A Contract of Adhesion

question 25

Multiple Choice

A contract of adhesion:

• A) is automatically unenforceable.
• B) consists largely of boilerplate provisions, such as a standard-form insurance policy.
• C) is a contract that exhibits either procedural or substantive unconscionability.
• D) is a contract containing multiple exculpatory clauses.

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Definitions:

Stock Dividend

Shareholders receive additional shares as a payment from a corporation, rather than receiving cash.

Preferred Stock

A class of ownership in a corporation that has a higher claim on assets and earnings than common stock, often with dividends that are paid out before those of common stockholders.

Par Value

The nominal value of a bond or stock as declared by the issuer, which may not reflect its actual market value.

Cumulative

Refers to the total amount accumulated over a period of time or the aggregate of elements collected.