Firm offer an offer that states it will be held open

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Unformatted text preview: ra money? rog80328_04_c04_062-088.indd 87 10/26/12 5:42 PM Section 4.5 Chapter Summary CHAPTER 4 Key Terms acceptance The offeree’s manifestation of assent to the terms of the offer. offer A promise to do business; the first element of a contract. bilateral contract One in which a promise is exchanged for another promise. offeree The person to whom an offer is made, who has the power to accept and form a contract. contract An agreement that may be enforced. A bargained-for exchange. offeror The person who makes an offer. express contract One in which the offer and acceptance are clearly stated in express language. option An offer for which consideration has been paid expressly to keep the offer open for a set period of time. firm offer An offer that states it will be held open. Under the UCC, it must be made by a merchant, in a signed writing, in order to be enforceable without consideration. promissory estoppel A legal doctrine that allows reasonable reliance on a promise to substitute for another legal requirement, such as consideration. formal contract One required to have a certain format, such as being in writing and signed with a seal. quasi contract A situation where to prevent unjust enrichment, a court may award a remedy because a benefit was accepted, even though there is no contract. Also called a contract implied in law. illusory promise A statement that sounds like a promise but is worded so as to not commit the promisor; an illusion of a promise. implied contract One in which either offer, acceptance, or both are implied by the conduct of the parties rather than explicit language. mailbox rule A rule that states that as long as mail is a proper way to accept an offer and the offer has not stated limits on acceptance, an acceptance is effective as soon as it is mailed. merchant A person who customarily deals in goods of the type involved in the transaction; one for whom the contract is in the course of business. mirror image rule A common law rule that states the acceptance must be on the same terms as the offer, or it will be deemed a counteroffer instead. rog80328_04_c04_062-088.indd 88 rejection An offeree’s declining the offer, which results in termination of the offer. requirement contract One in which a buyer has agreed to buy all the specified goods that the buyer needs or requires for a certain period of time. (A similar contract which involves a seller agreeing to sell all the goods the seller produces is known as an output contract.) revocation An offeror’s cancellation of the offer. simple contract A contract which is not required to be in a specific form. unilateral contract A promise (offer) exchanged for actual performance (the acceptance). unliquidated debt A legal obligation to pay money, but the amount owed is in genuine good faith dispute between the parties. 10/26/12 5:42 PM...
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This test prep was uploaded on 04/09/2014 for the course BUS 311 taught by Professor Parker during the Spring '10 term at Ashford University.

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