Chapter 11: Contracts (MC)

Question 1

One example of a unilateral contract is the

a. purchase and sale contract.
b. contract for deed.
c. open listing contract.
d. oral contract.

Answer 1

c. open listing contract.

Question 2

A broker’s commission will be subject to forfeiture when he or she

a. has an oral listing contract.
b. fails to obtain witnesses to a real estate sales contract.
c. performs according to the employment contract.
d. violates a fiduciary duty.

Answer 2

d. violates a fiduciary duty.

Question 3

If an owner revokes an exclusive right of sale listing and sells the property during the remaining time the listing would have been in effect, the broker is entitled to

a. a full commission.
b. bring a suit for damages.
c. write off the loss on their income taxes.
d. revoke the listing contract.

Answer 3

a. a full commission.

Question 4

When all terms and conditions are NOT fully expressed, a contract is referred to as being

a. implied.
b. bilateral.
c. parol.
d. executory.

Answer 4

a. implied.

Question 5

The required elements of all valid contracts are

a. legal subject, competent parties, legal age and offer.
b. offer, acceptance, legal age and legal subject.
c. legal subject, agreement, consideration and two or more competent parties.
d. meeting of minds, legal age, offer and competent parties.

Answer 5

c. legal subject, agreement, consideration and two or more competent parties.

Question 6

The phrase “meeting of the minds” refers to

a. offer and acceptance.
b. consideration.
c. legal subject.
d. two or more parties.

Answer 6

a. offer and acceptance.

Question 7

A contract is

a. a written instrument.
b. legally binding.
c. void unless accompanied by earnest money.
d. always bilateral.

Answer 7

b. legally binding.

Question 8

The party who receives an offer is the

a. offeree.
b. offeror.
c. optionor.
d. optionee.

Answer 8

a. offeree.

Question 9

When the terms and conditions of a contract have been fully performed, the contract is said to be

a. executory.
b. bilateral.
c. unilateral.
d. executed.

Answer 9

d. executed.

Question 10

Which statute requires a purchase and sale contract to be in writing to be enforceable?

a. Chapter 475
b. Chapter 120
c. Statute of Limitations
d. Statute of Frauds

Answer 10

d. Statute of Frauds

Question 11

The consideration given by a buyer to indicate serious intent to buy a property is called

a. an earnest money deposit.
b. a check deposit.
c. legal tender.
d. a boot deposit.

Answer 11

a. an earnest money deposit.

Question 12

An offer is NOT terminated by

a. expiration of a reasonable or specified time period.
b. the death of the offeror.
c. a counteroffer.
d. a failure to obtain a binder deposit.

Answer 12

d. a failure to obtain a binder deposit.

Question 13

The time period for enforcement of a contract is established by the

a. Statute of Frauds.
b. Statute of Limitations.
c. real estate license law.
d. state courts.

Answer 13

b. Statute of Limitations.

Question 14

A buyer negotiates a contract to purchase property, takes possession and pays the property purchase price in installments, but does not receive the legal title until the full purchase price has been paid. This agreement is

a. an obvious attempt to defraud the buyer.
b. a lease-option.
c. a violation of the Statute of Frauds.
d. an installment contract, contract for deed or land contract.

Answer 14

d. an installment contract, contract for deed or land contract.

Question 15

Which document is a real estate broker NOT legally allowed to prepare?

a. purchase and sale contract
b. listing
c. lease
d. option

Answer 15

c. lease