Fred Owes Amy £100 but Has Failed to Pay It

question 2

Multiple Choice

Fred owes Amy £100 but has failed to pay it for months. One day, Amy sees Fred at the bank. Fred is withdrawing £90. Amy reminds him of the debt. Fred agrees to pay Amy £90 if she stops whining about the remaining £10. Which of the following statements is TRUE?

• A) This agreement lacks consideration and is unenforceable since Amy is agreeing to accept less for the same. Amy can claim the remaining £10.
• B) This agreement may be supported by consideration since Amy may have a practical benefit in accepting £90 instead of £100, in which case she would be unable to go back on her promise and claim the remaining £10.

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Definitions:

Inequity

A state of unfairness or injustice where there is an imbalance or disproportionality in the distribution of resources or opportunities among individuals or groups.

Restoring Equity

The process of ensuring fairness and balance in the distribution of resources and opportunities.

Adams's Theory

Relates to the equity theory of motivation, suggesting that employees are motivated to maintain equity between inputs and outcomes in their job and workplace.

Expectancy Theory

A theory of motivation suggesting that individuals are motivated to act based on the expected outcome of their actions and the value they place on those outcomes.