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Instant Download PDF Cengage Advantage Books Law For Business 19th Edition Ashcroft Test Bank Full Chapter
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Chapter 08 Consideration
TRUEFALSE
(A) True
(B) False
Answer : (A)
(A) True
(B) False
Answer : (B)
3. For a promise to constitute consideration, the promise must prevent imposing an obligation on
the person making it.
(A) True
(B) False
Answer : (B)
4. As a general rule, the adequacy of the consideration is irrelevant because the law allows bargains.
(A) True
(B) False
Answer : (A)
5. Generally, a part payment of a past-due debt is not consideration to support the creditor's
promise to cancel the balance of the debt.
(A) True
(B) False
Answer : (A)
(B) False
Answer : (B)
7. If the supposed consideration consists merely of a promise to do what one is already legally
obligated to do, consideration is invalid.
(A) True
(B) False
Answer : (A)
(A) True
(B) False
Answer : (B)
9. When charitable enterprises are financed by voluntary subscriptions of many people, the promise
of each person is generally not held to be enforceable.
(A) True
(B) False
Answer : (B)
10. The Uniform Commercial Code states that when a contract for the sale of goods is modified by
agreement of the parties, consideration is necessary to make it enforceable.
(A) True
(B) False
Answer : (B)
(A) True
(B) False
Answer : (A)
MULTICHOICE
(A) It refers to the record of a case sent for review to a higher court.
(B) It indicates what the promisor demands and receives as the price for a promise.
(C) It signifies a promissory note given by the promisor as a token of the transaction.
Answer : (B)
(C) A promise to refrain from doing an act that can be lawfully done
Answer : (C)
14. Mark owes $2000 each to his business partners, Ryan, Bryan, and Clark. Since Mark is facing
financial difficulties, his business partners agree to accept a total amount of $4800 from Mark as a
cancellation of the unpaid balance due to them. This type of an agreement is known as a _____.
(C) forbearance
Answer : (A)
15. When parties to a contract mutually agree to cancel an old contract and replace it with a new
one, which of the following is true?
(A) To be enforceable, there must be added features in the new contract benefiting both parties.
(B) One party's past performance under the original contract is sufficient consideration for the new
contract.
(D) Neither party has a right to make changes to the original contract.
Answer : (A)
16. When one refrains or promises to refrain from doing something, this conduct is known as _____.
(A) duress
(B) forbearance
(C) negligence
(D) disaffirmation
Answer : (B)
17. Blake has subscribed to a local charitable association where he needs to make a monthly
payment of $100. However, a few months later, Blake stops paying this amount. Which of the
following exceptions to the requirement of consideration will enforce that Blake pays the amount?
Answer : (B)
18. As a general rule, a promise must be supported by consideration. Which of the following is an
exception to the rule and can be enforced without the support of consideration?
(C) An act performed prior to the promise made by the promisor
Answer : (D)
(B) It permits the promisor to claim lack of consideration when the promisee acts in reliance on his
promise.
(C) It requires the promisor to reasonably expect the promise to induce action by the promisee.
(D) It holds enforcement to be proper if the promisee would not be harmed if the promise were not
enforced.
Answer : (C)
ESSAY
20. As a general rule, a promise must be supported by consideration. Describe any two exceptions to
this rule.
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FOOTNOTES: