Business Law Chapter 14 True & False

5 May 2023
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20 test answers

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question
A contract entered into by a minor is voidable at the option of either of the contracting parties.
answer
False
question
A person who has been determined by a court to be mentally competent cannot form a legally binding contract with another party.
answer
False
question
For business purposes, an adult may petition a court to treat minors as adults.
answer
False
question
All states' laws permit minors to disaffirm contracts.
answer
True
question
If a minor can return only damaged goods, the minor cannot disaffirm the contract and obtain a full refund of the purchase price.
answer
False
question
Clothing is a "necessary."
answer
True
question
In some states, misrepresentation of age is enough to prevent disaffirmance.
answer
True
question
A minor who enters into a contract for necessaries may disaffirm the contract but remains liable for the reasonable value of the goods.
answer
True
question
A contract entered into by an intoxicated person is never valid.
answer
False
question
It is easy to prove that an intoxicated person's judgment was so severely impaired that he or she could not comprehend the legal consequences of entering into a contract.
answer
False
question
An intoxicated person, after becoming sober, may ratify a contract expressly or impliedly.
answer
True
question
If the illegal part of a bargain has not yet been performed, the party rendering performance must fulfill the contract before seeking damages.
answer
False
question
A contract with an unlicensed person is enforceable if the person is otherwise of good moral character.
answer
False
question
Contracts in restraint of trade usually positively affect the public policy that favors competition in the economy.
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False
question
In certain circumstances, bargains are so oppressive that the courts relieve innocent parties of part or all of their duties.
answer
True
question
All adhesion contracts are unconscionable.
answer
False
question
In a contract, an exculpatory clause releases a party from liability in the event of monetary or physical injury no matter who is at fault.
answer
False
question
In general, an illegal contract is void.
answer
True
question
In most illegal contracts, both parties are considered to be equally at fault, and neither party can enforce it or recover damages under it.
answer
True
question
When one party uses fraud to induce another party to enter into an illegal bargain, the second party will be allowed to recover for the performance or its value.
answer
True