1. When ambiguities appear in a contract, they will be construed against
A. the party with the greater bargaining power
B. the promisor
C. the promisee
D. the party who drafted the contract
2. Keith offers to sell his business to Debbie for $125,000. Debbie replies, "Your price is too high. I will buy your business for $100,000." Debbie's response is
A. a counteroffer
B. a rejection of the original offer only
C. the creation of a new offer only
D. none of the above
3. Bo offers to sell a laser printer to Ike, but it is lost in a fire before Ike accepts. Bo
A. must obtain a similar printer for Ike, if he notifies Bo that he accepts the offer
B. must obtain a similar printer for Ike, if Ike offers to pay Bo before delivery
C. is not required to obtain a similar printer for Ike, because it could take an unreasonable period of time to obtain a replacement
D. is not required to obtain a similar printer for Ike, because the destruction of the original printer automatically terminates the offer
4. Agatha promises to pay Betty, her niece, $5,000 if she will complete her college education. Betty eventually completes her education. Agatha is
A. not required to pay because the promise induced conduct that ultimately benefited Betty
B. not required to pay because Betty had indicated that she was considering attending college
C. required to pay because Betty's completion of college entitles her to payment
D. required to pay because Betty studied hard and got good grades.
5. Ned Contractors, Inc. begins construction of a mall for Van Development Corporation and after six months demands an extra $100,000. Van agrees to pay. Imagine that Ned offered no reason for the extra $100,000, but said only that it would stop working if Van did not agree to pay. The agreement is
A. enforceable because the parties executed an accord and satisfaction
B. enforceable because of the unforeseen difficulties
C. unenforceable due to the preexisting duty rule
D. unenforceable because the contract is for an amount greater than $5,000