Bill Is Restoring a Car and Has Already Spent $4000

question 19

Multiple Choice

Bill is restoring a car and has already spent $4000 on the restoration.He expects to be able to sell the car for $6200.Bill discovers that he needs to do an additional $2400 of work to make the car worth $6200 to potential buyers.He could also sell the car now,without completing the additional work,for $3800.What should he do?

• A)He should sell the car now for $3800.
• B)He should keep the car since it wouldn't be rational to spend $6400 restoring a car and then sell it for only $6200.
• C)He should complete the additional work and sell the car for $6200.
• D)It does not matter if Bill sells the car now or completes the work and then sells it at the higher price because the outcome will be the same either way.

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Definitions:

Offeree

The person to whom an offer is made, especially in the context of contracts.

Offer Made

In contract law, a proposal by one party to another intended to create a legally binding agreement upon acceptance.

Contract Law

A body of law that governs the creation and enforcement of agreements between parties.

Uniform Commercial Code

A comprehensive set of laws governing all commercial transactions in the United States, aiming to standardize laws across the states.