Connect_ECONOMICS Learning. Contains 90 Q&A Plus Raionale
1. Award: 10.00 points
Under ordinary circumstances, a party's duty to perform a promise agreed to in a contract is
absolute.
True
False
Under ordinary circ
...
Connect_ECONOMICS Learning. Contains 90 Q&A Plus Raionale
1. Award: 10.00 points
Under ordinary circumstances, a party's duty to perform a promise agreed to in a contract is
absolute.
True
False
Under ordinary circumstances, a party's duty to perform the promise agreed to in a contract is
absolute.
References
True / False Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
2. Award: 10.00 points
Contractual conditions may be expressly inserted into the contract by the parties but may not be
implied by law.
True
False
Contracts containing conditions affecting the performance obligations of the parties are called
conditional contracts. The conditions may be either implied by law or expressly inserted into the
contract by the parties.
References
True / False Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
3. Award: 10.00 points
There are two types of conditions that can be placed on contracts and affect a party’s duty to
perform the promise agreed to in the contract.
True
False
There are three types of conditions that affect a party’s duty to perform under a contract: a
condition precedent, a condition subsequent, and concurrent conditions.
References
True / False Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
4. Award: 10.00 points
5. Award: 10.00 points
Parties can discharge their duty under a contract by tendering performance.
True
False
Parties discharge their duty by making an offer to perform, and being ready, willing, and able to
perform. This offer of performance is known as a tender.
References
True / False Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
There are two primary kinds of performance.
True
False
There are two primary kinds of performance: complete performance and substantial performance.
References
True / False Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
6. Award: 10.00 points
7. Award: 10.00 points
Completion of all of the terms of a contract is required for substantial performance.
True
False
Completion of NEARLY all the terms of the agreement is a condition of substantial performance.
References
True / False Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 3 Hard
A material breach does not discharge the non-breaching party from his obligations under the
contract.
True
False
A material breach discharges the non-breaching party from his obligations under the contract.
References
True / False Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
8. Award: 10.00 points
9. Award: 10.00 points
When there is a substitution of a party to a contract, it is called rescission.
True
False
Sometimes the parties to the agreement want to replace one of the parties with a third party. This
substitution of a party is called novation.
References
True / False Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
Compensatory damages are frequently awarded damages.
True
False
The most frequently awarded damages are compensatory damages.
References
True / False Learning Objective:
20-02 What are the
primary legal
remedies available
for a breach of
contract?
Difficulty: 2
Medium
10. Award: 10.00 points
The court may award the plaintiff nominal damages in a case where no actual damages result from
the breach of a contract.
True
False
In a case where no actual damages result from the breach of a contract, the court may award the
plaintiff nominal damages.
References
True / False Learning Objective:
20-02 What are the
primary legal
remedies available
for a breach of
contract?
Difficulty: 2
Medium
11. Award: 10.00 points
Liquidated damages will be enforced based upon the free-will concept of contracts, even if the
liquidated damages amount is unreasonable.
True
False
The courts generally enforce a liquidated damages clause as long as the award appears to bear a
reasonable relationship to what the actual costs will be. If the amount specified is so unreasonable
as to not seem to bear any logical relationship to foreseeable costs, the courts declare the clause a
penalty clause and do not enforce it.
References
True / False Learning Objective:
20-02 What are the
primary legal
remedies available
for a breach of
contract?
Difficulty: 2
Medium
12. Award: 10.00 points
Rewriting a contract to reflect what the parties had agreed on is referred to as rescission.
True
False
Reformation occurs when a written contract does not reflect the parties' actual agreement or there
are inconsistencies in the contract, and the written document is rewritten to reflect what the parties
had agreed on.
References
True / False Learning Objective:
20-03 What are the
primary equitable
remedies available
for a breach of
contract?
Difficulty: 2
Medium
13. Award: 10.00 points
The court may grant a recovery based on quasi-contract in order to prevent an injustice from
occurring when one party thought there was an enforceable contract, but an enforceable contract
does not actually exist.
True
False
When an enforceable contract does not, in fact, exist, the court may grant a recovery based on
quasi-contract. This means the court may impose a contract-like obligation on a party to prevent an
injustice from occurring.
References
True / False Learning Objective:
20-03 What are the
primary equitable
remedies available
for a breach of
contract?
Difficulty: 2
Medium
14. Award: 10.00 points
Restitution is the return of any property given up under the contract.
True
False
Restitution is the return of any property given up under a contract.
References
True / False Learning Objective:
20-03 What are the
primary equitable
remedies available
for a breach of
contract?
Difficulty: 1 Easy
15. Award: 10.00 points
An order requiring that the breaching party fulfill the terms of the agreement is called specific
performance.
True
False
Specific performance is sometimes called specific enforcement. It is an order requiring that the
breaching party fulfill the terms of the agreement.
References
True / False Learning Objective:
20-03 What are the
primary equitable
remedies available
for a breach of
contract?
Difficulty: 1 Easy
16. Award: 10.00 points
Hector's house was damaged by fire. He obtained three independent appraisals to repair the
damage, and submitted the appraisals to his insurer, informing the insurer that he was willing to
accept use of the lowest appraisal as a basis for his insurance reimbursement. The adjuster for the
insurance company asked Hector to submit to an oral examination under oath concerning the fire,
but Hector refused. The insurance company denied reimbursement based on Hector's refusal to
provide the examination under oath. If the court follows the case in the text Hamilton v. State Farm
Fire & Casualty Insurance Company, will Hector recover under the policy?
