Kate and Ben Entered into a Contract

question 72

Multiple Choice

Kate and Ben entered into a contract.She promised to transfer 1000 shares in XYZ Corp to him; he promised to personally draft architectural plans to certain specifications for her.Kate transferred the shares to Ben as promised, but he later discovered that he simply lacked the ability to uphold his end of the bargain.Which of the following statements is TRUE?

• A)If Kate promises to give up her right to demand architectural plans from Ben in exchange for his promise to create a computer program for her, the parties can solve their problem through accord and satisfaction.
• B)Since neither party promised to pay money, the original contract is unenforceable because it is not supported by legal tender.
• C)A seal is necessary for the purposes of an accord and satisfaction.
• D)The contract would be unenforceable under the statute of limitations only if the parties had originally agreed that Ben would have more than six years to complete the architectural plans.
• E)Rescission provides the simplest way in which the parties can bring their contract to an end.

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Definitions:

Reservation Price Model

A model that defines the maximum price a consumer is willing to pay for a good or service.

Aggregate Demand

The aggregate need for all products and services in an economy, measured at a specific price level and during a particular time frame.

Marginal Revenue

The additional income generated from selling one more unit of a product or service.

Demand Curve

A graph showing the relationship between the price of a product and the quantity of the product that consumers are willing and able to purchase at various prices.