Which of the Following Statements Is Not True of Consideration

question 70

Multiple Choice

Which of the following statements is not true of consideration for performance of a contract?

• A)Consideration can be an agreement to refrain from doing something.
• B)Consideration can be the undertaking of an onerous obligation.
• C)Consideration must move from the promisee but not necessarily to the promisor.
• D)Consideration must represent a fair or adequate price for the subject matter of the contract.

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Definitions:

Liquidity

A company's ability to meet its short-term obligations using its most liquid assets, indicating financial health.

Present Value

The current worth of a future sum of money or stream of cash flows given a specified rate of return.

Working Capital

Working capital is the difference between a company's current assets and current liabilities, indicating its short-term financial health and operational efficiency.

Long-Term Liquidity

Measures a company's ability to meet its long-term financial obligations, indicating financial health over a prolonged period.