No, the insurer will prevail if it can establish actual prejudice based on Hector's refusal to
provide an examination under oath.
No, the insurer will prevail based on Hector's refusal to provide an examination under oath
regardless of whether or not it can establish actual prejudice.
Yes, Hector will prevail even if he refuses to provide an examination under oath, but he will
not be allowed to recover penalties or attorney fees.
Yes, Hector will prevail only if he is able to establish that the insurer was not prejudiced by
his refusal to provide an examination under oath; and, assuming he is able to do so, he will
be allowed to recover penalties and attorney fees.
Yes, Hector will prevail without any obligation to establish that the insurer was not
prejudiced by his refusal to provide an examination under oath, and he will also be
allowed to recover penalties and attorney fees.
According to the court in Hamilton v. State Farm Fire & Casualty Insurance Company failure to
cooperate with an insurer when requested to provide an examination under oath has been held to
be a material breach and a defense to suit on the policy. The court also recognized that the burden
is on the insurer to show actual prejudice.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 3 Hard
17. Award: 10.00 points
When a party's obligations under a contract are terminated, the party is said to be ____.
Finished
Terminated
Completed
Discharged
Recoursed
When a party's obligations under a contract are terminated, the party is said to be discharged.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
18. Award: 10.00 points
How may a party's contractual obligations be discharged?
Performance is the only way a party's contractual obligations may be discharged.
Performance or the failure of a condition to occur are the only ways a party's contractual
obligations may be discharged.
Operation of law is the only way a party's contractual obligations may be discharged.
Discharge may occur through material breach by one or both parties.
Discharge may not occur through the failure of a condition to occur.
Discharge may occur through performance, the happening of a condition or its failure to occur,
material breach by one or both parties, agreement of the parties, and operation of law.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
19. Award: 10.00 points
Contracts containing conditions affecting the performance obligations of the parties are called
______ contracts.
Uncertain
Conditional
Unreasonable
Voidable
Void
Contracts containing conditions affecting the performance obligations of the parties are called
conditional contracts.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
20. Award: 10.00 points
Which of the following is true regarding types of contractual conditions?
There is only one type of condition: precedent.
There are two types of conditions: precedent and subsequent.
There are three types of conditions: precedent, subsequent, and concurrent.
There are four types of conditions: precedent, subsequent, concurrent, and timeliness.
There are at least ten types of conditions, and their identification varies based upon the
subject matter.
There are three types of contractual conditions: precedent, subsequent, and concurrent.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
21. Award: 10.00 points
A condition ______ is a particular event that must occur in order for a party's duty to arise.
Precedent
Subsequent
Concurrent
At large
Certain
A condition precedent is a particular event that must occur in order for a party's duty to arise.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
22. Award: 10.00 points
A condition ______ is a future event that terminates the obligations of the parties when it occurs.
Precedent
Subsequent
Concurrent
At large
Certain
A condition subsequent is a future event that terminates the obligations of the parties when it
occurs.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
23. Award: 10.00 points
When each party's performance is conditioned on the performance of the other, which of the
following conditions occur?
Precedent
Subsequent
Concurrent
At large
Certain
Concurrent conditions occur when each party's performance is conditioned on the performance of
the other.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
24. Award: 10.00 points
Carrie and Peter enter into a contract in which Carrie agrees to wash Peter’s car if Peter tutors her
son in math and her son gets at least a B+. This is an example of which type of conditional contract?
Condition Precedent
Condition Subsequent
Condition Concurrent
Implied condition
The contract is not conditional.
A condition precedent is a particular event that must occur in order for a party's duty to arise. The
condition precedent is Carrie’s son getting a B+.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
25. Award: 10.00 points
Carrie and Peter enter into a contract in which Carrie agrees to wash Peter’s car as long as Peter
tutors Carrie’s son in math during the entire time Carrie is washing the car. This is an example of
which type of conditional contract?
Condition precedent
Condition subsequent
Condition concurrent
Implied condition
The contract is not conditional.
Concurrent conditions occur when each party's performance is conditioned on the performance of
the other. The concurrent conditions include Carrie washing the car and Peter tutoring her son.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
26. Award: 10.00 points
Carrie and Peter enter into a contract in which Carrie agrees to wash Peter’s car once a week as
long as Peter tutors Carrie’s son in math and Peter never comes home with a grade below B+. This
is an example of which type of conditional contract?
Condition Precedent
Condition Subsequent
Condition Concurrent
Implied condition
The contract is not conditional.
A condition subsequent is a future event that terminates the obligations of the parties when it
occurs. Carrie’s son coming home with a grade below B+ is a condition subsequent that would
discharge Carrie from her obligation.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
27. Award: 10.00 points
Which of the following describes conditions explicitly stated in the contract?
Express
Implied
Conditional
Concurrent
Certain
Express conditions are explicitly stated in the contract and are usually preceded by words such as
“conditioned on,” “if,” “provided that,” or “when.”
