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BUS 2061 Test #4

Multiple Choice
Identify the letter of the choice that best completes the statement or answers the question.
 

1. 

If the contract states, I must give my car for your truck. The truck is my:
a.
duty
c.
right
b.
obligation
d.
ride
 

2. 

If the contract states, I must give my car for your truck. The car is my:
a.
duty
c.
right
b.
obligation
d.
ride
 

3. 

By the traditional conflict-of-laws rule, the law of the state in which a contract is made determines:
a.
the rules of procedure to be followed.
b.
the measure of damages for nonperformance of the contract.
c.
matters that relate to the performance of the contract.
d.
whether the contract is valid in substance.
 

4. 

A third-party beneficiary:
a.
may be obligated to pay for services rendered.
b.
may bring suit on and enforce the contract.
c.
must consent to the contract.
d.
must be identified by name.
 

5. 

A life insurance contract is a third-party:
a.
beneficiary contract.
b.
assignment contract.
c.
payment contract.
d.
performance contract.
 

6. 

The party making an assignment is called the:
a.
assignee.
b.
assignor.
c.
obligor.
d.
successor.
 

7. 

An assignment is valid only if:
a.
it is written.
b.
it is written and sworn to before a notary public.
c.
there is a manifestation of the intent to assign.
d.
the assignment is paid for by the assignee.
 

8. 

Generally, the easiest item to assign is:
a.
credit.
b.
personal services.
c.
money.
d.
agreement calling for personal satisfaction of the assignor.
 

9. 

In the case of a bilateral contract concerning a promise to deliver goods for a promise to pay money, legally each party may:
a.
assign rights only.
b.
delegate duties only.
c.
assign rights and delegate duties.
d.
assign rights that then will relieve them from the duties.
 

10. 

The right to performance under a contract can be assigned:
a.
although the sufficiency of the performance is to be determined by the personal satisfaction of the other contracting party.
b.
although the contract requires the performance of personal services.
c.
although the contract provides for the extension of credit.
d.
if the burden of performing is not materially increased thereby.
 

11. 

When a buyer assigns the right to goods under a contract, the buyer's liability to make payment to the seller is:
a.
transferred to the third party.
b.
terminated.
c.
still in effect.
d.
split with the third party.
 

12. 

An assignee of a right to money may be liable for the misconduct of the assignor:
a.
under consumer protection laws.
b.
under common law.
c.
if the assignment was supported by consideration.
d.
if the assignment was in writing.
 

13. 

If an obligor could successfully defend against a suit brought by the assignor:
a.
then the obligor also would prevail against the third-party beneficiary.
b.
then the obligor also would prevail against the assignee.
c.
there is no indication how the obligor would fare against others.
d.
none of the above.
 

14. 

Most contracts are discharged by:
a.
tender of performance.
b.
performance by the parties.
c.
operation of law.
d.
substantial performance.
 

15. 

A debt of $20 is discharged when the debtor:
a.
tenders the creditor a $100 bill, but the creditor refuses it because the creditor cannot make change.
b.
tenders the creditor a $20 bill, but the creditor refuses it because the creditor wants smaller bills.
c.
gives the creditor a check for $20 and the creditor accepts it.
d.
gives the creditor a check for $20 and the creditor cashes the check at the debtor's bank.
 

16. 

A contract to build a house is deemed performed when:
a.
there has been substantial performance of the contract.
b.
the house is approved by the city housing inspectors.
c.
the house is approved by the owner's architect.
d.
the house is approved by the owner.
 

17. 

If the parties to a contract agree to undo the agreement and return any consideration involved, the contract is discharged by:
a.
waiver.
b.
mutual rescission.
c.
breach.
d.
cancellation.
 

18. 

The failure to act or perform in the manner called for by a contract is a:
a.
waiver.
b.
breach.
c.
forbearance.
d.
reservation of right.
 

19. 

When a party expressly declares that performance will not be made when required, this declaration is a(n):
a.
anticipatory repudiation.
b.
injunction.
c.
negotiating technique.
d.
waiver of breach.
 

20. 

One party to a contract permitting the other party to continue performance without objecting that the performance is unsatisfactory is an example of a(n):
a.
waiver.
b.
breach.
c.
anticipatory repudiation.
d.
forbearance.
 

21. 

If a seller delivers defective goods, the buyer does not lose the right to object to the breach of contract if the buyer:
a.
accepts the goods.
b.
accepts the goods with a reservation of right.
c.
agrees to a modification of the contract.
d.
accepts the performance without protest.
 

22. 

When one party has broken a contract, there are several remedies, which include:
a.
bringing an action for damages.
b.
rescinding the contract.
c.
seeking specific performance.
d.
all of the above.
 

23. 

If a plaintiff seeking damages from a breach-of-contract action were to receive $1 in damages, the damages would most likely be classified as:
a.
punitive damages.
b.
exemplary damages.
c.
nominal damages.
d.
compensatory damages.
 

24. 

Damages in excess of actual loss are called:
a.
punitive damages.
b.
compensatory damages.
c.
restitution.
d.
nominal damages.
 

25. 

The damages that are typically recoverable when a contract has been breached and one party has suffered loss are called:
a.
punitive damages.
b.
damages for annoyance and mental upset.
c.
compensatory damages.
d.
liquidated damages.
 

26. 

Which is not a correct statement concerning the remedy of specific performance?
a.
The subject matter of the contract generally must be unique.
b.
An award of monetary damages would be an inadequate remedy.
c.
The granting of specific performance is discretionary with the court.
d.
It generally is available in all breach-of-contract cases.
 

27. 

An action for injunctive relief may be granted:
a.
if money is due and payable.
b.
if the breach consists of doing a prohibited act.
c.
if the breach consists of a violation of criminal law.
d.
if the breach would cause consequential damages.
 

28. 

Damages to be paid in case of default that are specified in a contract are called:
a.
nominal damages.
b.
contract damages.
c.
liquidated damages.
d.
breach payments.
 

29. 

A contract provision that limits the liability of one of the parties in the event of breach is called a(n):
a.
liquidated-damages clause.
b.
exculpatory clause.
c.
waiver.
d.
exemplary clause.
 

30. 

Which of the following should be discussed on this test?
a.
negligence
c.
robbery
b.
breach
d.
bribery
 

Essay
 

31. 

I have a contract to sell my condo to Peggy for $98,000. Jerry offers me $100,000. I then sell the condo to Jerry. After calling me, threatening me and my dog Jenny (she actually poked my dog with a stick for 7 hours strait though my fence while standing on my property). Peggy then buys another condo from Marc for $99,000. List all parties, duties, rights, discharges. Are there any breaches and  damages, by whom and what type? (answer in box or on paper)
 



 
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