Back
0

Consideration

Description: Consideration is a fundamental element of contract law. It refers to the price paid or promised for the performance of an act or the forbearance of an act. This quiz will test your understanding of the concept of consideration.
Number of Questions: 15
Created by:
Tags: contract law consideration elements of a contract
Start the Quiz
Attempted 0/15 Correct 0 Score 0
‹
›

Which of the following is NOT an essential element of consideration?

  1. It must be of value.

  2. It must be legal.

  3. It must be in writing.

  4. It must be capable of being performed.

Show answer
Correct Option: C
Explanation:

Consideration does not have to be in writing to be valid. It can be oral, written, or implied.

What is the difference between a promise and consideration?

  1. A promise is an offer to do something, while consideration is the price paid or promised for the performance of an act.

  2. A promise is a legally enforceable agreement, while consideration is not.

  3. A promise is always in writing, while consideration can be oral or written.

  4. A promise is always unilateral, while consideration is always bilateral.

Show answer
Correct Option: A
Explanation:

Consideration is the price paid or promised for the performance of an act or the forbearance of an act. A promise is an offer to do something, but it is not consideration until it is accepted and there is a meeting of the minds.

What is the rule regarding past consideration?

  1. Past consideration is valid consideration.

  2. Past consideration is not valid consideration.

  3. Past consideration is valid consideration only if it is in writing.

  4. Past consideration is valid consideration only if it is supported by a moral obligation.

Show answer
Correct Option: B
Explanation:

Past consideration is not valid consideration because it was not given in exchange for the promise. Consideration must be given in exchange for the promise in order to be valid.

What is the rule regarding illusory promises?

  1. Illusory promises are valid consideration.

  2. Illusory promises are not valid consideration.

  3. Illusory promises are valid consideration only if they are in writing.

  4. Illusory promises are valid consideration only if they are supported by a moral obligation.

Show answer
Correct Option: B
Explanation:

Illusory promises are not valid consideration because they do not give the promisor any real choice. The promisor is not obligated to do anything, so there is no consideration for the promise.

What is the rule regarding moral obligation?

  1. Moral obligation is valid consideration.

  2. Moral obligation is not valid consideration.

  3. Moral obligation is valid consideration only if it is in writing.

  4. Moral obligation is valid consideration only if it is supported by a past consideration.

Show answer
Correct Option: B
Explanation:

Moral obligation is not valid consideration because it is not a legally enforceable obligation. Consideration must be a legally enforceable obligation in order to be valid.

What is the rule regarding liquidated damages?

  1. Liquidated damages are valid consideration.

  2. Liquidated damages are not valid consideration.

  3. Liquidated damages are valid consideration only if they are in writing.

  4. Liquidated damages are valid consideration only if they are supported by a moral obligation.

Show answer
Correct Option: A
Explanation:

Liquidated damages are valid consideration because they are a reasonable estimate of the actual damages that will be suffered if the contract is breached.

What is the rule regarding penalties?

  1. Penalties are valid consideration.

  2. Penalties are not valid consideration.

  3. Penalties are valid consideration only if they are in writing.

  4. Penalties are valid consideration only if they are supported by a moral obligation.

Show answer
Correct Option: B
Explanation:

Penalties are not valid consideration because they are not a reasonable estimate of the actual damages that will be suffered if the contract is breached.

What is the rule regarding impossibility?

  1. Impossibility is a valid defense to a breach of contract action.

  2. Impossibility is not a valid defense to a breach of contract action.

  3. Impossibility is a valid defense to a breach of contract action only if it is in writing.

  4. Impossibility is a valid defense to a breach of contract action only if it is supported by a moral obligation.

Show answer
Correct Option: A
Explanation:

Impossibility is a valid defense to a breach of contract action because it makes the performance of the contract impossible. If the performance of the contract is impossible, then the promisor is not liable for breach of contract.

What is the rule regarding frustration of purpose?

  1. Frustration of purpose is a valid defense to a breach of contract action.

  2. Frustration of purpose is not a valid defense to a breach of contract action.

  3. Frustration of purpose is a valid defense to a breach of contract action only if it is in writing.

  4. Frustration of purpose is a valid defense to a breach of contract action only if it is supported by a moral obligation.

