The State of Florida Enters into a Contract with Treasure

question 71

Multiple Choice

The State of Florida enters into a contract with Treasure Salvors governing the salvage of a Spanish galleon that sunk in the 1600s.Under the terms of the contract,the salvagers agree to relinquish 25% of the items recovered to the State of Florida in return for the right to salvage on state lands.At the time the parties enter into the contract,they both believe that the seabed where the ship lies is state land.Subsequently,the United States Supreme Court holds that the continental shelf on which the ship rests has never been owned by Florida.The salvagers sue to rescind the contract.The contract:

• A) cannot be rescinded.
• B) should be avoided because the parties made a mutual mistake.
• C) should be enforced because,although there is a mutual mistake,it is not material.
• D) will be enforceable because the United States government will automatically step into the shoes of the State of Florida.

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Definitions:

Variable Expenses

Costs that vary in proportion to the level of activity or volume of goods or services produced, such as utilities or credit card charges.

Students

Individuals who are engaged in learning, especially those who attend an educational institution.

Maximum Profit

The greatest difference between revenue and expense.

Quadratic Function

A polynomial function of the second degree, generally represented as f(x) = ax^2 + bx + c, where a, b, and c are constants and a ≠ 0.