LGS Exam 2

Michael received a proposal from a company for a new software service. What is the term for an agreement to be bound by the terms of the offeror's proposal?

• Agreement and Fulfillment

• Agreement to Terms

• Proposal Rejection

• Promise Not To Litigate

Answer explanation

The term for an agreement to be bound by the terms of an offeror's proposal is 'Acceptance'. This indicates that the offeree agrees to the terms set forth in the offer.

Aiden and Liam had a disagreement over a previous contract. They decided to resolve it by creating a new agreement that both parties accepted. What is this new agreement called?

• An agreement known as a Bilateral Contract

• An agreement known as a Click-On Agreement

• An agreement known as Accord and Satisfaction

• An agreement known as Contractual Capacity

Answer explanation

The term 'Accord and Satisfaction' refers to a new agreement that resolves a previous contract dispute, fulfilling the obligations of both parties. This distinguishes it from other types of agreements.

Avery and Ethan agree that Avery will paint Ethan's house, and in return, Ethan will pay Avery $500. What type of contract is this?

• A contract involving a promise to refrain from competition

• A contract involving a promise given in exchange for a promise

• A contract involving terms agreed to by use of a website

• A contract involving a rejection of the initial offer

Answer explanation

A bilateral contract involves mutual promises, where each party agrees to fulfill their promise in exchange for the other party's promise. This distinguishes it from unilateral contracts, which involve a promise for an act.

Charlotte visits a website to buy a book. What are browse-wrap terms?

• Terms that users agree to directly by clicking 'I agree'

• Terms that users agree to by simply using a website or program

• Terms that are enforceable by a court of law

• Terms that form a contract to avoid legal action

Answer explanation

Browse-wrap terms are agreements that users accept by simply using a website or program, without needing to explicitly agree to them. This makes the correct choice: 'Terms agreed to by use of a website or program, do not need to be explicitly agreed to'.

Emma is signing up for a new online service. What is a click-on agreement?

• An agreement that grants legal ability to enter into a contract

• An agreement where terms are directly accepted by the user

• An agreement involving a promise to refrain from legal action

• An agreement that constitutes a rejection of the initial offer

Answer explanation

A click-on agreement refers to terms that a user agrees to directly, often by clicking a button or checkbox. This choice accurately reflects the nature of such agreements, as they are based on user consent.

Hannah promises to pay Benjamin $100 if he mows her lawn. What does consideration refer to in this contract?

• A commitment to avoid competition

• A value exchanged for a promise or action

• An agreement on the contract terms

• A refusal of the original offer

Answer explanation

In contract law, consideration refers to the value given in return for a promise or performance. It is essential for a contract to be enforceable, as it signifies that both parties are providing something of value.

Arjun and Grace are starting a business together. What is contractual capacity?

• The legal ability to enter into a binding agreement

• The commitment to abstain from initiating legal proceedings

• The acceptance of terms through the use of a digital platform

• The formation and fulfillment of a mutual understanding

Answer explanation

Contractual capacity refers to the legal ability to enter into a contract, ensuring that parties can understand and agree to the terms. This makes "The legal ability to enter into a contract" the correct choice.

Grace received a job offer but wanted a higher salary. What is Grace's response if she proposes a new salary?

• An acceptance of the original offer with new terms

• A rejection of the original offer with a new proposal

• An agreement to avoid competition

• An enforceable contract by the court

Answer explanation

A counteroffer occurs when the original offer is rejected and a new offer is made. This means the initial terms are not accepted, and the counteroffer proposes different terms for consideration.

Nora is starting a new business and is asked to sign a covenant not to compete. What does this mean?

• A contractual promise to avoid legal disputes

• A contractual promise to avoid competing with another party for a specified time and area

• A contractual promise to adhere to terms agreed directly by the user

• A contractual promise to reach a mutual understanding about the terms of a contract

Answer explanation

A covenant not to compete is specifically a promise to refrain from competition with another party for a time in a specific area, making the second answer choice the correct one.

Maya and Grace are business partners. They decide to enter into a contractual agreement where Maya makes a promise to avoid legal action against Grace for any past disputes. What is this agreement called?

• A contractual promise to avoid competition

• A contractual promise to avoid legal action

• A contractual promise agreed upon by using a website

• A contractual promise to reject the initial offer

Answer explanation

A covenant not to sue is specifically a contractual agreement where one party agrees not to initiate legal action against another, making the correct choice "A contractual agreement to refrain from legal action."