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
28. Award: 10.00 points
Conditions that are not explicitly stated, but are inferred from the nature and language of the
contract are known as _________ conditions.
Express
Implied
Conditional
Concurrent
At large
Implied conditions are those that are not explicitly stated but are inferred from the nature and
language of the contract.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
29. Award: 10.00 points
What is the key difference between an express and an implied condition?
There are no differences; express and implied conditions are the same.
Express conditions are clearly stated while implied conditions are inferred.
Implied conditions are clearly stated while express conditions are inferred.
Only implied conditions are enforceable.
Only express conditions are enforceable.
Express conditions are explicitly stated in the contract. Implied conditions are those that are not
explicitly stated but are inferred from the nature and language of the contract.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
30. Award: 10.00 points
An offer for the sale of a vehicle contained the condition that the buyer must return the signed offer
with a $1,000 deposit upon acceptance. The requirement to send $1,000 is an example of what
type of condition?
Express
Implied
Conditional
Concurrent
At large
Express conditions are explicitly stated in the contract. For example, in a situation involving the
potential sale of a house, the offer expressly required a buyer make a deposit of $1,000 on
acceptance. When the buyer wrote “accepted” on the offer but returned it with no deposit, the court
found in a subsequent dispute that the payment of $1,000 was an express condition of acceptance.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
31. Award: 10.00 points
Juan and Carlos enter into a contract which states: “Carlos will paint Juan’s bedroom in Juan’s
house white and Juan promises to pay Carlos $100 upon completion.” Which is an example of an
implied condition?
That Carlos will paint Juan’s bedroom.
That Carlos will use white paint when painting Juan’s bedroom.
That Juan will pay Carlos $100.
That Juan will pay Carlos upon completion of the painting.
That Juan will allow Carlos access to his bedroom
Express conditions are explicitly stated in the contract. Implied conditions are those that are not
explicitly stated but are inferred from the nature and language of the contract. The painting, the use
of white paint, the $100 payment, and the time of payment are all express conditions. However, it is
an implied condition that Carlos must be provided access to Juan’s house in order to be able to
paint.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 3 Hard
32. Award: 10.00 points
____ occurs when the parties' discharge their obligations by doing what they respectively agreed
to do under the contract terms.
Discharge by tender
Discharge by performance
Discharge by finishing
Discharge by absolution
Discharge by reason
When parties discharge their obligations by doing what they respectively agreed to do under the
terms of the contract, this is called discharge by performance.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
33. Award: 10.00 points
How do parties generally discharge their obligations in most situations where there is a contract?
Discharge by performance
Discharge by tender.
Discharge by finishing
Discharge by absolution
Discharge by reason
In most situations, parties discharge their obligations by doing what they respectively agreed to do
under the terms of the contract. This is called discharged by performance.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
34. Award: 10.00 points
An offer of performance is known as ____ when parties offer to perform and are ready, willing, and
able to perform.
Offering
Showing
Tender
Completer
Implied acceptance
Parties discharge their duty by making an offer to perform and being ready, willing, and able to
perform. This offer of performance is known as a tender.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
35. Award: 10.00 points
What is the difference between performance and tender?
There is no difference.
Performance involves fulfilling contractual obligations, while tender involves offering
performance.
Tender is required when there is a conditional contract, while performance is required for
all other contracts.
Performance is required when there is a conditional contract, while tender is required for
all other contracts.
Tender is substantial performance, while performance refers only to complete
performance
Performance occurs when parties do what they respectively agreed to under the terms of a
contract. The offer of performance is known as tender.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
36. Award: 10.00 points
Yolef and Stacia enter into a contract for Stacia to cook a meal for Yolef and Yolef to pay Stacia $50.
Yolef shows up at Stacia’s house with $100. Yolef’s actions are an example of:
Tender.
Performance.
Complete performance.
Incomplete performance.
Implied performance
The offer of performance is known as tender. Yolef has offered to perform, or tendered
performance, by coming to Stacia’s house with the money
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 3 Hard
37. Award: 10.00 points
Yolef and Stacia enter into a contract for Stacia to cook a meal for Yolef and Yolef to pay Stacia $50.
Yolef shows up at Stacia’s house with $100 and hands it to Stacia. Stacia refuses to accept the
money. Yolef has:
Discharged his duties under the contract.
Performed subject to satisfaction of a contracting party
Substantially performed his duties.
Breached the contract
Not yet performed his duties under the contract
The offer of performance is known as tender. Paul has offered to perform, or tendered performance,
by coming to Stacia’s house with the money. Paul has now discharged his duties.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 3 Hard
38. Award: 10.00 points
Which of the following are the two primary kinds of performance?
Partial and significant
Partial and complete
Partial and substantial
Complete and substantial
Complete and significant
There are two primary kinds of performance: complete performance and substantial performance.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
39. Award: 10.00 points
When all aspects of the parties' duties under the contract are executed perfectly, which of the
following occurs?
Complete performance
Substantial performance
Significant performance
Absolute performance
Approved performance
Complete performance occurs when all aspects of the parties' duties under the contract are carried
out perfectly.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
40. Award: 10.00 points
Alexandra and Tomas enter into a contract in which Tomas agrees to install a new door for
Alexandra and to install a new silver doorknob. Tomas installs the door, but silver doorknobs are out
of stock so he finds a chrome knob that he believes looks silver and he installs it. Which of the
following describes Tomas’ performance of his duties?
