Question 1

If a UCC contract does not contain all the terms necessary to carry it out, there will be no contract.

Accepted Answer

A) True 
 B)False

Question 2

A(n)  __________ is a special type of lease transaction generally involving three parties instead of two.

Accepted Answer

A)   consumer lease
B)   sale
C)   finance lease
D)   optionE) B) and C)
F) A) and D)

Question 3

The CISG governs only the formation of the contract of sales and the rights and obligations of the seller and buyer. It does not cover the validity of the contract or any of its provisions.

Accepted Answer

A) True 
 B)False

Question 4

The common law "mirror image" rule has been modified by the Code.

Accepted Answer

A) True 
 B)False

Question 5

In the case of Pittsley v. Houser, the court:

Accepted Answer

A)   held that the contract should be severed into different parts, applying the UCC to the part of the contract involving goods and the common law to the services part of the contract.
B)   held that the "predominant factor" test contravened the UCC's declared purpose.
C)   found the "predominant factor" test was the better, more prudent rule.
D)   found the CISG governed the contract in question.E) None of the above
F) A) and B) C

Question 6

List four areas of contract law where the common law of contracts and the law of sales differ. Give both the common law rule and the rule under Article 2.

Accepted Answer

There are at least nine possible answers. Students should mention four of the following possibilities. (1) An underlying policy of the Code is to permit the continued expansion of commercial practices through custom, usage, and agreement of the parties. In particular, the Code places great emphasis on course of dealings and usage of trade in interpreting agreements. (2) A novel feature of the Code is the establishment of separate rules that apply to transactions between merchants or involving a merchant as a party. (3) A firm offer is not revocable for lack of consideration. Under the common law, an offer can be revoked at any time unless there is detrimental reliance or consideration to support an option contract. (4) The court, to determine whether in its commercial setting, purpose, and effect it is unconscionable, may scrutinize every contract of sale. (5) All parties who enter into a contract or duty within the scope of the Code must perform their obligations in good faith. (6) The Code's basic approach to validation of a contract is to recognize contracts whenever the parties manifest such intent. This is so whether or not the parties can identify a precise moment at which they formed the contract. Even though one or more terms to a contract may have been omitted, the contract need not fail for indefiniteness. (7) The common law "mirror image" rule, by which the acceptance cannot vary or deviate from the terms of the offer, is modified by the Code. The Code addresses the battle of the forms problem by focusing on the intent of the parties. (8) The Code provides that where the language in the offer or the circumstances do not otherwise clearly indicate, an offer to make a contract invites acceptance in any manner and by any medium reasonable in the circumstances. (9) The Code has abandoned the common law rule requiring that a modification of an existing contract be supported by consideration in order to be valid. A contract for the sale of goods can be effectively modified without new consideration, provided the modification is made in good faith.

Question 7

A contract has an open price term if the agreement:

Accepted Answer

A)   says nothing as to price.
B)   provides that the parties shall agree later as to the price and they fail to so agree.
C)   fixes the price in terms of some agreed market or other standard, as set by a third person or agency, and the price is not so set.
D)   All of these.
E)   None of these.F) None of the above
G) B) and E) D

Question 8

What does Article 2 say with regard to the following? 
a. Good faith. 
b. Unconscionability. 
c. Expansion of commercial practices.

Accepted Answer

a. All parties who enter into a contract...

Question 9

Which of the following transactions is governed by Article 2 of the UCC?

Accepted Answer

A)   The sale of an apartment complex.
B)   The sale of oranges to be picked from a 10-acre grove.
C)   The sale of common stock of a soft drink company.
D)   A contract to receive medical services in a hospital.E) All of the above
F) A) and B)

Question 10

Mary and Remaldi Co. have dealt with each other for many years. Mary's Boutique orders 100 assorted lipsticks at $2.00 each from Remaldi Co. Remaldi sends back a confirmation letter with an additional, nonmaterial term. There is:

Accepted Answer

A)   no contract, but a counteroffer.
B)   a contract with the additional term unless Mary objects.
C)   a contract with the additional term only if Mary agrees.
D)   a contract without the additional term.E) None of the above
F) C) and D)

Question 11

In the Carter v. Tokai Financial Services, Inc. case, the agreement was found to:

Accepted Answer

A)   fit within the definition of a secured transaction.
B)   be governed by UCC Article 9.
C)   be for an initial term of five years, which ARC had an option to renew for nominal consideration.
D)   be a true finance lease.E) C) and D)
F) B) and C)

Question 12

Edie telephoned the office supply store and agreed to buy a dozen ink cartridges at $26 each. She then realized what a good buy this was and called the store with a request to modify the contract to read two dozen. What is the consequence?

