agrees to pay extra compensation to overcome them. Regarding the agreement to pay more, a court would likely
   

   1. Aenforce it
   2. Brescind it
   3. Corder the parties to renegotiate it
   4. Dnot enforce it
8. 8Todos, Ltd., agrees to market the products of United Sales, Inc., in Venezuela. When the government is unexpectedly overthrown in a revolution, Todos can continue to fulfill its contract but only for a much higher price. United agrees to pay but later files a suit to recover the difference. The court will most likely rule that
   

   1. Aa change in government is a risk ordinarily assumed in business.
   2. Ban unforeseen difficulty supported the contract modification here.
   3. CTodos engaged in extortion or the so-called holdup game.
   4. DTodos had a preexisting duty to supply the goods at the initial price.
9. 9Quik Downtown Delivery contracts with Rico’s Tacos to deliver its products. Both parties change their minds, however, and inform each other that they would like to cancel the contract.
   
   The next day, Quik again offers to deliver Rico’s products. Rico’s is willing to deal, but for a new price. Quik and Rico’s
   
   

   1. Amay agree to a new contract, but it cannot include a new price.
   2. Bmay agree to a new contract that includes the new price.
   3. Cmust perform their original contract.
   4. Dmust perform the part of their original contract that is executory.
10. 10Quik Downtown Delivery contracts with Rico’s Tacos to deliver its products. Both parties change their minds, however, and inform each other that they would like to cancel the contract.
    
    Quik and Rico’s
    
    

    1. Amay rescind their entire contract.
    2. Bmay rescind their contract to the extent that it is executory.
    3. Cmust perform their entire contract.
    4. Dmust perform the part of their contract that is executory.

11. 11Industrial Engineering, Inc., promises to give stock options to Jasmine for processes she has already designed for the firm. This promise is enforceable
    

    1. Abecause it is a new contract
    2. Bbecause it is an illusory promise
    3. Cbecause it is supported by past consideration
    4. Dunder no circumstances
12. 12Dave’s uncle tells Dave that if “he feels that Dave deserves it,” he will give Dave $10,000 when Dave graduates from college. Dave’s uncle’s promise is

    1. Aillusory
    2. Ba contract
    3. Ca preexisting duty
    4. Da forbearance
13. 13Produce Packaging Company promises its employees a 10 percent raise at the end of the year if productivity has increased and management feels the raise is warranted. Produce Packaging must
    

    1. Ado nothing
    2. Bgive the employees a 10 percent raise only at the end of the year.
    3. Cgive the employees a 10 percent raise only if productivity increases.
    4. Dgive the employees a 10 percent raise under any circumstances.
14. 14Apples & Pears Orchards contracts to hire Brigit for one year to tend the fruit in its commercial orchards but reserves the right to cancel the employment on thirty days’ notice at any time after Brigit begins work. This promise is
    

    1. Aenforceable
    2. Billusory
    3. Cunliquidated
    4. Dunforseen
15. 15Qiana writes a check to Payday Loans, Inc., in an amount that represents half of her debt to the lender. On the back of the check, Qiana includes the words “payment in full.” Payday agrees to accept the lesser sum and cashes the check. This discharges the entire debt
    

    1. Aif the debt is liquidated
    2. Bif the debt is past due
    3. Cif the debt is unliquidated
    4. Dunder no circumstances
16. 16While sailboarding, Jolene is injured when Kilroy carelessly crosses her path. Kilroy’s insurance company offers Jolene $50,000 to release Kilroy from liability, and she accepts. Later, she learns that her injuries are more serious than she realized. The release is
    

    1. Aenforceable
    2. Bunenforceable because Jolene’s injuries are unforeseeably difficult.
    3. Cunenforceable because Kilroy has a preexisting duty to pay.
    4. Dunenforceable because the release is an illusory promise.
17. 17 Gustaf and Hilltop Country Club disagree as to the exact amount Hilltop owes Gustaf for his landscaping work. They form a new agreement that, on fulfillment, will discharge the prior obligation. This is
    

    1. Aa covenant not to sue
    2. Ban accord and satisfaction
    3. Ca release
    4. Dpromissory estoppel
18. 18After an accident with a vehicle licensed to Guardian Security Company, Heidi signs a covenant not to sue Guardian Security for damages in a tort action if it pays for the damage to her car. This covenant is
    

    1. Aa bar to recovery only if Guardian Security pays.
    2. Ban illusory contract.
    3. Cbarred by the preexisting duty rule.
    4. Dbarred by the doctrine of promissory estoppel.
19. 19Rudy files a suit against Shakes & Shingles, Roofing Contractor, Inc., under the doctrine of promissory estoppel. Rudy must show that
    

    1. Ahe justifiably refused to fulfill a promise to Shakes & Shingles.
    2. Bhe justifiably relied on Shakes & Shingles’ promise to his detriment.
    3. CShakes & Shingles justifiably refused to fulfill a promise to him.
    4. DShakes & Shingles justifiably relied on his promise to its detriment.
20. 20Readymade Credit Company loans Start-Up Enterprise, Inc., $150,000 to invest in new equipment. If Start-Up fails to pay the loan within a specified period, Readymade’s recovery of the debt will be barred by
    

    1. Athe preexisting duty rule
    2. Bthe doctrine of promissory estoppel
    3. Ca statute of limitations
    4. Dnone of the choices

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Quiz on Bus Law Chapter 13 Multiple Choice, created by Haley Lockrem on 21/10/2018.

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