Courts Will Consider the Adequacy of the Consideration When

question 28

Multiple Choice

Courts will consider the adequacy of the consideration when:

• A) one party clearly has the better side of the deal.
• B) one party has more business experience than the other.
• C) one party claims to have been defrauded.
• D) one party shows a much lower price nationally-advertised on television.

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Definitions:

Asset

An asset is a resource owned or controlled by an individual, corporation, or government with the expectation that it will produce positive economic value.

Cash

A form of liquid asset that includes currency and other easily accessible bank balances.

Prepaid Insurance

Refers to payments made in advance for insurance coverage, recorded as an asset on the balance sheet until the period to which the insurance relates.

Historical Cost

The original monetary value of an asset or transaction, without adjusting for inflation or market valuation changes.