Legal Exam – Business Law, Criminal Law Basics, and Legal System
Study Guide
Which of the following are true about contracts:
They are private agreements formed by two or more parties who agree to a promise or a set of
promises
In the event of a dispute, the rights and obligations of the parties to the contract are interpreted
according to what the parties intended when they made the contract.
The parties intent in forming a contract is determined by outward actions and private thoughts
All of the above
A and B - correct answer ✔✔A and B
Julius asks Rachel if she would like to sell her boat. Rachel privately has no interest in selling her
boat, and believes that Julius can't afford her boat anyway. Rachel says, "I'd sell my boat to you
for $20,000." To Rachel's surprise, Julius responds, "Ok, it's a deal." Rachel does not want to sell
the boat to Julius for any price. Julius and Rachel have:
not formed a valid contract because of lack of definiteness in the contract terms
Not formed a valid contract because Rachel did not want to sell the boat for any price
Formed a valid contract because Rachel's outward actions showed that she intended to form a
contract
, Formed a valid contract because Julius expressed outward interest in the boat - correct answer
✔✔formed a valid contract because Rachel's outward actions showed that she intended to
form a contract.
The requirements for a contract to be valid are:
The parties have agreement as evidenced by an offer being made and accepted
The contract is supported by legally sufficient consideration which is bargained for between the
parties
All the parties have contractual capacity to contract because they each meet the requirements
for legal competency
The contract is for a legal purpose
All of the above - correct answer ✔✔All of the above
Jackson offers to pay Casey $50 for his used business law textbook. Casey agrees to sell it for
that amount. They agree to meet one week later to exchange the money for the book. Casey
and Jackson have formed:
a unilateral contract
no contract
a bilateral contract
Study Guide
Which of the following are true about contracts:
They are private agreements formed by two or more parties who agree to a promise or a set of
promises
In the event of a dispute, the rights and obligations of the parties to the contract are interpreted
according to what the parties intended when they made the contract.
The parties intent in forming a contract is determined by outward actions and private thoughts
All of the above
A and B - correct answer ✔✔A and B
Julius asks Rachel if she would like to sell her boat. Rachel privately has no interest in selling her
boat, and believes that Julius can't afford her boat anyway. Rachel says, "I'd sell my boat to you
for $20,000." To Rachel's surprise, Julius responds, "Ok, it's a deal." Rachel does not want to sell
the boat to Julius for any price. Julius and Rachel have:
not formed a valid contract because of lack of definiteness in the contract terms
Not formed a valid contract because Rachel did not want to sell the boat for any price
Formed a valid contract because Rachel's outward actions showed that she intended to form a
contract
, Formed a valid contract because Julius expressed outward interest in the boat - correct answer
✔✔formed a valid contract because Rachel's outward actions showed that she intended to
form a contract.
The requirements for a contract to be valid are:
The parties have agreement as evidenced by an offer being made and accepted
The contract is supported by legally sufficient consideration which is bargained for between the
parties
All the parties have contractual capacity to contract because they each meet the requirements
for legal competency
The contract is for a legal purpose
All of the above - correct answer ✔✔All of the above
Jackson offers to pay Casey $50 for his used business law textbook. Casey agrees to sell it for
that amount. They agree to meet one week later to exchange the money for the book. Casey
and Jackson have formed:
a unilateral contract
no contract
a bilateral contract