Complete performance
Substantial performance
Significant performance
Absolute performance
Approved performance
Substantial performance occurs when nearly all of the terms of the agreement are complete, an
honest effort to complete all the terms has occurred, and no willful departure form the terms of the
agreement has occurred.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 3 Hard
41. Award: 10.00 points
A contractual condition of satisfaction is considered a[n] ______ condition that must be met before
the other party's obligation to pay for the performance arises.
Partial
Conditional
Express
Implied
Concurrent
Satisfaction is considered an express condition that must be met before the other party's obligation
to pay for the performance arises.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
42. Award: 10.00 points
A contractual condition of satisfaction may be judged by either a[n] ______ or ______ standard.
Objective; express
Subjective; express
Objective; absolute
Absolute; express
Objective; subjective
Satisfaction may be judged according to either a subjective or an objective standard.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
43. Award: 10.00 points
If a contract does not clearly specify that the satisfaction is to be personal, the ______ standard
applies.
Express
Subjective
Objective
Absolute
Unbiased
If a contract does not clearly specify that the satisfaction is to be personal, the objective standard
applies.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
44. Award: 10.00 points
If a woman is having a dress custom made for her, the ______ standard applies.
Subjective satisfaction
Express satisfaction
Objective satisfaction
Absolute satisfaction
Unbiased satisfaction
When the judgment involved is a matter of personal taste, such as when a woman is having a dress
custom made for her, the court apply a subjective satisfaction standards.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
45. Award: 10.00 points
Whenever a party fails to perform his or her obligations under the contract, a _____ occurs.
Split
Break
Breach
Misdeed
Mistake
A breach occurs whenever a party fails to perform his or her obligations under the contract.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
46. Award: 10.00 points
A[n] _____ discharges the non–breaching party from his or her obligations under the contract.
Immaterial breach
Substantial breach
Material breach
Delineated breach
Crossed breach
A material breach discharges the non-breaching party from his or her obligations under the
contract.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
47. Award: 10.00 points
Which term describes when a party unjustifiably fails to substantially perform his or her obligations
under the contract?
Immaterial breach
Substantial breach
Material breach
Delineated breach
Crossed breach
A material breach occurs when a party unjustifiably fails to substantially perform his or her
obligations under the contract.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
48. Award: 10.00 points
Which of the following occurs when a contracting party refuses to complete the contract before the
actual time of performance?
Immaterial breach
Substantial breach
Material breach
Delineated breach
Crossed breach
An anticipatory repudiation occurs when a contracting party decides not to complete the contract
before the actual time of performance.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
49. Award: 10.00 points
Penelope agrees to sell 100 pounds of sugar to Vito in June. In May, Penelope discovers there is a
major sugar shortage and she would have to pay her supplier 1000 times more than expected. She
alerts Vito in May that she does not intend to sell him the sugar. This is an example of:
Anticipatory repudiation
Tendered repudiation
Advance refusal
Advance repudiation
Preparatory refusal
An anticipatory repudiation occurs when a contracting party decides not to complete the contract
before the actual time of performance. The breaching party may convey the anticipatory breach by
making an obvious indication of the intent to no longer perform.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
50. Award: 10.00 points
Which of the following is NOT a way to discharge contractual obligations by mutual agreement?
Accord and satisfaction
Novation
Substituted contract
Mutual rescission
Anticipatory repudiation
Mutual rescission; substituted contract; accord and satisfaction; and novation are all ways to
discharge contractual obligations by mutual agreement.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
51. Award: 10.00 points
Which of the following occurs when parties agree that they simply wish to discharge each other
from their mutual obligations and therefore rescind or cancel the contract?
Accord and satisfaction
Novation
Substituted contract
Mutual rescission
Alteration
Mutual rescission occurs when parties agree that they simply wish to discharge each other from
their mutual obligations and therefore rescind or cancel the contract.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
52. Award: 10.00 points
When the parties substitute a new agreement in place of the original, instead of canceling a
contract, the parties have a[n] _____________.
Accord and satisfaction
Novation
Substituted contract
Mutual rescission
Alteration
The parties may enter into a substituted contract in place of the original contract instead of
canceling the contract and terminating their relationship.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
53. Award: 10.00 points
Which of the following is used when, by agreement, one of the parties substitutes a different
performance for his or her original duty under the contract?
Accord and satisfaction
Novation
Substituted contract
Mutual rescission
Alteration
An accord and satisfaction is used when one of the parties wishes to substitute a different
performance for his or her original duty under the contract.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
54. Award: 10.00 points
Which of the following occurs when the parties to the agreement wish to replace one of the parties
with a third party?
Accord and satisfaction
Novation
Substituted contract
Mutual rescission
Alteration
Sometimes the parties to the agreement want to replace one of the parties with a third party. This
substitution of a party is called novation.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
55. Award: 10.00 points
Kelly contracts with Raphael for Raphael to bring a pony to her daughter’s birthday party in
exchange for $100. Kelly later learns her daughter is frightened of ponies. She contacts Raphael and
Raphael agrees to bring a donkey to the party for $50 instead. Which of the following is true of the
original agreement involving the pony and the $100?
