Chapter 6 Multiple Choice Questions

. What is a unilateral contract?

A contract in which both parties are legally bound to perform their side of the agreement.

A unilateral contract is a contract whereby only one party promises to perform an act if the other party performs a stipulated act, but the other party is not under an obligation to perform the stipulated act.

A contract involving only one party.

A contract that either party can withdraw from at any time.

. What are the requirements for a valid and binding contract?

Offer, acceptance, consideration, and intention to create legal relations.

Offer, acceptance, certainty, practicality, and intention to create legal relations.

Offer, acceptance, certainty, consideration, and reasonableness.

Offer, acceptance, certainty, consideration, and intention to create legal relations.

. Which one of the following usually amounts to an offer?

Goods sold through a machine.

Advertisements.

Displays of goods.

An invitation to submit a tender.

. An offer can be terminated in a number of ways. Which one of the following is NOT an effective way to terminate an offer?

Rejection by the offeree.

Failure of a condition precedent.

Revoking the offer following acceptance.

Lapse of a reasonable time.

. Which one of the following statements regarding acceptance is true?

Silence does not constitute valid acceptance.

An offeree can accept an offer of which he was not aware.

Generally, there is no need for an offeree to communicate his acceptance to the offeror.

Generally, acceptance need not precisely match the terms of the offer.

. What is the principal effect of a counter-offer?

A counter-offer destroys the original offer and replace it with a new offer.

A counter-offer creates a binding contract based on the terms of the counter-offer.

A counter-offer creates a new offer, but the original offer is still capable of being accepted.

A counter-offer creates a binding contract based on the terms of the original offer.

. What does the postal rule state?

That acceptance occurs as soon as the letter is posted.

That acceptance occurs when the letter is received by the offeror.

That acceptance occurs when the letter is read by the offeror.

That acceptance does not occur if the letter is lost in the post.

. In relation to the requirement of certainty, which ONE of the following statements is true?

Where the parties have wholly or partially performed their obligations under a contract, the court is unlikely to hold that a contract is void due to vagueness or uncertainty.

If an agreement in uncertain, the courts will rewrite it to provide it with the requisite certainty.

Where the words of a contract are vague, the court will automatically hold that the contract is invalid.

The courts will never uphold an agreement that is incomplete.

. Which one of the following statements provides an accurate description of executory consideration?

Executory consideration is consideration that is yet to be provided.

Executory consideration is consideration that has already been provided.

Executory consideration is consideration that is promised following the other party's performance of an act.

Executory consideration is consideration that is insufficient in the eyes of the law.

. Which one of the following statements is untrue?

Performance of a contractual duty owed to a third party does not amount to good consideration.

Generally, performance by A of an existing legal duty does not provide fresh consideration for a new promise made by B.

Generally, the performance of a pre-existing contractual obligation by A does not provide fresh consideration for a new promise made by B.

Generally, part-payment of a debt does not constitute sufficient consideration.

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