Show answer
Correct Option: B
Explanation:

Frustration of purpose is not a valid defense to a breach of contract action because it does not make the performance of the contract impossible. The promisor is still liable for breach of contract even if the purpose of the contract is frustrated.

What is the rule regarding material breach?

  1. A material breach is a breach of contract that goes to the heart of the contract.

  2. A material breach is a breach of contract that does not go to the heart of the contract.

  3. A material breach is a breach of contract that is in writing.

  4. A material breach is a breach of contract that is supported by a moral obligation.

Show answer
Correct Option: A
Explanation:

A material breach is a breach of contract that goes to the heart of the contract and makes it impossible for the non-breaching party to receive the benefit of the contract. A material breach gives the non-breaching party the right to terminate the contract.

What is the rule regarding anticipatory breach?

  1. An anticipatory breach is a breach of contract that occurs before the time for performance.

  2. An anticipatory breach is a breach of contract that occurs after the time for performance.

  3. An anticipatory breach is a breach of contract that is in writing.

  4. An anticipatory breach is a breach of contract that is supported by a moral obligation.

Show answer
Correct Option: A
Explanation:

An anticipatory breach is a breach of contract that occurs before the time for performance. It gives the non-breaching party the right to terminate the contract and sue for damages.

What is the rule regarding substantial performance?

  1. Substantial performance is a defense to a breach of contract action.

  2. Substantial performance is not a defense to a breach of contract action.

  3. Substantial performance is a defense to a breach of contract action only if it is in writing.

  4. Substantial performance is a defense to a breach of contract action only if it is supported by a moral obligation.

Show answer
Correct Option: A
Explanation:

Substantial performance is a defense to a breach of contract action because it means that the promisor has substantially performed the contract and the non-breaching party has received the benefit of the contract. The non-breaching party is not entitled to damages if the promisor has substantially performed the contract.

What is the rule regarding accord and satisfaction?

  1. Accord and satisfaction is a valid defense to a breach of contract action.

  2. Accord and satisfaction is not a valid defense to a breach of contract action.

  3. Accord and satisfaction is a valid defense to a breach of contract action only if it is in writing.

  4. Accord and satisfaction is a valid defense to a breach of contract action only if it is supported by a moral obligation.

Show answer
Correct Option: A
Explanation:

Accord and satisfaction is a valid defense to a breach of contract action because it is a new agreement that replaces the original contract. The new agreement is supported by consideration and is therefore binding on the parties.

What is the rule regarding novation?

  1. Novation is a valid defense to a breach of contract action.

  2. Novation is not a valid defense to a breach of contract action.

  3. Novation is a valid defense to a breach of contract action only if it is in writing.

  4. Novation is a valid defense to a breach of contract action only if it is supported by a moral obligation.

Show answer
Correct Option: A
Explanation:

Novation is a valid defense to a breach of contract action because it is a new agreement that replaces the original contract. The new agreement is supported by consideration and is therefore binding on the parties.

What is the rule regarding rescission?

  1. Rescission is a valid remedy for breach of contract.

  2. Rescission is not a valid remedy for breach of contract.

  3. Rescission is a valid remedy for breach of contract only if it is in writing.

  4. Rescission is a valid remedy for breach of contract only if it is supported by a moral obligation.

Show answer
Correct Option: A
Explanation:

Rescission is a valid remedy for breach of contract because it allows the non-breaching party to cancel the contract and be restored to the position they were in before the contract was entered into.

- Hide questions
ADVERTISEMENT

Find more quizzes from top tags

general knowledge
3615 Quizzes
119858 Questions
 technology
307 Quizzes
36705 Questions
 sports
963 Quizzes
19148 Questions
 history
1187 Quizzes
13475 Questions
 physics
598 Quizzes
13441 Questions
 biology
1160 Quizzes
12174 Questions
 science & technology
551 Quizzes
11015 Questions
 chemistry
490 Quizzes
9892 Questions
 maths
518 Quizzes
9324 Questions
 softskills
0 Quizzes
7131 Questions