Accepted Answer

A)   The modified contract is unenforceable.
B)   The modified contract is void.
C)   The modified contract is valid and enforceable.
D)   There is no consideration, so the contract is void.E) None of the above
F) A) and C)

Question 13

The UCC modifies the common law rule by requiring additional consideration for the modification of a contract.

Accepted Answer

A) True 
 B)False

Question 14

The UCC definition of "unconscionable" is clear and unambiguous.

Accepted Answer

A) True 
 B)False

Question 15

"Goods" for purposes of the Code are essentially defined as tangible, movable, personal property.

Accepted Answer

A) True 
 B)False

Question 16

A lease is the transfer of title to goods from seller to buyer for a price.

Accepted Answer

A) True 
 B)False

Question 17

Mike inherited some antiques. Pat agrees to buy them. In the contract, Mike and Pat agree to value the antiques at whatever the Sotheby's representative says. If the valuation is much higher than either of them anticipated, Pat:

Accepted Answer

A)   has to buy at the price set by the Sotheby representative.
B)   has to buy, but at what Pat and Mike believe was a reasonable price.
C)   has no obligation to buy the antiques.
D)   can treat the contract as canceled.E) A) and C)
F) B) and D)

Question 18

Explain when a writing is required under the UCC for a contract for the sale of goods and what is needed in that writing. Identify three exceptions to the requirement of a writing or record for the sale of goods.

Accepted Answer

The UCC statute of frauds provides that ...

Question 19

The definition of "goods" in the UCC may include timber, minerals, growing crops, or a building.

Accepted Answer

A) True 
 B)False

Question 20

A "merchant" is defined as a person who:

Accepted Answer

A)   is a dealer in a particular type of goods.
B)   by his occupation holds himself out as having knowledge or skills peculiar to certain goods or practices.
C)   employs an agent or broker whom he holds out as having such knowledge or skill.
D)   All of these.E) None of the above
F) A) and B)

Exam 19: Introduction to Sales and Leases

If a UCC contract does not contain all the terms necessary to carry it out, there will be no contract.

Correct Answer
verified

A(n) __________ is a special type of lease transaction generally involving three parties instead of two.

Correct Answer
verified

The CISG governs only the formation of the contract of sales and the rights and obligations of the seller and buyer. It does not cover the validity of the contract or any of its provisions.

Correct Answer
verified

The common law "mirror image" rule has been modified by the Code.

Correct Answer
verified

In the case of Pittsley v. Houser, the court:

Correct Answer
verified
C

List four areas of contract law where the common law of contracts and the law of sales differ. Give both the common law rule and the rule under Article 2.

A contract has an open price term if the agreement:

Correct Answer
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D

What does Article 2 say with regard to the following? a. Good faith. b. Unconscionability. c. Expansion of commercial practices.

Correct Answer
verified
a. All parties who enter into a contract...
View Answer

Which of the following transactions is governed by Article 2 of the UCC?

Correct Answer
verified

Mary and Remaldi Co. have dealt with each other for many years. Mary's Boutique orders 100 assorted lipsticks at $2.00 each from Remaldi Co. Remaldi sends back a confirmation letter with an additional, nonmaterial term. There is:

Correct Answer
verified

In the Carter v. Tokai Financial Services, Inc. case, the agreement was found to:

Correct Answer
verified

Edie telephoned the office supply store and agreed to buy a dozen ink cartridges at $26 each. She then realized what a good buy this was and called the store with a request to modify the contract to read two dozen. What is the consequence?

