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Question 1
Regis has just undergone several hours of oral surgery to fix several dental problems that he has been living with. When he arrives home, he is in great pain and is unable to talk. Kelly, one of Regis' friends, comes over to see if Regis needs any help. When she enters Regis' apartment, Kelly sees that the place is an absolute mess. Kelly says to Regis "hiring a cleaning lady to clean this place is going to cost you $200. I'll clean up for you for $150. Clap once to say yes and clap twice to say no." Regis claps once. This interaction has created a binding contract:
Correct An offer is basically an expression of willingness to enter into a bargain made in a way so that the offeree understands that he can accept the offer and conclude a bargain. In order for an offer to be adequate, the offer must demonstrate intent to enter into a bargain and definiteness of terms. If an offer is made, the offeree has the power to conclude a bargain and bind the offeror by accepting the offer in an appropriate manner. Here, Kelly's statement demonstrated an intent to enter into a bargain and it laid out definite terms. Further, Regis accepted the offer by clapping once, which was the precise method that Kelly laid out for acceptance. Therefore, Regis and Kelly have a binding agreement and TRUE is the correct answer.
Incorrect! An offer is basically an expression of willingness to enter into a bargain made in a way so that the offeree understands that he can accept the offer and conclude a bargain. In order for an offer to be adequate, the offer must demonstrate intent to enter into a bargain and definiteness of terms. If an offer is made, the offeree has the power to conclude a bargain and bind the offeror by accepting the offer in an appropriate manner. Here, Kelly's statement demonstrated an intent to enter into a bargain and it laid out definite terms. Further, Regis accepted the offer by clapping once, which was the precise method that Kelly laid out for acceptance. Therefore, Regis and Kelly have a binding agreement and TRUE is the correct answer.
Correct
Incorrect!
Question 2
George is the owner and manager of Babe's baseball Memorabilia shop. One of the most valuable items in George's shop is a baseball bat signed by the 1918 Red Sox, the last Red Sox team to win the World Series. Pedro is an avid Red Sox fan and he would love to add the bat to his extensive collection of Red Sox memorabilia. Pedro goes to George's shop to ask about the bat and George tells Pedro, "It is one of my favorite pieces and I would hate to part with it, but I suppose I would be willing to sell it for $10,000." As soon as Pedro hears this, he runs out of the store and heads straight for the bank where he withdraws $10,000. He returns to George's shop with the money a few hours later, but George tells Pedro that he is not interested in selling the bat. Enraged, Pedro sues George, arguing that he and George had a binding contract to sell the bat for $10,000. Pedro will probably win the case:
Correct
Incorrect!
Correct There is a difference between actual offers and invitations to deal. Offers empower the offeree to accept and finalize a contract. However, invitations to deal are not offers so they cannot be accepted. An expression like "I would be willing to . . ." is only an invitation to deal. That being the case, Pedro will lose his suit and FALSE is the correct answer.
Incorrect! There is a difference between actual offers and invitations to deal. Offers empower the offeree to accept and finalize a contract. However, invitations to deal are not offers so they cannot be accepted. An expression like "I would be willing to . . ." is only an invitation to deal. That being the case, Pedro will lose his suit and FALSE is the correct answer.
Question 3
Pedro is an avid Red Sox fan who had built up an extensive collection of Red Sox memorabilia. Pedro hears that George, the owner of a baseball memorabilia shop has a large collection of old Red Sox baseball cards that he has put on sale. Pedro goes to the shop where George tells him "I'll sell you a part of the collection for fair value." Pedro leaves the store and returns a few hours later with several hundred dollars, at which point, George tells Pedro that he has decided not to sell any of the cards. Pedro sues George, arguing that he and George had a binding contract. Pedro will probably win the case:
Correct
Incorrect!
Correct Aside from examining the language of an expression, another way to determine if an expression constitutes an offer is to see whether or not the terms used in the discussion are definite. The general rule is that an expression will not be considered an offer unless it makes clear the subject matter of the bargain, the price and the quantity involved. Here, no quantity of cards or price was established between George and Pedro. Therefore, the expression that George articulated to Pedro was not an offer and FALSE is the correct answer.
Incorrect! Aside from examining the language of an expression, another way to determine if an expression constitutes an offer is to see whether or not the terms used in the discussion are definite. The general rule is that an expression will not be considered an offer unless it makes clear the subject matter of the bargain, the price and the quantity involved. Here, no quantity of cards or price was established between George and Pedro. Therefore, the expression that George articulated to Pedro was not an offer and FALSE is the correct answer.
