CH9: NC Real Estate Exam Practice Questions | Basic Contracts

Question 1

In the event, a seller defaults in his obligation to convey title to the property as agreed upon in a contract sale, which of the following remedies is available to the purchase?

a. suit for breach of contract
b. suit for specific performance
c. suit for compensatory damages
d. all of the above.

Answer 1

d. all of the above.

Question 2

For contracts in general, except for those of the sale of real estate property, the essential element includes all of the following EXCEPT:

a. competent parties
b. offer and acceptance
c. legality of object
d. writing

Answer 2

d. writing

Question 3

Of the following statements regarding voidable contracts, which is NOT correct?

a. a voidable contract can be voided by one or more parties
b. a voidable contract can be legally consummated by the parties
c. a voidable contract can never be consummated
d. a voidable contract results from failure to meet some legal requirements in negotiating the agreement

Answer 3

c. a voidable contract can never be consummated

Question 4

Which of the following is the basis of duress?

a. fear
b. mistake
c. indefiniteness
d. illusion

Answer 4

a. fear

Question 5

What type of real estate contract must be in writing per the Statute of Frauds?

a. an exclusive right to sell listing agreement
b. an exclusive right to represent buyer agreement
c. an offer to purchase and contract
d. short term rental agreements of less than three years

Answer 5

c. an offer to purchase and contract

Question 6

A contract to sell real property may be terminated by each of the following EXCEPT:

a. full performance
b. breach of contract
c. mutual agreement
d. death

Answer 6

d. death

Question 7

A contract in which mutual promises are exchanged at the time of signing (execution) is termed:

a. multilateral
b. unilateral
c. bilateral
d. promissory

Answer 7

c. bilateral

Question 8

A contract clause that stipulates the dates are to be strictly adhered to is the ___ clause

a. due diligence
b. assignment
c. time is of the essence
d. expressed contract

Answer 8

c. time is of the essence

Question 9

Which of the following has the effect of terminating contracts?

a. consideration
b. bankruptcy
c. exercise
d. assignment

Answer 9

b. bankruptcy

Question 10

All of the following contracts are unilateral EXCEPT:

a. contract for the sale of real estate
b. open listing contract
c. option to purchase contract
d. contract to pay $1,000 if someone will paint your house

Answer 10

a. contract for the sale of real estate

Question 11

When are contracts considered to be assignable?

a. only when it s specifically stipulated in the contract that it is assignable
b. contracts are always considered to be assignable
c. any time it is not prohibited
d. contracts are never considered assignable

Answer 11

c. any time it is not prohibited

Question 12

A complete transfer of contractual rights and privileges is a(n)

a. novation
b. specific performance
c. assignment
d. subsequent modifying agreement

Answer 12

c. assignment

Question 13

A contract is automatically void if there is:

a. duress
b. mutual mistake
c. willful misrepresentation
d. illegal purpose

Answer 13

d. illegal purpose

Question 14

Which one f the following is not required to be in writing according to the Statute of Frauds?

a. listing contract
b. offer to purchase
c. installment land contract
d. leases for more than three years

Answer 14

a. listing contract

Question 15

Substitution of a new contract for the former one is called a:

a. commingling
b. revocation
c. reversion
d. novation

Answer 15

d. novation