Question and answer layout preserved from source
Question: Question: A promise by Derkin Restaurants to buy all of the produce that Elfredo’s Produce can supply at an established price would be an:
Answer Choices:
Enforceable requirements contract.
Enforceable output contract.
Unenforceable. Illusory contract.
Unenforceable promise based on past consideration.
Answer: Enforceable output contract.
Question: Question: Jennifer materially breaches her service contract with Gretchen. Due to Jennifer’s failure to render complete performance, Gretchen:
Answer Choices:
Is discharged from any further contractual obligations.
Is required to pay the full contract price, minus the value of Jennifer’s defective performance.
Is required to pay the full contract price.
May declare a material breach and pay only for the value received.
Answer: Is discharged from any further contractual obligations.
Question: Question: Farmer Erwin is holding 200 pounds of potatoes in storage for Chef Noble but Chef Noble has breached the contract by failing to pay for the potatoes. The potatoes are beginning to rot. If Farmer Erwin sells the potatoes to a local diner to make potato soup and salad, then this action would be considered:
Answer Choices:
A reasonable mitigation of damages.
An attempt to maximize damages.
An attempt to realize an unwarranted profit.
Conversion.
Answer: A reasonable mitigation of damages.
Question: Question: Collector Carl displays his beer can collection at the local swap meet. Mary sees the collection and is interested in buying it. Carl says he will sell the collection for $1,500. Mary says she really likes the collection but is only willing to pay $1,000. Which of the following is correct?
Answer Choices:
Mary’s counteroffer terminates Carl’s offer of $1,500.
If Carl rejects Mary’s counteroffer, she can still accept Carl’s offer of $1,500.
Neither offer is valid. Who would pay $1,000 or $1,500 for a beer can collection?
Mary’s offer is a firm offer. Carl has an exclusive right to consider her offer for a reasonable period of time.
Answer: Mary’s counteroffer terminates Carl’s offer of $1,500.
Question: Question: Jackie hires Charles to lay new carpet in her bedroom. Charles does a bad job, and the carpet installation must be repaired. Which of the following best describes this situation?
Answer Choices:
This is substantial performance. Jackie must still pay something to Charles.
This is a material breach. Jackie must still pay something to Charles.
This is substantial performance. Jackie owes nothing to Charles.
This is a material breach. Jackie owes nothing to Charles.
Answer: This is a material breach. Jackie owes nothing to Charles.
Question: Question: Melody is a recent graduate of State Law School. She lands an impressive employment contract with the firm of Dewey, Cheatham, and Howe, Attorneys at Law, on the stated provision that she pass the upcoming bar exam. This provision in the employment agreement is a(n):
Answer Choices:
Condition precedent.
Condition subsequent.
Implied condition.
Concurrent condition.
Answer: Condition precedent.
Question: Question: The main difference between the UCC requirement for a writing for a contract for the sale of goods and the common law is that the:
Answer Choices:
UCC requires only the signature of both parties.
UCC does not require all the terms of the agreement to be in writing.
Common law requires only an indication that the parties reached an agreement.
Common law requires only the signature of the defendant and the quantity of goods being sold.
Answer: UCC does not require all the terms of the agreement to be in writing.
Question: Question: Shelly offers to sell Jane goods both parties know are stolen. Jane accepts the offer, and agrees to pay for the goods. Later, Jane refuses to accept or pay for the goods. If Shelly sues Jane for breach of contract, what is the probable result?
Answer Choices:
The law would enforce this valid, enforceable contract.
Jane would win as this is a voidable contract.
Answer: Jane would win as this is a voidable contract.
Question: Question: John enters into a contract to paint Chad’s house. When Chad decides on a color, John will buy the paint at a cost of $2500 and paint the house for the price of $500. Which of the following is true?
Answer Choices:
The common law of contracts governs because this is a mixed contract (one for services and goods).
The common law of contracts governs because the predominant factor of the contract is for the sale of services and not goods.
The Uniform Commercial Code governs because a sale of goods is the predominant part of the contract.
Both the common law and the Uniform Commercial Code will govern this contract.
Answer: The common law of contracts governs because the predominant factor of the contract is for the sale of services and not goods.
Question: Question: Ann promises in writing to pay her cousin Bert, who is dangerously obese, $10,000 if Bert loses 100 pounds within the next two years. Bert agrees, performs his part of the bargain, and asks for the money. Ann refuses to pay, saying that she got the deal, but that even if she did make such a pledge, there was no valid consideration for it. Bert files a suit against Ann. In whose favor is the court likely to rule?
Answer Choices:
The court is likely to rule in favor of Bert because there was valid consideration.
The court is likely to rule in favor of Bert because Ann promised Bert in writing. In this case, since there was a promise made between two parties, $10,000 for losing 100 pounds in 2 years. Because there was a request made, this would be sufficient enough for the court to favor Bert.
Answer: The court is likely to rule in favor of Bert because there was valid consideration.
ECON 002 – Timed Final Exam
Question: Question: Keynesian believe the economy is characterized by recessions and inflationary booms which can cause unemployment and inflationary conditions. The solutions proposed by Keynesians to address inflation (high levels) is contractionary fiscal policy which involves:
Answer Choices:
Tax increases and decreased government spending
Tax cuts and increased government spending
Increasing the discount rate to influence the fed fund rate
Answer: Tax increases and decreased government spending
Question: Question: Keynes argued that the ________ was unable to keep the economy at full employment. As a result, ________ should take an active role in managing the economy.
Answer Choices:
Public sector; government
Private sector; government
Private sector; corporations
Answer: Private sector; government
Question: Question: According to Keynes what should the government do improve economic conditions during a recession?
Answer Choices:
Increase government spending and/or decrease taxes
Increase spending and/or increase taxes
Reduce government spending and increase taxes
Answer: Increase government spending and/or decrease taxes
Question: Question: According to economic laws explained by Keynes, it is believed that economies in the _______ and _______ driven.
Answer Choices:
Long-run; supply
Long-run; demand
Short-run; demand
Answer: Short-run; demand
Question: Question: What type of policies does a Keynesian economist say need to be used to influence the economy to correct for unemployment and inflation?
Answer Choices:
Production policies
Reduction policies
Fiscal policies
Answer: Fiscal policies
Question: Question: In the neoclassical view of the economy, expansionary fiscal policy cannot work to raise equilibrium output because:
Answer Choices:
It will disincentivize production.
Flexible prices will eventually choke off any increase in aggregate demand.
It will raise unemployment.
Answer: Flexible prices will eventually choke off any increase in aggregate demand.
Question: Question: Jontel got a raise, which may help the economy since:
Answer Choices:
She will likely consume more goods and services.
She will likely hoard more money to prepare for fluctuations in the economy.
She will likely put more money in savings.
Answer: She will likely consume more goods and services.
Question: Question: Consider the following scenario. If foreign goods are relatively more expensive than U.S. goods, exports from the U.S. rise. How would this scenario make the aggregate demand curve change?
Answer Choices:
The AD curve would shift to the right.
The AD curve would remain unchanged.
The AD curve would shift to the left.
Answer: The AD curve would shift to the right.
Question: Question: Which factor other than income can also cause the entire consumption function to shift?
Answer Choices:
Export spending
Changes in wealth
Government spending
Answer: Changes in wealth