The Agreement Element of a Contract States That ______

question 128

Multiple Choice

The agreement element of a contract states that ______.

• A) a contract must be intended to accomplish a legal purpose
• B) a contract must include a legitimate offer and a legitimate acceptance
• C) something of value must be exchanged between the two parties
• D) the parties entering into a contract must have the capacity to do so

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Definitions:

Purchasing-power Parity

a theory that in the long run, exchange rates ought to adjust so that an identical good in different countries will have the same price when expressed in a common currency.

Nominal Exchange Rate

The rate at which one country's currency can be exchanged for another country's currency without adjusting for inflation.

Price Level

represents the average of current prices across the entire spectrum of goods and services produced in the economy.

Net Capital Outflows

The difference between the purchase of foreign assets by domestic residents and the purchase of domestic assets by foreigners; indicating the amount of money leaving a country to invest abroad minus the amount coming in.