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Chapter Quiz
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1
An agreement is illegal if the legislature has declared that particular type of contract to be unenforceable or void or because the agreement violates public policy.
A)True
B)False
2
An agreement can be illegal even if no statute specifically states that it is illegal.
A)True
B)False
3
In determining whether a contract that violates a licensing statute is illegal, courts will look at whether the licensing statute is regulatory or revenue raising.
A)True
B)False
4
In order to be enforceable, a non-competition clause must be reasonable in time, geographic area, and scope.
A)True
B)False
5
Exculpatory clauses are always enforced by the courts.
A)True
B)False
6
A contract of adhesion is a contract offered by a party in a superior bargaining position on a "take it or leave it" basis.
A)True
B)False
7
Ignorance of the law is never an excuse, so the ignorant party can never recover damages for breach of the agreement.
A)True
B)False
8
Which of the following contracts are generally enforceable?
A)A contract to loan money in excess of the maximum interest rate.
B)A contract between two competing merchants to set the price of gasoline at a particular rate.
C)A contract between two people whereby one agrees not to sue the other.
D)All of the above
9
Alan signs an agreement with ABC Stores, which includes a provision that Alan will not sue ABC for negligence. This is an example of a(n) __________ clause.
A)exculpatory
B)illegal
C)ad hoc
D)None of the above
10
Which of the following is a remedy for unconscionability?
A)Court can refuse to enforce agreement.
B)Court can refuse to enforce unconscionable provision but enforce the rest of the contract.
C)A and B
D)None of the above





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