Chapter 21. Introduction to Sales and Leases
1. Until the early 1900s, sales transactions were completely governed by general contract law, but now sales of tangible
personal property are predominantly governed by statute.
a. True
b. False
2. The firm offer provision in Articles 2 and 2A of the UCC covers only merchant sellers.
a. True
b. False
3. If a merchant makes a written offer to buy or sell goods, this will be irrevocable only if accompanied by
consideration.
a. True
b. False
4. In a contract to sell goods, the sale does not take place until the seller transfers the title to the goods to the buyer.
a. True
b. False
5. Most of the Code’s provisions are not mandatory but allow the parties to vary or displace them by agreement.
a. True
b. False
6. Article 2A of the UCC, approved by drafters of the Code in 1987 and amended in 1990, deals with leases of
personal property, which exceed $100 billion annually.
a. True
b. False
7. If a seller buries important terms of its sales agreement in fine print, this could constitute procedural
unconscionability, which could result in a court’s refusal to enforce the entire sales contract or at least the part the
court finds unconscionable.
a. True
b. False
8. Consumer leases are treated no differently than business leases under the UCC.
a. True
b. False
9. A finance lease is a special type of lease transaction that generally involves three parties instead of two.
a. True
b. False
10. Leslie, the owner of a shoe store, purchased 500 Model XT-50 running shoes from her supplier, but price was not
stated in the contract. The contract is voidable at Leslie’s option until the parties agree on a price.
a. True
b. False
11. The general law of contracts is displaced by the Code in all aspects of the sale of goods.
a. True
b. False
12. Andrew has a contract to buy 100 tables from Bartholomew at a price of $50 a table. Five days before
Bartholomew is to deliver the tables, he tells Andrew that he is sorry, but $50 won’t cover his costs; he will need at
least $75 a table. Andrew agrees, because he needs the tables for his special sale. The modified contract is
enforceable without new consideration, so long as Bartholomew is acting in good faith.
a. True
b. False
13. The Uniform Electronic Transactions Act, in effect in all of the states, covers contracts not governed by Articles 2
and 2A.
a. True
b. False
14. “Acceptance” under the UCC always means taking possession of goods.
a. True
b. False
15. A court faced with an unconscionable lease contract may refuse to enforce the entire contract.
a. True
b. False
16. Sales contracts containing unconscionable clauses are void and unenforceable.
a. True
b. False
17. The UCC treats merchants more leniently than others in transactions involving goods.
a. True
b. False
18. If a UCC contract does not contain all the terms necessary to carry it out, there will be no contract.
a. True
b. False
19. Unless an auction is advertised or announced as being without reserve, the sale is with reserve, and the auctioneer
may withdraw the goods at any time until he announces completion of the sale.
a. True
b. False
20. The Code provides that its remedies shall be liberally administered to place the aggrieved party in a position as good
as the one she would have occupied had the defaulting party fully performed.
a. True
b. False
21. If a contract does not comply with the statute of frauds, it is void.
a. True
b. False
22. A prompt promise to ship or prompt shipment of goods is a valid acceptance of an offer to buy goods for prompt or
current shipment.
a. True
b. False
23. The common law “mirror image“ rule has been modified by the Code.
a. True
b. False
24. The Code addresses the battle of the forms problem by focusing on the intent of the parties.
a. True
b. False
25. “Goods” for purposes of the Code are essentially tangible, movable personal property.
a. True
b. False
26. If the original agreement was oral, a subsequent oral modification, which brings the resulting contract within the
statute of frauds, is binding on and enforceable by the parties.
a. True
b. False
27. The CISG governs contracts for the international sale of goods between parties located in different nations that have
ratified the CISG.
a. True
b. False
28. The CISG supersedes the UCC in any situation to which either could apply.
a. True
b. False
29. The CISG does not apply to sales of goods for personal, family, or household use.
a. True
b. False
30. Under the Code, “good faith” for merchants is defined as “honesty in fact in the conduct or transaction concerned.”
a. True
b. False
31. The doctrine of unconscionability deals only with whether the actual terms of the contract are grossly unfair or
oppressive.
a. True
b. False
32. Under the Code, a contract to sell or lease personal property is recognized whenever the parties manifest such an
intent, even if they cannot identify a precise moment the contract was formed.
a. True
b. False
33. Which of the following is correct with respect to Article 2A of the UCC?
a. It is an analogue of Article 2 that adopts many of the same rules.
b. No states have as yet adopted 2A.
c. Article 2A specifically includes security interests in its scope.
d. All of these.
34. A “sale,” as defined by the UCC, takes place when:
a. the price is paid.
b. there is a manifestation of mutual assent.
c. the parties shake hands or affirmatively agree.
d. the title is transferred to the buyer.
35. The UCC provides rules, where the parties do not set forth terms in their contract, to cover:
a. terms of payment.
b. place of delivery.
c. particulars of performance.
d. All of these.
36. Which of the following transactions is governed by Article 2 of the UCC?
a. The sale of an apartment complex
b. The sale of oranges to be picked from a 10-acre grove
c. The sale of common stock of a soft drink company
d. A contract to receive medical services in a hospital