Content check — Business Law, Chapter 7: Contract Law

Every problem in the chapter beside the book’s answer, a chapter at a time as you scroll.

Chapter 7: Contract Law

8 problems · 0 figures

7-1 §7.AQ source ↗

What is the definition of a contract?

Answer

A contract is defined as an agreement between two or more parties that is enforceable by law.

7-3 §7.AQ source ↗

What are the ways an agreement can be invalidated?

a.
Fraud.
b.
Misrepresentation.
c.
Undue influence.
d.
All of the above.

Answer

D. All of the above.

7-5 §7.AQ source ↗

Consideration may include any of the following except:

a.
A promise.
b.
A gift.
c.
Property.
d.
Money.

Answer

B. A gift.

7-7 §7.AQ source ↗

Which of the following is most likely to be classified as a necessity for which a minor will be held liable on a contract?

a.
A television.
b.
School supplies.
c.
Education.
d.
Food.

Answer

D. Food.

7-9 §7.AQ source ↗

When can a mentally incompetent person void a contract?

Answer

If a person lacks the mental capacity to enter a contract, then either he or she, or his or her legal guardian, may void it, except in cases where the contract involved necessities. In most states, mental capacity is measured against the “cognitive standard” of whether the party understood its meaning and effect.

7-11 §7.AQ source ↗

Define a material breach.

Answer

A material breach is when something substantially different from what was expected under the terms of the contract is delivered, the breach is considered material.

7-13 §7.AQ source ↗

Distinguish between rescission and reformation.

Answer

Rescission terminates the duties of both parties under the contract, while reformation allows courts to equitably change the contracts substance.

7-15 §7.AQ source ↗

Define restitution.

Answer

Restitution restores the injured party to status quo or the position they had prior to the formation of the contract, by returning to the plaintiff any money or property given to the defendant pursuant to the contract.

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Problems and answers are adapted from Business Law I Essentials 2e by Mirande Valbrune, Renee De Assis and Suzanne Cardell, OpenStax, and are used under the CC BY-NC-SA 4.0 licence. Access for free at https://openstax.org/books/business-law-i-essentials-2e/pages/1-introduction. Illustrations: Copyright Rice University, OpenStax, under CC BY-NC-SA 4.0 license. This adaptation is released under the same licence, is non-commercial, and is neither affiliated with nor endorsed by OpenStax or Rice University.