It was discharged by accord and satisfaction
It was discharged by novation
It was discharged by substituted contract
It was discharged by mutual rescission
It was breached
Substituted contract occurs when parties mutually agree to discharge each other from the contract
by substituting a new agreement.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
56. Award: 10.00 points
Which of the following is NOT a way in which a contract may be discharged by operation of law?
Alteration of the contract
Bankruptcy
Impossibility of performance
Accord and satisfaction
Commercial impracticability
Alteration of the contract, bankruptcy, tolling of the statute of limitations, impossibility of
performance, commercial impracticability, and frustration of purpose are situations in which a
contract may be discharged by operation of law.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
57. Award: 10.00 points
Which of the following is used as a basis for discharge by operation of law when performance is still
objectively possible but would be extraordinarily injurious or expensive to one party?
Frustration of purpose
Commercial impracticability
Alteration of the contract
Anticipatory repudiation
Anticipatory renunciation
Commercial impracticability is used for discharge when performance is still objectively possible but
would be extraordinarily injurious or expensive to one party.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
58. Award: 10.00 points
In England, parties who had contracted for rooms along a parade route for a king's coronation were
refunded their money when the coronation was canceled because the king became ill. Which of the
following doctrines arose from this decision?
Frustration of purpose
Commercial impracticability
Alteration of the contract
Anticipatory repudiation
Anticipatory renunciation
The doctrine of frustration of purpose arose from coronation cases in England.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 1 Easy
59. Award: 10.00 points
Monetary damages are also referred to as ______ damages.
Equitable
Fair
Public
Legal
Injunctive
Monetary damages are also referred to as legal damages or legal remedies.
References
Multiple Choice Learning Objective:
20-02 What are the
primary legal
remedies available
for a breach of
contract?
Difficulty: 1 Easy
60. Award: 10.00 points
Damages that are designed to put the plaintiff in the position he or she would have been in had the
contract been fully performed are known as which of the following?
Equitable
Compensatory
Public
Legal
Punitive
Compensatory damages are damages designed to put the plaintiff in the position he or she would
have been in had the contract been fully performed.
References
Multiple Choice Learning Objective:
20-02 What are the
primary legal
remedies available
for a breach of
contract?
Difficulty: 2
Medium
61. Award: 10.00 points
Under the UCC, how are compensatory damages calculated when a seller breaches a contract for
the sale of goods?
By the liquidated damage clause, which the Uniform Commercial Code requires buyers
and sellers must include in all contracts for the sale of goods.
By calculating the degree of inconvenience the buyer incurred as a result of the seller’s
breach of contract.
By the price the seller had agreed to sell the goods for, multiplied by 1.5 to account for the
buyer’s inconvenience.
By finding the difference between what the buyer would have paid for goods under the
contract and the amount the buyer will have to pay to obtain the goods from another
seller.
By calculating the value of the buyer’s actual losses and adding punitive damages.
Under the UCC, the measure of damages is the difference between what the buyer would have
paid for the goods under the contract and what he or she is now going to have to pay to obtain the
goods from another seller.
References
Multiple Choice Learning Objective:
20-02 What are the
primary legal
remedies available
for a breach of
contract?
Difficulty: 2
Medium
62. Award: 10.00 points
Which type of damages are foreseeable damages that result from special facts and circumstances
arising outside the contract itself, and are within the contemplation of the parties at the time the
contract was made?
Consequential
Punitive
Liquidated
Nominal
Repugnant
Consequential damages are foreseeable damages that result from special facts and circumstances
arising outside the contract itself. These damages must be within the contemplation of the parties at
the time the breach occurs.
References
Multiple Choice Learning Objective:
20-02 What are the
primary legal
remedies available
for a breach of
contract?
Difficulty: 2
Medium
63. Award: 10.00 points
Which of the following types of damages are designed to punish the defendant and deter him and
others from engaging in similar behavior in the future?
Consequential
Punitive
Liquidated
Nominal
Repugnant
Just as in tort law, punitive damages in contract law are designed to punish the defendant and deter
him and others from engaging in similar behavior in the future.
References
Multiple Choice Learning Objective:
20-02 What are the
primary legal
remedies available
for a breach of
contract?
Difficulty: 1 Easy
64. Award: 10.00 points
Which is an example of a situation in which the court would likely award punitive damages after a
breach of contract?
When fraud occurred.
When anticipatory breach occurred
When anticipatory repudiation occurred
When substantial performance occurred.
When only nominal damages occurred.
Punitive damages in contract law are designed to punish the defendant and deter him and others
from engaging in similar behavior in the future. Most jurisdictions award punitive damages only
when the defendant has engaged in reprehensible conduct, such as fraud
References
Multiple Choice Learning Objective:
20-02 What are the
primary legal
remedies available
for a breach of
contract?
Difficulty: 1 Easy
65. Award: 10.00 points
The court may award the plaintiff ______ damages when no actual damages result from the breach
of a contract.
Consequential
Punitive
Liquidated
Nominal
Repugnant
In a case where no actual damages resulted from the breach of a contract, the court may award the
plaintiff nominal damages.
