Chapter 10

Question 1

voluntary exchange of promises between two or more legally competent persons to do or to refrain from doing an act

Answer 1

agreement

Question 2

An assent by the parties—a “meeting of the minds”—to perform current or future contractual duties

Answer 2

mutual assent

Question 3

agreement that meets certain additional legal criteria and is enforceable in a court of law

Answer 3

contract

Question 4

The party who makes an offer.

Answer 4

offeror

Question 5

The party to whom an offer has been made

Answer 5

offeree

Question 6

The manifestation of willingness to enter into a bargain, so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it

Answer 6

offer

Question 7

3 required elements in order for an offer to be effective

Answer 7

1. The offeror must objectively intend to be bound by the offer.
2. The terms of the offer must be definite or reasonably certain.
3. The offer must be communicated to the offeree.

Question 8

4 terms an offer must contain

Answer 8

(1) identification of the parties, (2) identification of the subject matter and quantity, (3) consideration to be paid, and (4) time of performance

Question 9

Terms in offers and contracts that expressly identify the parties, the subject matter of the offer or contract, the consideration to be paid by the parties, and the time of performance, as well as other terms of the offer and contract

Answer 9

express terms

Question 10

A term in a contract that can reasonably be supplied by the courts

Answer 10

implied term

Question 11

An invitation to make an offer or an actual offer

Answer 11

advertisement

Question 12

2 requirements to be entitled to collect a reward

Answer 12

(1) have knowledge of the reward offer prior to completing the requested act and (2) perform the requested act

Question 13

An award given for performance of some service or attainment

Answer 13

reward

Question 14

A sale in which a seller of goods offers goods for sale through an auctioneer.

Answer 14

auction

Question 15

An auction in which the seller retains the right to refuse the highest bid and withdraw the goods from sale.

Answer 15

auction with reserve

Question 16

Unless expressly stated otherwise, an auction is an ___________.

Answer 16

auction with reserve

Question 17

An auction in which the seller expressly gives up the right to withdraw the goods from sale and must accept the highest bid.

Answer 17

auction without reserve

Question 18

The _________ of an offer by an act of the parties consists of situations in which one party takes an action that indicates that he or she is not interested in forming a contract under the terms of the offer.

Answer 18

termination

Question 19

Withdrawal of an offer by the offeror that terminates the offer

Answer 19

revocation of an offer

Question 20

Express words or conduct by the offeree to reject an offer. This terminates the offer.

Answer 20

rejection of an offer.

Question 21

A response by an offeree that contains terms and conditions different from or in addition to those of the offer. This terminates the previous offer

Answer 21

counteroffer

Question 22

A contract that is created when an offeree pays an offeror compensation to keep an offer open for an agreed-upon period of time. This prevents the offeror from revoking his or her offer during the option period

Answer 22

option contract

Question 23

The enactment of a statute, regulation, or court decision that makes the object of an offer illegal. This action terminates the offer.

Answer 23

supervening illegality

Question 24

A stated time period after which an offer terminates. If no time is stated, an offer terminates after a reasonable time

Answer 24

lapse of time

Question 25

The subject matter of an offer is destroyed prior to acceptance through no fault of either party.

Answer 25

destruction of the subject matter

Question 26

Prior to acceptance of an offer, either the offeror or the offeree dies or becomes incompetent.

Answer 26

death or incompetency

Question 27

a manifestation of assent by the offeree to the terms of the offer in a manner invited or required by the offer as measured by the objective theory of contracts

Answer 27

acceptance

Question 28

An acceptance of an offer that is clear, unambiguous, and has only one possible meaning

Answer 28

unequivocal acceptance

Question 29

An offeree’s acceptance must be an ________ acceptance.

Answer 29

unequivocal

Question 30

An _________ response by the offeree does not create a contract.

Answer 30

equivocal

Question 31

An offeree’s response to an offer that is not clear, is not unambiguous, or has more than one possible meaning

Answer 31

equivocal response

Question 32

A rule stating that, for an acceptance to exist, the offeree must accept the terms as stated in the offer

Answer 32

mirror image rule

Question 33

A rule stating that an acceptance is effective when it is dispatched, even if it is lost in transmission.

Answer 33

acceptance-upon-dispatch rule

Question 34

The proper addressing, packaging, and posting of an acceptance

Answer 34

proper dispatch

Question 35

A rule that states that an offeree must accept an offer by means expressly specified in the offer, or if there is no such requirement, then by any means customary in similar transactions, usage of trade, or prior dealings between the parties.

Answer 35

authorized means of communication

Question 36

A mode of acceptance that is implied from what is customary in similar transactions, usage of trade, or prior dealings between the parties.

Answer 36

implied authorization

Question 37

A stipulation in an offer that says the acceptance must be by a specified means of communication.

Answer 37

express authorization