Question 4
Pedro is an avid Red Sox fan who had built up an extensive collection of Red Sox memorabilia. Pedro hears that George, the owner of a baseball memorabilia shop has a large collection of old Red Sox baseball cards that he has put on sale. Pedro goes to the shop where George tells him "I am selling the cards for $100 per fifty cards but if you buy now, I'll give you five sets of fifty cards for only $400." Pedro leaves the store and returns a few hours later with four hundred dollars, at which point, George tells Pedro that he has decided not to sell any of the cards. Pedro sues George, arguing that he and George had a binding contract. Pedro will probably win the case:
Correct Aside from examining the language of an expression, another way to determine if an expression constitutes an offer it to see whether or not the terms used in the discussion are definite. The general rule is that an expression will not be considered an offer unless it makes clear the subject matter of the bargain, the price and the quantity involved. Here, both quantity and price were established between George and Pedro. Therefore, the expression that George articulated to Pedro was an offer and Pedro's acceptance of the offer established a binding contract. Thus, TRUE is the correct answer.
Incorrect! Aside from examining the language of an expression, another way to determine if an expression constitutes an offer it to see whether or not the terms used in the discussion are definite. The general rule is that an expression will not be considered an offer unless it makes clear the subject matter of the bargain, the price and the quantity involved. Here, both quantity and price were established between George and Pedro. Therefore, the expression that George articulated to Pedro was an offer and Pedro's acceptance of the offer established a binding contract. Thus, TRUE is the correct answer.
Correct
Incorrect!
Question 5
Babe's Baseball Memorabilia posts an advertisement in the New York Times saying that on April 1st, in honor of opening day, all packs of 2003 Topps baseball cards will be sold for a dime per pack. By the time Pedro gets to Babe's, all of the 2003 Topps baseball card packs have been sold out. Pedro sues George, the owner of the shop, claiming that the advertisement was an offer and that, when he accepted the offer by showing up at the store and trying to buy cards, George breached their contract by not selling any cards to Pedro. Pedro will probably lose this case:
Correct The general rule regarding advertisements is that they are invitations to deal. The rationale underlying this rule is that, generally, advertisements are indefinite as to quantity and other terms. Also, since advertisements are addressed to the general public, there would be a risk of over-acceptance if advertisements are construed as offers. That being the case, Pedro cannot claim that he accepted an offer from Babe's and sue for damages because the ad was not an offer. It was only an invitation to deal. Therefore, Pedro will lose this case and TRUE is the correct answer.
Incorrect! The general rule regarding advertisements is that they are invitations to deal. The rationale underlying this rule is that, generally, advertisements are indefinite as to quantity and other terms. Also, since advertisements are addressed to the general public, there would be a risk of over-acceptance if advertisements are construed as offers. That being the case, Pedro cannot claim that he accepted an offer from Babe's and sue for damages because the ad was not an offer. It was only an invitation to deal. Therefore, Pedro will lose this case and TRUE is the correct answer.
Correct
Incorrect!
Question 6
Babe's Baseball Memorabilia posts an advertisement in the New York Times saying that on April 1st, in honor of opening day, one hundred brand new Franklin's baseball gloves will be on sale for $50 per glove. The ad also says that only one glove will be sold to each customer and only the first one hundred buyers will receive the sale price. By the time Pedro gets to Babe's, ninety-five of the gloves have been sold. Pedro picks up one of the gloves and tries to buy it, but George, the owner of the shop, informs Pedro that the sale price is no longer being offered. Pedro sues George, claiming that the advertisement was an offer and that, when he accepted the offer by showing up at the store and trying to buy a glove, George breached their contract by not selling a glove to Pedro. Pedro will probably lose this case:
Correct
Incorrect!
Correct Certain advertisements may be considered real offers if the advertisement is definite in its terms and either 1) the circumstances clearly indicate an intention to make a bargain, 2) the advertisement invites people to take specific action without further communication with the offeror, or 3) over-acceptance is unlikely. Here, the advertisement is definite in its terms, it invites people to take further action without communicating with George and over-acceptance is not possible because the offer is only made to the first one hundred buyers. Therefore, George's advertisement was actually a valid offer. That being the case, Pedro will win this suit and FALSE is the correct answer.
Incorrect! Certain advertisements may be considered real offers if the advertisement is definite in its terms and either 1) the circumstances clearly indicate an intention to make a bargain, 2) the advertisement invites people to take specific action without further communication with the offeror, or 3) over-acceptance is unlikely. Here, the advertisement is definite in its terms, it invites people to take further action without communicating with George and over-acceptance is not possible because the offer is only made to the first one hundred buyers. Therefore, George's advertisement was actually a valid offer. That being the case, Pedro will win this suit and FALSE is the correct answer.