FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 10: Consideration

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 1

Multiple Choice

Review LaterAdd Note

Review Later

Fact Pattern 10-5 Brick and Carmen are in an auto accident. Brick offers Carmen $2,000 if she promises not to pursue her potential legal claim against Brick. Carmen agrees. Later, Carmen discovers that it will cost $1,500 to repair her car and $4,000 to cover the medical expenses for a latent injury. Refer to Fact Pattern 10-5. The agreement between Brick and Carmen is

A) past consideration.
B) an illusory promise.
C) a release.
D) promissory estoppel.

E) All of the above
F) B) and C)

Correct Answer

verified

Show Answer

Question 2

Multiple Choice

Review LaterAdd Note

Review Later

Marketing Solutions Inc. promises to employ Niki as a software engineer. In reliance on the promise, Niki quits her job with Online Ad Agency, but Marketing Solutions does not hire her. Most likely, Marketing Solutions is

A) liable to Niki under the concept of rescission.
B) liable to Niki under the doctrine of promissory estoppel.
C) liable to Niki under the preexisting duty rule.
D) not liable to Niki.

E) A) and D)
F) A) and C)

Correct Answer

verified

Show Answer

Question 3

True/False

Review LaterAdd Note

Consideration refers to the time that a party takes to evaluate a deal.

Sean promises to pay his personal assistant Terry $50,000 in consideration of the services she provided over the years. Sean never makes the payment. Sean's promise is

Essentially, adequacy of consideration concerns the fairness of the bargain.

Fact Pattern 10-4  Rex contracts with Spicy Pizza to deliver its products. Later, both parties inform each other that they would like to cancel the contract. Refer to Fact Pattern 10-4. Rex and Spicy

Forbearance is undertaking an action that one has a legal right to undertake.

Cloud Storage Inc. promises to pay its employees a year-end bonus "if profits continue to be high and management agrees at the time." This is

Ethan is indebted to Finance Credit Corporation for $100,000. Ethan agrees to pay, and Finance Credit agrees to accept, a lesser amount than the creditor originally claimed was owed. This agreement is

Business Center Inc. and Catering LLC have an executory contract. They agree to rescind it and simultaneously enter into a new contract. If the previous contract was subject to a preexisting duty, the new contract will most likely be

Legal sufficiency of consideration is distinct from adequacy of consideration.

Consideration is the value given in return for a promise or in return or a performance.

Fact Pattern 10-2 Brad defends against a breach-of-contract suit by College Credit Corporation by claiming that their deal-a student loan-was unfair because the consideration for the contract was inadequate. Refer to Fact Pattern 10-2. "Adequacy" of consideration refers to

Kris buys Liz's house for $300,000, which is the fair market value of the house. If the contract is later disputed in court, the court is likely to declare Kris's consideration

Consideration refers to the serious thought that underlies a party's intent to enter into a contract.

Fact Pattern 10-1 Sports Bar and Tasty Bakery are adjacent businesses with adjoining parking lots. Sports Bar offers Tasty a discount on purchases if the bakery will not tow the cars of Sports Bar's patrons who park in the bakery's lot. Refer to Fact Pattern 10-1. Tasty's forbearance from towing is legally sufficient consideration

Adequacy of consideration refers to "how much" consideration is given.

An accord and satisfaction is an agreement in which one party gives up the right to pursue a legal claim against another party.

For an accord and satisfaction to occur, the amount of a debt must be in dispute.

An obligation is enforceable only if it is made in return for actions or events that have already taken place.