1. A contract becomes legally binding when there is:
(A) Offer and acceptance
(B) Only offer
(C) Only acceptance
(D) Only consideration
2. Consideration in a contract means:
(A) Something of value exchanged
(B) A gift
(C) A promise without value
(D) A suggestion
3. A void contract is:
(A) Fully enforceable
(B) Valid but illegal
(C) Not enforceable by law
(D) Partially legal
4. A minor (under 18) entering a contract makes it:
(A) Valid
(B) Voidable
(C) Enforceable
(D) Compulsory
5. The document containing terms agreed by both parties is called:
(A) Contract
(B) Memorandum of understanding
(C) Invoice
(D) Guarantee note
6. Which of the following is essential for a valid contract?
(A) Coercion
(B) Misrepresentation
(C) Fraud
(D) Lawful consideration
7. A contract signed under pressure is:
(A) Valid
(B) Void
(C) Voidable
(D) Enforceable
8. When both parties are mistaken about a fact, the contract is:
(A) Valid
(B) Enforceable
(C) Void
(D) Guaranteed
9. An agreement without consideration is:
(A) Binding
(B) Valid
(C) Enforceable
(D) Void
10. The person who makes an offer is called:
(A) Acceptor
(B) Offeror
(C) Promisor
(D) Promisee
11. The acceptance of an offer must be:
(A) Absolute and unconditional
(B) In writing only
(C) Verbal only
(D) Delayed
12. Breach of contract means:
(A) Changing terms
(B) Not performing contractual obligations
(C) Signing the contract
(D) Ending a contract mutually
13. A contract that can be enforced by either party is called:
(A) Valid contract
(B) Illegal agreement
(C) Void contract
(D) Voidable contract
14. A promise made without intention to perform is:
(A) Mistake
(B) Fraud
(C) Undue influence
(D) Coercion
15. A contract involving illegal activities is:
(A) Valid
(B) Enforceable
(C) Conditional
(D) Void
16. A contract must be made by parties who are:
(A) Wealthy
(B) Government employees
(C) Mentally sound
(D) Relatives
17. A contingent contract depends on:
(A) Mutual misunderstanding
(B) No future conditions
(C) A minor’s approval
(D) A collateral event
18. Performance of a contract means:
(A) Fulfilling all promises
(B) Altering terms
(C) Filing a complaint
(D) Terminating early
19. Quasi-contracts are created by:
(A) Law
(B) Mutual agreement
(C) Court orders
(D) Partnerships
20. Acceptance is complete when:
(A) Payment is made
(B) Offeror signs contract
(C) Document is printed
(D) Offeror receives acceptance
21. When parties mutually decide to end a contract, it is called:
(A) Breach
(B) Ratification
(C) Rescission
(D) Fraud
22. Undue influence occurs when one party:
(A) Uses dominant position unfairly
(B) Makes a fair deal
(C) Gives a gift
(D) Performs service honestly
23. An agreement in restraint of trade is generally:
(A) Valid
(B) Enforceable
(C) Illegal and void
(D) Mandatory
24. Implied contracts arise from:
(A) Future promises
(B) Conduct or actions
(C) Written documents only
(D) Court orders
25. When a contract can’t be performed due to impossibility, it becomes:
(A) Valid
(B) Void
(C) Enforceable
(D) Mandatory