Correct Answer
verified

The UCC modifies the common law rule by requiring additional consideration for the modification of a contract.

Correct Answer
verified

The UCC definition of "unconscionable" is clear and unambiguous.

Correct Answer
verified

"Goods" for purposes of the Code are essentially defined as tangible, movable, personal property.

Correct Answer
verified

A lease is the transfer of title to goods from seller to buyer for a price.

Correct Answer
verified

Mike inherited some antiques. Pat agrees to buy them. In the contract, Mike and Pat agree to value the antiques at whatever the Sotheby's representative says. If the valuation is much higher than either of them anticipated, Pat:

Correct Answer
verified

Explain when a writing is required under the UCC for a contract for the sale of goods and what is needed in that writing. Identify three exceptions to the requirement of a writing or record for the sale of goods.

Correct Answer
verified
The UCC statute of frauds provides that ...
View Answer

The definition of "goods" in the UCC may include timber, minerals, growing crops, or a building.

Correct Answer
verified

A "merchant" is defined as a person who:

Correct Answer
verified

Exam 19: Introduction to Sales and Leases

If a UCC contract does not contain all the terms necessary to carry it out, there will be no contract.

Correct AnswerverifiedShow Answer

A(n) __________ is a special type of lease transaction generally involving three parties instead of two.

Correct AnswerverifiedShow Answer

The CISG governs only the formation of the contract of sales and the rights and obligations of the seller and buyer. It does not cover the validity of the contract or any of its provisions.

Correct AnswerverifiedShow Answer

The common law "mirror image" rule has been modified by the Code.

Correct AnswerverifiedShow Answer

In the case of Pittsley v. Houser, the court:

Correct AnswerverifiedC

List four areas of contract law where the common law of contracts and the law of sales differ. Give both the common law rule and the rule under Article 2.

A contract has an open price term if the agreement:

Correct AnswerverifiedD

What does Article 2 say with regard to the following? a. Good faith. b. Unconscionability. c. Expansion of commercial practices.

Correct Answerverifieda. All parties who enter into a contract...View AnswerShow Answer

Which of the following transactions is governed by Article 2 of the UCC?

Correct AnswerverifiedShow Answer

Mary and Remaldi Co. have dealt with each other for many years. Mary's Boutique orders 100 assorted lipsticks at $2.00 each from Remaldi Co. Remaldi sends back a confirmation letter with an additional, nonmaterial term. There is:

Correct AnswerverifiedShow Answer

In the Carter v. Tokai Financial Services, Inc. case, the agreement was found to:

Correct AnswerverifiedShow Answer

Edie telephoned the office supply store and agreed to buy a dozen ink cartridges at $26 each. She then realized what a good buy this was and called the store with a request to modify the contract to read two dozen. What is the consequence?

Correct AnswerverifiedShow Answer

The UCC modifies the common law rule by requiring additional consideration for the modification of a contract.

Correct AnswerverifiedShow Answer

The UCC definition of "unconscionable" is clear and unambiguous.

Correct AnswerverifiedShow Answer

"Goods" for purposes of the Code are essentially defined as tangible, movable, personal property.

Correct AnswerverifiedShow Answer

A lease is the transfer of title to goods from seller to buyer for a price.

Correct AnswerverifiedShow Answer

Mike inherited some antiques. Pat agrees to buy them. In the contract, Mike and Pat agree to value the antiques at whatever the Sotheby's representative says. If the valuation is much higher than either of them anticipated, Pat:

Correct AnswerverifiedShow Answer

Explain when a writing is required under the UCC for a contract for the sale of goods and what is needed in that writing. Identify three exceptions to the requirement of a writing or record for the sale of goods.

Correct AnswerverifiedThe UCC statute of frauds provides that ...View AnswerShow Answer

The definition of "goods" in the UCC may include timber, minerals, growing crops, or a building.

Correct AnswerverifiedShow Answer

A "merchant" is defined as a person who:

Correct AnswerverifiedShow Answer

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C

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D

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a. All parties who enter into a contract...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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The UCC statute of frauds provides that ...
View Answer

Correct Answer
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Correct Answer
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