References
Multiple Choice Learning Objective:
20-02 What are the
primary legal
remedies available
for a breach of
contract?
Difficulty: 1 Easy
66. Award: 10.00 points
The damages parties specify in advance in a contract, in contemplation of a particular kind of
breach, are known as ___________ damages.
Consequential
Punitive
Liquidated
Nominal
Repugnant
Liquidated damages are a type of damages that the parties specify in advance in a contract in
contemplation of a particular kind of breach.
References
Multiple Choice Learning Objective:
20-02 What are the
primary legal
remedies available
for a breach of
contract?
Difficulty: 1 Easy
67. Award: 10.00 points
The obligation to use reasonable efforts to minimize damage resulting from a breach is referred as
the duty to ______ one's damages.
Reduce
Remit
Reform
Mitigate
Migrate
To recover damages in a breach-of-contract case, the plaintiff must demonstrate that he or she used
reasonable efforts to minimize the damage resulting from the breach. This obligation is referred to
as the duty to mitigate one's damages.
References
Multiple Choice Learning Objective:
20-02 What are the
primary legal
remedies available
for a breach of
contract?
Difficulty: 1 Easy
68. Award: 10.00 points
Equitable remedies, as applied in the U.S., developed from the court’s authority in which country?
France
Italy
England
Spain
Portugal
Equitable remedies grew out of the English court's authority.
References
Multiple Choice Learning Objective:
20-03 What are the
primary equitable
remedies available
for a breach of
contract?
Difficulty: 2
Medium
69. Award: 10.00 points
Why did equitable remedies come into being?
To fashion remedies when the existing laws did not provide any adequate ones.
To supplement compensatory damages with punitive damages.
To provide a way to award nominal damages.
To provide a way to award consequential damages.
To provide a way to award certain parties liquidated damages.
Equitable remedies grew out of the English court's authority to fashion remedies when the existing
laws did not provide any adequate ones.
References
Multiple Choice Learning Objective:
20-03 What are the
primary equitable
remedies available
for a breach of
contract?
Difficulty: 2
Medium
70. Award: 10.00 points
Which is NOT an example of a common equitable remedy used today?
Rescission.
Restitution.
Anticipatory breach.
Orders for specific performance.
Injunction.
The most common equitable remedies used today include rescission, restitution, orders for specific
performance, and injunction.
References
Multiple Choice Learning Objective:
20-03 What are the
primary equitable
remedies available
for a breach of
contract?
Difficulty: 2
Medium
71. Award: 10.00 points
______ is the termination of the contract, and ______ is the return of any property given up under
the contract.
Rescission; restitution
Rescission; reformation
Reformation; restitution
Reformation; rescission
Rescission; compensation
Rescission is the termination of the contract, and restitution is the return of any property given up
under the contract.
References
Multiple Choice Learning Objective:
20-03 What are the
primary equitable
remedies available
for a breach of
contract?
Difficulty: 2
Medium
72. Award: 10.00 points
In the text case Thrifty Rent-A-Car System v. South Florida Transport, the plaintiffs sued the
defendant, the operator of a Thrifty franchise, for amounts owed, but the defendant resisted
payment on the basis that several hurricanes rendered the business operations commercially
impractical. How did the court rule in the case?
The court ruled that the bad weather completely excused the defendant's performance.
The court ruled that the parties had to jointly bear the burden of bad weather and that 50%
of what the defendant owed would be excused.
The court ruled that the defendant was legally entitled to additional time in which to pay,
but that the defendant would be required to pay all amounts owed.
The court ruled that the plaintiffs were entitled to recover because the defendant failed to
anticipatorily repudiate the contract.
The court ruled that the plaintiffs were entitled to recover for reasons including that the
nonoccurrence of hurricanes was not a basic assumption of the agreement.
The court ruled that the non-occurrence of hurricanes was not a basic assumption of the parties'
agreements. Additionally, there was no evidence that hurricanes made the cost of performance
unduly burdensome, and the defendant was behind on its payments before the arrival of the
hurricanes.
References
Multiple Choice Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
73. Award: 10.00 points
College president Robert contracted with Denise to teach business law. Alice did a good job
teaching, but became upset with Robert and refused to turn in her grades. What type of order
should Robert seek to compel Denise to abide by her contract?
An order of specific performance
A compensatory order
A nominal order
A consequential order
A demand order
Specific performance is sometimes called specific enforcement. It is an order requiring that the
breaching party fulfill the terms of the agreement.
References
Multiple Choice Learning Objective:
20-03 What are the
primary equitable
remedies available
for a breach of
contract?
Difficulty: 3 Hard
74. Award: 10.00 points
Which of the following requires that the breaching party fulfill the terms of the agreement?
Specific obligation
Specific performance
Absolute obligation
Identified obligation
Absolute performance
Specific performance is sometimes called specific enforcement. It is an order requiring that the
breaching party fulfill the terms of the agreement.
References
Multiple Choice Learning Objective:
20-03 What are the
primary equitable
remedies available
for a breach of
contract?
Difficulty: 1 Easy
75. Award: 10.00 points
Which of the following is an order either forcing a person to do something or prohibiting a person
from doing something?
