Formation of Contracts: Master the Basics of Contract Law

Question 1

What constitutes valid consideration in a contract?

Accepted Answer

Something of value given or promised in exchange for the other party's promise or performance

Answer

A promise made without expecting anything in return

Answer

Fulfilling an obligation that is already legally required

Answer

A statement of intention without any legal consequence

Question 2

Which of the following is NOT an essential element for the formation of a valid contract?

Accepted Answer

Mutual trust

Answer

Consideration

Answer

Offer

Answer

Acceptance

Question 3

Once an offer has been made, it can be revoked before acceptance. Is this statement true or false?

Accepted Answer

True

Answer

False

Answer

Not mentioned in the text.

Answer

Only if it is a unilateral offer.

Question 4

Which of the following is NOT a valid form of acceptance?

Accepted Answer

Silence

Answer

Written communication

Answer

Verbal communication

Answer

Conduct that indicates acceptance

Question 5

Consideration is something of value given in exchange for a promise. Is this statement true or false?

Accepted Answer

True

Answer

Not mentioned in the text.

Answer

False

Answer

Only if it is a unilateral contract.

Question 6

An agreement made under duress is voidable. Is this statement true or false?

Accepted Answer

True

Answer

Only if the duress is physical.

Answer

Not mentioned in the text.

Answer

False

Question 7

Which of the following is NOT a remedy for breach of contract?

Accepted Answer

Imprisonment

Answer

Injunction

Answer

Damages

Answer

Specific performance

Question 8

Which of the following is NOT an essential element for a valid contract to be formed?

Accepted Answer

Mutual affection

Answer

Consideration

Answer

Offer

Answer

Acceptance

Question 9

An offer must be communicated to the offeree through a recognized mode of communication to be valid. Which of the following is NOT considered a valid method of communication?

Accepted Answer

Psychic transmission

Answer

Verbal communication

Answer

Electronic communication

Answer

Written communication

Question 10

Consideration is defined as:

Accepted Answer

Something of value given in exchange for a promise

Answer

A statement of intent to enter into a contract

Answer

A legal obligation to perform a certain act

Answer

A benefit conferred on the promisor

Question 11

In order to create a valid contract, there must be:

Accepted Answer

An intention to create legal relations

Answer

An intention to deceive

Answer

An intention to socialize

Question 12

A contract under seal is:

Accepted Answer

A formal contract that requires no consideration

Answer

A contract that is void ab initio

Answer

A written contract that must be signed by both parties

Answer

An oral contract that is enforceable by law

Question 13

Which of the following statements about electronic contracts is true?

Accepted Answer

They are legally enforceable in the UK

Answer

They must be in writing to be valid

Answer

They cannot be used to create contracts for the sale of land

Answer

They are not subject to the same rules as traditional contracts

Question 14

The parol evidence rule:

Accepted Answer

Prevents the introduction of oral evidence to contradict or vary the terms of a written contract

Answer

Makes oral contracts unenforceable

Answer

Requires all contracts to be in writing

Question 15

Which of the following is NOT an essential element of a valid contract?

Accepted Answer

Witness signature

Answer

Consideration

Answer

Offer

Answer

Acceptance

Question 16

An offer can be terminated through:

Accepted Answer

Withdrawal of offer, rejection, counteroffer, lapse of time

Answer

Death of the parties

Answer

Acceptance

Answer

Change of circumstances

Question 17

An intention to create legal relations exists when:

Accepted Answer

The parties intend their agreement to be legally binding.

Answer

The contract is of a significant value.

Answer

The agreement is in writing.

Answer

The parties are of legal age.

Question 18

Which of the following is a type of unilateral contract?

Accepted Answer

Reward offer, competition prize

Answer

Insurance policy

Answer

Rental agreement

Answer

Sale of goods

Question 19

In which of the following situations is there an implied contract?

Accepted Answer

Buying a loaf of bread at a grocery store.

Answer

Signing a written employment agreement.

Answer

Making a verbal agreement to purchase a car.

Answer

Hiring a lawyer to represent you in court.

Question 20

Which of the following is a remedy for breach of contract?

Accepted Answer

Damages, injunction, specific performance, rescission

Answer

Imprisonment

Answer

Confiscation of property

Answer

Arrest

Question 21

A contract is void ab initio if:

Accepted Answer

It is illegal or impossible to perform, it is entered into under duress, undue influence, fraud, misrepresentation, or mistake.

Answer

One party is a minor.

Answer

It is not in writing.

Answer

It is made under duress.

Question 22

Which of the following is a factor that can affect the validity of an offer?

Accepted Answer

Mistake, misrepresentation, fraud, undue influence, duress

Answer

Time of day

Answer

Location of the contract formation

Answer

Age of the parties

Question 23

In an electronic contract, the parties must:

Accepted Answer

Have the capacity to use the electronic medium and intend to create legal relations through it.

Answer

Sign the contract in person.

Answer

Use a specific type of software.

Answer

Be physically present in the same location.