Which of the following statements is true? Question 2Select one:a.Executory consideration is said to be when the performance of the act relied on as consideration occurs prior to a subsequent promise and independently of it. b.In order to create a valid contract for the sale of a motor vehicle, it is necessary for the purchaser to pay a deposit. c.The exchange of promises amounts to good consideration. d.Consideration is not regarded as good consideration until it has been performed.
Question
Which of the following statements is true? Question 2Select one:a.Executory consideration is said to be when the performance of the act relied on as consideration occurs prior to a subsequent promise and independently of it. b.In order to create a valid contract for the sale of a motor vehicle, it is necessary for the purchaser to pay a deposit. c.The exchange of promises amounts to good consideration. d.Consideration is not regarded as good consideration until it has been performed.
Solution
The correct statement is c. The exchange of promises amounts to good consideration.
Here's why:
a. Executory consideration is not when the performance of the act relied on as consideration occurs prior to a subsequent promise and independently of it. Instead, it is when both parties to a contract have obligations remaining under a contract.
b. It is not necessary for the purchaser to pay a deposit in order to create a valid contract for the sale of a motor vehicle. What is necessary is an agreement (offer and acceptance), consideration, capacity to contract, and legality of purpose.
c. The exchange of promises does amount to good consideration. This is known as bilateral consideration, where both parties are obligated to fulfill promises made to each other.
d. Consideration is regarded as good consideration even before it has been performed. It is the promise to give or do something that forms the basis of a contract's consideration.
Similar Questions
Which of the following is CORRECT?Question 10Answera.In unilateral contracts, consideration is executory or executed.b.In bilateral contracts, consideration is executory.c.In unilateral contracts, consideration is executory.d.In bilateral contracts, consideration is executed or executory.
Consideration, an essential element in the formation of a valid contract, may be identified as:
In a contract, consideration refers to:a.The amount of money paid to execute the contractb.The promises exchanged by the parties involvedc.The legal capacity of the parties to enter into the contractd.The written documentation of the contract
Which of the following statements is true? Question 1Select one:a.An employer's promise to pay an employee an increased salary in the future is supported by good consideration from the employee. b.A person is not legally bound to pay his or her taxi fare because the services of the taxi driver rest on past consideration. c.Past services performed by an employee for his or her employer amount to good consideration to support a current promise by the employer to pay an increased salary for the period of those past services. d.An agreement in writing will be binding even if the promises contained in the written document are not supported by consideration.
Consideration, an essential element in the formation of a valid contract, may be identified as:Question 11AnswerA.The need for fairness in the contract.B.The intention of the parties to be legally bound.C.A balance in the terms of the agreementD.The 'bargain' element of a contract.
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