Specification
Directive
Instructional edict
Demand
Injunction
An injunction is an order either forcing a person to do something or prohibiting a person from doing
something.
References
Multiple Choice Learning Objective:
20-03 What are the
primary equitable
remedies available
for a breach of
contract?
Difficulty: 2
Medium
76. Award: 10.00 points
Caroline goes to work for a soft drink company who own a proprietary recipe. She signs a nondisclosure agreement. When she is fired, she threatens to go public with the company’s recipe. The
company wants to stop her. They should seek a(n) __________ .
Injunction
Directive
Instructional edict
Demand
Order for specific performance
An injunction is an order either forcing a person to do something or prohibiting a person from doing
something. The company wants to prohibit Caroline from releasing their secret recipe.
References
Multiple Choice Learning Objective:
20-03 What are the
primary equitable
remedies available
for a breach of
contract?
Difficulty: 2
Medium
[Dream Home] Jacob finds a dream home on the lake. He wants to buy it but is unsure whether he
can get a loan. He signs a contract with the seller that he will buy the home provided that he can
obtain a loan. Jacob also includes a clause in the contract with the seller stating that if he loses his
job before the date the purchase contract is signed, the seller will release him from any obligation.
After obtaining a loan and buying the home, Jacob decides he wants to have new windows installed.
He enters into a contract with a window contractor. The window contractor visits the home, but never
finds Jacob there. The contractor makes several attempts to reach Jacob, but Jacob does not return
phone calls and makes no attempt to assist the contractor in arranging the window installation.
77. Award: 10.00 points
The provision that the seller will release Jacob unless he is able to obtain a loan is a
_____________.
A condition subsequent
A condition precedent
A bona fide condition
A condition concurrent
An exculpatory condition
A condition precedent is a particular event that must occur in order for a party's duty to arise.
Express conditions are explicitly stated in the contract and are usually preceded by words such as
conditioned on, if, provided that, or when.
References
Multiple Choice Difficulty: 3 Hard Learning Objective: 20-01 What are the
primary methods of discharging a
contract?
78. Award: 10.00 points
The provision that the seller will release Jacob from any obligation if he loses his job is a
_____________.
A condition subsequent
A condition precedent
A bona fide condition
A condition concurrent
An exculpatory condition
A condition subsequent is a future event that terminates the obligations of the parties when it
occurs.
References
Multiple Choice Difficulty: 3 Hard Learning Objective: 20-01 What are the
primary methods of discharging a
contract?
79. Award: 10.00 points
The responsibility of Jacob to make arrangements to give the window installer access to the home
is a[n] ______________.
A condition subsequent
A condition precedent
An implied condition
An express condition
An acknowledged condition
Implied conditions are those that are not explicitly stated but are inferred from the nature and
language of the contract.
References
Multiple Choice Difficulty: 3 Hard Learning Objective: 20-01 What are the
primary methods of discharging a
contract?
[Bathroom Mess] For $300,000, Michael agreed to build a new home for Ashton, who is very picky.
Michael built the home to Ashton's specifications with one exception: the faucets and flooring in the
upstairs bathroom were not exactly what Ashton specified. That was a mistake on Michael’s part, but
he did not intentionally fail to follow the specifications. When Ashton saw the bathroom, she went
ballistic and told Michael that she would not pay Michael anything for the house. It will take $300 to
put in the correct faucets and flooring. Michael responded that he is willing to pay $300 to put
Ashton in the position she would have been in had the correct faucets and flooring been used, but
that is all he is willing to pay
80. Award: 10.00 points
Which statement is true regarding the breach, if any, that occurred between Michael and Ashton?
Michael did not breach the contract.
Michael materially breached the contract.
Michael substantially breached the contract.
Michael breached the contract.
Michael committed an anticipatory breach of the contract.
A breach occurs whenever a party fails to perform his or her obligations under the contract. A
breach may be a minor breach.
References
Multiple Choice Difficulty: 3 Hard Learning Objective: 20-01 What are the
primary methods of discharging a
contract?
81. Award: 10.00 points
Regarding the appropriate amount of damages, if any, which of the following statements is true
regarding the effect Michael’s failure to meet his obligations under the building contract?
There are no damages because Michael did not breach the contract.
Ashton will not have to pay for the house because Michael failed to perform as required.
Even though Michael substantially performed, Ashton will not have to pay for the house
because Michael materially breached the contract.
Ashton is released from paying for the house because of the anticipatory breach.
Any damages awarded would be in the range of $300, the amount it would take to fix the
breach.
A breach occurs whenever a party fails to perform his or her obligations under the contract. If the
breach is a minor one, it may entitle the non-breaching party to damages but a minor breach does
not discharge the non-breaching party from the contract.
References
Multiple Choice Difficulty: 3 Hard Learning Objective: 20-01 What are the
primary methods of discharging a
contract?
82. Award: 10.00 points
Michael’s offer to put Ashton in the position she would have been in had the proper faucets and
flooring been used is based on the measure used for what type of damages?
Nominal
Punitive
Compensatory
Liquidated
Consequential
The most frequently awarded damages are compensatory damages, which are damages designed
to put the plaintiff in the position he or she would have been in had the contract been fully
performed.
References
Multiple Choice Difficulty: 3 Hard Learning Objective: 20-02 What are the
primary legal remedies available for a
breach of contract?
[Hawaiian Adventure] Hannah decides to go on a fun trip to Hawaii. While she is gone, she needs
someone to take care of her two dogs, Champ and Sage. She hires Amir three months in advance,
and they reach a contractual arrangement whereby he will be paid $200 for taking care of the dogs
for two weeks. Amir comes over two months before Hannah is set to leave, takes one look at Champ
and Sage, and declares that they are too difficult to handle so he will not care for them. Hannah then
hires Alisha who agrees to care for Champ and Sage. Two weeks before Hannah is set to leave,
however, Alisha calls and tells her that she just broke both her legs in an automobile accident and
has been put on bed rest for two months. Finally, Hannah hires Kelsey to care for the dogs and
heads off to Hawaii where she has a great time. Unfortunately, when Hannah returns home, she finds
that Kelsey has disappeared with Champ and Sage. Later, they are found in good health at an
exclusive resort visited by Kelsey. Kelsey refuses to return Champ and Sage to Hannah, claiming that
they were all enjoying the resort and that she has become quite attached to them.
83. Award: 10.00 points
What was the effect of Amir's refusal to keep Champ and Sage?
He committed an anticipatory repudiation.
He is not guilty of any breach because he gave Hannah sufficient warning that he was not
willing to perform.
He is not guilty of any breach because the contract is not over $1,000 in amount.
He is guilty of an immaterial breach because of the low value of the contract.
He is guilty of a nominal breach.
Anticipatory repudiation occurs when a contracting party announces his refusal not to complete a
contract before the actual time of performance.
References
Multiple Choice Difficulty: 3 Hard Learning Objective: 20-01 What are the
primary methods of discharging a
contract?
84. Award: 10.00 points
What was the effect of Alisha's refusal to keep Champ and Sage?
She is discharged from performance because of frustration of purpose.
She is discharged from performance because of impossibility of performance.
She committed a material breach.
She failed to substantially perform but only committed an immaterial breach.
She is guilty of only a nominal breach because she had a good excuse for breaching.
Sometimes an unforeseen event occurs that makes it physically or legally impossible for a party to
carry out the terms of the contract. In such a situation, the party will be discharged on grounds of
impossibility of performance.
References
Multiple Choice Difficulty: 3 Hard Learning Objective: 20-01 What are the
primary methods of discharging a
contract?
85. Award: 10.00 points
86. Award: 10.00 points
What will Hannah seek in order to force Kelsey to return Champ and Sage?
An injunction
Compensation
Punitive damages
Nominal performance
Adequate performance
An injunction is an order either forcing a person to do something or prohibiting a person from doing
something.
References
Multiple Choice Difficulty: 3 Hard Learning Objective: 20-03 What are the
primary equitable remedies available for
a breach of contract?
List the ways by which a party's contractual obligations can be terminated.
A party's contractual obligations can be terminated by performance, the happening of a condition or
its failure to occur, material breach by one or both parties, agreement of the parties, and operation
of law.
References
Essay Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
87. Award: 10.00 points
Courtney and Jonathan agreed that Jonathan would paint Courtney's home for $800 with Courtney
supplying the paint. Jonathan went to Courtney's home on several occasions to do the job, but she
never had the paint. Finally, he moved on to other jobs. Six months later, Courtney sued Jonathan
for not painting her home. Who is likely to win and why? Include the legal term for Jonathan's offer
of performance.
Jonathan is most likely to win because Jonathan offered to perform by being ready, willing, and
able to perform. His offer of performance is called tender. Courtney delayed excessively.
References
Essay Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 3 Hard
88. Award: 10.00 points
Describe the elements of substantial performance of a contract and the effect of a finding of
substantial performance on damages.
Substantial performance occurs when the following conditions have been met: (1) completion of
nearly all the terms of the agreement, (2) an honest effort to complete all the terms, and (3) no willful
departure from the terms of the agreement. Substantial performance discharges the party's
responsibilities under the contract, although the court may require that the party compensate the
other party for any loss in value caused by the failure to meet all the standards set forth in the
contract.
References
Essay Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
89. Award: 10.00 points
Describe the actions that bring about an anticipatory repudiation of a contract, and the rights of a
non-breaching party when faced with anticipatory repudiation.
Anticipatory repudiation occurs when a contracting party refuses to complete a contract before the
actual time of performance. When an anticipatory repudiation occurs, the non-breaching party is
discharged from his or her obligations under the contract. The non-breaching party is free to go
ahead and sue for breach, as well as find another similar contract elsewhere. However, if the nonbreaching party wishes, they may decide to give the party who repudiated the opportunity to
change their mind and still perform.
References
Essay Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
90. Award: 10.00 points
Describe the three main situations in which the courts find objective impossibility.
The first situation in which courts find objective impossibility is the destruction of the subject matter.
The second situation of objective impossibility is the death or incapacity of a party whose personal
services are necessary to fulfill the terms of the contract. The third situation is subsequent illegality.
References
Essay Learning Objective:
20-01 What are the
primary methods of
discharging a
contract?
Difficulty: 2
Medium
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